If left unchecked, Amazon will become a lawless monster in 10 years.
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Editor’s note: The pace of Amazon’s expansion has not yet shown signs of slowing down. The company is attacking the city in various fields, wherever it goes, and the blood flows into the river. Although the company did not say anything about serving consumers and investors, letting it expand and deliberately create a monopolistic market state will only lead to disaster. This article is translated from medium, article author Brett Schafer, the original title Can Anyone Stop Amazon?.
When I browsed Amazon’s first quarter earnings report, I couldn’t help thinking: Who else can compete with this guy? Since 1993, the Seattle-based e-commerce giant has grown steadily, reinvesting almost every dollar it earns into its business.
The size of this giant is truly shocking: its operating cash flow in the past 12 months was $34.4 billion, an increase of 89% year-on-year. What about the net income in the first quarter? Net income increased by 125% to reach $3.6 billion. On the surface, the $860 billion tech giant is just getting started.
The emerging voice assistant Alexa has quietly penetrated into millions of homes. It now has 90,000 skills, advises developers, and enables users to track baby activity. It is conceivable that Alexa will decide to send your child to school in the near future.
Amazon also lowered the price of commodities in Whole Foods, further weakening the advantages of competitors in high-end sales. Whole Foods’ two-hour delivery service is also available in 75 major locations, not to mention a host of other services for Prime members.
Amazon Web Services (AWS) first-quarter sales rose 41% to $7.7 billion, and growth showed no signs of slowing.
Finally, for all e-commerce competitors, what really makes them nervous is that all Prime members can enjoyA delivery service that is available in one day. This may be the last straw to crush Target, Walmart and other companies because they realize that all the efforts they have made in this area seem to make it difficult to bridge the gap with their rivals.
Amazon is at the consumer’s heart and deaf ears
So far, Amazon’s products are unbeatable. As its CEO Jeff Bezos likes to say: “So far, the primary reason for our success is to focus on our customers, not on our competitors.”
I can’t deny that Amazon saves me more time and money than I can calculate. Then why am I still tired of it? Why am I bored with a company that brings ease and convenience to many aspects of my life?
Simply, Amazon is only good for consumers and investors, and harmful to everyone else.
For a critical article from The Verge, the article points out that Amazon automatically tracks and fires inefficient warehouse workers. Their logistics center is the lubricant for the entire company’s engine operations, forcing employees to work at a crazy pace, so that some people may even be fired just because they went to the toilet.
The article says:
People believe that the Amazon system is a machine that only sees numbers, not people. Mitchell said: One thing we hear from workers is that they are actually treated as robots because they are monitored and supervised by these automated systems.
Don’t expect this to change very quickly. Because Amazon continues to invest heavily in automation, it wants to “optimize” the order process (ie, lay off as many employees as possible while making existing employees more painful). The company also touted the recent increase in employee salaries to $15 an hour. I fully support wage growth, and I think that many Americans are underpaid – it is simply a crime. But don’t forget that while wages are growing, bonuses and stock options have also been cut sharply. Some workers say that cuts in this area will cost them thousands of dollars a year.
Don’t forget, Amazon didn’t pay a little tax in 2018. This is not my fault. Reasonable tax avoidance is not illegal, and to be honest, if I am in its place, I will do the same. Whether you agree or not, the company has the responsibility to return as much money as possible to the shareholders in the current production mode. But this is still not so ethical.
So what happens next?
I believe that if left unchecked, Amazon will become a huge $5 trillion behemoth in the next 10 years. No one can tame it. It is growing.China will leave behind the bodies of hundreds of companies. Some people may say that this is not a bad thing, it is acceptable for a company to control all aspects of retail (and other industries), and it will not directly harm consumers. The idea of ”letting capitalism develop naturally” does have some truth, but I think politicians need to look at the big picture.
Do we really want a company, or a person, to decide the future of American business? The competitive market is nurturing innovation, and now Amazon is creating an increasingly uncompetitive market. That’s why I think politicians need to see the true face of Amazon: a monopoly that manipulates unfair markets.
The only problem is that I am not sure if Congress or the Department of Justice is willing or able to block Amazon at this point. Obviously, Facebook or Google are more likely to be split because you only need to separate their core platforms. But for Amazon, all actions need to be more cautious, because it is possible to harm consumers in the short term.
I won’t reveal my views on how Amazon should split. People like Scott Galloway and Elizabeth Warren who are much smarter than me have already expressed their positions and attitudes on many occasions. Be aware that if we don’t act now, this problem (yes, this is not only a problem, but also a catastrophic problem) will only become more difficult to resolve.
I wrote in December last year (it may be too early), and September 2018 was the time when “the limit of expansion of large technology companies”. I sincerely hope that my prediction is correct, but I am now beginning to believe that I am wrong. Large technology companies (including Amazon) are likely to continue to expand, become unconstrained forces, crush their competitors, and everything we value.
Translator: Xitang