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Amazon CEO Says the Next Decade Will See Company Growth in Every Area

by Lottar

At the Code Conference(Opens in a new window) Amazon president and CEO Andy Jassy this week laid out some big ambitions for where the company is headed, saying Amazon’s business is only “a shadow of what it will be 10 years from now be” in almost every area in which it plays.

In retail, he said, he expects customers to find any item online or in-store with the company’s “just walk-out technology,” with prime customers able to get many products within a few hours through the firm’s using drone airlift initiative. In technology, while Amazon Web Services (AWS) is big, 90 to 95% of IT spending is now on-premises; he expects it to completely turn around. He thinks Alexa will be much more useful by becoming an assistant that can help you with all kinds of things, like calendaring. Content, he said, “will be all streaming.”

Code host Kara Swisher said Amazon founder Jeff Bezos described the company as having three core pillars: Prime, Marketplace and AWS. She asked Jassy what another one would be. He said there are possibilities in streaming entertainment, Alexa, transportation (where Amazon bought self-driving company Zoox), low-earth satellites and healthcare. About his satellite plan, Jassy noted that more than 300 million people have no connection, and Amazon’s Project Kuiper aims to change that.

In the longest part of the conversation, Jassy talked about healthcare, noting that “if there’s ever a customer experience that needs reinvention, at least in the US, it’s healthcare.” He envisions a service that will offer chat, video dating, real-life dating and pharmaceutical delivery in a much simpler way than the current process. He noted that the company recently acquired One Medical, which supplies part of this. (He later said that customers loved the soon-to-be-shutdown Amazon Care telehealth service, which gave them more time with providers, but that turned out not to work from a business perspective. He said: It’s hard to find the right economic model.”)

The common thread in all these concepts, Jassy said, is “always trying to make customers’ lives better.”

He repeated that concept throughout the conversation. He talked about how during the pandemic the company had to double the size of its fulfillment network in 24 months to meet customer demand. He said third-party logistics companies couldn’t scale the volume at the cost Amazon wanted, and while they thought it would take 6 to 10 years, Amazon needed to do it internally to have the capacity it needed by 2022 . something is growing that fast, he said, there are always things to clean up, perhaps reflecting the additional expenses the company recently highlighted. He said that Amazon is still hiring, but not at the same rate as the past two years.

Swisher and Jassy at Code 22 (Credit: Michael J. Miller)

Pressed by Swisher on unionization, Jassy defended Amazon’s salary (saying its average starting salary was now $18 an hour), benefits and methods of direct feedback, saying, “We think employees are better off in the structure we have now has.” Asked why salaries couldn’t be higher, he noted that the company needs to build a business with sustainable economics, adding that retail is a “mid-single-digit operating margin business.”

Jassy doesn’t really believe office workers will return to the office like we did before, but said Amazon will be intentional about getting people together. He said that different teams make different decisions and that there is a lot of experimentation. He said hardware teams often find more benefit in working in person, and that there are benefits to in-person meetings for invention and building company culture.

Jassy was very negative about the antitrust bill being pushed by Senators Klobuchar and Grassley, saying it was broad and overreaching by specifically targeting five companies for being too big. He complained about the size of the fines in the bill, and about its focus on self-preference, saying if the issue is private label products, the same rules should apply to Wal-Mart and Target.

He claims that the problem is too much scapegoating and that there are ways to regulate the industry if the private companies and the public sector work together to figure out what needs to be regulated, such as privacy or private label products.

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