Building a commercial powerhouse from the ground up is difficult, but Amazon has had enough time in a short period of time to emerge as one of the top businesses in the world.
The history of Amazon is comparable to that of organizations such as Apple, Google, or Microsoft — a company that started out in an abandoned, dusty garage and eventually built a tower.
This article explores the history of Amazon, how it got its start, when it started selling things other than books, and how the company has changed over time.
In this article you will learn:
- A Synopsis of Amazon's Past: Cadabra
- Amazon's Past: The Initial Years
- Amazon's Past: An Expanding Company
- Evaluating Amazon's Ethical Issues and Rebuttals
- FTC Is Challenging Tech Giant Amazon
- Conclusions
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A Synopsis of Amazon's Past: Cadabra
After graduating from Princeton University in 1986, Jeff Bezos was a young man who rapidly established himself in the business world. He finally rose to the position of vice president at the prominent Wall Street firm DE Shaw and Co. a job he quit in 1994 to start his own business in Seattle, Washington.
Jeff Bezos made the decision to launch his new online business in 1994 after reading a study on the Internet's future that predicted web commerce will increase by 2,300% annually in a Seattle garage. Cadabra, the Amazon's progenitor, was the outcome of this expedition.
When the business first started out, its exclusive focus was online book sales. In an interview, the company's founder stated, "With more than three million titles for sale and available throughout the world, the books category has more articles than any other."
Simultaneously, the business owner soon decided to rename the company in an attempt to increase business volume.
Bezos used a dictionary to choose the name Amazon. In addition to its connection to the Amazon River, he chose this name since it started with the alphabet's first letter.
From A to Z is the tagline for Amazon.
Amazon's Past: The Initial Years
Bezos determined that, in light of the tremendous global demand for literature, this new company would sell books online.
He also made use of the excellent range of titles that were accessible in print as well as the low price that could be charged for books.
The website Amazon.com went live on July 16, 1995. starting right away with the company's online presence and exponential growth.
Within 30 days of its launch, Amazon.com was selling books in all 50 US states as well as 45 other countries—all without any media attention.
Bezos intended to focus on connecting the website to all kinds of customers and making it as user-friendly as possible. Discounts, reasonable costs, browseable topic areas, recently highlighted books, a recommendation center, customer review access, and a host of other consumer favorites were all provided by the company!
It was not all sunshine and roses, even with the rapid takeoff. It didn't take long for other businesses to begin accusing the new one of stealing his business concept. For example, Walmart claimed that Bezos's company had stolen his idea.
Amazon's Past: An Expanding Company
On May 15, 1997, Amazon debuted as a stock market player, trading under the NASDAQ symbol AMZN. The company's shares, which were valued at $18 apiece at the time of its initial public offering, have increased by an astounding 211 times since then.
In the last year of the 20th century, Amazon created the first marketplace—which it now refers to as the Marketplace—where independent merchants could offer pre-owned goods. This campaign was extremely successful very quickly; in the first few months, a fifth of users made purchases using this service.
In addition, Bezos closed the year out on a high note when Time magazine awarded him its esteemed "Person of the Year" title.
The business completely changed course in 2000, becoming a marketplace that enabled consumers to search for and purchase a wide range of goods and services online with the best quality and guarantees available.
Having fully embraced the 21st century, Amazon ventured to make yet another significant advancement in its unrelenting development.
The business introduced Amazon Web Services (AWS) in 2002 as part of its ongoing diversification efforts. This service is a cloud service platform that offers a range of infrastructure services, including messaging, artificial intelligence, networks, databases, storage, and application services. AWS is present in 190 different nations worldwide.
Data centers for Amazon Web Services are located in Europe, Singapore, Japan, Australia, and the United States. Actually, Amazon's AWS program is its main source of operating profit.
2004 saw Amazon purchase Joyo. This business used to ship books and other media products around the country.
After Jeff Bezos bought Joyo, the company was rebranded as "Amazon China." Control over additional Joyo.com-owned Chinese companies and partners was also included in the acquisition agreement. China, one of the biggest and most powerful markets in the world, is incredibly well-liked in the e-commerce space. Furthermore, China has emerged as the global leader in exports.
The well-known Amazon Prime service was introduced in 2005, and it enables free shipping on all orders—both company-owned and those from independent sellers—within a 48-hour window.
Amazon introduced a ground-breaking service called Fulfillment By Amazon (FBA) in 2006.
Fulfillment by Amazon, or FBA, is a program that gives sellers the ability to list and sell products on the Amazon website. It gives the ease of storing goods in Amazon's warehouses, with Amazon handling customer delivery, refunds, returns, and providing excellent customer support. Sellers are spared the complexities of managing the full process on their own thanks to this.
Since third-party sellers account for more than 50% of all Amazon sales, they are an integral element of the company's core and one of its most significant revenue streams, along with AWS. This marked the beginning of Amazon's ascending pyramid of growth.
Even with the company's quick diversification, Bezos still hadn't had time to work on all of the initiatives.
He started adding businesses to his portfolio, including Audible (audiobooks), Zappos (shoe shopping site), IMDB, Good Reads, Kiva Systems (robotics company), Twitch (social video game streaming site), Whole Foods, and The Washington Post. Joyo is the largest online seller of books and electronics in the Chinese market.
Additionally, Amazon unveiled its own advancements, such as the Fire TV, Kindle, Echo, and Alexa, in addition to its own innovations.
The secret to Amazon's success is that it continuously puts customers before merchants, treating them not just as buyers but as valued clients.
Even now, many are skeptical of their vision, especially the third-party vendors who are most affected. However, a key component of their success now is their skepticism.
Amazon has revolutionized online shopping by allowing users to review items and wish lists, make one-click transactions simple, and offer flexible return policies.
Evaluating Amazon's Ethical Issues and Rebuttals
The biggest businesses of today, most of which are in the technology sector, are typically attributed to their ability to innovate, high levels of inventiveness, and willingness to take risks when others wouldn't.
The pandemic in 2020 dealt a serious hit to the world economy. From January 1st to October 31st, 2020, the founder and CEO of Amazon, Jeff Bezos, saw a considerable increase in his wealth due to the company's share value.
In addition, the business has been accused of terminating employees who have voiced criticism of the organization and has seen strikes in some of its departments as a result of job instability and demands for increased wage rights.
In this regard, publications like "What Are the Conditions and How Does an Amazon FBA Warehouse Work? "I Worked at One" provides a nuanced viewpoint on the complex workings of Amazon.
Among the wealthiest corporations globally is Amazon. It actually brings in more money than a lot of states. According to the income level of the 100 largest economies in the world, 69 are companies and the rest are states, thus far surpassing the power and influence of most countries in the world.
Offshoring is a popular and unfavorable tactic in its continuous growth plan. The multinational corporations relocate their manufacturing to nations lacking environmental regulations and with shaky social and labor protection frameworks.
These businesses also utilize tax havens as an excuse to evade paying taxes, resulting in annual losses of $1 billion. As a result, there is an unparalleled concentration of wealth, inequality, flagrant breaches of human rights, and devastation of ecosystems.
There is no international agreement that makes multinational corporations accountable for the grave human rights breaches and environmental crimes they commit. There are always those who profit from the law when it doesn't apply to everyone equally.
Profit always takes precedence over human rights and the environment in transnational enterprises. A legally binding treaty that gives victims access to justice and forces corporations to take responsibility for their crimes is required because they are extremely well-protected and are rarely held accountable for the violations they perpetrate.
The Binding Treaty was published in 2014. Transnational corporations are required under this process to respect the environment and human rights.
FTC Is Challenging Tech Giant Amazon
One of the biggest tech companies in the world, Amazon, has become a success story by investing billions of dollars to build companies that can offer products at the lowest possible price. There is only one unchallenged king in this art on the internet, and that is Amazon.
According to Amazon's theory, if you satisfy customers with low prices and return policies that disadvantage third-party sellers, they will leave you alone and prosper. This is how Amazon has escaped regulatory scrutiny while constructing a massive empire.
The monopolistic practices of Jeff Bezos have not received much criticism. Among them is European Commissioner for Competition Margrethe Vestager, who claims that despite a two-year inquiry, the European Commission has not obtained enough evidence to demonstrate how Amazon manipulates its algorithm to favor its products over those of its competitors.
On the other side of the Atlantic, Lina Khan, who was selected by the Joe Biden Administration to the position of commissioner of the US regulator in 2021, wrote a book titled "The Antimonopoly Paradox of Amazon" in 2017 that outlined some of the main tactics for "hunting" Amazon. Khan challenged decades of antimonopoly economic theory in this paper.
The United States altered its rules in the 1970s and 1980s to determine whether or not there is price competition, which determines whether or not a business is a monopoly. Lina contends that one needs examine the dynamics and structure of a sector in order to ascertain whether it is truly competitive, particularly when it comes to online platforms.
Khan explains, "It is not just a 'online' store; it is also a 'marketing' platform, a logistics network, a payment provider, financial services provider, book publisher, series and movie producer, fashion designer, device manufacturer, and one of the world's largest cloud services provider." Khan suggests that we think of these large "online" platforms as public utilities, similar to gas, electricity, or water, and that we should regulate and step in to end discrimination based on price and service.
The Federal Trade Commission (FTC) began preparing to sue Amazon in early 2023 for allegedly engaging in anticompetitive behavior.
However, since 2021, the FTC has accused Amazon on several occasions. The organization charged it with forcing millions of customers to sign up for its expensive subscription service, Amazon Prime, without their permission and making it impossible for them to discontinue.
A complaint was filed in 2021, claiming that Amazon's ad campaign violates FTC regulations.
It was agreed in June 2023 that Amazon would pay a $25 million civil penalty in order to address allegations that it had broken a child privacy law. The claims concern the location data and voice recordings of kids that are gathered by their popular Alexa voice assistant.
In addition, as part of a settlement over claims of privacy violations pertaining to its doorbell camera product, Ring, Amazon had also agreed to reimburse $5.8 million to customers.
CONCLUSIONS
Amazon began in the book industry and has since extended its reach into a variety of other industries, including cloud services and the sale of various goods.
Additionally, Amazon's focus on the customer has propelled it to the top and made it a formidable force that few can match.
We have seen the rise of several empires that have come to dominate their respective industries globally over the past fifty years, during the height of capitalist idealism. Empires that mercilessly destroyed everything they came across while expanding.
The tale of Amazon's past is not any different. Since its founding in the middle of the 1990s, Amazon has been embroiled in a number of scandals.
The industry association for booksellers and publishers has questioned the company's business model; some employees claim they work in unfavorable conditions in its distribution centers; an inquiry into Amazon's financial procedures has also been launched.
These are but a few illustrations that demonstrate that, in the end, growth does have a cost. Amazon has grown into a genuine behemoth that will soon rule the worldwide eCommerce market, if it hasn't already.
