In its quarterly earnings announcement yesterday, Seattle based Amazon.com, the largest US eCommerce company, admitted that it has missed bith revenue and profit estimates for Q3, 2014.
These disappointing third-quarter results see the online
retailer’s shares at 9 percent lower than the 7 to 18 percent revenue growth
that was originally forecasted. This loss has taken more than $15 billion off
of Amazon’s market value (now at $144.7 billion) and seen their stock plummet
13 percent since the poor Q2 results announced in July. Amazon is reporting
losses around $437 million resulting from failed product launches and various
acquisitions and expansions that take the ecommerce company further and further
away from their original charter and core competency.
Amazon continues to invest heavily in hardware devices, expanding it to include a phone and dropping the word "Kindle" from their Tablet line of products, simplifying it to just Fire. However, the hyped Amazon Fire Phone ha…
Less than an hour ago, Amazon prompted KDP authors (like me) to write an email to Hachette CEO, Michael Pietsch, supporting their point of view in their negotiation with Hachette.
It's interesting on how Amazon is finally realizing that it's bullying tactics towards traditional media corporations that are already facing financial challenges are no longer working, and given the enormous size of Amazon, the public now views Amazon with suspicion and as the bully.
While in its email Amazon makes some valid points about how lower cost will actually increase the size of the business by increasing volume, it fails to mention that lowering prices of popular, top-rated eBooks will also result in increased sales of the Kindle devices, eventually allowing it to sell those devices at profit rather than selling them as a cost. This is called vertical competition, consumers have a annual budget for books in their mind and if eBooks are lot cheaper than books, then the break even point for b…
Last week, Amazon unveiled the much-anticipated or at leastmuch-hyped 3D smart phone, following up with an email to all its customers introducing
the phone with the slogan "The First Smartphone Designed by Amazon". That slogan sounds a bit strange since the Amazon brand is
not associated with product design excellence so "the first blah designed
by Amazon" does not really carry much weight with us - Amazon did pioneer
the eBook reader business with Kindle and dominates it, but that's not because
of its elegant design, more because of ready availability of the content at
bargain prices, which in turn is based on Amazon’s willingness to sell both the device
and eBooks at a loss to gain market share. Brilliant business strategy, perhaps, but IMHO, that does not
set Amazon as a product design excellence star. All that slogan does is tell us that Amazon is not too proud to be (just) a company that efficiently operates warehouses and packs & delivers stuff prom…