Viswanathan K's Thoughts

All of us use Amazon. Brian Dumaine’s book Bezonomics (titled after its founder and ex-CEO, Jeff Bezos) gives an awesome overview of how the company operates. Bezos truly believes that a key factor about Amazon is: “We are genuinely customer-centric… (unlike other companies that) are focussed on the competitor, rather than the customer.” Of course, customer satisfaction is a moving target. Because customers are “divinely discontent”. No wonder then Bezos has insisted on having a Day 1 mentality, to act with the same enthusiasm and fear like it is the first day of the job/company. At an all-hands, he was asked would Day 2 would be like. His answer says it all: “Day 2 is stasis. Followed by irrelevance, followed by excruciating, painful decline, followed by death.” In fact, just a few years back, he said something hard to imagine today: “Amazon is not too big to fail… One day, Amazon will fail. Amazon will go bankrupt. If you look at large companies, their life spans tend to b...

Amazon’s founder and CEO, Jeff Bezos, stepped down last week.   But did you know how the company got the name? Brad Stone’s aptly titled book The Everything Store tells the story. It was initially called Cadabra, Inc, derived from the word “abracadabra”. As in magic. The idea was eventually dropped (it sounded too similar to the word “cadaver”). Bezos, in a sign of his ambitions, even considered the name Relentless.com. (Try typing relentless.com into your browser, it will redirect you to the Amazon website). Friends though convinced him that the name sounded too sinister.   So why Amazon? Well, he was picking a name before the Internet had taken off. As Bezos wrote in his farewell letter: “The question I was asked most frequently at that time was, “What’s the internet?” Blessedly, I haven’t had to explain that in a long while.” Back then, alphabetical listings still existed, and Bezos wanted a name starting with “A” to be closer to the first set of names. But wh...

Amazon’s founder and boss, Jeff Bezos spoke in front of a US government hearing on an increasingly common topic: are the top tech companies in the US too big, monolpolistic, and thus bad for the custome r? Given that backdrop, it isn’t surprising that Bezos’ speech to the US government is filled with all the good Amazon brings to customers, its schemes for employees, and all the employment it creates. But dismiss all of that, and there’s still lots of interesting stuff left over in his speech.   Humility isn’t a Bezos characteristic, because he starts with: “I founded Amazon 26 years ago with the long-term mission of making it Earth’s most customer-centric company.” Unlike most of the huge tech companies that were founded by college dropouts (Bill Gates, Steve Jobs) or kids still at college (the Google guys), Bezos had a well-paying job when he decided to form an online bookstore on this thing called the “internet”: “When I told my boss I was leaving, he took me on a lo...

A while back, I’d written this blog on how the scheme called Amazon Prime came about. I found a very interesting use of that very scheme (from Amazon’s perspective) in Scott Galloway’s The Four , a book on the fastest growing tech companies (Apple, Amazon, Facebook and Google). In the age of the Internet, customer loyalty to brands has been steadily eroding. People tend to search for what they want and don’t care about the brand, something that leaves retailers at the “mercy of Google and disloyal consumers”, writes Galloway. To which this is Amazon’s response, especially in the US: “(Amazon) via pricing and exclusive content and products, is asking people to either join Amazon Prime or leave.” Why? “Prime members represent recurring revenue, loyalty and annual purchases.” But if you thought Amazon is the knight in shining armour for brands, you could not be more wrong! You must have heard of Alexa, Amazon’s voice assistant. Named after the famous library in Alexandri...

Who hasn’t encountered Amazon’s famous “People who bought this product also liked…” recommendations? More often than not, those recommendations aren’t annoying shots in the dark guessing what you might like; they are actually pretty good. But the algorithm wasn’t always this good. In fact, in the beginning, when Amazon didn’t have a history of your previous purchases, they had human critics recommending “the Amazon voice” on its site. Sounds so quaint now, doesn’t it? Then, when the algorithms replaced the humans, they weren’t exactly smart. As James Marcus described the initial algorithms in his book, Amazonia : “It felt as if you had gone shopping with the village idiot.” Then Amazon realized it didn’t have to customize suggestions based on individuals ; rather they could just identify correlations between products ; and make their recommendations based on the latter! But even as the algorithms got better, there remained several problems for Amazon to improve their recommen...

As the Amazon v/s Hachette (one of the Big Publishers) war heated up, a non-Hachette author, John Green, worried if this was a sign of how Amazon was going to start abusing its monopolistic power: “What's ultimately at stake is whether Amazon is going to be able to freely and permanently bully publishers into eventual nonexistence.” (If you are wondering, Amazon increased the delivery time of all Hachette books. And some Hachette books stopped showing up altogether in Amazon search). So is Amazon the bad guy? Well, it certainly isn’t the only bad guy. Hachette was part of the cartel that worked with Apple to artificially keep e-book prices high. This wasn’t just an accusation; the publishers settled matters in a US court in 2013, albeit without admitting guilt. The court ordered all those publishers to re-negotiate e-book prices with everyone, including Apple and Amazon. And it is as part of those negotiations that the war has started. Amazon says the issue isn’t abo...

Heard of Amazon Dash ? It’s supposed to work like this: you are walking around the house, notice you are running out of cereal or whatever, point the Dash at the carton and bingo! The item just got added to your shopping list. Of course, some items don’t have bar codes or maybe you threw away the carton, in which case, you speak to the Dash to add the item. Right now, it’s a (very) limited edition gadget only available in 2 or 3 American cities. I remember reading this article that said: “Amazon doesn’t innovate by crafting new product categories, like Apple does. It also doesn’t make much money selling its hardware. Instead, it takes all the data it gathers as the world’s biggest online retailer, breaks down exactly what’s available and what consumers want, then produces a piece of hardware that it can sell cheaply in order to bring consumers into its ecosystem.” That’s Big Data in action! Google too has a huge amount of information about us and uses it to make money vi...

When Jeff Bezos, Amazon's founder and CEO, bought the Washington Post , my cousin sent me this analysis by AnantGoenka , of the Indian Express group. Goenka laments: “The Washington Post brand…once considered priceless, now has a value.” So price equals value? This reminds me of what Mike Masnick wrote in a recent post titled “There Is No 'True' Price For Anything” : “Someone doesn't seem to understand the difference between price and value...Price and value are not the same thing. Just because a price is low, it does not mean the value is low.” Goenka cites the Hindustan Times being valued at Rs 2,250 crores compared to the Post's valuation of Rs 1,550 crore. Is the Hindustan Times more valuable than the Post, he asks?Hello...the Internet has being eating into journalism in the West, not in India...not yet anyway. The pricing reflects the ground realities of the US, not India! Goenka complains about the price not reflecting the brand value (it jus...

I’ve never cared about critics, whether of books, art or movies. It’s just that (one) guy’s view, isn’t it? Who cares what he thinks? To be fair, well known critics (by that, I mean the ones whose names get published in the papers) run a risk: criticize an SRK movie and the poor guy may be out of a job. And would any well known critic ever call Dan Brown’s next novel crap knowing that it will sell a few million copies anyway? Ok then, how about anonymous critics? Like the ones on the Internet. Are they any better? Well sure, they could be more honest than well known critics. But it turns out that an analysis by Google shows that after the first few reviewers, the next set either conform to what the first set said or end up responding to the first reviews rather than voicing their own view. Which sort of skews the whole collective opinion rating we see online (puts that 4.5 out of 5 rating in a whole new light, doesn’t it?). Was Seth Godin right when he wrote: “For me, the o...

Ever heard of fan fiction or fan fic? Wikipedia defines it as:  “ a broadly-defined fan labor term for stories about characters or settings written by fans of the original work, rather than by the original creator. Works of fan fiction are rarely commissioned or authorized by the original work's owner, creator, or publisher; also, they are almost never professionally published.” So why do they do it? Lev Grossman in TIME magazine: “Fanfiction is what literature might look like if it were reinvented from scratch after a nuclear apocalypse by a band of brilliant pop-culture junkies trapped in a sealed bunker. They don't do it for money. That's not what it's about. The writers write it and put it up online just for the satisfaction. They're fans, but they're not silent, couchbound consumers of media. The culture talks to them, and they talk back to the culture in its own language.” Amazon recently changed fan fiction a bit through their “Kindle Worlds” ...

Teddy Wayne described one of the attractions of a physical book over an e-book : “there’s something irreplaceable about a printed book: the heft of it in your hands, the striking cover, and, most important to me, its  smell .” Jeff Bezos, Amazon’s boss, agreed with that sentiment. Which is why he said: “…we have to look for things that we can do that you can never do with a paper book.” Features like the ability to write reviews for everyone else to see and to search for information as you read your e-book. Now contrast all of those Amazon features with a patent the same Amazon filed some time back about resale of e-books. See, e-books don’t degrade over time unlike their “dead-tree brethren”. So unlike physical books that can’t be sold an infinite number of times because of all the wear and tear, an e-book could be resold forever. Not very good news if your business is selling e-books, is it? So here’s the gist of Amazon’s patent: add a (digital) counter in the e-bo...

Some time back, I read this article in the Guardian on the pricing of eBooks v/s physical books . The argument was something like this: the value of the book, physical or electronic, is almost entirely because of the content ("text itself"). If you agree with that (and I can’t see who can disagree with it), then the article said that “the delivery method shouldn't matter much”. So, the article argues, the price of an eBook should be the same as the price of the physical book (after all, isn’t the content the same?). The conclusion part, I don’t agree with at all. Because the article confuses 2 different things: value and price. Conventional, prehistoric thinking would suggest the two are the same. But, on the Internet, do you pay for Wikipedia or Google? And since you don’t, does that mean you don’t value those 2 sites?! Then that article goes after Amazon, accusing them of using their monopolistic position to drive down the price of eBooks so that they can promote sa...