Amazon

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Amazon.JPG
Type: Public
Industry: e-Commerce
Founded: 1994
Founder(s): Jeff Bezos
Headquarters: Washington
Country: USA
Employees: 33,700 (full-time and part-time)
Revenue: $34.20B
Website: amazon.com
Key People
Jeff Bezos, President, CEO, Chairman of the Board

Werner Vogels, VP & CTO
Mathew Work, VP, Alexa Research
Shelley Reynolds, VP Worldwide Controller, Principal Accounting Officer
Bill Carr, VP Digital Media
Colin Bodell, VP Website Application Platform
Jeffrey Wilke, SVP, North American Retail

Amazon.com Inc. is a global leader in e-Commerce and the largest online retail store in the United States and in 45 other countries worldwide offering a wide range of products from books, electronics, games, home and garden, movies, music, toys and many other products.

ICANN & New gTLDs

New gTLD applications

Amazon has applied for the following TLDs in ICANN's New gTLD Program: .amazon, .app, .audible, .author, .aws, .book, .bot, .box, .buy, .call, .circle, .cloud, .coupon, .deal, .dev, .drive, .fast, .fire, .free, .game, .got, .group, .hot, .imdb, .jot, .joy, .kids, .kindle, .like, .mail, .map, .mobile, .moi, .movie, .music, .news, .now, .pay, .pin, .play, .prime, .read, .room, .safe, .save, .search, .secure, .shop, .show, .silk, .smile, .song, .spot, .store, .talk, .tunes, .tushu, .video, .wanggou, .wow, .yamaxun, .you, .yun, .zappos, .zero, .亚马逊, .家電, .通販, .食品, .アマゾン, .クラウド, .ストア, .セール, .ファッション, .ポイント, .書籍.[1]

In total, the company submitted 76 applications.[2]

Complaints over Closed Generic TLDs

In September, 2012, an influential consumer advocacy group, Consumer Watchdog, sent a letter to U.S. Sen. Rockefeller, who is the chair of the Senate Commerce, Science and Transportation Committee. Sen. Rockefeller's senate subcommittee is the same that had held hearings regarding ICANN and its new gTLD program just before its launch. Consumer Watchdog is upset over both Google and Amazon's plans to acquire generic TLDs and then to restrict them only for their own use. The letter states: "If these applications are granted, large parts of the Internet would be privatized. It is one thing to own a domain associated with your brand, but it is a huge problem to take control of generic strings. Both Google and Amazon are already dominant players on the Internet. Allowing them further control by buying generic domain strings would threaten the free and open Internet that consumers rely upon. Consumer Watchdog urges you to do all that you can to thwart these outrageous efforts and ensure that the Internet continues its vibrant growth while serving the interests of all of its users." The whole letter can be seen here.[3]

This letter came just a day after a similar appeal by a group of domain industry regulars was announced. Michele Neylon, CEO of Blacknight Internet Solutions Ltd and a highly active member of the ICANN community, led the signatories of a letter adressing the same issue, though it does not name Google nor Amazon by name. Instead it focuses on any and all use of generic terms that are being sought after only to become closed TLDs: "generic words used in a generic way belong to all people. It is inherently in the public interest to allow access to generic new gTLDs to the whole of the Internet Community, e.g., .BLOG, .MUSIC, .CLOUD. Allowing everyone to register and use second level domain names of these powerful, generic TLDs is exactly what we envisioned the New gTLD Program would do. In contrast, to allow individual Registry Operators to segregate and close-off common words for which they do not possess intellectual property rights in effect allows them to circumvent nation-states’ entrenched legal processes for obtaining legitimate and recognized trademark protections." Other signatories include: Scott Pinzon, former Director of ICANN; Kelly Hardy, domain industry consultant; Frédéric Guillemaut, MailClub.fr; Robert Birkner, 1API GmbH; the whole letter can be seen here.

GAC Early Warnings

Amazon was widely recognized as one of the most warned applicants within the GAC Early Warning system. The system does not represent consensus within ICANN's Governmental Advisory Committee (GAC), but instead lets know of one nation's viewpoint that could go on to influence the wider GAC and result in advice to the ICANN Board to not approve a given application. Amazon received 28 warnings, which represents 38% of its portfolio. The vast majority of the complaints came from the Australian GAC representative, and GAC Chair, Heather Dryden, who argues repeatedly that Amazon, nor any other company, should not be given complete control over generic terms on the Internet. Amazon is known for its numerous applications for generic terms that it hopes to restrict to internal registration and its own corporate strategy, such as .music, .blog, etc. It was also warned by governments in South America against its application for its brand name, .amazon, given that the name also represents a prominent region across multiple South American nations.[4]

Background

Jeff Bezos, a young hedge fund analyst, founded Amazon in 1994 as an online bookstore. At first, he planned to call his company Cadabra but he changed his mind because it sounds like “cadaver.” He finally decided to call the company Amazon.com after one of the world’s largest rivers, the Amazon, which represents the gigantic number of books he planned to sell online. Jeff’s parents were the first investors in the company and entrusted him with $300,000 from their retirement savings.[5]

Bezos officially launched the Amazon online bookstore on July 6th, 1995, offering one million titles. The first book that was purchased was "Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought." He used his garage as his working area and warehouse. In 1996, Bezos move to a new headquarters, a small warehouse, and hired 11 people to help him with his operations. He decided to just maintain a small inventory of books in the warehouse and trusted his suppliers to ship every order promptly. The company grew rapidly at the end of 1996. Bezos later decided move to a bigger warehouse in downtown Seattle. During that time, his employees increased from 11 to 151. [6]

In 1997, the company announced the [Initial Public Offering of stocks and started trading on NASDAQ under “AMZN”.[7] The company initially offered 3 million shares at $18 per share and at the end of the trading it closed at $23.25 per share. Amazon sold $54 million worth of stock in one day.[8]

Company Expansion

Since its IPO of stocks, Amazon's sales continued to increase; and in 1998 the company was already offering 3.1 million titles. It also acquired the Internet Data Base and opened its music store.

In 1999, the company acquired Alexa Internet, Tool Crib of the North's Online and Catalog Sales Division and it also opened four fulfillment centers. The company also launched the Amazon.com Auction and added the consumer electronics, toys and games, home improvement, software, video games and gift ideas stores and the zShops. Time Magazine also recognized Jeff Bezos as 1999 "Person of the Year." [9]

In 2000, Amazon had approximately 16 million customers and it became the most popular e-Commerce company in the United States. The increasing number of customers inspired the management to create a new logo to represent the company’s message; the arrow under the name Amazon represents its offerings of everything from A to Z. The arrow is also an illustration of a smile from a customer who is happy and satisfied purchasing a product from the company. [10]

During the dot com bubble burst, the majority of e-Commerce companies went bankrupt but Amazon is one of the few to carry on with the operations of the business and climb the ladder of success; it continued to open more stores, achieving the company goal of offering every product available in the market and kept introducing different programs to entice more customers to shop on the website, such as the super saver shipping offer, look inside the book, consumer reviews, etc.

Amazon also acquired more businesses, expanded its operations internationally, opened more fulfillment centers and created partnerships with different companies and launched more stores, programs and opportunities for consumers as well as small entrepreneurs.

Acquisitions

  1. Internet Movie Data Base (1998)
  2. Alexa Internet (1999)
  3. Tool Crib of the North Online & Catalog Sales Division (1999)
  4. Joyo.com Limited (2004)
  5. Book Surge LLC (2005)
  6. Custom Flix Labs,Inc. (2005)
  7. Shopbop.com (2006)
  8. Fabric.com (2008)
  9. Abe Books (2008)
  10. Zappos.com (2009)
  11. BuyVIP.com (2010)
  12. LOVEFilm International Limited (2011)

International Operations

Amazon.com Inc.has international operations in six countries and established its software development center in Scotland.[11]

  1. United Kingdom- Amazon.co.uk
  2. Germany - Amazon.de
  3. France - Amazon.fr
  4. Japan - Amazon.co.jp
  5. Canada - Amazon.ca
  6. China - www.joyo.com.cn

Business Alliances

  1. Toys "R" Us- A 10 year alliance was created in 2000.[12]
  2. Borders Group- In 2001 Amazon took-over the online operations of Borders, the second largest bookseller in the US. The company CEO, Greg Josefowicz believed that Amazon is better at online retail and the partnership will give better service to Borders' online customers.[13]
  3. Target- The company signed and e-commerce agreement in 2001[14]
  4. National Basketball Association- The partnership was inked in 2003 wherein Amazon will serve as the e-commerce platform for both the men and women's basketball league website.[15]
  5. The Bombay Company[16]
  6. Diane Von Furstenberg Studio Alliance- In 2005 Amazon announced the DVF studios chose Amazon to create and maintain its websites.[17]
  7. Sears Canada, Inc.- signed an e-commerce alliance with Amazon to develop its online brand and business using the tools and technology provided by Amazon.[18]

Financial Performance

During the fourth quarter of 2010, the company reported a revenue increase of 36% to $12.95 billion. The company's income increased by 8% to $416 million compared to $384 million in 2009. The company's cash flow operating expenses for the last 12 months in 2010 also increased by 6% at $3.50 billion compared with 3.29 billion in 2009.[19]

According to Jeff Bezos, the company achieved their first $10 billion quarter after customers purchased millions of third generation Kindles. He said, "Kindle books have now overtaken paperback books as the most popular format on Amazon.com".[20]

Other Businesses

Aside from selling products on its online store, the company is also engaged in different businesses such as:[21]

  1. selling e-commerce platforms to other retailers
  2. providing fulfillment and customer service capabilities to other businesses
  3. offering technology infrastructures through a set of web services technologies enabling developers to use the Amazon servers (EC2, S3, SQS)
  4. operates its subsidiary search website A9.com
  5. runs Alexa.com, a a web search and metrics website
  6. manages the internet movie database, IMDb.com
  7. runs Endless.com, a shoe and handbag store
  8. operates the internet advertising platform, Clickriver.com
  9. manages a human task marketplace called Mechanicalturk.com, as well as the question and answer marketplace Askville.com
  10. runs the product wiki Amapedia.com

References

  1. New gTLD Current Application Status, icann.org
  2. Paul Sloan Writes For Cnet On Amazon’s 76 New gTLD Applications: “We Want To Own Them All”, thedomains.com
  3. Consumer Watchdog Slams Outrageous Google and Amazon Keyword gTLD bids, DomainIncite.com
  4. ICANN Prioritization Draw, TLDH.org Retrieved 1 Dec 2012
  5. NYTimes.com
  6. Referenceforbusiness.com
  7. Corporate-ir.net
  8. Referenceforbusiness.com
  9. Company Timeline
  10. Corporate-ir.net
  11. Amazon Timeline
  12. Amazon-Toys 'R' Us Alliance
  13. Borders-Amazon Alliance
  14. Amazon-Target Alliance
  15. NBA e-commerce Partnership
  16. Amazon Timeline
  17. Amazon-DVF Studios Alliance
  18. Amazon-Sears Allliance
  19. 2010 4Q Performance
  20. 2010 4Q Performance
  21. AMZN