Amazon is facing a big change in the post-Bezos era

amazon after jeff bezos

From starting as an online bookseller to growing Amazon (NASDAQ: AMZN) into one of the world’s largest companies worth a mind-blowing $1.77 trillion, Jeff Bezos is the man behind Amazon’s epic growth and transformation. Amazon may have started as a regular bookseller but has grown into a dominant player in online retail in the western world. Eventually, it expanded into the production of video content and music streaming, and through Amazon Web Services, it became the world’s largest provider of cloud computing services (AWS).

Bezos is 57 now, and after ruling Amazon for more than 26 years now, he decided to step down as the CEO of Amazon and hand the baton to Andy Jassy, the CEO of Amazon Web Services (AWS). He will, however, be a part of the Executive Board and will be involved in big Amazon projects! Bezos now plans to spend more time with Blue Origin, the space exploration business that he created and on whose first passenger voyage to near space he will be aboard, along with his brother Mark, at the end of July. Bezos said in his last shareholder’s letter, “We are all taught to “be yourself.” What I’m asking you to do is to embrace and be realistic about how much energy it takes to maintain that distinctiveness.” Bezos will focus more on new products and early initiatives because he explained, “I’m an inventor. It’s what I enjoy the most and what I do best.”

Bezos has classified his decision into two types: The first is a one-time, irreversible decision, and the other is a decision that can be canceled at any time. He claims that his departure belongs to the first type, like “walking out of a one-way door”, because once a decision is made, even if he sees the consequences he doesn’t want to see, he can’t go back. Talking about his plans, he said, “I will continue to participate in important Amazon projects, but I also want to have the time and energy to focus on Day 1 Fund, Bezos Earth Fund, Blue Origin, The Washington Post, and my Other hobbies. I have never felt as energetic as I am now, and it has nothing to do with retirement.”

Amazon is now expanding its grocery business into both online and brick-and-mortar locations, having purchased the Whole FoodsMarket for $13.7 billion in 2017 and establishing its Amazon Go brand of completely automated grocery stores. Amazon is also focusing on online pharmaceuticals now.

Amazon Revenue and sales

Although Andy Jassay is now the CEO of Amazon, there are many challenges ahead for him, and it won’t be a cakewalk to overcome those. He ruled AWS like a King, and here are a few stats to determine how successful Jassy made AWS be:

  • AWS’s operating profit accounts for 60% of Amazon’s total operating profit.
  • AWS Q4 revenue in 2020 is 12.7 billion U.S. dollars
  • In 2020, AWS sales reached 45 billion U.S. dollars, a year-on-year increase of 30%.
  • AWS has a 30% share of the entire cloud computing market.

Challenges that Amazon faces now post the transfer of power

  1. International regulators on matters such as taxation and data collecting, and it is now defending itself against antitrust allegations that might result in significant fines.
  2. President Joe Biden just appointed Lina Khan, a well-known tech critic, as the head of the Federal Trade Commission, which is now probing Amazon’s business practices. The specifics of the investigation are not yet known. Still, the investigation will almost certainly revolve around the conflict of interest that Amazon faces as a vendor of its products that compete with those sold by third-party merchants on its platform. Amazon has been accused of stealing proprietary data from third-party vendors to produce lower-cost, private-label copies of the products they sell. Amazon, on the other hand, disputes these assertions.
  3. Meanwhile, Congress is debating new antitrust legislation that might have an impact on Amazon’s operations. In addition, European regulators are looking into a variety of the company’s activities at this time.
  4. Amazon is also up against competition from some of the largest corporations in the United States. Walmart Inc. (NASDAQ:WMT) , for example, is pursuing Amazon’s home turf with its package delivery club. At the same time, Microsoft Corp. has struck cloud agreements with large companies, including Walmart, to close the gap on Jassy’s AWS.
  5. Jassy is likewise at risk of internal debate. Amazon is dealing with a surge in interest in unionization among warehouse employees and prospective other employees. Although it easily defeated an organizing campaign at its fulfillment center in Bessemer, Alabama, labor groups like the Teamsters have stated that the struggle is just getting started.
  6. In addition, the company hopes to preserve its appeal among office employees, while several startups are offering tech employment with more flexible work schedules. The company first stated that it intended to have an “office-centric culture,” but it soon changed its policy to require in-person work three days a week, in line with other companies in the same industry.

Who is Andy Jassy, and what to expect?

Amazon CEO Jeff Bezos and Andy Jassy
Amazon’s new CEO, Andy Jassy

$125 billion in just the last three months of 2020 and, on the other hand, is facing immense scrutiny from antitrust regulators, labor, activists, and politicians. So, how will Andy Jassy make a difference in the lives of 1.3 million people currently working for Amazon? And how will he impact millions of consumers?

Quite interestingly, a report says that Jassy is a man with eyes for immense detail and precision. He still reviews every press release of AWS before it goes for publication!

Is there a new plan for Andy to take over as Bezos’ successor? Andy has expressed his interest in the production of video games on several occasions through internal emails. Even though Amazon attempted various mobile games and PC game development between 2015 and 2016, none of these endeavors were successful. Amazon will have a new barrier when it comes to entering the game sector. Twitch, an e-sports live broadcast network acquired by Amazon in 2014, has undisputed control in the game streaming area. It is undoubtedly a positive card in Amazon’s hand as it prepares to enter the gaming streaming market. Playing games, on the other hand, is not the same as creating games. Amazon is analogous to exploring from the downstream (live broadcast) to the upstream (game research and development), with obstacles and possibilities to be found along the way.

Let’s wait and watch how Andy Jassy, the new man for Amazon can turn these challenges into victories and his plans into a reality!

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