Amazon Product Teardown

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Amazon Product Teardown

You will dive deep into the customers, products, platforms, services and sectors that Amazon is focused on dominating.

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In this training, you will

  • Experience the resilience and discipline required to truly understand your competition.
  • A deep understanding of Amazon's Product Suite and Service Offerings.
  • Learn how you need to radically diversify your business’ customers, plans, products, platforms and sectors to emulate Amazon’s success.
  • Learn more than you ever wanted to know about Amazon. 
  • Have a new respect for Amazon’s strategy and its breadth.

Skills that will be explored

Key Metrics

Market Cap


PE Ratio




Net Sales


YOY Growth


Online Stores


Physical Stores


Third-party seller services







566,000 full-time and part time employees

Retrieved March 27, 2018 from Yahoo Finance and Amazon 10-K


Jeff Bezos

President, Chief Executive Officer,
and Chairman of the Board

Jeff Blackburn

Senior Vice President, Business Development

Andrew Jassy

CEO Amazon Web Services

Brian Olsavsky

Senior Vice President and Chief Financial Officer

Shelley Reynolds

Vice President, Worldwide Controller, and Principal Accounting Officer

Jeff Wilke

CEO Worldwide Consumer

David Zapolsky

Senior Vice President, General Counsel, and Secretary

Customer and Revenue Growth

Revenue Segments:

  • Global net revenue of from 2014 to 2016, by segment (in billion U.S. dollars)
  • He [Amazon CFO] said advertising growth had been “strong and fairly consistent” over the last three quarters. According to eMarketer, Amazon will generate $1.81 billion (£1.38 billion) in online ad revenues.
  • For cloud computing, Amazon is the dominant first mover in the infrastructure-as-a-service space. That vertical is projected to grow almost 40% in 2017 as businesses of all kinds eventually make the transition to the cloud.
  • The growth in Prime has been fairly consistent over the last recent quarters in Prime memberships, and as I said, we had the largest new sign-ups on Prime Day for the Prime program. The monthly program is gaining traction and is an attractive option for a lot of people.
  • And again, on the other subscription services, music especially, it works just so well with our Echo device that we’re seeing a lot of growth in that area as we increase the number of Echo devices and customers using the Echo devices.
  • It’s because the video business is having great results with our most important customer base, which is our Prime customers. It continues to drive better conversion of free trials, higher membership renewal rates for existing subscribers and higher overall engagement.
  • We’re seeing the engagement go up year-after-year in video and also music and a lot of the other Prime benefits.
  • Online store sales growth, which includes product sales and digital media content, isn’t slowing at all. Online store sales grew 22% in the third quarter, versus 18% the prior quarter and 20% one year ago. The growth rate in this segment has been around 20% (+/- 4%) for several quarters now. The segment is showing no signs of slowing down.
  • Third-party seller services growth isn’t slowing all that much either. Revenue in this segment jumped 40% in the third quarter, the same growth rate it had last quarter. Over the past several quarters, growth has been between 35% and 50%. All signs point to growth rates staying in this range into the foreseeable future.
  • Subscription services revenue grew 59% in the third quarter, better than the 53% growth rate seen last quarter and the 47% growth rate seen one year ago. In fact, that 59% rate is the best subscription growth rate Amazon has recorded in recent memory.
  • The only place where we see growth slowing is AWS, and even there, growth rates remain above 40%.
  • Amazon is accelerating revenue growth in its high-margin, recurring revenue subscription business, implying profit growth will one day catch revenue growth.
  • AWS revenues have grown at a CAGR of over 60% in this decade, with the trend continuing through the first half of the year.

International Sales:

  • Indeed, one in three net sales dollars earned by Amazon in 2016 came from markets outside North America. Growth abroad is roughly inline with domestic growth fluctuating between 23-28% YoY in 2016.
  • … the International segment posted a loss of $936 million, which is more than it lost in the comparable period in 2016 and in Q2 2017. Despite this drop, its international net sales increased 29.3% YoY to $13.7 billion following a successful Prime Day and Diwali. This is up from 16.7% YoY growth in Q2 2017, meaning its heavy investments may be having the right impact.

Prime memberships:


  • Amazon is in the portfolio because: a) its total addressable markets (ecommerce, cloud computing, and streaming video) are far bigger than those of the other FANG stocks. Moreover, Amazon seems to have a policy of spending all of its profits on experimental research and development, as well as new data centers for AWS and fulfillment centers for speedier Prime delivery. Therefore, the company spends all it can on future growth and to further cement its deep competitive advantages, which makes valuing Amazon trickier than simply taking a multiple of GAAP net earnings.
  • Amazon accounts for about 34% of ecommerce, and ecommerce makes up only about 8% of overall retail, so that means the company has only about 3% of retail sales overall. That’s a lot of room to grow, even from this incredibly large base.
  • After Amazon’s IPO in 1997, it took 14 years before the market valuation of its stock exceeded $100 billion in July of 2011, and another four years to surpass $200 billion in June of 2015. Then it took only five months to top $300 billion in market value in November 2015, and another 15 months to exceed $400 billion for the first time in February of this year.
  • Since the start of 2015 Amazon’s share price has risen by 173%, seven times the growth of the preceding two years.
  • Amazon’s laser-like focus on creating value for consumers and keeping them satisfied with low prices, huge selection, speedy delivery and great customer service goes a long way towards explaining its phenomenal success as a retailer, which gets reflected in the meteoric rise in its stock price and market capitalization.
  • It doesn’t hurt that the cloud business means investors see Amazon at least partially as a software company — and are thus willing to pay a higher multiple for the stock.
  • So investors have high expectations for the stock. Amazon’s price-to-earnings ratio—a measure of how much investors expect Amazon to earn in the future—is around 200. For comparison, Apple’s P/E ratio is around 13.37, while Facebook’s comes in around 63.
  • Amazon has been at the forefront of a vast range of emerging industries since its inception, including e-commerce, e-readers and e-books, cloud computing, video streaming, digital technology such as Alexa, and even drone delivery.
  • While most businesses seek out profits to satisfy shareholders, Bezos has always been content to play the long game, promising investors from day one that he was building a company for the long term, and it’s paid off.
  • Prime has encouraged Amazon shoppers to spend double what they used to on the website and encouraged members to participate in other parts of Amazon’s ecosystem, such as video streaming and Kindle books.
  • The company’s Marketplace and Fulfillment by Amazon have made the website the most popular home for third-party vendors. That adds another revenue stream for Amazon and in turn makes it the more appealing for customers as it increases its product range.
  • Amazon is one of the market’s best-performing stocks this year. Its shares have rallied 57 percent through Tuesday versus the S&P 500’s 20 percent gain.411

Customer Data Collection

  • It analyzes what items you purchased previously, what is in your online shopping cart or on your wish list, which products you reviewed and rated, and what items you search for most.
  • Amazon regularly reviews words highlighted in your Kindle to determine what you are interested in learning about.
  • Companies may benefit from Amazon Web Services by analyzing customer demographics, spending habits and other pertinent information to more effectively cross-sell company products in ways similar to Amazon.

Personal Information About Customers

Following section pulled from Amazon Privacy Notice

  • We receive and store any information you enter on our Website or give us in any other way.
  • For example, you provide information when you search for a product; place an order through or one of our third-party sellers; provide information in Your Account (and you might have more than one if you have used more than one e-mail address when shopping with us) or Your Profile ; communicate with us by phone, e-mail, or otherwise; complete a questionnaire or a contest entry form; use our services such as Amazon Instant Video; compile Wish Lists or other gift registries; participate in Discussion Boards or other community features; provide and rate Reviews; and employ Product Availability Alerts, such as Available to Order Notifications.
  • As a result of those actions, you might supply us with such information as your name, address, and phone numbers; credit card information; people to whom purchases have been shipped, including addresses and phone number; people (with addresses and phone numbers) listed in 1-Click settings; e-mail addresses of your friends and other people; content of reviews and e-mails to us; personal description and photograph in Your Profile ; and financial information, including Social Security and driver’s license numbers.

Automatic Information:

  • We receive and store certain types of information whenever you interact with us. For example, like many Web sites, we use “cookies,” and we obtain certain types of information when your Web browser accesses or advertisements and other content served by or on behalf of on other Web sites.
  • Examples of the information we collect and analyze include the Internet protocol (IP) address used to connect your computer to the Internet; login; e-mail address; password; computer and connection information such as browser type, version, and time zone setting, browser plug-in types and versions, operating system, and platform; purchase history, which we sometimes aggregate with similar information from other customers to create features like Top Sellers ; the full Uniform Resource Locator (URL) clickstream to, through, and from our Web site, including date and time; cookie number; products you viewed or searched for; and the phone number you used to call our 800 number.
  • During some visits we may use software tools such as JavaScript to measure and collect session information, including page response times, download errors, length of visits to certain pages, page interaction information (such as scrolling, clicks, and mouse-overs), and methods used to browse away from the page. We may also collect technical information to help us identify your device for fraud prevention and diagnostic purposes.

Information from Mobile Apps:

  • When you download or use apps created by Amazon or our subsidiaries, we may receive information about your location and your mobile device, including a unique identifier for your device.

Information from e-Mail:

  • To help us make e-mails more useful and interesting, we often receive a confirmation when you open e-mail from if your computer supports such capabilities.
  • We also compare our customer list to lists received from other companies, in an effort to avoid sending unnecessary messages to our customers.

Information from Other Sources:

  • We might receive information about you from other sources and add it to our account information.
  • Examples of information we receive from other sources include updated delivery and address information from our carriers or other third parties, which we use to correct our records and deliver your next purchase or communication more easily; account information, purchase or redemption information, and page-view information from some merchants with which we operate co-branded businesses or for which we provide technical, fulfillment, advertising, or other services; search term and search result information from some searches conducted through the Web search features offered by our subsidiary, Alexa Internet; search results and links, including paid listings (such as Sponsored Links); and credit history information from credit bureaus, which we use to help prevent and detect fraud and to offer certain credit or financial services to some customers.

Interest-Based Ads


Children’s Information


  • This AWS Privacy Policy describes how we collect and use information that customers provide to us in connection with the creation or administration of AWS accounts, which we refer to as “Account Information”. For example, Account Information includes names, usernames, phone numbers, email addresses and billing information associated with a customer’s AWS account.

Amazon Pay

Following section pulled from Amazon Payments Privacy Notice

  • For example, to open an Amazon Payments Account, you must provide your name, address, and an e-mail address. To make certain payments through us, you must provide credit card or bank account information.
  • When you use our Services to send money to someone else or request money from someone else, we may ask you to provide information related to each transaction, including the amount of the transaction, the type of transaction (purchase of goods, purchase of services, or simple money transfer) and the e-mail address of the third party.
  • We also collect information that may be necessary for us to verify your identity and comply with the U.S.A. Patriot Act and Bank Secrecy Act. Such information may include name, address, date of birth, social security number, and/or driver’s license number.
  • We may ask you to send us additional information (such as a credit card statement and/or a recent utility bill or other information linking you to an address in your account). We also may ask you to answer additional questions online to help verify your identity. We may also require additional information if you send or receive certain high-value transactions or high aggregate payment volumes through our Services.
  • We may sometimes offer optional questionnaires and surveys to our users to collect information for analytical purposes, such as demographic information. If we collect personally identifiable information from our users in these questionnaires and surveys, the users will be given notice of how the information will be used prior to their participation in the survey or questionnaire.

Amazon Key

Following section pulled from Amazon Key Terms of Use

  • The Software provides Amazon with information about your use and the performance of Amazon Key, the Software, and Compatible Products, as well as information regarding the devices on which you download and use Amazon Key.
  • For example, this may include information about Compatible Products and how they were operated; authorizations for guests and service providers and when and how guests and service providers used Amazon Key; and occurrences of technical errors.
  • If you use a Compatible Product capable of creating Recordings, we will process and retain your Recordings in the cloud to provide and improve our services.

Amazon Devices

Following section pulled from Amazon Device Terms of Use

  • Your Amazon Device may have a feature that allows maps, other applications, and Amazon to use and access location and related information from your device.
  • Your Amazon Device may have a feature that backs up to the cloud certain data on your device, including account settings, notes, email and wireless configurations, bookmarks, search history, communications, and call history, so that you can restore that data later to an Amazon Device.
  • When you use voice services, we may process your voice input and other information (such as location) in the cloud to respond to your requests and to improve your experience and our products and services.
  • Some Amazon Devices, such as Echo Look, Amazon Cloud Cam, or Amazon Devices with Firefly, have features that allow you to capture images, video, or audio. When you use these features, we may process and store your captured images, video, or audio in the cloud to provide and improve our products and services.
  • The Software will provide Amazon with information about use of your Amazon Device and its interaction with Digital Content and the Services (such as last page read, content archiving, available memory, up-time, log files, network diagnostics, content usage, search queries, location, voice information, connectivity and signal strength)

Amazon Firefly

Amazon Drive and Prime Photos

Amazon Cloud Cam

  • Amazon processes and retains your Cloud Cam Recordings in the cloud to provide and improve our products and services.
  • The Software will provide Amazon with information about your use of Cloud Cam Services (such as when motion alerts are triggered or, if enabled, when a person is detected or a geo-fence is activated). This information may be stored on servers outside the country in which you live.

Kindle Store

  • The Kindle Application will provide Amazon with information about use of your Kindle Application and its interaction with Kindle Content and the Service (such as last page read, content archiving, available memory, up-time, log files, and signal strength).

Amazon Appstore for Android

Amazon GameCircle

Amazon Music

Following section pulled from Amazon Music Terms of Use

  • The Music Library Service and the Software may scan Music Content on your device and collect other information that may be used to identify Music Content on your device, such as the names of songs, artists, and associated metadata.
  • For example, this information may include the device type, mobile network connectivity, IP address of the device, information about your internet service provider, information about when the Software is launched, individual session lengths for use of the Services, information about the Music Content used through the Services, or occurrences of technical errors.
  • We may provide certain information regarding your use of Music Content, such as your postal code and listening history, to Music Content providers, including record companies.
  • Some record companies require us to insert identifiers in the metadata that accompanies Music Content from these companies that uniquely identify it as Music Content you have received from us (“Unique Identifiers”). This includes Purchased Music and Matched Music. These Unique Identifiers may contain information that can be used to identify you as the owner of the Purchased Music or Matched Music.

Amazon Silk

  • Amazon Silk also temporarily logs web addresses — known as uniform resource locators (“URLs”) — for the web pages it serves. We do not associate these URLs with your identity, and we generally do not keep this information for longer than 30 days.

Amazon Maps

Rights and Permissions


Kindle (eReader)


  • The Amazon Kindle was launched with one real aim: to bring people books. The Kindle was never designed to compete with tablets and sticking to this principle has allowed the Kindle to evolve through to the present day and excel at its task.
  • Launched in November 2007, the Amazon Kindle was showcased in NewsWeek magazine. It went on sale on on 19 November and sold out within hours and was immediately dubbed “the iPod of reading”.
  • The original Kindle launched with a 6-inch E Ink display, offered a free wireless connection over Sprint’s EV-DO network, on the new Whispernet announced by Amazon.
  • It cost $399 and was only available within the US, offering access to 90,000 books at launch.
  • In the ten years since release, there have been many iterations:
    • Original Kindle (white)
      • Release date: November 19, 2007
      • Also called ″Kindle (1st Generation)″
    • Kindle 2 (white)
      • February 23, 2009
    • Kindle 2 International (white)
      • October 19, 2009
      • Also called ″Kindle (2nd Generation)″
    • Kindle DX (white)
      • June 10, 2009
    • Kindle DX International (white)
      • January 19, 2010
    • Kindle DX Graphite (graphite)
      • July 1, 2010
      • Also called ″Kindle DX (2nd Generation)″
    • Kindle Keyboard (white or graphite)
      • August 27, 2010
      • Also called ″Kindle (3rd Generation)″
    • Kindle Keyboard with special offers (graphite)
      • Wi-Fi: May 3, 2011
      • 3G: May 25, 2011
    • Kindle 4 (silver)
      • September 28, 2011
      • Also called ″Kindle (4th Generation)″
    • Kindle Touch (silver)
      • Wi-Fi and 3G: September 28, 2011
      • Also called ″Kindle Touch (4th Generation)″
    • Kindle 5 (black)
      • September 6, 2012
      • Also called ″Kindle (5th Generation)″
    • Kindle Paperwhite (1st gen) (black)
      • Wi-Fi and 3G: October 1, 2012
      • Also called ″Kindle Paperwhite (5th Generation)″
    • Kindle Paperwhite (2nd gen) (black)
      • Wi-Fi: September 30, 2013
      • 3G: November 5, 2013
      • Also called ″Kindle Paperwhite (6th Generation)″
    • Kindle 7 (black)
      • October 2, 2014
    • Also called ″Kindle (7th Generation)″
      • Kindle Voyage (black)
      • Wi-Fi and 3G: November 4, 2014
    • Also called ″Kindle Voyage (7th Generation)″
      • Kindle Paperwhite (3rd gen) (black or white)
      • Wi-Fi and 3G: June 30, 2015
      • Also called ″Kindle Paperwhite (7th Generation)″
    • Kindle Oasis (1st gen) (black)
      • Wi-Fi and 3G: April 27, 2016
      • Also called ″Kindle Oasis (8th Generation)″
    • Kindle 8 (black or white)
      • July 7, 2016
      • Also called ″Kindle (8th Generation)″
    • Kindle Oasis (2nd gen) (black, silver on back)
      • Wi-Fi and 3G: October 31, 2017
      • Also called ″Kindle Oasis (9th Generation)″


  • Sales of e-readers declined by more than 40% between 2011 and 2016, according to consumer research group Euromonitor International.
  • Amazon is now the undisputed leader in e-readers, holding 60 percent of worldwide device sales this year, according to Euromonitor.
  • See “digital text” for more information on ebook sales.

Future Plans:

Relevant Acquisitions:

  • Liquavista, Acquisition, Undisclosed  (<$100MM)
    • In 2013, Amazon acquired Liquavista, a company known for its “electrowetting” display. The valuation is not public but Samsung had put Liquavista up for sale earlier in the year for less than $100 million. It is speculated that Amazon wants to use the displays to create a full color Kindle.
  • Comixology, Acquisition, Undisclosed $
    • In 2014, Amazon acquired the comics distribution platform Comixology for an undisclosed price. This acquisition shows an increased commitment to controlling and creating content and will be valuable for the Kindle eReader and Kindle fire.
    • “That synergy has led to some profitable initiatives. Last year [2016], the company launched the highly successful ComiXology Unlimited—a monthly subscription service, similar in concept to Amazon’s Kindle Unlimited, that offers access to some 10,000 comics. This year, it started publishing original comics, and added Marvel titles and a recommendation menu. The goal is to lure new subscribers, increase reading frequency, and introduce existing readers to other genres, and it’s working: Recent ComiXology figures revealed new customers comprising 60% of free trials, and ComiXology Unlimited increasing customers’ reading frequency by 58% and encouraging 74% of subscribers to try new genres.”

Fire (Tablet)


  • The Fire Tablet, formerly called the Kindle Fire, is a tablet computer developed by Built with Quanta Computer, the Kindle Fire was first released in November 2011, featuring a color 7-inch multi-touch display with IPS technology and running a custom version of Google’s Android operating system called Fire OS. The Kindle Fire HD followed in September 2012, and the Kindle Fire HDX in September 2013. In September 2014, when the fourth generation was introduced, the adjective “Kindle” was dropped. In September 2015, the fifth generation Fire 7 was released, followed by the sixth generation Fire HD 8, in September 2016. The seventh generation Fire 7 was released in June 2017


  •’s aggressive hardware strategy in the tablet market has proven to be quite successful as the company managed to grow 38.7% on an annual basis. [2017] The low-cost hardware push has always been a means to create a long-standing and ongoing relationship with end users.
  • Amazon’s hardware strategy is likely a loss leader, but the devices build long-term relationships with customers, fuel content sales and drive Prime subscriptions and e-commerce. Amazon’s tablets have also become another vehicle for Alexa.
  • In general the demand for tablets is decreasing. However, the decline in demand is aimed towards high-end tablets (Apple’s iPad, Samsung’s Galaxy Tab). Amazon’s Fire tablet is doing well due to its low cost.
    • “Amazon’s Fire tablets achieved massive growth during the quarter. The company shipped 2.2 million devices in Q1 2016, up 5,422% YoY. The Fire tablet accounted for 5.7% of the market last quarter, up from 0.1% in Q1 2015. Amazon’s success is due in large part to the relatively low cost of its products. The Fire tablet retails for $50, but has also been sold in bundles of 6 for as low as $250, or ~$40 a piece. Amazon is using the device to bring more customers into its retail ecosystem.”

Future Plans:

  • Amazon Fire tablets are an entry point into Amazon’s ecosystem.
    • See digital video
    • See digital text
    • See gaming

Acquisitions and Investments:

  • ComiXology, Acquisition, Undisclosed (<$100MM)
    • “Of course, there are obvious opportunities for synergy: It would be startling if some flavor of ComiXology didn’t wind up as a standard feature of Amazon’s Kindle Fire tablets, for instance. (Naggar told me that the company will continue to sell comics outside of ComiXology–graphic novels are already a major Kindle category–but that even there, cross-pollination is possible.)”

Fire Phone


  • Jun. 18, 2014– (NASDAQ: AMZN)—Amazon today unveiled Fire, the first smartphone designed by Amazon. Fire is the only smartphone with Dynamic Perspective and Firefly, two new breakthrough technologies that allow you to see and interact with the world through a whole new lens
  • “Fire Phone puts everything you love about Amazon in the palm of your hand—instant access to Amazon’s vast content ecosystem and exclusive features like the Mayday button, ASAP, Second Screen, X-Ray, free unlimited photo storage, and more,” said Jeff Bezos, Founder and CEO
  • After roughly a year of dismal sales (and the resulting steep discounts), Amazon’s Fire Phone is no more


Fire TV


In April of 2014, Amazon launched Fire TV, their offering to make it into the expanding market of streaming video. “Amazon Fire TV is part of a multibillion-dollar effort by Amazon to move from selling goods produced by others, which is traditionally a low-margin business, to presiding over the entire process of creation and consumption.” This is a very similar path that Amazon took with books, launching the Kindle and its own publishing arm.


  • “In total, 168.1 million people in the US will use an internet-connected TV this year, up 10.1% over 2016. Usage of smart TVs, which have connectivity built in and need no secondary device, are the largest single subgroup within the category.”
  • “Growth in usage of connected-TV devices remains robust, nevertheless. eMarketer estimates that 38.9 million Americans will use a Roku device at least once a month, up 19.3% vs. 2016. As a result, the device will capture 23.1% of all connected TV users….
  • Roku’s closet competitor in the US is Chromecast, which will have 36.9 million users this year, equating to 22.0% of connected TV users. Meanwhile, Amazon Fire TV will have 35.8 million users in 2017, or 21.3% of connected TV users.”
  • “Amazon Fire is the fastest—growing connected-TV device; it will nearly double its user base by 2020, almost catching up with Chromecast. Next year, Amazon Fire TV will overtake Roku in terms of users.”
  • “According to Parks Associates, of the other major players in this market, only Amazon’s Fire TV had an increase in its share of installed base during the same timeframe. Amazon increased its share from 16% to 24% of streaming media players owned by U.S. broadband households, which moved the e-tailer ahead of Google for second place in streaming media player adoption. Google’s Chromecast now holds an 18% share of installed base, while Apple’s share fell to 15%.”
  • See digital video adoption.

Future Plans:

  • Further integration with Alexa:
    • “Amazon Fire TV owners will now be able to control more video apps using Alexa and their voice, the company announced today. This feature lets you ask Alexa to “watch,” “play,” “pause,” “rewind,” “fast forward,” and more. It can also take you to an individual show, network, or specific genre of programming.
    • Before, Alexa could control Amazon’s own video content in this fashion. But now the same voice commands work with third-party apps like Hulu, NBC, Bravo, and others that quietly launched voice support last week, including Showtime, Sony PlayStation Vue, and CBS All Access.”
  • Expanding Fire TV ecosystem to content outside of streaming services (Netflix, Hulu, etc.)
    • “With little fanfare, Amazon launched its Silk web browser for Fire TV, allowing users with Fire TV, Fire TV Stick, and Fire TV Edition televisions to surf the web from their big screen. The app offers several standard web browser features, like the ability to search or enter URLs, access bookmarks, move forward or back, save passwords, and more. It also uses as the default search engine, and supports searches via voice, thanks to its integrations with Fire TV’s voice remote.”
    • “But the point of the Silk browser for Fire TV is not really web searches – it’s for online video.”
    • “The app includes a section of content called “Trending on the Web,” which highlights popular videos, including those from news sources like CNBC, CNN, Fox and others. You can play, pause, fast forward and rewind these videos using the buttons on the remote, instead of the cursor, which makes for easier viewing.”
  • Competing directly with Google’s Chromecast:

Acquisitions and Investments:

  • Play Impossible, Alexa Accelerator
    • Amazon chose the startup Play Impossible for its inaugural Alexa Accelerator. Amazon is looking to integrate Play Impossible’s Gameball technology into gaming offerings, starting with the Fire TV.
    • “During the Amazon Alexa Accelerator, Play Impossible developed a relationship with the teams for Amazon Alexa and Fire TV. Play Impossible believes voice technology promotes natural play patterns because it’s instant and doesn’t require users to divert their attention towards a digital screen. Alexa is a natural progression for the Gameball’s technology, and the company will begin to invest in voice integration, initially through the Fire TV.”
  • See digital video: Lovefilm, IMDB.

Amazon Echo


  • The Amazon Echo was released in November of 2014 to Prime users on an invite only basis.
  • In July of 2015, the product was extended to all customers. “Echo is a new category of device designed around your voice—it’s always on, hands-free, and fast—just ask for information, music, news, weather, and more from across the room and get answers instantly”.
  • In March of 2016, Amazon expanded the Echo line with the Echo Tap, a bluetooth-enabled speaker with Alexa built in, and the Echo Dot, a smaller version of the original echo at ~half the price.
  • Amazon is continuing to diversify the Echo line; launching the touchscreen-enabled Echo Show in June of 2017:
    • “Amazon is pitching the Echo Show as a central home hub through which users can watch video flash briefings, browse YouTube, control smart home devices, and create visual to-do and shopping lists with the aid of Alexa. Users will also be able to make video and voice calls to friends that have an Echo or the Alexa app on a smartphone via a 5MP camera.”
  • The fashion-focused Echo Look in April of 2017:
    • “With the addition of a camera, Amazon’s new Echo Look device can now see and hear all. The device is a sort of standalone selfie machine so users can take full-length photos and videos of themselves specifically for the sake of checking their fashion choices in the morning.”
  • And the smaller echo with a screen, the Echo Spot:
    • “The device is basically a smaller version of the Echo Show, Amazon’s first Echo device with a touchscreen. It includes a 2.5-inch screen that allows it to double as an alarm clock or a nursery camera, all while still being able to make video calls through the mini screen.”


  • “In fact, more than a quarter of the survey’s respondents said they plan to snag the latest addition [Echo Show] to the Echo line of connected speakers in the next 12 months. Based on that data, we estimate Amazon could sell at least 9 million of these devices in the year ahead. As context, the installed base of all previously released Echo devices is about 9 million, according to our estimates.
  • “Consumers are more excited about the Echo Show than the Echo Look. In an earlier survey, only 39% of our surveyed respondents said they found the Look useful, and only 36% were excited by it. The Look includes a camera (not included with the original Echo) that allows users to take pictures of their outfits and receive fashion recommendations from artificial intelligence (AI) and stylists. However, the Look does not include a screen.”
  • “Amazon Echo, the home speaker that doubles as a virtual assistant, dominates its emerging category with an estimated 15 million units sold, according to new research. That represents 75% of the U.S. market for these Internet-connected devices, which people can use with their voices to order take out food, check their bank accounts, check the weather, and play music.”
  • “An estimated sixty eight percent of all smart speakers sold this year will run on Amazon’s Alexa platform while Google’s Assistant will account for just over twenty percent of sales.”
  • “Amazon’s new Echo Show is the big winner — it has mass-market appeal and looks like it will take off. A large portion of respondents (28%), especially the critical self-identified early adopters (39%), plan to buy the device, showcasing its potential market. The combination of usefulness and excitement will drive consumers to buy the Echo Show.”
  • “The Echo Look seems like it will struggle to attract that same level of interest. The more niche device does not show a potential user base with the same enthusiasm or overall interest. Only 6% see the device as very useful, and it fails to resonate with critical first adopters, with just 7% saying they would buy it as soon as they can.”

Future Plans:

  • A move away from in-house smart speakers?
    • “Manufacturers of first-party speakers such as Amazon, Google and Baidu will account for the overwhelming majority of smart speaker sales in 2017 but their collective share will fall to less than seventy percent by 2020 as they begin to increasingly leave hardware development to third-party manufacturers in order to concentrate on optimizing their virtual personal assistants.”
  • Continue to strengthen automated home ecosystem
    • “Amazon is working on building a pair of smart glasses to house its Alexa voice assistant, and a home security camera that could be linked to its existing Echo connected devices to further expand their capabilities, according to a report in the FT citing people familiar with the company’s plans.”
    • “An updated version of the Echo speaker to go up against the better sound of Apple’s rival HomePod, which will be released in December.”
    • “A connected home-security system that would compete with the new Nest Secure system, unveiled by the Alphabet Inc. unit last week.”
  • See voice product for more on Alexa.

Acquisitions and Investments:

  • Scout, Investment, Alexa Fund
    • “Today, Amazon announced the Alexa Fund, and Scout is among the first companies to be part of it! Amazon’s investment in Scout will drive the creation of an incredible new feature on the Scout system: voice control using Alexa on Amazon Echo. This will make Scout the first home security system to integrate with Amazon Echo.”
  • Body Labs, Acquisition,  $50+MM
    • “It has also released another Echo device (called Look) that’s specifically designed for taking style selfies. So it’s possible the company might be interested in tech that can power visual transformations for fun and fashion-based purposes — such as by being able to add real-time effects to people’s faces and bodies during an Echo Show videocall, for example, a la Snapchat selfie lenses. And Body Labs has a mobile AI called Mosh for adding special effects photos using based on its tech detecting and adapting to the person’s pose.”
    • “So it’s also possible the Body Labs acquisition is mostly an acquihire for Amazon, aimed at picking up talent and expertise for handling the data it’s hoping to gather via its Echo Look device which — notably — contains an on-board depth sensor so could be used to extract 3D data on body form via users’ style selfies.”
  • Ecobee, Investment, Alexa Fund
    • “This funding round marks our largest single Alexa Fund investment to date and builds on our existing relationship with ecobee, who was instrumental in helping us build the Alexa Smart Home Skill API,” said Steve Rabuchin, Vice President of Amazon Alexa. “We’ve been impressed with ecobee’s innovative smart home technologies and their ability to improve the everyday lives of homeowners. We’re excited to see what the future holds for this growing company and the new voice experiences they’ll bring to Amazon Alexa customers.”
    • “This is not the first time the company has had a relationship with Amazon. Earlier this year, Ecobee became the first thermostat maker to tie itself to the Amazon Echo, enabling Alexa’s control over the device. That pairing makes it possible to issue commands like “Alexa, turn the heat to 74 degrees.” After the success of this integration, Amazon decided to chip in money from its $100 million Alexa Fund to support Ecobee.”
  • Luma, Investment, Alexa Fund
    • “Luma, bringing the experience of Surround WiFi to the home, announced today a $12.5 million Series A led by Accel with a significant investment from the Amazon Alexa Fund.”
    • “It’s exciting to see Luma’s vision to bring better and faster WiFi to customers come to life with the availability of its first home system,” said Steve Rabuchin, Vice President, Amazon Alexa. “We saw great promise in Luma to push forward IOT and voice technologies when we invested in the company through the Alexa Fund. The addition of an Alexa skill will bring increased functionality and make it seamless for customers to better control their home internet through their voice.”
  • Sutro, Investment, Alexa Fund
    • Today we announced the next recipient of the Alexa Fund, Sutro. Sutro is creating a connected smart pool monitor that uses breakthrough technology to remove the burden of water maintenance and enable homeowners to focus on enjoying their pool and spa investments. Sutro automates water testing, can ship chemicals when needed either direct from Sutro or through Amazon’s Dash Replenishment Service, and guides users on how and when to maintain their pool. Sutro is using the Alexa Skills Kit so that Amazon Echo users can simply say “Alexa, ask Sutro what temperature is my pool?” or “Alexa, ask Sutro how long until my spa is ready?”
  • Petnet, Investment, Alexa Fund
    • “Today we announced that Petnet is the latest recipient of funding from the Alexa Fund. Petnet is the creator of the SmartFeeder, an app-enabled intelligent feeding appliance, which allows pet owners to manage and tailor feeding times and portions to ensure overall health and well-being. The SmartFeeder integrates with pet food vendors to automate replenishment and intelligently helps pet owners stay aware of their pet’s feeding habits. The smart appliance keeps owners informed of proper feeding portions and delivers insights to them about compatible ingredients specific to their pet’s age, weight and level of activity.”
    • Petnet is building skills for Alexa enabling Echo customers to control their SmartFeeder connected appliance using only voice commands to inquire about feedings, so they can simply ask: “Alexa, how much has Max eaten today?” Petnet will also work to integrate with the Alexa Voice Service.”
  • Mosaic, Investment, Alexa Fund
    • “Musaic is a high-resolution wireless HiFi system that allows customers to listen to music in every room with exceptional sound quality, integrate smart lighting to create and control scenes and moods, and combine with home automation to create a connected smart home. Musaic is building skills for Alexa enabling Echo customers to control their Musaic system using only their voice. Musaic is also working to be one of the first companies to integrate with the Alexa Voice Service.”
  • See voice product and 3rd party applications for more on Alexa.




Amazon’s voice offering is through its ubiquitous personal assistant, Alexa. Alexa was released in November of 2014 for the Amazon Echo device. Since its release, Alexa “has since been integrated into washers, dryers, refrigerators, televisions, other connected speakers, and more.” Alexa has grown from a system that could only handle one-step commands to a system that can handle multi step routines that is supported by an ecosystem of 25,000 Alexa “skills”.


  • “Amazon Alexa is in more than 20 million devices. The vast majority of these are in the Amazon Echo portfolio. If you consider how few Alexa-enabled devices other than Echo have been sold through Q3, it is easy to conclude that Echo sales to date have totaled 19.5-21.5 million units. Non-echo smart speakers with Alexa are estimated to be in the 1 million unit range through Q3 2017.”
  • “Siri remains the most popular virtual assistant with 41.4 million monthly active users in the U.S., according to a new report from measurement firm Verto Analytics out this morning, but it has seen a 15 percent decline since last year – or 7.3 million monthly users. In addition, the study found that engagement with Siri has also dropped by nearly half during this period, from 21 percent to 11 percent.
  • Meanwhile, Amazon Alexa usage has been skyrocketing – jumping 325 percent in monthly active users – that is, from 0.8 million to 2.6 million monthly users, as its user engagement also increased from 10 percent to 22 percent during the same time frame.”
  • “While there are now more than 7,000 Skills to choose from on the Alexa platform, only 31% have more than one consumer review. This means that many of these voice applications are ‘Zombie Skills’: they are accessible but are not heavily used or appreciated. While this issue is not unique to the Alexa app store (present in iOS and Android ecosystems), it is an issue that must be addressed.”
  • “Voice-controlled digital assistants are being incorporated into a wide range of consumer products, and nearly half of U.S. adults (46%) say they now use these applications to interact with smartphones and other devices, according to a Pew Research Center survey conducted this spring.”
  • “Voice assistants are present on a wide range of devices, but the most common way for Americans to use them is on a smartphone: 42% of U.S. adults use voice assistants in this way. Some 14% of the public has used a voice assistant on a computer or tablet, while 8% say they use them on a stand-alone device such as an Amazon Echo or Google Home.”
  • See Echo hardware adoption.

Future Plans:

  • Aggressive Expansion of Alexa
    • “We have this vision of Alexa everywhere,” he said. “We can’t do it all ourselves. There’s no way we’re going to build every smart home device and every wearable… so we opened that up.” Voice-controlled technology is a “significant new interface that humans will use. It’s very convenient and it makes hard things simple.”
    • Cars, Appliances, etc. (build)
  • Increased Investment for Alexa Development
    • “Perhaps the clearest sign that Amazon is investing big in the Echo and the virtual personal assistant that goes with it, Alexa, came from a comment made by David Limp, Amazon’s senior vice president of devices and services: More than 5,000 people now work just on Alexa.
    • Five thousand people is a relatively small slice of Amazon’s overall headcount, which hit 382,400 full- and part-time employees in the most recent quarter. Still, it’s a sharp increase from 15 months ago, when Amazon CEO Jeff Bezos said there were about 1,000 people working on Alexa and the Echo. “It’s just the tip of the iceberg,” he said at the time.”
  • Further opening the Alexa ecosystem to 3rd-Party Hardware
  • More Tools and Support for Developer Ecosystem
    • See third party applications.

Acquisitions and Investments:

  • Alexa Fund:
    • “Just over 18 months ago, we set out to build Amazon’s first dedicated corporate venture capital fund with the same mindset of any new Amazon experiment: Work Hard, Have Fun, Make History. And we’re doing just that. The Alexa Fund, with an initial $100MM investment commitment, has already made 23 investments in companies committed to building delightful experiences using voice as a primary interface.”
    • The Alexa Fund is named after the voice technology that powers Amazon products like the Echo, Amazon Tap, and Echo Dot, as well as Amazon Fire TV and Fire tablets. Alexa’s voice capabilities are purposefully built so developers can use the Alexa Skills Kit (ASK) to create new voice experiences for Amazon’s devices, or Alexa Voice Service (AVS) when they want to embed Alexa into a third-party device.”
  • MARA, Amazon Alexa Fund
    • “MARA is an intelligent, voice-based running assistant that provides performance data and training information during exercise, serving as a virtual running coach or personal trainer. MARA is using the Alexa Voice Service and the Alexa Skills Kit to give users easy access to information about their workouts. For example, ask Echo or any Alexa-enabled device “Alexa, how many miles have I run so far this week?” or “What has my average pace been this week?””318
  • Moijo, Amazon Alexa Fund
    • “Mojio is a leading provider of connected car solutions. The company’s device connects to a vehicle’s OBD-II port and extracts driving performance, on-board systems status, and other diagnostic data. Mojio uses the Alexa Skills Kit to enable customers to use Echo or other Alexa-enabled devices to ask “Alexa, do I need to get gas on the way to work today?” before leaving home or “Alexa, where is my daughter driving the car this evening?”, giving them the peace of mind that the car is healthy and the kids are safe.”
  • Dragon Innovation, Amazon Alexa Fund
    • “With the new funding, Dragon plans to build expertise in using Alexa Voice Services and the Alexa Skills Kit, two sets of APIs and tools that Amazon offers to developers and startups who might want to integrate the Alexa voice functions with their apps, hardware, or Web products, Amazon says. Dragon plans to work with its clients to add voice services to their devices, Amazon wrote in a statement.”
  • Graphiq Inc., Acquisition est. $10-50 Million
  • Evi, Acquisition $26 Million
    • “Amazon Echo, the acclaimed voice-controlled AI device, is built on the technology of a little-known British company, Evi, which Amazon acquired in 2012.”
    • “When it reached the market in 2012, the technology, Evi 11, was positioned as a contender to Apple’s Siri – although not by Tunstall-Pedoe, 47, who says he set out to build something new, not to compete. Now, 11 years after its inception, he can celebrate Evi’s real-world impact. “These technologies are now good enough that they are able to create useful products that change lives and are used daily,” he says.”
  • TrackR, Investment Alexa Fund + Follow-On

Digital Video

Amazon Unbox:

Amazon entered the digital video space in September 2006 with Amazon Unbox. “Amazon Unbox is a digital video download service offering thousands of television shows, movies and other video content from more than 30 studio and network partners from Hollywood and around the world.”

Amazon Video On Demand:

In September of 2008, Amazon renamed their video service Amazon Video On Demand. This signaled a shift in the video product towards streaming. “customers can now instantly watch ad-free movies and television shows on Macs or PCs with Amazon Video On Demand, Amazon’s digital video service offering thousands of movies and television shows. Previously, customers could only download titles and watch them on a PC (using the Amazon Unbox application) or on their TiVo box. Now customers can either watch instantly within their web browser or download using the Unbox application and watch anytime.”

Amazon Prime Video:

On February 22, Amazon launched Amazon Prime Video. This move position the Amazon Video offering as a part of the Prime ecosystem — offering access to video streaming at no additional cost. “, Inc. (NASDAQ:AMZN) today announced the launch of a new benefit for Amazon Prime members: unlimited, commercial-free, instant streaming of more than 5,000 movies and TV shows. This new benefit is being added at no additional cost — Prime membership will continue to be $79 per year.”

Since integrating with Prime, Amazon has moved upstream and is now positioning itself as a force to be reckoned with in digital content production.


  • “eMarketer estimates that close to half (46.8%) of US internet users will watch video content via Netflix at least once per month in 2017—the largest audience of any over-the-top (OTT) SVOD service. By comparison, Amazon will be a considerable way back with 31.2% penetration.”
  • “It appears the majority of people who subscribe to Amazon Prime do, in fact, use the streaming service with some frequency, but the 37% number was surprising, at least until we dug into some specific answers.”.114
  • “Currently 61% of viewers subscribe to Netflix, 36% to Amazon Prime, and 22% to Hulu.”
  • “While Netflix remains the clear leader in the OTT market, it’s also clear that other services are now establishing their own presence. Netflix reached an impressive 75 percent of OTT homes as of  December 2016, but YouTube had a large OTT footprint being viewed in 53 percent of those homes. Amazon Video was third with 33 percent reach, and Hulu was fourth at 17 percent. In fact, there are now 11 OTT services that reach one million or more homes in a given month.”
  • “Netflix’s dominance is also being challenged by Amazon Video, which appears to be growing the OTT pie through its tie-in to Amazon Prime and the Fire TV platform. At the time of this writing, Netflix is the top OTT service on every viewing platform from Roku to game consoles to Blu-ray Disc players, with one big exception: Fire TV. On the Fire TV stick/box, Amazon is first, followed by YouTube. Netflix is third.”

Future Plans:

  • Increased Spend on Content – original and otherwise
    • “Amazon CFO Brian Olsavsky highlighted the value of video to Amazon during its earnings call on Thursday. He said that Amazon is going to “significantly increase [its] content spend” on its video offerings because the company is seeing better engagement and conversions from Prime members who use the video service.”
    • “Demand for Netflix originals was eight to nine times higher than demand for Amazon Video and Hulu originals in 2016, according to research company Parrot Analytics.”
    • “In July, Amazon CFO Brian Olsavsky said Amazon would “nearly double” its investment in video, while “tripling” its amount of original content in Prime Video, over the remainder of 2016. This new estimate from JPMorgan on the 2017 budget suggests that spending will continue to blast upward.”
    • “But Amazon isn’t only focused on shows. Amazon and the NFL recently struck a $50 million deal for Amazon to stream 10 Thursday night games, according to The Wall Street Journal. This is a similar deal to the one the NFL had with Twitter last year, except about five times larger for the same number of games. These games will only be available as part of Amazon Prime Video, and the general public won’t be able to watch.”
  • Continue to Expand Digital Video Globally
    • “Amazon has made the Prime Video streaming service available worldwide, following the global launch of Netflix in January 2016. As of 14 December 2016, Amazon Prime Video was available in 200 countries, excluding China, Syria, Iran, and North Korea. In total, the launch encompasses 242 distinct geographical territories.”
  • Extend the use of Twitch beyond gaming
    • “From live-streaming the Democratic National Convention to sharing a bizarre South Korean channel where people watch other people eat meals, Twitch is definitely expanding into disparate areas as it strives to reach demand in every far corner of the internet.”
    • “There’s clear demand from the creator side and the viewer side for this non-gaming content,” Shear added. “Gamers want to watch more than just video games.”

Acquisitions and Investments:

  • Twitch, Acquisition $1B
    • The acquisition makes even more sense when you think about services like Amazon Instant Video. Amazon’s been in the video-on-demand business since 2006, and with its recent shift to an all-you-can-eat Amazon Prime streaming video model, whereby Prime members gain access to scads of video content (including the company’s coup-of-coups exclusive deal with HBO) for a Netflix-ian flat fee, capturing new eyeballs by adding a service like Twitch fits hand-in-glove with the company’s ostensible goals. And think of what else the purchase buys Amazon in terms of new eyeballs: Twitch is already an entrenched and critical presence on both Sony’s PlayStation 4 and Microsoft’s Xbox One.”
    • “While the video-streaming service still runs as a standalone, the two companies have joined forces to grow Amazon’s Prime membership by creating Twitch Prime, a $10.99 monthly membership that gives Twitch users the same benefits as Amazon Prime along with discounts on games and other perks.”
  • IMDB, Acquisition, <$55 Million (lump sum for 3 acquisitions)
    • “Jeff explained Amazon was primarily a bookseller, but would be moving from books to other things, such as video, and he was looking for a site to partner with,” explained Needham. “Maybe a licensing deal, or an outright acquisition.
    • “First arriving for Kindle Fire in 2012, before landing on Fire TV and the Nintendo Wii U, Amazon X-Ray for Movies and TV uses IMDb data to serve up relevant information related to what’s happening on-screen in Amazon Video streams.”

Digital Music and Audio:


Following section pulled from Amazon Music Wikipedia

Amazon Music (previously Amazon MP3) is a music streaming platform, online music store, and former music locker operated by Launched in public beta on September 25, 2007,  in January 2008 it became the first music store to sell music without digital rights management (DRM) from the four major music labels (EMI, Universal, Warner Music, and Sony BMG), as well as many independents All tracks were originally sold in 256 kilobits-per-second variable bitrate MP3 format without per-customer watermarking or DRM; however, some tracks are now watermarked. Licensing agreements with recording companies restrict the countries in which music can be sold: sells music only to US customers while sells music only to UK customers.


  • “Millions of Prime members already stream music on Amazon Prime every month, making Amazon Music one of the most popular music streaming services in the world. The Prime catalog has grown to more than two million songs and over one thousand hand-curated playlists and personalized stations. Today, with the launch of Amazon Music Unlimited, Prime members who want even more music have access to a catalog of tens of millions of songs and thousands of hand-curated playlists and personalized stations at a breakthrough Prime member price of $7.99/month or $79/year (which equals only $6.58/month).”
  • “In the Annual Music Study, we observed that 13 percent of Echo users had listened to Amazon Music Unlimited, whether through a paid subscription, a trial or sharing an account. But we noticed something else that was interesting. There appears to be a halo effect on services that are on the Echo platform. As shown in the chart below, usage of iHeartRadio is 64 percent higher among Echo users compared to the total internet population.  TuneIn has a nearly 4:1 lift in usage incidence among Echo users. Spotify has a more than 2:1 increase.”
  • “Parks Associates announced today that the majority of paid streaming music services experienced an increase in their number of subscribers in 2016, with Amazon Prime Music leading the market with 15% of U.S. broadband households. 360 View: Digital Media & Connected Consumers notes Amazon Prime Music experienced a 50% increase in subscription during the one-year period. In addition to Prime Music, Amazon also launched Amazon Music Unlimited late last year, an on-demand music streaming service with tens of millions of songs and multiple subscription options.”
  • “Amazon’s bundled service model has been a successful strategy in boosting the company’s status in multiple content verticals,” said Glenn Hower, Senior Analyst, Parks Associates. “Nearly one-half of streaming music subscribers, the equivalent of 15% of all broadband households, indicate they have a subscription to Amazon Prime Music. The number of households with access to Amazon’s music services through a Prime subscription is higher, as 28% of broadband households indicate they subscribe to Amazon Prime Video, so the number of streaming music subscribers likely reflects actual usage of the streaming music portion of Amazon’s service.”

Future Plans:

  • Focusing music plans around Alexa, Echo
    • “Boom went on to discuss Amazon’s two fundamental core strategies regarding music, which are letting their users find and consume music through Prime and Alexa. Amazon’s sales funnel onboarding process includes moving people who were already streaming music, then moving them further down the sales funnel to convert to its paid service.”
    • “Steve Boom said, “and then we find with Echo and Alexa, is bringing people into premium streaming that had never used it before.” He continues, “And because it’s something that you use every day, and it’s so easy, the idea of paying a few bucks a month for a streaming service…you know, when we look at the conversion rates that we have from people using their free trial on an Echo, then converting into premium, we see subscription levels that the industry has never seen before.”
    • Music “top activity” assc. w/ Echo
  • Thinking of music for groups rather than individuals
    • “By merging and integrating Amazon music into the Echo and Alexa products, consumers are now able to take advantage and experience communal listening, versus the antisocial environment that the smartphone created (usually tuned out with headphones).”
    • “In the smartphone era, we think of music as moving out of the home and living room,” Boom said. “With voice, it’s moving it back in.”

Acquisitions and Investments:

Digital Text:

The Kindle Store: Following section pulled from Kindle Store Wikipedia

The Kindle Store is an online e-book e-commerce store operated by Amazon as part of its retail website and can be accessed from any Amazon Kindle, Fire tablet or Kindle mobile app. At the launch of the Kindle in November 2007, the store had more than 88,000 digital titles available. This number increased to more than 275,000 by late 2008, and exceeded 765,000 by August 2011. In July 2014, there were over 2.7 million titles available at the U.S. store and as of December 2017 there are nearly 5.9 million titles available in the U.S. Content from the store is purchased online and downloaded using either Wi-Fi or Amazon’s 3G Whispernet to bring the content to the user’s device. One of the innovations Amazon brought to the store was one-click purchasing that allowed users to quickly purchase an e-book. The Kindle Store users a recommendation engine that looks at purchase history, browsing history, and reading activity, and then suggests material it thinks the user will like.


  • “Taken all together, Amazon accounts for more than 80% of English-language ebook purchases, Apple another 10%, Kobo 2% and Nook 3%”
  • “Amazon Imprints have made the most market headway in the US. Despite being single-retailer exclusive to Amazon Kindle, the dozen or so Amazon “house” publishing imprints between them account for 14% of all US ebook sales, 10% of all UK ebook sales, and 8% of Australian ebook sales. In Canada, the Amazon Imprint footprint is a much more modest 3% of all ebook sales, largely due to the substantial shares of the overall Canadian ebook market held by Kobo (25%) and Apple (14%).”
  • “The statistic shows the websites consumers used to purchase e-books in the United States in 2017. During the survey, 85 percent of respondents stated that they purchased e-books at or with the Kindle-app.”
  • “But top writers proved surprisingly loyal to their gatekeepers, and Amazon had to spend a lot of money on two dubious projects: a million dollars for “The 4-Hour Chef,” by the self-help guru Timothy Ferriss, and eight hundred thousand dollars for “My Mother Was Nuts,” a memoir by Penny Marshall, the “Laverne & Shirley” star. In hardcover, Ferriss’s book has sold a fraction of the numbers of his two earlier self-help books; Marshall’s has sold seventeen thousand. Nearly all of Amazon’s other books have fared worse: “Actors Anonymous,” a novel by James Franco, has sold fewer than five thousand. (Amazon claims to have sold many more copies of these titles as e-books.) In the past year, Amazon Publishing has barely been a presence at auctions, and several editors have departed; last month, Kirshbaum left the company, having failed at the task Amazon gave him. The new publisher, Daphne Durham, has spent her entire career at Amazon, and will remain in Seattle. Grandinetti, keeping his game face on, told me, “Amazon Publishing is off to a very good start.””
  • “There was a practical reason for the failure. Hardcover copies were printed and distributed in a partnership with Houghton Mifflin Harcourt, under an imprint called New Harvest, with Amazon’s name missing from the spine. But bookstores weren’t fooled. Barnes & Noble and nearly all the independents refused to stock its books—why help their mortal enemy?—and no

Acquisitions and Investments:

Avalon Books, Acquisition Undisclosed $

  • “Avalon has a long tradition in publishing wonderful stories that affirm a positive way of life,” said Philip Patrick, Director, Business Development, Rights and Licensing. “We are thrilled to have these talented writers join our publishing program. None of these titles have been digitized yet and we know Kindle customers will delight in this great new offering.”

TenMarks, Acquisition Undisclosed $

  • “Amazon and TenMarks share the same passion for student learning. TenMarks’s award-winning math programs have been used by tens of thousands of schools and Amazon engages with millions of students around the world through our Kindle ecosystem,” said Dave Limp, Vice President, Amazon Kindle. “Together, Amazon and TenMarks intend to develop rich educational content and applications, across multiple platforms, that we think teachers, parents and students will love.”
  • “Why would Amazon need a tool to make math lessons? Well, math curriculum — whether it be digital or found in a textbook — is essentially just another form of content. And the textbook publishing industry generates over $5 billion per year from lower educational material (Kindergarten to 12th grade) alone — making it a very lucrative opportunity for Amazon to make money.”



  • February 2009: “Online retailer has stepped into another online shopping segment – video game downloads. With the unveiling of its new downloadable PC game store today, more than 600 titles are immediately available.”
  • August 2012: “The Seattle-based company released its first social game Monday on Facebook and announced the creation of a new team called Amazon Game Studios.Amazon gave few details about the new division except that it’s focused on developing “innovative, fun and well-crafted games,” a sign that more titles are on the way. It also noted that the team is hiring.”
  • 2014: Amazon Acquires Twitch (see acquisitions and investments) and releases a Fire TV with an optional gaming controller capable of running android. Other high-profile acquisitions and hires:
    • “So far in 2014, the company has acquired Double Helix, the Southern California-based company behind such games as Killer Instinct, and hired a bevy of industry talents, including leading game designers Clint Hocking (Far Cry 2) and Kim Swift (Portal) . By doing so, it’s rapidly built out Amazon Game Studios (AGS), the group within the company which produces games–some of which are done entirely in-house, and some of which are the result of collaboration with outside firms.”
    • “At the same time, Amazon has spent the year rolling out an array of devices to play those games on: not just new tablets in its Fire line but also its first smartphone and a TV box that goes Roku and Apple TV one better by treating gaming as a primary activity.”
  • Present: 3 Platform games scheduled to be released


Future Plans:

Acquisitions and Investments:

  • Twitch, Acquisition $1B“Like Twitch, we obsess over customers and like to think differently, and we look forward to learning from them and helping them move even faster to build new services for the gaming community.”
  • ““Talking to Mike [Frazzini, VP of Amazon Games] along the way, it really became clear that we have a shared vision for the gaming industry. We see the same trends in the same space,” said Shear. “And it’s also their culture. Amazon thinks about problems and solving those problems in the same way we do at Twitch. They think about how you can build things for customers, and how to do that in the long run.””
  • ““I was never, like, ‘How does this, that or the other company do it, and maybe we should,’” said Frazzini. “I’ve always thought about it in much simpler terms, through the lens of the customer experience and what we wanted to create, where we thought we could built inventive new experiences that would resonate. That’s been the driving motivation. If you look at Amazon fairly high-level, what you end up with is, we have a commerce business, and games are a very important part of the commerce business.””
  • “Amazon loves people who buy games through Amazon, said Frazzini, because gamers tend to come back and buy all sorts of other things. But it’s also about more than consumers, he said, talking about the importance of catering to the sort of premium content developers the company’s been wooing with its cloud-focused Amazon Web Services model–which is just another way of saying Amazon’s Twitch purchase is (at least in part) about growing its gaming cred.”
  • GameSparks, Acquisition $10M“Amazon’s interest in GameSparks fits in well with what the company has built so far in the gaming space, and specificallywith games hosted in the cloud. The startup built a cloud-native business, embodying the belief (shared by Amazon) that the cloud is the logical and inevitable evolution of how games are, should be, and will be built and administered in our connected, mobile-friendly and globalised world.”
  • Bodylabs, Acquisition $70-100M“Amazon runs its own games studios, distributes Lumberyard, and has GameLift and GameSparks back-end services for multi-player games. Body Labs would be a natural extension for gamers to have to develop photo-realistic, moving body avatars. Adding on this kind of service would continue to expand their digital revenue, so it makes sense, although the company has not commented on this direction.”
  • Double Helix, Acquisition <$100M, Mostly Likely ~$50M“Amazon Game Studios Orange County is the relatively new name of Double Helix, the game studio Amazon acquired back in 2014. At the time of the acquisition, the developer was best-known for its revival of Killer Instinct, turning the arcade fighter into a tournament-based, online-focused game. That experience of building Killer Instinct led the team to want to explore the competitive online space even further, and that desire only grew later on in 2014, when Amazon acquired game streaming powerhouse Twitch.”
  • “Amazon has acquired Double Helix as part of our ongoing commitment to build innovative games for customers.”
  • Reflexive Entertainment, Acquisition Undisclosed Terms“Reflexive isn’t particularly new to the game. The Orange County, California based company was founded in 1997 and produced games like Wik and the Fable of Souls, Big Kahuna Reef, Music Catch and the Ricochet series. The company also set out to build a development and distribution platform for PC, Mac and free web games dubbed Reflexive Arcade, which is likely the main reason why Amazon was interested in an acquisition. The blog post mentions the fact that Reflexive will now be able to tap into the Amazon distribution channel for its own games.”
  • Play Impossible, Investment – Amazon Alexa Fund“In 2018, its games will also be operable from a Fire TV, and the Alexa AI and specific voice commands will continue to be a key component of new games as they’re developed.”


Following section pulled from Wikipedia

A9 was created by in 2003 as an independent company aimed at producing technology for search and advertising. They moved into the building previously used by the DEC Systems Research Center in Palo Alto, California. One purpose of was to leverage algorithms, and the name was chosen as a numeronym to represent that word (i.e. ‘A’ + 9 other letters). The office was in Silicon Valley, near Stanford University. Under the direction of its first president, Udi Manber, A9 focused on several areas, including the destination website, product search, and a search advertising platform. Some early A9 services such as “search inside the book” continued, while others have been discontinued. The A9 search engine powers product search for and several other eCommerce retailers.

Product Search (Where Amazon is today):

  • “Now, 49 percent of consumers turn to Amazon first when shopping for products online, with search engines taking 36 percent and retailers falling farther back at 15 percent. In 2016, a Survata study – previously commissioned by BloomReach – found Amazon at 55 percent, search engines at 28 percent and retailers at 16 percent.”
  • “Nearly 46 percent will start on search engines when they have no idea of what they want, with Amazon trailing at 39 percent. The remainder, 15 percent of U.S. consumers, said they’d start at a preferred retailer when they weren’t sure what they wanted. Related to specific product categories, electronics, apparel and home furnishings had the highest likelihood for consumers to start on a search engine over Amazon.”
  • “The vast majority (65%) of consumers who shop online reported searching on Amazon all or most of the time. And Amazon has had great success bringing people from the beginning of the purchase process to the end, as 57% of those who usually search on Amazon buy from the e-commerce titan most or all of the time. This is an impressive conversion rate, and it gives competitors little opportunity to draw consumers away from Amazon, since many consumers start on Amazon and never leave the site.”

Cloud Search (AWS):

  • “We use the best scanning techniques combined with advanced data science to monitor the market share of over 5,000 technology products, including Enterprise Search. In the Enterprise Search category, Amazon CloudSearch has a market share of about 3.9%.”

Future Plans:

  • Focus on Mobile
    • Search“Search engines are the most popular option for mobile shopping, with consumers favoring them over retailers’ websites and apps, which includes Amazon’s. M-commerce is estimated to have grown from 19% of US e-commerce sales in 2016 to 23% in 2017, so search engines’ mobile advantage may be helping it gain on Amazon in product search. Mobile shopping is projected to make up nearly half of all US e-commerce by 2021, so search engines would be wise to invest in their mobile shopping search experience going forward.”
    • See SnapTell Acquisition

Acquisitions and Investments:

In this training, you will

3rd Party Applications and Developer Ecosystem

Amazon App Store

Following section pulled from Amazon Appstore Wikipedia

The Amazon Appstore for Android is an app store for the Android operating system operated by It was opened on March 22, 2011 and was made available in nearly 200 countries. Developers are paid 70% of the list price of the app or in-app purchase.

On September 28, 2011, Amazon launched the Kindle Fire tablet.The tablet, designed for media consumption in the Amazon ecosystem, relies solely on the Amazon Appstore for its marketplace, eschewing Google Play. Alongside the tablet was a new design for the Amazon Appstore designed to better integrate with the tablet’s user interface.


Number of apps available in leading app stores as of March 2017, Statista, 2017

Amazon Underground:


  • In August 2015 we launched the Underground Actually Free program, and since that time we added thousands of apps, expanded internationally, and added support for Fire tablets. At the same time the Amazon Appstore increased selection to offer more than 800,000 apps and games while expanding our footprint across a growing portfolio of Fire tablets, Fire TV, and Android devices as well as 236 countries and territories worldwide. In addition to expanding the reach of Appstore, we created new monetization opportunities for developers. Developers can now earn revenue outside their game by converting game characters and imagery into branded t-shirts via Merch by Amazon. And with Amazon Coins, Appstore customers can save on every game in the Amazon Appstore. Customers can buy Amazon Coins at a discount, while developers continue to get their full 70 percent revenue share.
  • The Underground app store launched just shy of two years ago with a weird sales pitch to developers: let us give your downloads away, and we’ll pay you a penny for every five minutes someone uses your app. The idea is that Underground versions of games and apps would not only be free to download but also have all in-app purchases removed—which might mean that players get hooked and rack up enough hours to get developers paid by Amazon’s weird system.
  • However, the storefront has its share of issues. It is only compatible with Android phones and tablets, and any participating app must be downloaded and installed either through the Amazon Underground app or the more recently updated Amazon app. (This also slaps interstitial, Amazon-related ads onto any participating app.) Bizarrely, Amazon never ported Underground to its line of Fire TV devices, which all run on an Android base.
  • Amazon Underground closed in fall of 2017.


  • Royalties paid to developers are up 3,600 percent since Amazon Underground launched in August. They grew 50 percent from December to January alone. The number of developers on the platform has more than tripled since launch, and the customer base has grown 870 percent.
  • You can attribute much of that growth to the popularity of Amazon Fire tablets, which come with Underground pre-loaded. That’s especially important, because Underground can be tricky to access on devices beyond Amazon’s ecosystem. Android owners must contort to a multi-stage download process to install Underground on their phones; for obvious competitive reasons, Google doesn’t allow apps that sell apps and games in its Play Store. The iOS faithful, meanwhile, can’t access Underground at all.

Amazon Alexa Skills

Acquisitions and Investments:

Amazon Web Services (Aws)


Section pulled from Amazon cloud has 1 million users and is near $10 billion in annual sales, Ars Technica, 2015

AWS launched in March 2006 with the Simple Storage Service (S3). It expanded with the Elastic Compute Cloud (EC2) a few months later, letting customers rent virtual machines over the Internet. The service allowed developers to obtain computing capacity on demand without having to operate their own servers, and over the years, many startups have built online businesses with Amazon’s data centers and services providing the back-end infrastructure. It’s not just small companies relying on Amazon, though, as big names like Adobe, Capital One, GE, MLB Advanced Media, Netflix, and Pinterest use the online platform.

Amazon has also been used by scientists to run giant calculations that would normally require a supercomputer.

“Today, AWS offers more than 70 services for compute, storage, databases, analytics, mobile, Internet of Things, and enterprise applications,” Bezos wrote. “We also offer 33 Availability Zones across 12 geographic regions worldwide, with another five regions and 11 Availability Zones in Canada, China, India, the US, and the UK to be available in the coming year.”

Offerings: (Pulled from Cloud Products)


  • Amazon EC2: Virtual Servers in the Cloud
  • Amazon Elastic Container Service: Run and Manage Docker Containers
  • Amazon Elastic Container Service for Kubernetes: Run Managed Kubernetes on AWS
  • Amazon Elastic Container Registry: Store and Retrieve Docker Images
  • Amazon Lightsail: Launch and Manage Virtual Private Servers
  • AWS Batch: Run Batch Jobs at Any Scale
  • AWS Elastic Beanstalk: Run and Manage Web Apps
  • AWS Fargate: Run Containers without Managing Servers or Clusters
  • AWS Lambda: Run your Code in Response to Events
  • AWS Serverless Application Repository: Discover, Deploy, and Publish Serverless Applications
  • Auto Scaling: Automatic Elasticity
  • VMware Cloud on AWS: Build a Hybrid Cloud without Custom Hardware


  • Amazon S3: Scalable Storage in the Cloud
  • Amazon EBS: Block Storage for EC2
  • Amazon Elastic File System: Managed File Storage for EC2
  • Amazon Glacier: Low-cost Archive Storage in the Cloud
  • AWS Storage Gateway: Hybrid Storage Integration
  • AWS Snowball: Petabyte-scale Data Transport
  • AWS Snowball edge: Petabyte-scale Data Transport with On-board Compute
  • AWS Snowmobile: Exabyte-scale Data Transport


  • Amazon Aurora: High Perfomance Managed Relational Database
  • Amazon RDS: Managed Relational Database Service for MySQL, PostgreSQL, Oracle, SQL Server, and MariaDB
  • Amazon DynamoDB: Managed NoSQL Database
  • Amazon ElastiCache: In-memory Caching System
  • Amazon Redshift: Fast, Simple, Cost-effective Data Warehousing
  • Amazon Neptune: Fully Managed Graph Database Service
  • AWS Database Migration Service: Migrate Databases with Minimal Downtime


  • AWS Application Discovery Service: Discover On-Premises Applications to Streamline Migration
  • AWS Database Migration Service: Migrate Databases with Minimal Downtime
  • AWS Migration Hub: Track Migrations from a Single Place
  • AWS Server Migration Service: Migrate On-Premises Servers to AWS
  • AWS Snowball: Petabyte-scale Data Transport
  • AWS Snowball Edge: Petabyte-scale Data Transport with On-board Compute
  • AWS Snowmobile: Exabyte-scale Data Transport

Networking and Content Delivery:

  • Amazon VPC: Isolated Cloud Resources
  • Amazon CloudFront: Global Content Delivery Network
  • Amazon Route 53: Scalable Domain Name System
  • Amazon API Gateway: Build, Deploy, and Manage APIs
  • AWS Direct Connect: Dedicated Network Connection to AWS
  • Elastic Load Balancing: High Scale Load Balancing

Developer Tools:

  • AWS CodeStar: Develop and Deploy AWS Applications
  • AWS CodeCommit: Store Code in Private Git Repositories
  • AWS CodeBuild: Build and Test Code
  • AWS CodeDeploy: Automate Code Deployment
  • AWS CodePipeline: Release Software using Continuous Delivery
  • AWS Cloud9: Write, Run, and Debug Code on a Cloud IDE
  • AWS X-Ray: Analyze and Debug Your Applications
  • AWS Command Line Interface: Unified Tool to Manage AWS Services

Management Tools:

  • Amazon CloudWatch: Monitor Resources and Applications
  • AWS CloudFormation: Create and Manage Resources with Templates
  • AWS CloudTrail: Track User Activity and API Usage
  • AWS Config: Track Resource Inventory and Changes
  • AWS OpsWorks: Automate Operations with Chef and Puppet
  • AWS Service Catalog: Create and Use Standardized Products
  • AWS Systems Manager: Gain Operational Insights and Take Action
  • AWS Trusted Advisor: Optimize Performance and Security
  • AWS Personal Health Dashboard: Personalized View of AWS Service Health

Media Services:

  • Amazon Elastic Transcoder: Easy-to-use Scalable Media Transcoding
  • Amazon Kinesis Video Streams: Process and Analyze Video Streams
  • AWS Elemental MediaConvert: Convert File-based Video Content
  • AWS Elemental MediaLive: Convert Live Video Content
  • AWS Elemental MediaPackage: Video Origination and Packaging
  • AWS Elemental MediaStore: Media Storage and Simple HTTP Origin
  • AWS Elemental MediaTailor: Video Personalization and Monetization


  • Amazon Athena: Query Data in S3 using SQL
  • Amazon EMR: Hosted Hadoop Framework
  • Amazon CloudSearch: Managed Search Service
  • Amazon Elasticsearch Service: Run and Scale Elasticsearch Clusters
  • Amazon Kinesis: Work with Real-time Streaming Data
  • Amazon Redshift: Fast, Simple, Cost-effective Data Warehousing
  • Amazon Quicksight: Fast Business Analytics Service
  • AWS Data Pipeline: Orchestration Service for Periodic, Data-driven Workflows
  • AWS Glue: Prepare and Load Data

Security, Identity & Compliance

  • AWS Identity & Access Management: Manage User Access and Encryption Keys
  • Amazon Cloud Directory: Create Flexible Cloud-native Directories
  • Amazon Cognito: Identity Management for your Apps
  • AWS Single Sign-On: Cloud Single Sign-On (SSO) Service
  • Amazon GuardDuty: Managed Threat Detection Service
  • AWS Direct Connect: Dedicated Network Connection to AWS
  • Amazon Inspector: Analyze Application Security
  • Amazon Macie: Discover, Classify, and Protect Your Data
  • AWS Certificate Manager: Provision, Manage, and Deploy SSL/TLS Certificates
  • AWS CloudHSM: Hardware-based Key Storage for Regulatory Compliance
  • AWS Directory Service: Host and Manage Active Directory
  • AWS Key Management Service: Managed Creation and Control of Encryption Keys
  • AWS Organizations: Policy-based Management for Multiple AWS Accounts
  • AWS Shield: DDoS Protection
  • AWS WAF: Filter Malicious Web Traffic

Machine Learning:

  • Amazon SageMaker: Build, Train, and Deploy Machine Learning Models at Scale
  • Amazon Comprehend: Discover Insights and Relationships in Text
  • Amazon Lex: Build Voice and Text Chatbots
  • Amazon Polly: Turn Text into Lifelike Speech
  • Amazon Rekognition: Analyze Image and Video
  • Amazon Machine Learning: Machine Learning for Developers
  • Amazon Translate: Natural and Fluent Language Translation
  • Amazon Transcribe: Automatic Speech Recognition
  • AWS DeepLens: Deep Learning Enabled Video Camera
  • AWS Deep Learning AMIs: Quickly Start Deep Learning on EC2
  • Apache MXNet on AWS: Scalable, High-performance Deep Learning
  • TensorFlow on AWS: Open-source Machine Intelligence Library

Mobile Services:

  • AWS Mobile Hub: Build, Test, and Monitor Apps
  • Amazon API Gateway: Build, Deploy, and Manage APIs
  • Amazon Pinpoint: Push Notifications for Mobile Apps
  • AWS AppSync: Real-time and Offline Mobile Data Apps
  • AWS Device Farm: Test Android, FireOS, and iOS Apps on Real Devices in the Cloud
  • AWS Mobile SDK: Mobile Software Development Kit

AR and VR

  • Amazon Sumerian: build and Run VR and AR Applications

Application Integration

  • AWS Step Functions: Coordinate Distributed Applications
  • Amazon Simple Queue Service (SQS): Managed Message Queues
  • Amazon Simple Notification Service (SNS): Pub/Sub, Mobile Push and SMS
  • Amazon MQ: Managed Message Broker for ActiveMQ

Customer Engagement

  • Amazon Connect: Cloud-based Contact Center
  • Amazon Pinpoint: Push: Notifications for Mobile Apps
  • Amazon Simple Email Service (SES): Email Sending and Receiving

Business Productivity

  • Alexa for Business: Empower your Organization with Alexa
  • Amazon Chime: Frustration-free Meetings, Video Calls, and Chat
  • Amazon WorkDocs: Enterprise Storage and Sharing Service
  • Amazon WorkMail: Secure and Managed Business Email and Calendaring

Desktop and App Streaming

  • Amazon WorkSpaces: Desktop Computing Service
  • Amazon AppStream 2.0: Stream Desktop Applications Securely to a Browser

Internet of Things

  • AWS IoT Core: Connect Devices to the Cloud
  • Amazon FreeRTOS: IoT Operating System for Microcontrollers
  • AWS Greengrass: Local Compute, Messaging, and Sync for Devices
  • AWS IoT 1-Click: One Click Creation of an AWS Lambda Trigger
  • AWS IoT Analytics: Analytics for IoT Devices
  • AWS IoT Button: Cloud Programmable Dash Button
  • AWS IoT Device Defender: Security Management for IoT devices
  • AWS IoT Device Management: Onboard, Organize, and Remotely Manage IoT Devices

Game Development

  • Amazon GameLift: Simple, Fast, Cost-effective Dedicated Game Server Hosting
  • Amazon Lumberyard: A Free Cross-Platform 3D Game Engine with Full Source, Integrated with AWS and Twitch

Highlight — Recent NLP Additions:

Amazon Voice Service: “Use the Alexa Voice Service (AVS) to add intelligent voice control to any connected product that has a microphone and speaker. Your customers will be able to ask Alexa to play music, answer questions, get news and local information, control smart home products, and more on their voice-enabled products.”

Amazon Language additions to AWS: In November of 2017, “Amazon has launched three language oriented services on Amazon Web Services (AWS), the company’s on-demand cloud computing platform. The services are called Amazon Comprehend, Amazon Translate and Amazon Transcribe. Developers can easily integrate the services into their own applications, and use them in conjugation with other services from Amazon.”


Acquisitions and Investments:

Machine Learning and Artificial Intelligence



  • Using our pre-packaged versions of popular deep learning frameworks running on P2 compute instances (optimized for this workload), customers are already developing powerful systems ranging everywhere from early disease detection to increasing crop yields.
  • Amazon launched its own education initiative this week. A new $250 camera called DeepLens is designed to give developers an easy way to learn about machine learning—and Amazon services. Carnegie Mellon University plans to use the device with students, and other colleges are expected to do the same.
  • “I am not a data scientist, nor do I have any idea how facial recognition or artificial intelligence works,” Adzima cheerfully admits. Within a couple of months, however, he was able to fashion a system that uses Rekognition to match newly taken photos with ones from the archive. So far, it’s helped identify 20 suspects. It was also an extraordinary bargain. The initial setup cost the sheriff’s office only around $400; the monthly bill from Amazon Web Services is about $6. “With every dollar I spend, I’m accountable to the taxpayers,” says Adzima. “We’re spending such small amounts of money and we’re getting a huge return on investment.”
  • We have more machine learning running on the platform than anywhere else” he claims, meaning AWS is doing more A.I. than Google or any other facility in the world. Wood can rattle off names of customers using machine learnings, such as consumer health software provider ZocDoc, which has developed a machine vision application with it; and InstaCart, the grocery delivery service that uses it to know where produce is at various local stores; and Pinterest, the photo-sharing service, that uses it to classify images; and StitchFix, the fashion startup that Wood says uses it “to predict the next fashion trend.”
  • We then asked both Massingham and Wood which areas of industry is AWS gaining the most traction in relation to AI. Interestingly, their responses differed slightly. Massingham spoke of customer services, finance, and even education, whereas Wood felt their AI was being used most innovatively in healthcare.467
  • However, one of the most interesting areas that Massingham mentioned was education. He mentioned how they were seeing AI being used in language tuition. He spoke of language tutoring apps such as DuoLingo and another app called Whizz-kidz, which teaches children with learning difficulties how to read and write. He even spoke of how the Royal Institute for the Blind used Amazon Polly to design software that can transcribe text into audio for blind people. Then he discussed how NASA was using Lex to talk to ROV-E on Mars!
  • With regards to healthcare, Wood discussed how companies like GE Healthcare were using AI to create “medical imaging reports”. He said that AI was, “driving outcomes for patients in care,” and that we are heading ever quicker to what he referred to as, “digitised health”. There are other companies like AliveCor developing AI-based tools to help doctors better detect symptoms that could potentially lead to strokes.

Future Plans:

Acquisitions and Investments:



Some other large e-commerce sellers use Amazon to sell their products in addition to selling them through their own websites. The sales are processed through and end up at individual sellers for processing and order fulfillment and Amazon leases space for these retailers. Small sellers of used and new goods go to Amazon Marketplace to offer goods at a fixed price.


  • As of the last reported quarter, 50 percent of paid units were sold by third-party sellers.
  • Orders fulfilled by Amazon — both Amazon’s own and marketplace orders delivered through Fulfillment by Amazon (FBA) — grew 40% year-over-year (YoY) in 2016. Amazon previously reported that it delivered 2 billion orders in 2016 on behalf of marketplace sellers.
  • E-commerce giant Amazon handled the warehousing, packing, and shipping of 1 billion items last year for merchants that are part of its fulfillment program.
  • Over the past two years, the fulfillment program has seen a big growth spurt as more merchants join. The number of sellers using the service grew more than 50% in 2015 after a 65% rise a year earlier, according to Amazon (AMZN, -0.38%), which did not disclose the number of merchants involved.
  • In particular, Amazon said that international sales for third-party merchants in the fulfillment program has been gaining steam. Their cross border trade, which involved sellers in more than 100 countries sending orders to 185 countries, has more than doubled year-over-year.
  • Instant Pickup is already available in five locations, including the University of California at Berkeley and UCLA. Amazon says it will expand the service to its 22 college campus locations by the end of this year. Like most new Amazon services, it’s for Prime customers only.

Future Plans:

New Fulfillment Centers:

  • To meet this growing fulfillment demand, Amazon invested heavily in expanding its logistics network last year. It opened 23 new fulfillment centers in the second half of 2016 — most of them in North America — compared with only three new fulfillment centers opened in the first half of the year. Those new fulfillment centers helped drive Amazon’s total square footage at its warehouses up by 30% for the year, versus a 20% increase in square footage in 2015.
  • The company plans to continue investing heavily in expanding fulfillment centers and other logistics capabilities. Driving further growth in the number of sellers and packages going through FBA is a key focus, and Amazon will invest in further warehouse and logistics capacity to handle that volume, with that investment being more balanced between North America and other geographies, company executives said.

Pushing fast and free delivery:

Amazon is testing Drones for delivery but the concept faces many hurdles as current alternative delivery options are already very efficient:

Acquisitions and Investments:

Third Party Advertising


Amazon has several advertising products:

Following section pulled from Amazon Advertising Ad Specs and Policies

  • Amazon Advertising Platform (AAP): With AAP, advertisers can reach Amazon shoppers everywhere. AAP desktop and mobile web display ads, AAP mobile app banner ads, Mobile interstitial ads, In-stream video ads
  • Campaign Landing Pages: Showcase your products or offers with cross-platform landing pages on Amazon’s website & mobile apps. Landing Page Guidelines and Components, Templated Landing Pages, Tailored Landing Pages, Custom Landing Pages
  • Non-Standard Media: Unique Amazon ad units that are closely integrated with the shopping experience. Amazon Video Ads, Billboard Below The Fold, Daily Deals Site Stripe, Marquee Ads, Offer Listings Stripe, Seller Central Ads
  • Amazon Dynamic eCommerce Ads: eCommerce Ads introduce Amazon features like Add to Cart and Customer Reviews into display ad units.
  • Amazon Mobile Shopping: Banner ad placements on Amazon’s Shopping Apps and the mobile version of
  • Fire Tablet with Special Offers: Our Fire Tablets with Special Offers provide a unique ad experience for customers.
  • Fire TV: Engage customers with your brand through a featured banner on the home screen.
  • Fire TV Landing Pages: Promote your products or offers with simple to navigate pages, built for TV.
  • Kindle with Special Offers: Our Kindle reading devices with Special Offers provide a unique ad experience for customers.
  • Android with Ads: Our Android with Ads devices offers a unique advertising experience for customers anywhere, anytime.
  • Standard Media: Standard sizes for desktop ad units.
  • IMDb: Advertise your brand with solutions across IMDb.

Although Amazon is known for its e-commerce business, its high-margin advertising business it’s growing fast:


Amazon ads revenue is increasing fast while enjoying a higher level of trust from consumers in comparison to Google ads:

  • Survata’s Amazon study found that Amazon’s ads were slightly more trusted than Google’s, though not overwhelmingly. Approximately 31 percent of consumers felt that Amazon’s ads were better for finding trusted brands, compared to almost 22 percent for Google. Nearly half, 47 percent, felt that neither was better. A September analysis of 1,000 U.S. consumers by Survata found that 44 percent reported clicking on at least one sponsored product ad on Amazon, versus 46 percent who hadn’t. Approximately 10 percent said they didn’t use Amazon.
  • Amazon doesn’t report its advertising revenue directly. Instead, it lumps in results with a few other small revenue sources, such as its co-branded credit card. But the Other category grew 58% year over year in the third quarter to $1.12 billion. That’s above its $1.07 billion in Other revenue from the fourth quarter last year, and an acceleration from 53% year-over-year growth in the second quarter.

Future Plans:

Consolidating video ads:

  • Amazon is aiming to unite its far-flung video ad offerings, from the live-streaming hub Twitch to IMDb, in a move that could make it a stronger alternative to Google and Facebook. The plan is to let video ads flow automatically through the Amazon Advertising Platform to its owned-and-operated properties, which also include Fire TV and the Amazon home page, according to industry insiders familiar with the strategy.
  • “Twitch is still managed as a separate entity, but it’s large enough and interesting enough for Amazon to start pulling it in,” says an exec from an ad technology company that has worked with Amazon, speaking on condition of anonymity. “Amazon Ad Platform has become a significant player, and Amazon wants to tie the two sides of its house together.”

Voice Ads:

Consolidating its ads inventory and open it to more programmatic buying to make it more attractive for advertisers:

After some Alexa skills developers tried to monetize through Alexa ads, Amazon decided it to shut them down through a policy change and focus on customer experience:

  • “Our advertising policy is designed to maintain the delightful experience customers expect on Alexa and our top priority is to maintain that experience,” an Amazon spokesperson said. “It’s early days for voice and we will continue to explore ways for developers to monetize in the future while maintaining the best possible experience for our customers.”

Search ads:



Unlike eBay, Amazon sellers do not have to maintain separate payment accounts; all payments are handled by Amazon.

Amazon Pay

Following section pulled from Amazon Pay Wikipedia

Amazon Pay is an online payments processing service that is owned by, Inc.. Launched in 2007, Amazon Pay uses the consumer base of and focuses on giving users the option to pay with their Amazon accounts on external merchant websites. As of June 2017 the service is available in the U.S., France, Germany, Italy, Japan, Spain, India and the UK.

Amazon Pay incorporates a variety of products for buyers and merchants to process online payments.

Amazon Pay
Amazon Pay provides the option to purchase goods and services from websites and mobile apps using the addresses and payment methods stored in the Amazon account, such as credit cards or direct debit bank account.

Amazon Pay Express
Amazon Pay Express is a payments processing service for simple E-commerce use cases on websites. Built on Amazon Pay but without requiring a full E-commerce integration it uses a Java button code generator to create a button that can be copied and pasted onto a website or added via WordPress Plug-in. It is best suited for merchants selling a small number of products and with a single item in each order, such as a digital download.

Amazon Pay has undergone many changes in its evolution to improve the online payments processing for Amazon customers on external websites. While Amazon Pay is the most recent product, it represents the culmination of previous trial and error products, and strategic acquisitions.

Checkout by Amazon (CBA)
CBA was an E-commerce solution that allowed web merchants to accept Amazon account information and use Amazon for payment processing. CBA could manage several aspects of the transaction including order processing, promotional discounts, shipping rates, sales tax calculation, and up-selling. Depending on the needs of the merchant, CBA could be integrated into the merchant’s systems with manual processing (through Seller Central) or through SOAP APIs or downloadable CSV files. CBA also claimed to reduce bad debt because of Amazon’s fraud detection capabilities. CBA was discontinued in the UK and Germany in 2016 and is set for discontinuation in the U.S. in April 2017

Amazon Flexible Payments Service (FPS)
FPS was an Amazon Web Service that allowed the transfer of money between two entities using a technology built on single, multiple, and unlimited use payment tokens. Merchants managed their use of the service via API or solution providers and accessed the account through the merchant account on the Amazon Payments website. The service was launched as a limited beta in August 2007, and later in February 2009 was promoted to General Availability. FPS differed from CBA in that FPS did not handle additional capabilities associated with order processing such as promotions, tax, and shipping. FPS also provided the payments processing for the Amazon Web Services DevPay service ( but was discontinued on June 1, 2015.


  • Amazon’s biggest challenge might be convincing more merchants to give them access to what their customers are buying. With all the data Amazon already has on digital spending trends, competing merchants might be reluctant to give up more data to the online retail giant.
  • The most remarkable statistic was that 33 million customers had now used the platform to complete a transaction — more than 50% of whom were Amazon Prime members. Although the company did not reveal its payment volume numbers, Amazon did say that the payment volume had doubled and merchant coverage had grown 120% in 2016.
  • “Amazon also said that payment volume nearly doubled in 2016, but failed to offer any solid numbers associated with that. It did reference the increased volume on Cyber Monday as contributing to this growth.”
  • “However, it’s worth pointing out how closely tied Amazon Payments is tied with Amazon Prime. Though Amazon Payments doesn’t require that shoppers are Prime members to use the service, those who are make up the majority of Amazon Payments transactions. This makes sense as Prime members are more likely to have their current credit or debit card information and addresses on file with Amazon, compared with less frequent Amazon shoppers. Over 50 percent of Pay with Amazon customers are Prime members, said the retailer.”
  • “In addition, over 32 percent of transactions using Pay with Amazon came from a mobile device. This figure is more likely an indication of the growth of mobile commerce in general as it lines up with the figures rival PayPal reported during the Black Friday shopping season.”
  • “Amazon Payments could be another means for the company to profit from its sizable user base who have their credit card numbers and shipping addresses saved on its site. Today, the company takes 2.9 percent of its U.S. transactions, plus a $0.30 authorization fee. The average Pay with Amazon purchase was $80 last year, Amazon also said, and the largest single transaction was $40,000. PayPal still has Amazon beat on that front, as it saw a purchase of over $75,000 on Thanksgiving this year, as well as one topping $53,000 on

Future Plans:

Making it easier for customers in India to pay online:

  • Making it easier for customers to pay for online purchases is a key point of focus for India’s top e-commerce businesses, which include Amazon, Snapdeal, and Flipkart. India’s e-commerce market is expected to be worth $100 billion by 2020, but the country’s credit card penetration rate is still extremely low. Instead, many shoppers pay for e-commerce purchases using online wallets that can be topped up at brick-and-mortar stores, pre-paid cards, or cash on delivery.

Mobile payment and retail checkout systems based on GoPago technology acquired in 2013:

Using Amazon to pay for in-store purchases:

  • Amazon is today introducing a new feature called Amazon Pay Places, that allows customers to pay for in-store and order ahead shopping experiences using their Amazon app. That is, instead of using cash, check, credit or debit while shopping out in the real world, you can just use your Amazon account information.
  • But Amazon’s intentions are to take Amazon Pay Places beyond restaurants. It’s not hard to imagine a future where Amazon-owned Whole Foods used the feature for customer pick-up orders, for example.

Acquisitions and Investments: