Started from the bottom now we here.
These lines by Drake seem almost prophetic, describing Amazon’s success. From the early days when it was called Cadabra to the Goliath level status, it has achieved in the market today, Amazon has come a long way.
But unlike the biblical version, this time it is the Goliath which is defeating all the Davids. The Amazon Raj is upon us.
Amazon has been steadily taking over every single space in the market. It first wiped out the retail book business by offering a huge collection at a discounted price. It then began selling other products and used its excellent logistical and distribution system and gradually changed the market entirely. A revolution is how I would describe it. The Amazon Raj has begun.
By changing the market this drastically, Amazon broke the monopoly of retail chains and forced them to up their game. It changed the psychology of the consumer, we started thinking differently about how we purchase goods.
Next Amazon, went ahead and disrupted the market again with its Kindle reading tablets which dealt another blow to the ailing book industry. The cheapness of the ebooks and the mobility really made the Kindle a hit.
Since this big hit, Amazon has been a juggernaut, difficult to stop. It has invested heavily in the cloud computing space and as a result, Amazon Web Services has a 40 percent share in the cloud computing market. In fact, it’s a good chance that most of the websites you visit are hosted on AWS.
Microsoft, Google, and IBM have a collective share of less than Amazon. Just think about it. The Amazon Raj gains territory.
Amazon has been nothing if not innovative, I am sure everyone has heard of the drone delivery initiative that they took up, aiming to deliver the goods to houses in a matter of hours.
Speaking of innovations, Amazon has also acquired a slew of companies along the way, in every sphere of operation.
It acquired The Washington Post, one of the top newspapers in the world, Zappos, a fashion brand, Twitch (one of the biggest live-streaming websites in the world), Grail (a cancer research company), Audible.Com (one of the world’s largest repository of audiobooks). It even has a major stake in Twitter.
And these are just the top ones.
Amazon also launched its Prime Video platform as a rival to Netflix. It has done pretty well and has gained a significant audience as it comes bundled with Amazon’s other prime benefits. There is also a cloud storage service like Dropbox and there are also talks of a music service coming pretty soon.
Amazon started branching out to the food and groceries arena with Amazon Pantry which is already giving heavy competition to Indian startups like Big Basket and Grofers. But the real masterstroke has been played in the US where Amazon acquired Whole Foods for $13.7 billion cash. This has taken its stake in the FMCG sector to a whole new level. Whatte wow.
I was not personally scared or concerned about any of this till I read this article about how Amazon might end up delivering Flipkart’s products.
The company has supposedly come up with a plan to expand its logistics business. It wants to make its delivery service ATS into an independent company and use that to deliver your orders, even if they are placed through Flipkart.
Now, this gets scary because as we have seen, Amazon has the guts and the capital to fight a long war and win at the end. It has effectively wiped out the competition in multiple markets and has become a monopoly or has almost become one.
And here lies the problem, monopolies are inherently bad for a market as they kill innovation. Sure Amazon has been innovative till now but on the way, it has killed numerous small businesses which could have innovated and added to the market in their own ways.
In a way, Amazon is becoming exactly what it stood against when it started out. Small revolutionary companies do not do well in a monopoly culture as the monopoly sees it better to kill the young company than let it harm its own market position, hence killing innovation.
And this should never, ever happen. Because if it did, we would have nothing but an Amazon Raj, and like that of the British, it will sure as hell be brutal.
Image Credits: Google Images
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