Summary of “How AI Could Change Amazon: A Thought Experiment”

As advances in AI make prediction cheaper, economic theory dictates that we’ll use prediction more frequently and widely, and the value of complements to prediction – like human judgment – will rise.
Most shoppers have noticed Amazon’s recommendation engine while they shop – it offers suggestions of items that their AI predicts you will want to buy.
At some point, as they turn the knob, the AI’s prediction accuracy crosses a threshold, such that it becomes in Amazon’s interest to change its business model.
Better predictions will attract more shoppers, more shoppers will generate more data to train the AI, more data will lead to better predictions, and so on, creating a virtuous circle.
Today, in the case of AI, some companies are making early bets anticipating that the dial on the prediction machine will start turning faster once it gains momentum.
First, they must invest in developing a better understanding of how fast and how far the dial on their prediction machines will turn for their sector and applications.
Second, they must invest in developing a thesis about the strategy options created by the shifting economics of their business that result from turning the dial, similar to the thought experiment we considered for Amazon.
The overarching theme for initiating an AI strategy? Close your eyes, imagine putting your fingers on the dial of your prediction machine, and, in the immortal words of Spinal Tap, turn it to eleven.

The orginal article.

Summary of “Amazon Is Testing Its Own Delivery Service to Rival FedEx and UPS”

Amazon.com Inc. is experimenting with a new delivery service intended to make more products available for free two-day delivery and relieve overcrowding in its warehouses, according to two people familiar with the plan, which will push the online retailer deeper into functions handled by longtime partners United Parcel Service Inc. and FedEx Corp. The service began two years ago in India, and Amazon has been slowly marketing it to U.S. merchants in preparation for a national expansion, said the people, who asked not to be identified because the U.S. pilot project is confidential.
Amazon will oversee pickup of packages from warehouses of third-party merchants selling goods on Amazon.com and their delivery to customers’ homes, the people said – work that is now often handled by UPS and FedEx.
Handling more deliveries itself would give Amazon greater flexibility and control over the last mile to shoppers’ doorsteps, let it save money through volume discounts, and help avoid congestion in its own warehouses by keeping merchandise in the outside sellers’ own facilities.
The merchants had to demonstrate they could meet Amazon’s delivery pledge, and many used UPS and FedEx for deliveries.
Seller Flex would also give Seattle-based Amazon more visibility into the warehousing and delivery operations of its merchant partners, potentially helping it make full use of their product inventory, storage space and proximity to customers while still guaranteeing quick delivery.
The project underscores Amazon’s ambitions to expand its logistics operations and wean itself off the delivery networks of UPS and FedEx.
Taking over some responsibility for delivery enables Amazon to protect that edge as rivals like Wal-Mart Stores Inc. enhance their own delivery operations.
“But if you look at the world of e-commerce and double-digit growth year after year, FedEx and UPS are still going to get their share of growth. If Amazon does take a few customers, the whole ecommerce pie is growing so fast that FedEx and UPS won’t miss a beat.”

The orginal article.

Summary of “Can Anyone Beat Jeff Bezos?”

In a few years, they would almost certainly be trying to put each other out of business-if they weren’t already doing so secretly.
When the meal-kit delivery service Blue Apron announced it was going public its bankers had planned to price its initial public shares between $15 and $17. But upon the mere news that Amazon had concocted a pithy slogan-“We do the prep. You be the chef.”-for a potential future meal-delivery business of its own, Blue Apron was forced to slash the share price to between $10 and $11. Earlier this year, supermarket chains saw their market capitalization recede by $22 billion in a mass sell-off just hours after Amazon had announced that it was buying Whole Foods.
Presumably, these investors had nightmares of owning shares of the next Borders, which is out of business, or Barnes & Noble, which saw its stock drop some 75 percent in the past two years alone.
The Amazon Effect, alas, is no longer unique to Amazon.
A June 2017 Ball State University study noted that about half of all U.S. jobs could be eliminated in the coming years due to advances in automation.
A March report by PricewaterhouseCoopers estimates that 38 percent of all jobs in the U.S. could be lost to automation in just 15 years.
In reality, the Industrial Revolution was a horribly painful event that spanned some 80 years.
An abiding and solid company, and even an entire industry, can fall in just a few years as a result of technology in the hands of an adept competitor.

The orginal article.

Summary of “Nothing Is Too Strange for Cities Wooing Amazon to Build There”

For Jeff Cheney, the mayor of Frisco, Tex., a city of 160,000 about a half-hour drive from Dallas, the courtship includes offering to build his city around Amazon.
City applications are not due until Oct. 19, but Mr. Cheney has already sent a video letter to Amazon.
The video opens on him holding an Amazon box and saying, “Amazon, you’re growing your business, and we want to grow with you.” Jerry Jones, the owner of the Dallas Cowboys, is seen talking about catching the “Frisco Flu,” which the mayor’s office said was a phrase Mr. Jones came up with.
Mark D. Boughton, the mayor of Danbury, Conn., posted a video on Sept. 14 calling himself a “Proud Amazon customer” and asking Alexa, the Amazon virtual assistant, where Amazon should build its second headquarters.
“There’s, you know, the immigration issue – we avoid that,” said Dan Gilbert, a local business leader in Detroit who was asked by the city’s mayor, Mike Duggan, to lead the effort to land Amazon.
The city would also consider overhauling its tax system for Amazon.
Tax policy experts are more skeptical of Amazon’s bidding process and how much cities stand to benefit.
Mr. Gardner acknowledged that many cities really had no other course than to try to win Amazon.

The orginal article.

Summary of “An open letter to Jeff Bezos-you are needed to disrupt the health care sector”

Health care is a huge sector of the economy, comprising close to 18% of US GDP. Roughly one out of every ten American workers is employed in this sector.
No wonder we pay more for health care and get poorer outcomes than any other industrialized nation.
Once you hang out a new shingle, Amazon Health, people will find getting health care products from you highly attractive, given you offer them at a discount and, above all, with a much better delivery system than others provide.
To reduce health care costs, one can hardly imagine a better place to start than to use the trillions of pieces of information already in the database of Medicare to assess all procedures for safety and effectiveness.
Theoretically the Department of Health and Human Services is tasked with carrying out such evaluation studies, but does them on a small scale, reportedly due to lobbying pressure to protect health care reimbursements.
The reason is that in disrupting the heath care sector, Amazon will have to take on much more powerful players than bookstores, publishers, and even big name retailers.
Health insurers, who would seem natural allies for a drive by Amazon Health to reform and rationalize the health care sector, in the past have been at least reluctant to take on special interests, and rather increased premiums.
Granted, Mr. Bezos, even you cannot bring rationality to this high and complex sector that is as poorly structured as our health care sector currently is.

The orginal article.

Summary of “The 5 biggest announcements from Amazon’s hardware event”

Amazon surprised everyone with a press event that unveiled a bunch of new Echo hardware.
The Echo speaker, originally launched in 2014, was overdue for an update after the company spun off devices with a camera and a touchscreen.
As part of the original Echo refresh, Amazon announced the Echo Plus.
The Echo Plus is priced at $149, and it’s compatible with over 100 smart home devices that you can set up via voice, without any apps.
The Echo Plus is available for preorder today and comes out on October 31st. Alexa can now add multiple events to a routine that you activate with one command.
The second generation Echo comes out on October 31st. Additionally, there’s a new $35 Echo Connect device that you can use to make landline calls with Alexa.
Lastly, there is a smaller product called Echo Buttons that will join the Echo family.
Priced at $20 for a two-pack, Echo Buttons are hockey puck-shaped devices that you can use to play games alongside an Alexa-enabled device.

The orginal article.

Summary of “3 Things You Can Learn From Jeff Bezos About Making Smart Decisions”

Distinguish Between High and Low ImpactEvery day, we make big and small decisions in response to what our environment dictates.
The problem is that we intuitively judge the importance of our decisions based not on impact, but on random timing.
As Jeff Bezos explained to Amazon shareholders in his 2015 letter, there are two categories of decisions.
At Amazon, by distinguishing between impact, they leave all Type 2 decisions to the teams and individuals on the ground, while the people higher up focus on Type 1 decisions.
Most of your time should always be spent on Type 1 decisions.
Type 2 decisions should either be delegated, or they should be batched together with other less critical choices for later.
For most Type 2 decisions, proxies are helpful, but when it comes to the high-impact Type 1 decisions, it’s better to reason from ground up, taking into account each unique situation.
Release Ideas at 70% and Then IterateFor most decisions, after a certain point, information and time provide diminishing returns.

The orginal article.

Summary of “Sears’s History Predicts Almost Everything Amazon’s Doing”

Why is Amazon looking more and more like an old-fashioned retailer? The company’s do-it-all corporate strategy adheres to a familiar playbook-that of Sears, Roebuck & Company.
Sears might seem like a zombie today, but it’s easy to forget how transformative the company was exactly 100 years ago, when it, too, was capitalizing on a mail-to-consumer business to establish a physical retail presence.
From its founding in the late 19th century to its world-famous catalog, the history of Sears, Roebuck & Company is well known.
Like Amazon among its online-shopping rivals, Sears was not the country’s first mail-order retailer, but it became the largest of its kind.
After one of the most successful half-centuries in U.S. corporate history, Sears did something really crazy.
In the early 1920s, Sears found itself in an economy that was coming off a harsh post-World War recession, according to Daniel M. G. Graff and Peter Temin’s essay “Sears, Roebuck in the Twentieth Century.” The company was also dealing with a more lasting challenge: the rise of chain stores.
The first Sears stores opened in the company’s existing mail-order warehouses, for convenience’s sake.
Amazon’s online sales have actually grown in regions where it has a physical store presence, according to CNBC. Second, it’s important to remember that, although Sears eventually became a dominant physical retailer, the transition was bumpy.

The orginal article.

Summary of “As Amazon Pushes Forward With Robots, Workers Find New Roles”

Amazon even sponsors an annual contest to encourage more innovation in the category.
Mr. Ford, the author, believes it is just a matter of time before the employment picture in Amazon’s warehouses changes.
“I would not say that overnight huge numbers of jobs disappear. Maybe the first indication is they don’t get rid of those people but the pace of job creation slows down.”
Amazon’s Mr. Clark said history showed that automation increases productivity and, in some cases, demand from consumers, which ultimately creates more jobs.
He said warehouse workers would continue to work in technologically rich environments.
“It’s a myth that automation destroys net job growth,” he said.
In the case of the Florence facility, it opened up the new opportunity for Ms. Scott.
“The robot will work the same all day long,” said Edward Cohoon, who supervises Ms. Scott and other Amazon workers as they tend to individual robots.

The orginal article.

Summary of “Whole Foods’ dilemma: Amazon is the new Walmart”

Amazon is already changing Whole Foods – and it’s a departure from the grocery chain’s hippie roots.
Fairly or unfairly, both Amazon and Whole Foods’ reputations are shifting away from their progressive former identities.
On Monday, Amazon’s $13.7 billion acquisition of Whole Foods formally went through.
Whole Foods items started being sold on Amazon.com, and, perhaps most surprisingly, Whole Foods stores began selling the Amazon Echo.
While Walmart was once seen as the destroyer of mom-and-pop businesses, now Amazon is taking on that unpleasant role.
In 2014, Salon published an article with the headline “Worse than Wal-Mart: Amazon’s sick brutality and secret history of ruthlessly intimidating workers,” which highlights both Amazon’s internal issues and how synonymous Walmart has become with everything that’s wrong with big business.
Basically, Amazon’s reputation is taking hits from all sides, and that means Whole Foods’ reputation is also under the microscope.
Amazon is already making its presence known in Whole Foods stores, from its new signage to the Echo devices on sale.

The orginal article.