Googzilla Versus the Bezos Bulldozer: Shopping Search, Ads, and Sales
October 9, 2020
The battle between the two ethical outfits is becoming more interesting. “Google Tries to Turn YouTube into a Major Shopping Destination” reports that there will be more advertising than ever on the precursor to TikTok. The write up reports:
The world’s largest video site recently started asking creators to use YouTube software to tag and track products featured in their clips. The data will then be linked to analytics and shopping tools from parent Google. The goal is to convert YouTube’s bounty of videos into a vast catalogue of items that viewers can peruse, click on and buy directly, according to people familiar with the situation. The company is also testing a new integration with Shopify for selling items through YouTube.
The essay / analysis includes another sourceless factoid:
However, the pandemic has hammered marketing budgets, particularly in the travel and physical retail sectors that are major Google advertisers. Meanwhile, e-commerce has boomed as people stay home and order more products online. That’s left Google watching from the sidelines as rivals such as Facebook and its Instagram app become hotbeds of online shopping. Amazon, the US e-commerce Goliath, has seen sales soar, while Google suffered its first-ever revenue decline in the second quarter.
There may be some other facets to this concern; for example:
- Amazon’s product search function may be taking bulldozer-sized chunks out of Google search traffic. One of my research team’s estimates pegged the downturn at about 35 percent in the last year.
- The Google has a history of getting excited and then failing; for example, Froogle and Google Plus. Shopping is of interest now, but as the competitive toll is collected, the Googlers eager to work on a bonus-guaranteed project may look elsewhere for career satisfaction.
- The write up suggests that Google may not have worked out some of the administrivia to cash in on products in YouTube videos appropriately tagged by “creators” who might be skeptical of the actual payoff for their “creativity.”
To sum up: If the write up is accurate, Googzilla may have to investigate acquiring more firepower; for example, Shopify, Dr. Scott Galloway’s favorite stock to hype.
Worth watching. Googzilla Confronts the Bezos Bulldozer, a Netflix original.
Stephen E Arnold, October 9, 2020
Amazon Deals for Machine Learning
October 8, 2020
“Amazon Announces Price Cuts on GPU Instances in AWS Sagemaker” contains an interesting statement; to wit:
Amazon Web Services is cutting the price of GPU instances on Sagemaker, its fully managed machine learning service. AWS said customers will see up to 18% in price reductions on all ml.p2 and ml.p3 GPU instances. The price cuts will apply from October 1 for all SageMaker components…
Several questions come to mind:
- Are Microsoft’s sales policies becoming a problem for Amazon AWS?
- Has the JEDI generated an uptick in interest in Azure from US allies?
- Are deals like Oracle’s play to land Zoom in Big Red’s cloud sounding an alarm?
On the other hand, Amazon may be sufficiently confident to cut prices because its cloud business continues to surge.
Price wars among gasoline filling stations were common in the 1950s. Could the sales tactic find traction in 2020, which has been an interesting year.
Stephen E Arnold, October 10, 2020
Amazon and Ads: Missing the Point?
October 8, 2020
“Amazon’s Growing Ad Business Could Forever Change Tech: Google and Facebook’s Ad Business Might Not Survive Amazon” joins a growing cottage business: Criticizing what thumbtypers have supported. The main idea is one that some people accept with a shrug of your shoulders as if to say, “What are you gonna do?”
The write up contains a useful observation; to wit:
And the ads are cheap. For one campaign, I paid just $249 to show my ad to 1,049,000 people. Ads are cheap because Amazon has a vested interest in driving more sales. The company collects a commission of between 6% and 20% on every item sold through the site. For every product I sold through a Sponsored Products campaign, Amazon was effectively getting paid twice — once for running the ad, and again for managing the sale of my product. This likely allows them to keep ad rates lower than those charged by their competitors.
Amazon does get paid twice; however, close investigation of the public information about the company suggests some other ways Amazon gets paid; for example, sellers may use Amazon’s products themselves. These can include the home security devices, videos, or Amazon Web Services.
Another pipe into the money streams taps data. What’s Amazon do with the data gathered? That’s a good question. Who would pay for access to these data? What new partnerships do these data trigger? These are interesting questions and may suggest that Amazon gets paid more than twice.
Stephen E Arnold, October 9, 2020
Amazon and Its Pricing Methods
October 8, 2020
The COVID-19 pandemic is harming the world economy with huge job losses and forcing consumers to stay at home, instead of going out and spending their money. Amazon is thrilled, however, because their sales have never been higher. In order to maintain social isolation and distancing, more people are buying products online. The result is Amazon is price gouging its customers. Ars Technica reports on Amazon’s poor business tactics in, “Price Gouging And Defective Products Rampant On Amazon, Report Finds.”
Amazon allows third party sellers to list and sell their products through the marketplace. Many of these sellers practiced price gouging on essential items, such as hand sanitizer, soap, flour, toilet paper, and face masks. Many of these products are also faulty goods. Amazon claims it constantly monitors its Web site in order for consumers to receive the lowest price on the Internet. However, Amazon does not watch itself for price gouging and faulty products with its own brands.
“A new report from consumer watchdog group Public Citizen, however, finds that price-gouging for some critical goods was just as prevalent in Amazon’s own first-party sales as it was in its vendor marketplace. Between May and August, for example, Public Citizen found that ordinary antibacterial hand soap, which usually sells for around $1.50, was going for $7—a 470-percent price increase.
Public Citizen’s report includes two instances of markups of 1,000 percent or more: disposable face masks, which were selling for $40 instead of $4, and corn starch, which sold for $9 instead of $0.90. ‘It is troubling that so much effort was put into blaming third-party sellers, but so little effort was made to stop the price increases—including on the products sold by Amazon directly,’ the report concludes. ‘Amazon is not merely a victim in the price gouging on its marketplace. It is a perpetrator.’”
Amazon and third party sellers treat the marketplace like an “unsupervised flea market.” Amazon makes 60% of its sales from the third party marketplace, while the remaining 40% of sales are from its private label brands. There are hundreds of negatives reviews of AmazonBasics products, including electronics catching on fire. Amazon says reviews alone does not mean an product is unsafe. There are also ten reports filed with the US Consumer Product Safety Commission (CPSC) dangerous AmazonBasics products. Amazon, of course, has only made two official recalls on its products.
Amazon has problems. Amazon needs to fix it problems, but will Bezos do it?
Whitney Grace, October 8, 2020
Amazon: The Bulldozer Grinds Forward
October 7, 2020
It is hard to tell whether the company is shameless or clueless. Either way, SlashGear observes, “Amazon Has A Creepiness Problem.” The growingly ubiquitous tech giant recently unveiled two products that will make privacy enthusiasts shiver. Writer Chris Davies reports:
“The Echo Show 10, for example, brings movement to Amazon’s smart displays, with a rotating base that promises to track you as you wander around the room. The result? A perfectly-centered video call, or a more attentive Alexa, whether you’re stood at the sink or raiding the refrigerator. Echo Show 10 seems positively pedestrian, though, in comparison to the Ring Always Home Cam. Part drone, part security camera, it launches out of a base station that resembles a fancy fragrance diffuser and then buzzes around your home to spot intruders or misbehaving pets. Never mind wondering whether the microphone on your Echo is disabled: now, the cameras themselves will be airborne.”
Naturally, Amazon offers reassurances that users are in complete control of what the devices observe and transmit. The Ring drone maintains a certain hum so one can hear it coming, and users can limit its flight area. Also, when it is docked, the camera is physically blocked. The Echo Show 10 relies on visual and audio cues to keep the user center stage, but we’re assured that data is processed locally and immediately deleted. But there is no easy way to verify the devices respect these restrictions. Users will just have to take Amazon’s word. Davies considers:
“Rationally, nothing Amazon has announced today is any more intrusive or dangerous to privacy than, well, any other smart speaker or connected camera the company has offered before. All the same, there’s a gulf between perception and reality. I could understand you being skeptical about Amazon’s intentions – and its technology – simply because it’s, well, Amazon. The company that knows so much about your shopping habits it can make pitch-perfect recommendations; the company that wants to put microphones and cameras all over your house, in your car, and in your hotel room. […]”
The man has a point. Apparently, many consumers do trust Amazon enough to place these potential spies in their homes and offices. Others, though, do not. Will a day come when it will be difficult to function in society without them? We think Amazon hopes so.
Cynthia Murrell, October 7, 2020
Always: An Alluring Notion
September 30, 2020
DarkCyber ran a short video about a product called the Dronut. It looks like a small flying donut. You can get a link to the company, its patent document, and a snippet of the promotional video for your product at this link at the 10 minute 36 second point in the show.
I was interested in “Why You Should Be Very Skeptical of Ring’s Indoor Security Drone,” an article in IEEE Spectrum. My team and I have done lectures, briefings, and even a book chapter about Amazon’s policeware and intelware activities. I know first hand that no one, not even law enforcement and intelligence officers, care.
In fact, at one digital security conference last year in San Antonio, an attendee — an Air Force intel professional — summed up the attitude of the 100 people in the lecture hall:
My wife loves Amazon. The company may have some interesting technology, but, come on, even my kids depend on Amazon videos. Amazon is not an intelware player.
Not bad for a colonel’s analytic and content processing skills, right?
I am not going to rehash our research about Amazon’s intelligence related services. I want to focus on IEEE Spectrum’s write up; for example, this statement in the article:
Ring, the smart home company owned by Amazon, announced the Always Home Cam, a “next-level indoor security” system in the form of a small autonomous drone. It costs US $250 and is designed to closely integrate with the rest of Ring’s home security hardware and software. Technologically, it’s impressive. But you almost certainly don’t want one.
Clueless? Not completely. The Amazon surveillance drone is not marketed like the Dronut. Plus, the Amazon home surveillance drone is not a standalone product. The Always Home Cam provides the equivalent of a content acquisition “paint by numbers” module to the Amazon intelware infrastructure.
Little patches of data particularized and indexed by time, location, and other metadata can be cross correlated with other information. Some information is unique to Amazon; for example, the “signal” generated by processing payment history, video viewing, and product purchase information for an account holder. The cross-correlation (Amazon’s lingo from one of its blockchain related inventions) makes it possible to perform the type of analytic work associated with intelligence analysis software and subject matter experts.
The article notes:
Ring hasn’t revealed a lot of details on the drone itself, but here’s what we can puzzle out. My guess is that there’s a planar lidar right at the top that the drone uses to localize, and that it probably has a downward-looking camera as well. Ring says that you pre-map the areas that you want the drone to fly in, which works because the environment mostly doesn’t change. It’s also nice that you don’t have to worry about weather, and minimal battery life isn’t a big deal since you don’t need to fly for very long and the recharging dock is always close by. I like that the user can only direct the drone to specific waypoints rather than piloting it directly, which (depending on how well the drone actually performs) should help minimize crashes.
The author is either ignoring UAS characteristics of surveillance devices or unaware of those conventions. The write up does reference to the challenge of avoiding mobile cameras. The parallel between Amazon’s in home UAS and a telepresence robot misses the point. The data, not the device, are the story. At least the author reaches a reasonable conclusion:
But is it worth $250, questionably better security versus cheap static cameras, and a much larger potential for misuse or abuse? I’m not convinced.
If you are interested in a one hour briefing about Amazon’s policeware and intelware initiative, write benkent2020 at yahoo dot com. Someone on the DarkCyber team will respond with options and fees.
On the other hand, why not be like the intel colonel, “What’s the big deal?”
Stephen E Arnold, September 28, 2020
An Infographic about Amazon with One Tiny Omission
September 18, 2020
Until the Visual Capitalist diagrammed “The Jeff Bezos Empire In One Giant Chart,” South Park creators Trey Parker and Matt Stone had the best portrayal of Bezos. Stone and Parker depicted Bezos as a psychic human with a giant brain akin to something out of a science fiction B movie. The 2018 season of South Park also compared Amazon Fulfillment Centers to indentured servitude complete with renditions of “I Sold My Soul To The Company Store.”
The Visual Capitalist takes a more professional representation of Bezos by breaking down his fortune and depicting it with handy dandy charts. Bezos’s assets total $137 billion, surpassing philanthropist and Microsoft founder Bill Gates. That fortune will decrease in the future, because Bezos and his wife of twenty-five years MacKenzie Bezos are divorcing. It is currently unknown how the couple will divide the fortune.
Most of Bezos’ empire is Amazon and acquisitions he made through his main company. He purchased Whole Foods, PillPack, twitch.tv, Zappos, and Kiva Systems. Not all of Bezos’s purchases were wise as seen in failed dot-com kozmo.com and Twilio. He has also invested money as a venture capitalist through his Bezos Expeditions.
If that was not enough, his personal investments are also shared:
“Jeff Bezos also invests money on a personal level. He was an angel investor in Google in 1998, and has also put money in Uber and Airbnb. (Note: these last two companies are listed on the Bezos Expeditions website, but on Crunchbase they are listed as personal investments.
Nash Holdings LLC
Nash Holdings is the private company owned by Bezos that bought The Washington Post for $250 million.
Bezos Family Foundation
The BFF is run by Jeff Bezos’ parents, and is funded through Amazon stock. It focuses on early education, and has also made an investment in LightSail Education’s $11 million Series B round.
Blue Origin
Finally, it’s also worth noting that Jeff Bezos is the founder of Blue Origin, an aerospace company that is competing with SpaceX in mankind’s final frontier.”
Does Bezos have enough to purchase his own island yet? Why stop at an island, when he could buy an entire archipelago.
And the omission?
Amazon’s policeware and intelware businesses.
Whitney Grace, September 18, 2020
Amazon ARM: We Are Just Being Efficient. Absolutely.
September 17, 2020
The Register published “AWS Is Bursting with Pride for Its Arm CPU Cores – So Much It’s Put Them behind a Burstable Instance Type.” The main point is that certain AWS uses cases will be less expensive. Good. However, the most interesting facet of the write up is this comment from an individual who uses the handle “Anonymous Coward”; to wit:
ARM servers in the datacenter are not going to be a Thing until there is a sufficiently common systems architecture that important software can be portable between different vendors’ implementations without a massive conversion and optimization effort. Compare for example AWS ARM instances and the Fujitsu ARM compute nodes. The market today is a lot like the desktop computer world before the IBM PC (which, incidentally, is the direct ancestor of the Lintel server of today). Contrast the rapid adoption of GPUs for compute, which is facilitated enormously by Nvidia driving a standardized API across a broad range of cards. The worst case scenario for ARM servers is that the market remains an archipelago of incompatible implementations. The second worst is that AWS ARM instances become the de facto standard by sheer weight of market presence, and everybody else is left trying to “do what AWS does” by inspection, much like S3.
DarkCyber believes that Anonymous Coward has nailed the AWS tactic. Competitors have to be more like Amazon AWS. The long term objective, in DarkCyber’s opinion, is to implement an updated version of IBM’s “lock in tactics.” Pretty savvy for an online vendor of digital books.
Stephen E Arnold, September 17, 2020
Amazon Cares and Helps Small Business
September 16, 2020
DarkCyber noted “Amazon to Invest $18 Billion This Year to Help SMBs.”
“SMB” means small and mid sized businesses. These are the companies that are going out of business because some of the digital monopolists do not care.
The write up states with enthusiasm:
In the next 12 months, the ecommerce behemoth will provide more than 500,000 SMBs in the US currently selling on Amazon, with online selling guidance, education, and support and the company plans to onboard an additional 100,000 US businesses as new sellers in its store.
But that is not all:
Amazon has launched more than 135 new tools and services this year to help sellers manage and grow their businesses, including new ways to connect brands with customers. The company said it will spend an additional $100 million this year to promote small businesses during Prime Day and through the holiday season. Last year during Prime Day, third-party sellers – mostly SMBs – exceeded $2 billion in global sales.
Definitely significant because if it works, Amazon wins. That’s the way it is supposed to be when the Bezos bulldozer drives along the Information Superhighway. That road may feature billboards which say, “We are helping.” Impressive.
Stephen E Arnold, September 16, 2020
Amazon and Its Next Leader According to Bezos Owned AMZ Paper
September 14, 2020
Modern “real news.” Definitely interesting most of the time. I read “Bezos’s Likely Amazon Successor Is an Executive Made in Bezos’s Image.” (I know the story is objective because the page displayed “Support journalism you can trust when it matters most.” Thomson Reuters uses the trust thing too. Okay, trust. The write up is notable because one syllable words ending in “s” require an apostrophe s when used in a possessive structure; for example, Bezos’s newspaper or Bezos’s billions.)
The main point is that the head of Amazon Web Services could take over when Mr. Bezos drives the Bezos bulldozer (no apostrophe because the noun is used as an adjective) into / over another challenge.
I learned:
the company still values high-risk, high-reward bets and is less defined by online shopping than some might think.
Plus, there’s a rare pothole in the Amazon autobahn:
Even in the cloud business, Amazon has had to confront a newly vigorous rival, Microsoft, which has won contracts — including a massive one from the Defense Department — that Amazon might have handily taken just a few years ago.
Are there key points about the possible Bezos replacement? Perhaps:
- Harvard
- Ideas, not operations
- Onliney, not retaily.
This statement seems important:
While retail drives Amazon’s revenue, the cloud business fuels Amazon’s bottom line. AWS generated $3.4 billion in net income in the most recent quarter, about 64 percent of Amazon’s total profit, even though the business accounted for just 12 percent of Amazon’s sales.
Several questions:
- Why the profile now?
- Why emphasize the anti-administration angle?
- What’s the plan for AWS?
I know that the Bezos newspaper is objective. And trust. Yep, the trust thing.
Stephen E Arnold, September 14, 2020
-
- Subscribe to Beyond Search
Feature archive
News archive
-
