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Jeff Bezos To Employees: 'One Day, Amazon Will Fail' But Our Job is To Delay it as Long as Possible (cnbc.com) 129

Days before Amazon announced the cities it had picked for its HQ2, CEO Jeff Bezos had to address a separate but related concern among employees: Where is all this headed? At an all-hands meeting last Thursday in Seattle, an employee asked Bezos about Amazon's future. Specifically, the questioner wanted to know what lessons Bezos has learned from the recent bankruptcies of Sears and other big retailers. From a report: "Amazon is not too big to fail," Bezos said, in a recording of the meeting that CNBC has heard. "In fact, I predict one day Amazon will fail. Amazon will go bankrupt. If you look at large companies, their lifespans tend to be 30-plus years, not a hundred-plus years." The key to prolonging that demise, Bezos continued, is for the company to "obsess over customers" and to avoid looking inward, worrying about itself. "If we start to focus on ourselves, instead of focusing on our customers, that will be the beginning of the end," he said. "We have to try and delay that day for as long as possible." Bezos' comments come at a time of unprecedented success at Amazon, with its core retail business continuing to grow while the company is winning the massive cloud-computing market and gaining rapid adoption of its Alexa voice assistant in the home.
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Jeff Bezos To Employees: 'One Day, Amazon Will Fail' But Our Job is To Delay it as Long as Possible

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  • by Anonymous Coward

    I predict one day Amazon will fail. Amazon will go bankrupt. - Short their stock now!!!

  • by Nexus7 ( 2919 ) on Friday November 16, 2018 @10:52AM (#57655178)

    Not having had my coffee yet, I read "One day Amazon will be fair."

  • by 140Mandak262Jamuna ( 970587 ) on Friday November 16, 2018 @10:53AM (#57655186) Journal
    That is how most rich people think. Just delay it, global warming, population explosion, running out of oil, precarious infrastructure, giving away the crown jewels of the economy to the enemy, nothing matters, as long as I am convinced all the bad things will happen after my lifetime.

    The people who care are the evangelists. Either the old style religious evangelists and the new breed of nature, vegetarianism, environmentalism evangelists.

    • Rich people without kids, Maybe. Most I know generally try to make the world a better place, at least until the point that other people's stupidity makes them stop.

      But this stuff is hard. Met a gentleman from Eritrea the other day and we got to talking about the politics and stability in Eritrea/Ethiopia and he explained to me how Obama's focus on "peace" set the peace process back a decade. Kind of gets to the "_____ on what terms" discussion.

      • by Dallas May ( 4891515 ) on Friday November 16, 2018 @11:48AM (#57655554)

        Most I know generally try to make the world a better place...

        Minor correction:
        Most I know generally try to make the world a better place... ... so long as the steps needed to do that don't interfere with their personal life styles or personal business interests.

        • Most I know generally try to make the world a better place... ... so long as the steps needed to do that don't interfere with their personal life styles or personal business interests.

          I'm far from being rich, but I do feel largely this way.

          I don't go out of my way to waste or hurt the world, but on the other hand, I don't put myself out to do otherwise either.

          I like my lifestyle....and I don't see myself as frantically running through the house to turn off this or that to save electricity. I've got a jo

          • by jimbo ( 1370 )

            I was like this until I had a kid. I was not planning to have children but it happened anyway and to my complete surprise I love being a parent and I am a much better person because of him. I now feel empathy with others, even strangers in distress and I now follow the Golden Rule more pro-actively.

            However, it fills me with despair knowing what my son will see and experience in his lifetime. I'm spending money on being more environmentally conscious and I've discovered that even though I'm not by any means

          • "I'm going to enjoy it to the max I can. In only a couple decades after I pass on, no one will even remember my name to "curse" it as some think future generations will."

            So in other words "FU, I got mine?"

            Conservative morality in a nutshell right there.

    • by Raenex ( 947668 )

      The people who care are the evangelists. Either the old style religious evangelists and the new breed of nature, vegetarianism, environmentalism evangelists.

      The road to hell is paved with good intentions. Some of the worst outcomes have been engineered by people trying to do what is "right".

    • by epine ( 68316 )

      That is how most rich people think. Just delay it, global warming, population explosion, running out of oil, precarious infrastructure, giving away the crown jewels of the economy to the enemy, nothing matters, as long as I am convinced all the bad things will happen after my lifetime.

      Yoda contains more wisdom about the Grand Mastery of prudent delay in the green fingerclaw of his pinky hand-toe than you will ever even suspect.

  • by Anonymous Coward

    That's why he's so successful. My prediction is Amazon will continue to be great until there's new management (ie. until after he retires or passes away).

    • I'd imagine that even after he dies/retires, the company will continue to be a behemoth for another decade or so until finally getting out innovated and eventually becoming the next Sears.

      I mean, look at Apple... almost nothing new or really innovative has come out of that company since Steve Jobs died, but they're are still printing money selling products with slightly better specs than last year's model.

      • They did innovate with something completely new: a really crap keyboard that breaks at the first spec of dust and costs 50% of the price of the machine to repair because it's all glued together.

      • Re: (Score:2, Interesting)

        Isn't it more likely that as soon as the board decides that a person who wears a tie and says Synergy is the best person to run the company the company will fail.

        Look at Cisco. There's a moron at the head cranking up prices like crazy and bullying customers but showing amazing returns on the stocks. And yet, everyone in the rest of the world is starting to look elsewhere now. We can't afford Cisco anymore. Hell my company sold $2 billion of Cisco last year and our Cisco sales forecast is so bad the parent c
      • There's still innovation at Apple (AirPods, Watch, FaceID). It just takes time to get it right. How many innovations has Samsung burned through without any kind of market traction?

        Also, most people are OK with slow progress.
        Just look at Google, trying things, working on them for a while and then abandoning them or morphing them into something else.
        Most people have better things to do than play the guinea-pig for some Silicon-Valley Tech Giant.

    • After Jobs passed away, the "bean counters" took over.
  • So I Need you to work 80+ hours a week with NO OT pay

  • Comment removed based on user account deletion
  • by Anonymous Coward

    It's unusual for a CEO to be so frank about the possibility of failure.

    What I think he left unsaid was that most companies tend to prosper when their owners/founders are heavily involved. Once the founders are gone, the company can do well for a while on inertia, but the people running the company often no longer understand or care about the factors that originally made the company successful.

    He probably doesn't expect Amazon's success to continue when he is no longer involved.

    • Nahhh, once Bezos Prime's conscious has been uploaded to the Wandering Shepherd orbital platform, he'll instruct his robotic army to reduce the earth to ash and cinder -- and from his orbital perch he'll crush any attempt by the survivors to rebuild.

      The rule of Bezos Prime will never end. It will be as a boot forever stomping on a human face (which you can also get with free 2 day delivery anywhere in the continental US)

  • by Only Time Will Tell ( 5213883 ) on Friday November 16, 2018 @11:04AM (#57655268)
    The larger Amazon becomes and the more businesses it buys or gets into, the harder it will be to see when it starts to fail at its core business. The company will be able to continue to report record revenues while hiding that certain portions of its business may be stagnating or even failing, but are propped up by the other portions. This was the case of GE, where for the longest time it was in everything from biomedical devices to airplane engines to locomotives to power generation to financing to you name it. Under Welch all was well because of his obsession with performance, but under subsequent leaders, these lines began to fail at different rates and weren't addressed early enough to stop the bleeding. GE is now like a deflating balloon, shedding business divisions left and right as it tries to right itself. Amazon may be successful in everything from cloud computing to groceries to electronic devices to selling just about everything under Bezos, but one has to wonder if the next leader can keep it all going without cracks forming.
    • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Friday November 16, 2018 @11:50AM (#57655570) Homepage Journal

      The larger Amazon becomes and the more businesses it buys or gets into, the harder it will be to see when it starts to fail at its core business.

      It's quite easy to see when cloud computing hosting is failing because you have to-the-minute metrics on use. AWS is now Amazon's core business [techcrunch.com], it brings in more net profit than retail.

    • Amazon may be successful in everything from cloud computing to groceries to electronic devices to selling just about everything under Bezos, but one has to wonder if the next leader can keep it all going without cracks forming.

      I think Amazon is likely to start seeing problems when Bezos is out of the picture similar to Apple without Jobs or possibly someday Berkshire Hathaway without Warren Buffet. Amazon is kicking ass but Bezos has the authority to do a lot of things most public company CEOs can't do because he owns a lot of the company and has the track record to tell investors to get bent if they don't like his quarterly results. The next guy isn't likely to have that option to anywhere near the same degree. Tim Cook seems

  • by jellomizer ( 103300 ) on Friday November 16, 2018 @11:08AM (#57655286)

    If you have seen the Pixar movie Wall-e made just 10 years ago. It showed a future with the Big Unstoppable Buy n Large (In essence a parity of Walmart) just got so big and influential that it took over and destroyed the world.

    Now today Amazon is bigger then Walmart and they are struggling to fight for competition with Amazon. Just as these big box stores dominated the last decade, are now their former self. There are plenty of other forces ready to unseat Amazons spot.

    • Re:He isn't wrong. (Score:5, Insightful)

      by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Friday November 16, 2018 @11:53AM (#57655592) Homepage Journal

      There are plenty of other forces ready to unseat Amazons spot.

      Where? Point to them. Amazon is dominating retail, and that's not even their most profitable business. AWS produced something like $300M more than retail in net profits for Amazon last year. The fact that they're in these two businesses specifically is the key to their ongoing success. These days, a site like Amazon is mostly in the cloud anyway, so in order to compete with Amazon, someone else would have to become them. But good luck undercutting them in both of those markets... You basically already have to have the cloud on standby. Who's got that? Microsoft, Oracle. Neither one could feasibly defeat Amazon in retail.

      I think that Amazon is safe until the way we do business changes again.

      • Re:He isn't wrong. (Score:4, Interesting)

        by ceoyoyo ( 59147 ) on Friday November 16, 2018 @12:05PM (#57655678)

        Alibaba is an example. They got going five years after Amazon and are now the same ballpark size. If Alibaba is better at figuring out the western market than Amazon is at getting into the Asian market, then Amazon could be in trouble. Alibaba also has a natural advantage in that their home turf is growing faster than Amazon's.

        • They got going five years after Amazon and are now the same ballpark size. If Alibaba is better at figuring out the western market than Amazon is at getting into the Asian market, then Amazon could be in trouble.

          No worry, then. Have you actually been to aliexpress? The site is hot garbage. Finding anything is a goddamned nightmare. Further, everything comes straight from China. I'm willing to buy the same items I find on aliexpress from amazon because they tend to be warehoused in the USA, and because I have a reasonable conflict resolution system to work with.

          Alibaba also has a natural advantage in that their home turf is growing faster than Amazon's.

          If they develop competence, they will be a force to be reckoned with, but there doesn't appear to be any danger of that.

          • by ceoyoyo ( 59147 )

            Amazon's site is pretty garbage too, compared to specialty sites. Try searching for some piece of hardware with specific specs. You can't. Yesterday I used the NewEgg search to find something specific I wanted to add to an order from Amazon then looked up the part number on Amazon. Oh, it's 25% cheaper from NewEgg... guess I'm going to order it separately from them.

            Half the stuff on Amazon comes from China too, often by the slow boat. And half the rest comes from Joe Random independents.

            Web sites are cos

            • by drinkypoo ( 153816 ) <drink@hyperlogos.org> on Friday November 16, 2018 @12:44PM (#57655940) Homepage Journal

              Amazon's site is pretty garbage too, compared to specialty sites. Try searching for some piece of hardware with specific specs. You can't.

              Well, you can a little bit. They don't track many specs. I have the same problem with eBay, albeit less so since eBay tracks more facts about items for sale than Amazon does. Inevitably the feature upon which I really want to differentiate isn't tracked their either.

              Yesterday I used the NewEgg search to find something specific I wanted to add to an order from Amazon then looked up the part number on Amazon. Oh, it's 25% cheaper from NewEgg... guess I'm going to order it separately from them.

              Yeah, I usually find that Newegg has the best prices on computer equipment. But OTOH, I usually find that they have the worst prices on anything else they carry. They do have an excellent search function, but as you pointed out, you can easily search on Newegg and then comparison shop.

          • Amazon is US centric, even if it exists elsewhere like in Canada where I am, here there's maybe 20% of the stuff available on the US site, and often 50% to 200% more expensive. It costs less to buy in the US and have shipping + custom + duties + taxes than to order in Canada. In the US Amazon may be #1 but not elsewhere, don't know about europe but at least in Canada, Amazon sucks.

            AliExpress is impressive, everything is 50% cheaper than amazon, and with ePacket shipping it takes sometimes less than 10 days

            • Amazon is US centric

              If the buying power of the US citizen continues to fall, then you'll see them put some more energy into other markets.

              AliExpress is impressive, everything is 50% cheaper than amazon,

              You misspelled 10% there, sport. I've been pricing solar equipment lately, and I've been finding the same stuff on amazon and aliexpress (because the actual brand names are shown on aliexpress, and there's more documentation links there) and the difference is much much smaller than you claim.

              and with ePacket shipping it takes sometimes less than 10 days to be on my porch.

              ePackets are pretty amazing, it's obvious that the Chinese government is subsidizing those. Larger it

          • Aliexpress sells the no-name stuff that retails here for 1/10 of the price. The problem is finding a good seller/manufacturer there that delivers consistently good quality.

            Though, a lot of bonded warehouses for Chinese goods are popping up in Europe. Doesn't mean the companies behind them are more legit or trustworthy, though.

    • Now today Amazon is bigger then Walmart and they are struggling to fight for competition with Amazon.

      Depends on how you define "bigger". Amazon is bigger by market cap but only about a third of the size by revenue. ($177B vs $500B) Saying Walmart is struggling against Amazon is only true for online sales. Walmart is playing catch up with online sales (with mixed results) but the demographics the two companies cater to aren't precisely the same ones so it's unclear how much that will matter in the long run. Amazon will have a hard time displacing Walmart in rural communities and with many of your typic

  • by rsilvergun ( 571051 ) on Friday November 16, 2018 @11:09AM (#57655288)
    like Sears. Or Toys R Us. Or Yellow Front (anyone on West cost remember them?).

    Oh, and while we're on the subject treating your employees like crap non stop doesn't help. Even Walmart had to raise pay and decrease workload a bit because they were losing money with unstocked shelves.
    • Comment removed (Score:5, Insightful)

      by account_deleted ( 4530225 ) on Friday November 16, 2018 @12:54PM (#57656020)
      Comment removed based on user account deletion
      • Eddie Lampert is a hedge fund manager. Over the last 10 years he sold Sears prime real estate (well below market value) to other companies he owns, and continued gutting the company, he even got employee pensions (in Canada), but was prevented from getting the pensions in the US.

        They typically take on massive debt that the company in question needs to pay interest payments on. Eventually the debt outpaces revenue and chapter 11 comes calling.

      • One mustn't forget that Sears.com was the worst e-commerce site ever. Even with a naked browser (and thus no add-ons to screw things up) it usually didn't work right when I was actually trying to use it. It was like a bad mainframe application, but with graphics. Probably that's what it actually was.

        While Amazon was still coming up, Sears had a great chance to dominate the online retail space. But their site sucked and their prices were too high, and then they sold off their real estate and now they're goin

  • And that one thing is the customer focus rather than the self-focus. If Amazon becomes a means to a non-customer-serving end, that indeed will be the end, or the start of the downward spiral. Sure, it's about money, but you get that from... customers.

  • by BringsApples ( 3418089 ) on Friday November 16, 2018 @11:20AM (#57655368)
    Every company should know that this is the truth. Every people should know that this is the truth. In fact, the same basic truth exists in regards to life too. Because one day we will die, but it's the job of our entire system to keep from dying as long as possible.
    • by AmiMoJo ( 196126 )

      Maybe in America companies last 30 years, but look at Japan. Lots of very large companies with 100+ year histories. In fact Japan has the most very long lived companies in the world.

      The main difference is that Japanese companies consider employees to be assets. Western investors look at their wage bills and wonder why they are wasting so much money on people they could replace with cheaper labour, without understanding that good people, fair wages and high retention are the reasons why they have been around

      • It has nothing to do with business practices or culture. It has to do with Nature. Everything will end, eventually (no, I don't mean the end of the universe itself, I just mean that nothing lasts forever).

        However, you're onto something, speaking about Japan having the oldest businesses. They also, generally have, the oldest people in the world. The correlation is plain to see.
        • Or perhaps it's the Japanese emphasis on honor and integrity? Ritualistic suicide to atone for making a mistake isn't that far back in history over there.

          Or the fact that it was accepted to start at a company and stay there for your entire working life. That kind of long term employment breeds loyalty to the company -- you are invested in its long-term success; rather than cooking the books or selling core business units off for a couple of good quarters; and then float away on your golden parachute.

  • by sjbe ( 173966 ) on Friday November 16, 2018 @11:21AM (#57655372)

    If you look at large companies, their lifespans tend to be 30-plus years, not a hundred-plus years.

    That's not quite true unless you are using a rather narrow definition of corporate lifespan. They might only be at the top of their game for 20-30 years but once they get to a certain size they rarely actually die completely in the sense of bankruptcy. They just tend to get absorbed into other companies or shift to a less prominent place in the market. Go look at any company in the Fortune 500. Most of them have been around a LOT longer than 30 years. Apple and Microsoft are already older than 30 years and are unlikely to go away any time soon. Yahoo is/was close to 25 years old as a standalone company but it isn't actually gone, it just got absorbed into another company and that's fairly normal. Amazon has reached sufficient scale that they'd have to do something remarkably stupid to go bankrupt or there would have to be some sort of techtonic shift in the marketplace. Also please recall that Amazon was founded in 1994 so it's already 25 years old and most of that time could properly be described as a large company.

    You have to remember that large companies are the ones that survived. The companies that go away before 30 years are the ones that didn't so there is something of a surviviorship bias in play here. It's entirely plausible that Amazon won't be a standalone company 20 years from now but it's pretty unlikely the company will disappear completely.

  • "If we start to focus on ourselves, instead of focusing on our customers, that will be the beginning of the end."

    Is he talking about Apple and their obsession with ever-thinner laptops, sacrificing usable keyboards - the main input method of a laptop - to make them 2mm thinner?

    • by Anonymous Coward

      It's an anti-worker's rights speech, in the style of the old "gentleman's" definition: a gentleman never questions his decisions. In other words, he (the gentleman) is a unlearning sociopath destined to fail within the 30 years. I hope Bezos doesn't see himself as such a gentleman. Also, to add to the point others have been made with the Japanese companies, their later successes have been about also looking in. That's what quality thinking and management really is.

  • by orlanz ( 882574 ) on Friday November 16, 2018 @11:28AM (#57655424)

    Obviously the author of the article meant to catch eyeballs with that title but he did a huge disservice to Bezos and all the readers by choosing such a title.

    Because the title says the exact opposite of what Bezos said. He didn't say we need to delay the demise of Amazon. Read the 2 simple quotes in the article & submission. Bezos is saying they need to delay the onset of focusing on their survival and stay focused on the customer as long as possible. This will keep Amazon alive. Once Amazon starts focusing on itself, the beginning of the end starts.

    The article's title implies that Amazon is already looking at itself and thus is well on its way to its end. Bezos is saying they need to delay getting to the start of such a day.

    This is a case of the reporter not understanding wisdom and passing on their misunderstanding to those they are supposed to educate.

    • Same thing. He is saying they need to delay the beginning of the end of the (inevitable) demise. The author simplified it to they need to delay the demise. The difference is pedantic, and I don't know how you come up with the idea that the headline is the "exact opposite".
    • When I read "Amazon is not too big to fail," I immediately thought that was simply a seed to plant in people's minds as they get bigger and bigger, to prevent the idea that Amazon is too big to fail and needs to be broken up or regulated.

      They can't be too big to fail, Bezos himself said so!

      I do agree that Amazon is the best at managing their customers, and as long as they continue to do that, it will be much harder for them to fail.

  • I see this as very wise: only after accepting that there will be an end (to the company), can one make the intervening time more fulfilling (profitable).

  • That question is actually pretty complicated and harder to answer than most people think.

    • Individuals, businesses and the government. Individuals are the retail customers and sellers and business/government are the AWS customers and retail sellers. Not complicated at all.
  • ...in Fire! Says the Amazonian Vorlon

  • There are two books that discuss how and why companies last

    * From Good to Great
    * Built to Last

    I'm assuming Bezos has read them.

    There are usually 2 reasons companies fail:

    * Implode -- bureaucracy grinds effectiveness to a halt
    * Explode -- competition does it better, faster, cheap

    Will see what happens to Amazon.

  • Sears (Score:5, Insightful)

    by Dan East ( 318230 ) on Friday November 16, 2018 @12:23PM (#57655786) Journal

    There is a lot of irony in the history of Sears. Sears was the original Amazon. Sears aggressively made use of a new technology as it was rolled out throughout the country to reach a massive customer base and flourish - modern transportation. As roads, and especially rail, began to be built and improved across the country Sears capitalized on it to create a massive mail order business. Rural areas might only have a few small stores, but if they had a train depot, then they had access to the entire Sears catalog. You could buy any part for your tractor from Sears, or even an entire set of materials needed to build a house (literally).

    Then Sears began to roll out brick and mortar stores - a natural progression for a large retail business with lots of money. Store fronts are like bragging rights - a tangible, physical way to show off the power and size of your business. Eventually mail order declined significantly, and their catalogs were primary an advertising tool to get people into stores.

    Then came the internet, and Sears did not capitalize on it as they could have. That opened the door for Amazon to beat Sears at its original game. It's so ironic that one of the things forcing Sears out of business is being undercut by mail-order shopping.

    Less than two months ago Amazon opened its first brick and mortar store in New York - Amazon 4-Star. Bragging rights.

    What will be the demise of Amazon? Maybe 3D printing purchases regionally and then using drones to handle last-mile delivery? It will be some technology that Amazon fails to embrace, letting a new competitor get a leg up on them.

    • What will be the demise of Amazon?

      Either Amazon gets broken up into Amazon.com and AWS, or Google comes up with an Amazon-like interface which aggregates basically all web retailers and which handles processing orders for them. Google is the only player with even a hope in hell of defeating Amazon, and they actually have all of the pieces, so I'm not sure why they haven't bothered yet.

      • by Raenex ( 947668 )

        Google is the only player with even a hope in hell of defeating Amazon

        Walmart already has stores across the country. If anybody is poised to beat Amazon at their own game, it's them. They're also making a healthy profit of ~$100 billion a year, and have been for some time.

  • But it is not this day! An hour of wolves and shattered yields, when our online store comes crashing down! But it is not this day! And then Bezos rode out of the meeting on his mighty steed...
  • Even the universe will end... someday.

    So obviously, nothing is too big to fail.

    But there are big companies that have been around for a lot longer than 30 years. IBM comes to mind as one.

  • by cascadingstylesheet ( 140919 ) on Friday November 16, 2018 @01:46PM (#57656432) Journal

    1. One day our company will die.

    2. That will happen sooner if we focus on ourselves instead of our customers. So let's focus on our customers.

    What's so unreasonable about that?

  • You think he cares if his company falls apart some day in the future? Nope, he's already hidden away his wealth.
  • Who else thought of this when you read the title?

    https://www.youtube.com/watch?... [youtube.com]

  • "If we start to focus on ourselves, instead of focusing on our customers, that will be the beginning of the end,"

    I like what he's saying. It's something that's lost on most tech shops - even on their first day. Google has no conception of customer first. Apple is a PR company that has created the most user-hostile tech ever conceived. Microsoft has weaponized their Operating System.

    Having said this... Amazon is following in those steps. Their tablets are surveillance machines. Alexa is the next-gen snooping

  • They will eventually end one way or another, whether that's through going bankrupt or merging with another company.

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