Amazon.com Totally Explained

Everything about Amazon Co Uk totally explained

Amazon.com, Inc. is an American electronic commerce, e-commerce, company in Seattle, Washington. Amazon was one of the first major companies to sell goods by Internet, and was an iconic "stock in which to invest" of the late 1990s dot-com bubble. After the collapse, the public became skeptical about Amazon's business model, yet, it turned an annual profit in 2003. Jeff Bezos founded Amazon.com, Inc. in 1994, and launched it on-line in 1995. Amazon.com started as an on-line bookstore, but soon diversified to product lines of VHS, DVD, music CDs, MP3 format, computer software, video games, electronics, apparel, furniture, food, toys, etc. Amazon has established separate websites in Canada, the United Kingdom, Germany, France, China, and Japan. It also provides global shipping to certain countries for some of its products.

History and business model

Amazon was founded in 1994, spurred by what Bezos called "regret minimization framework", his effort to fend off regret for not staking a claim in the Internet gold rush. Company lore says Bezos wrote the business plan while he and his wife drove from Fort Worth, Texas to Bellevue, Washington, a story largely apocryphal, say early employees.
The company began as an online bookstore named "Cadabra.com", a name quickly abandoned for sounding like "cadaver";
   In 1994, the company incorporated in the state of Washington, beginning service in July 1995, and was reincorporated in 1996 in Delaware. The first book Amazon.com sold was Douglas Hofstadter's Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought. Amazon.com issued its initial public offering of stock on May 15 1997, trading under the NASDAQ stock exchange symbol AMZN, at an IPO price of US$18.00 a share (U.S. $1.50 after three stock splits in the late 1990s).
   Amazon's initial business plan was unusual: the company didn't expect a profit for four to five years; the strategy was effective. Amazon grew steadily in the late 1990s while other Internet companies grew blindingly fast. Amazon's "slow" growth provoked stockholder complaints: that the company wasn't reaching profitability fast enough. When the dot-com bubble burst, and many e-companies went out of business, Amazon persevered, and, finally, turned its first profit in the fourth quarter of 2002: U.S. $5 million, just 1¢ a share, on revenues of more than U.S. $1 billion, but the profit was symbolically important.
   The company remains profitable: 2003 net income was U.S.$35.3 million, U.S.$588.50 million in 2004, U.S.$359 million in 2005, and U.S.$190 million in 2006 (including a U.S.$662 million charge for R&D in 2006), nevertheless, the firm's cumulative profits remain negative. As of September 2007, the accumulated deficit stood at U.S.$1.58 billion. Revenues increased thanks to product diversification and an international presence: US$3.9 billion in 2002, U.S.$5.3 billion in 2003, U.S.$6.9 billion in 2004, U.S.$8.5 billion in 2005, and U.S.$10.7 billion in 2006. On November 21 2005, Amazon entered the S&P 500 index, replacing AT&T after it merged with SBC Communications.
   In 1999, Time Magazine named Bezos Person of the Year, recognizing the company's success in popularizing on-line shopping.

Merchant partnerships

The Web sites of Borders (borders.com, borders.co.uk), Waldenbooks (waldenbooks.com), Virgin Megastores (virginmega.com), and CDNOW (cdnow.com) are powered and hosted by Amazon. Until June 30 2006, typing ToysRUs.com into a browser would similarly bring up Amazon.com's Toys & Games tab; however, this relationship was terminated as the result of a lawsuit.
Amazon.com powers and operates retail web sites for Target, the NBA (partnership terminated in 2007), Sears Canada, Sears UK, Benefit Cosmetics (US and UK), Bebe Stores, Timex Corporation, Marks & Spencer, Mothercare, Lacoste and Bombay Company (now defunct). For a growing number of enterprise clients, currently including the UK merchants Marks & Spencer, Benefit Cosmetics' UK entity and Mothercare, Amazon provides a unified multichannel platform from whence a customer can interchangeably interact with the retail website, standalone in-store terminals, and phone-based customer service agents. Amazon Web Services also powers AOL's Shop@AOL.

Locations

Headquarters

The company's global headquarters is located on Seattle, Washington's Beacon Hill. It has offices throughout other parts of greater Seattle including Union Station and The Columbia Center.
Amazon has announced plans to move its headquarters to the South Lake Union neighborhood of Seattle beginning in mid-2010, with full occupancy by 2011. This move will consolidate all Seattle employees onto the new 11-building campus.

Software development centers

The company employs software developers in medium- to large-sized centers across the globe. International locations include:

Slough (England)
Edinburgh (Scotland)
Bangalore, Chennai, and Hyderabad (India)
Cape Town (South Africa)
Iaşi (Romania)
Shibuya (Tokyo, Japan) (closed in 2005)
Beijing (China)

Fulfillment and warehousing

Fulfillment centers are located in the following cities, often near airports:

North America: � *Arizona, USA: Phoenix

   *Delaware, USA: New Castle � *Indiana, USA: Whitestown

   *Kansas, USA: Coffeyville � *Kentucky, USA: Campbellsville, Hebron (near CVG), Lexington, and Louisville

   *Nevada, USA: Fernley and Red Rock (near 4SD) � *Pennsylvania, USA: Carlisle, Chambersburg, Hazleton, and Lewisberry

   *Texas, USA: Dallas/Fort Worth � *Ontario, Canada: Mississauga (a Canada Post facility)

Europe:
� *Munster, Ireland: Cork

   *Bedfordshire, England, UK: Marston Gate � *Inverclyde, Scotland, UK: Gourock

   *Fife, Scotland, UK: Glenrothes � *Neath Port Talbot, Wales, UK: Jersey Marine

   *Loiret, France: Orléans-Boigny (2000), � *Loiret, France: Orléans-Saran (2007),

   *Hesse, Germany: Bad Hersfeld � *Saxony, Germany: Leipzig

Asia: � *Chiba, Japan

*Guangzhou, China � *Shanghai, China

*Beijing, China

Product lines

Amazon has steadily branched into retail sales of music CDs, videotapes and DVDs, software, consumer electronics, kitchen items, tools, lawn and garden items, toys & games, baby products, apparel, sporting goods, gourmet food, jewelry, watches, health and personal-care items, beauty products, musical instruments, industrial & scientific supplies, groceries, and more.
The company launched Amazon.com Auctions, its own Web auctions service, in March 1999. However it failed to chip away at industry pioneer eBay's juggernaut growth. Amazon Auctions was followed by the launch of a fixed-price marketplace business called zShops in September 1999, and a failed Sotheby's/Amazon partnership called sothebys.amazon.com in November.
Amazon no longer mentions either Auctions or zShops on its main pages and the help page for sellers now only mentions the Marketplace. Old links to zShop ((External Link

)) now simply redirect to the Amazon home page, while old links to Auctions ((External Link

)) take users to a transactions history page. New product listings are no longer possible for either service.
   Although zShops failed to live up to its expectations, it laid the groundwork for the hugely successful Amazon Marketplace service launched in 2001 that let customers sell used books, CDs, DVDs, and other products alongside new items. Today, Amazon Marketplace's main rival is eBay's Half.com service.
   Beginning August 2005, Amazon began selling products under its own private label, "Pinzon"; the initial trademark applications suggested the company intended to focus on textiles, kitchen utensils, and other household goods. The list of products registered for coverage by the trademark grew to include items such as paints, carpets, wallpaper, hair accessories, clothing, footwear, headgear, cleaning products, and jewelry. The store launched in public beta September 25, 2007, selling downloads exclusively in MP3 format without digital rights management..
   In August 2007, Amazon announced AmazonFresh

, a grocery service offering perishable and nonperishable foods. Customers can have orders delivered to their homes at dawn or during a specified daytime window. Delivery was initially restricted to residents of Mercer Island, Washington, and was later expanded to several ZIP codes in Seattle proper. AmazonFresh also operated pick-up locations in the suburbs of Bellevue and Kirkland from summer 2007 through early 2008.
In 2008 Amazon expanded into film production and is currently funding the film The Stolen Child with 20th Century Fox.

Review and Recommendation Feature

Amazon.com is known for its candid reviews and its capabilities for recommending products to its customers. The customer reviews are monitored for all negative or indecent comments that are directed at anything, or anyone, but the product itself. In regards to the reviews lacking relative restrictions, Robert Spector who is the author of the book Amazon.com, describes how “when publishers and authors asked Bezos why Amazon.com would publish negative reviews, he defended the practice by claiming that Amazon.com was ‘taking a different approach…we want to make every book available – the good, the bad, and the ugly…to let truth loose’” (Spector 132).

Website

The domain amazon.com attracted at least 615 million visitors annually by 2008 according to a Compete.com survey. This was twice the numbers of walmart.com.
   A popular feature of Amazon is the ability for users to submit reviews to the web page of each product. As part of their review, users must rate the product on a rating scale from one to five stars. Such rating scales provide a basic idea of the popularity and dependability of a product.
   The review feature is an important and highly influential function for customers and one of the main reasons for amazon.com’s success at selling books. As with book reviews anywhere, the buyer must beware that all reviewers have bias. Under normal circumstances, reviews give the reader at least a modest basis for evaluating a given book.
   Because it's an open forum, the reader can benefit from a variety of perspectives. However, the anonymity of web reviewers increases the chances of abuse in the form of self-praise, praise from friends, or malicious criticism. This situation was confirmed in 2004 when the origin of reviews was accidentally made public on an amazon site, and some authors openly confirmed their glowing reviews of their own books.
   Additionally, Amazon created a feature in recent years that allowed users to comment on reviews. This has been met with a mixed reaction, since a few of the high-profile sellers have been getting "spammed" in these forums, regardless of the quality of the reviews. Amazon has done little to enforce the rules of these forums, but did recently add an "ignore" button feature to help counteract the spamming. Nonetheless, at least one critic in the top 50 quit writing for Amazon and began contributing to another site due to the spam issues and Amazon's inability to enforce the rules.
   Amazon provides an optional badging option for reviewers, for example, to indicate the “real name” of the reviewer (based on a credit card) or to indicate that the reviewer is one of the “top” (most popular) reviewers. Some books have well over one thousand reviews (for example Ayn Rand’s Atlas Shrugged), but many books, especially new ones, have none.
   The U.S. site generally has the most reviews, but other country sites offer the perspectives of other reviewers. A review posted on one site isn't necessarily visible on another site.
   Search Inside the Book is a feature which allows customers to search for keywords in the full text of many books in the catalog. The feature started with 120,000 titles (or 33 million pages of text) on October 23 2003. There are currently about 250,000 books in the program. Amazon has cooperated with around 130 publishers to allow users to perform these searches.
   To avoid copyright violations, Amazon.com doesn't return the computer-readable text of the book but rather a picture of the matching page, disables printing, and puts limits on the number of pages in a book a single user can access. One author observed that his entire book could be read online by searching a few words. Amazon is planning to launch Search Inside the Book internationally. Additionally, customers can purchase access to the entire book online via the Amazon Upgrade program, although the selection of books eligible for this service is currently limited.
   According to information in Amazon.com discussion forums, Amazon derives about 40% of its sales from affiliates whom they call "Associates", and third party sellers who list and sell products on the Amazon website(s).
   An Associate is an independent seller or business that receives a commission for referring customers to the Amazon.com site. Associates do this by placing links on their websites to the Amazon homepage or to specific products. If a referral results in a sale, the Associate receives a commission from Amazon. Worldwide, Amazon has "over 900,000 members" in its affiliate programs. Associates can access the Amazon catalog directly on their websites by using the Amazon Web Services (AWS) XML service.
   Amazon was one of the first online businesses to set up an affiliate marketing program. AStore is a new affiliate product that allows Associates to embed a subset of Amazon products within, or linked to from, another website.
   Amazon reported over 1.3 million sellers sold products through Amazon's worldwide web sites in 2007. Selling on Amazon has become more popular as Amazon expanded into a variety of categories beyond media, and built a variety of features to support volume selling. Unlike eBay/Paypal, Amazon sellers don't have to maintain separate payment accounts - all payments and payment security are handled by Amazon itself.
   According to the Internet audience measurement website Compete.com, Amazon attracts approximately 50 million U.S. consumers to its website on a monthly basis.

Acquisitions and spinoffs

In April 1998, Amazon bought the Internet Movie Database (IMDb).

In August 1998, Amazon bought Cambridge, Massachusetts-based PlanetAll for 800,000 shares of Amazon stock. PlanetAll operated a web-based address book, calendar, and reminder service. In the same deal, Amazon acquired Sunnyvale-based Junglee, an XML-based data mining startup for 1.6 million shares of Amazon stock. The two deals together were valued at about US$280 million at the time.

In June 1999, Amazon bought Alexa Internet, Accept.com and Exchange.com in a set of stock deals worth approximately US$645 million.

In 2004, Amazon purchased Joyo.com, a Chinese e-commerce website. It also debuted A9.com, a company focused on researching and building innovative technology.

In March 2005, Amazon acquired BookSurge, a print on demand company, and Mobipocket.com, an eBook software company.

In July 2005, Amazon purchased CreateSpace (formerly CustomFlix), a Scotts Valley, CA-based distributor of on-demand DVDs. Since the acquisition, CreateSpace has expanded its on-line services to include on-demand books and CDs, as well as video downloads. On July 30, 2007, the National Archives announced that it would make thousands of historic films available for purchase through CreateSpace.

In February 2006, Amazon acquired Shopbop, a Madison, Wisconsin-based retailer of designer clothing and accessories for women.

In May 2007, Amazon acquired dpreview.com, a London-based digital photography review website created by Phil Askey as his personal hobby website and Brilliance Audio, the largest independent publisher of audiobooks in the United States.

In January 2008, Amazon announced that it would acquire audiobook provider Audible.com for $300 million in cash.

Noteworthy events

In 2002, Amazon became the exclusive retailer for the much-hyped Segway Human Transporter. Bezos was an early supporter of the Segway before its details were made public.
   In 2003, Amazon purchased the rival online music retalier CD Now, which was founded in 1994.
   On June 21 2003, Amazon coordinated what was at the time one of the largest sales and distribution events in e-commerce history with the sale of over 1.3 million copies of Harry Potter and the Order of the Phoenix, since beaten by Harry Potter and the Deathly Hallows with a sale of over 2 million copies preordered in 2007.
   On July 16 2005, Amazon celebrated its 10th anniversary by telecasting a worldwide live concert hosted by Bill Maher and artists such as Bob Dylan and Norah Jones.
   On December 13 2007, Amazon paid £1,950,000 for a hand written copy of The Tales of Beedle the Bard by J. K. Rowling.
   In December 2007, Amazon was fined €100,000 by the The Tribunal de Grande Instance in France for offering free shipping. The 1981 Lang Law prohibits companies from discounting books by more than 5%.

Products and services

Amazon.com has incorporated a number of products and services into its shopping model, either through development or acquisition.

2001

Honor System and donations:The Honor System was originally launched in 2001 to allow customers to make donations or buy digital content, with Amazon collecting 2.9 percent of the payment plus a flat fee of $0.30 USD.

2002

Web Services:Amazon launched Amazon Web Services (AWS) in 2002. The service provides programmatic access to many features leveraged behind the scenes on its website.

2004

Amazon also created "channels" to benefit certain causes. In 2004, Amazon's "Presidential Candidates" allowed customers to donate US$5-200 to the campaigns of 2004 U.S. presidential hopefuls. Amazon has periodically reactivated a Red Cross donation channel after such tragedies as 9/11 and Hurricane Katrina. After the 2004 earthquake and tsunami in the Indian Ocean, Amazon set up an online donation channel to the American Red Cross, waiving its processing fee. As of January 2005, over 162,000 individuals had donated over US$13.1 million. Similar channels were set up for the British, Canadian, French, German and Japanese Red Cross organizations. Over 7,000 Britons donated more than US$350,000; 900 Canadians over US$56,000; 660 French over US$23,000; 2,900 Germans over US$145,000; and 1,900 Japanese over US$66,000.

2005

Prime:Amazon Prime offers customers free 2-day and discounted priority shipping for a yearly fee of US$ 79. Amazon launched the program in the continental United States in 2005, Japan in June 2007 and the United Kingdom and Germany in November 2007.

Shorts:Launched in 2005, Amazon Shorts offers exclusive short form content, including short stories and non-fiction pieces from best-selling authors, all available for immediate download at US$.49. As of June 2007, the program has over 1,700 pieces and is adding about 50 new pieces per week.

Mechanical Turk:In November 2005, Amazon.com began testing Amazon Mechanical Turk, an application programming interface (API) allowing programs to dispatch tasks to human processors.

2006

S3:In March 2006, Amazon launched an online storage service called Amazon Simple Storage Service (Amazon S3). An unlimited number of data objects, from 1 byte to 5 gigabytes in size, can be stored in S3 and distributed via HTTP or BitTorrent. The service charges monthly fees for data stored and for data transferred.

Discussion boards:In August 2006, Amazon launched product wikis (later folded into Amapedia) and discussion forums for certain products using guidelines that follow standard message board conventions.

EC2:In August 2006, Amazon introduced Amazon Elastic Compute Cloud (Amazon EC2), a virtual site farm, allowing users to use the Amazon infrastructure with its high reliability to run diverse applications ranging from running simulations to web hosting.

2007

Amapedia:In January 2007 Amazon launched Amapedia, a collaborative wiki for user-generated content to replace ProductWiki.

Unbox:In March 2007, Amazon launched an online video on demand service, which has been criticized for its use of digital rights management (DRM).

MP3 downloads:In September 2007, Amazon launched a new music store (currently in beta) called Amazon MP3, which sells downloadable tracks, all in the MP3 format and most recorded at 256 kilobits per second variable bitrate (VBR). Amazon's terms of use agreements legally restrict use of the music, but Amazon doesn't use DRM to enforce those terms. � Amazon MP3 is selling music from the Big 4 record labels, EMI, Universal, Warner Music, and Sony BMG, as well as many independents; as of January 2008 they're the only store to sell DRM-free music from all Big 4 labels. Previous to the launch of this service, Amazon made an investment in Amie Street, a similar music store with a variable pricing model based on demand.

Vine:In August 2007 Amazon launched Amazon Vine, which allows top product reviewers free access to pre-release products from vendors participating in the program.

FPS:In August 2007 Amazon launched a payment service specifically targeted at developers. Amazon FPS has facilities for developing many different charging models including micro-payments. The service also gives developers easy access to Amazon customers.

Kindle:In November 2007, Amazon launched Amazon Kindle, an e-book reader which downloads content over "Whispernet," a free EV-DO wireless service on the Sprint Nextel network. Initial offerings include approximately 115,000 books, newspapers, magazines and blogs. The screen uses E Ink technology to reduce battery consumption.

SimpleDB:In December 2007, Amazon introduced SimpleDB, a database system, allowing users of its other infrastructure to utilize a high reliability high performance database system.

2008

Amazon MP3: In January 2008 Amazon announced they'd be rolling out their Amazon MP3 service to their subsidiary websites worldwide throughout the year.

Undated

Connect:Amazon Connect enables authors to post remarks on their book pages and to customers who have bought their books.

WebStore:WebStore by Amazon allows businesses to create e-commerce websites using Amazon technology. Merchants can customize their sites using their own photos and branding. Sellers pay a commission of 7 percent, which includes credit-card processing fees and fraud protection, and a subscription fee of $59.95/month for an unlimited number of webstores and listings.

Controversies

Trademark infringement

In 1999 the Amazon Bookstore Cooperative of Minneapolis, Minnesota sued Amazon.com for trademark infringement. The cooperative had been using the name "Amazon" since 1970, but reached an out-of-court agreement to share the name with the on-line retailer.

Patent use

The company has been controversial for its alleged use of patents as a competitive hindrance. The "1-click patent" is perhaps the best-known example of this. Amazon's use of the one-click patent against competitor Barnes and Noble's website led the Free Software Foundation to announce a boycott on Amazon in December 1999. The boycott was discontinued in September 2002.
   On February 22, 2000, the company was granted a patent covering an internet-based customer referral system, or what is commonly called an "affiliate program". Reaction was swift and negative. Industry leaders Tim O'Reilly and Charlie Jackson spoke out against the patent, and O'Reilly published an open letter to Bezos protesting the 1-click patent and the affiliate program patent, and petitioning him to "avoid any attempts to limit the further development of internet commerce".
   O'Reilly collected 10,000 signatures with this petition. Bezos responded with his own open letter. The protest ended with O'Reilly and Bezos visiting Washington D.C. to lobby for patent reform.
   On February 25, 2003, the company was granted a patent titled "Method and system for conducting a discussion relating to an item on Internet discussion boards".
   On May 12 2006, the USPTO ordered a reexamination of the "One-Click" patent, based on a request filed by Peter Calveley, who cited as prior art an earlier e-commerce patent and the Digicash electronic cash system.

Canadian operations

Amazon has a Canadian site in both English and French, but is prevented from operating any headquarters, servers, fulfillment centers or call centers in Canada due to that country's legal restrictions on foreign-owned booksellers. Instead, Amazon's Canadian site originates in the United States, and Amazon has an agreement with Canada Post to handle distribution within Canada and for the use of the Crown corporation's Mississauga, Ontario shipping facility. The launch of Amazon.ca generated controversy in Canada. In 2002, the Canadian Booksellers Association and Indigo Books and Music sought a court ruling that Amazon's partnership with Canada Post represented an attempt to circumvent Canadian law, but the litigation was dropped in 2004.

Customer service

Amazon.com previously didn't publish its toll-free customer service number on its own web site. Customers can submit written customer service requests (which are answered by e-mail), call a toll-free number, or use a click-to-call service to be connected by phone to an available service representative.
Before Amazon published its phone number, numerous web pages existed solely to publish the Amazon.com customer service phone numbers. One such page received in excess of 23,000 visits in December 2004 alone. Despite the perceived difficulty in reaching customer service by phone, Amazon.com "remains the leader among e-tailers" in customer satisfaction according to the American Customer Satisfaction Index's fourth-quarter 2007 survey.

Labor relations

Amazon has opposed efforts by trades unions to organize in both the United States and the United Kingdom.
   In 2001, 850 employees in Seattle were laid off by Amazon.com after a unionisation drive. The Washington Alliance of Technological Workers (WashTech) accused the company of violating union laws, and claimed Amazon managers subjected them to intimidation and heavy propaganda. Amazon denies any link between the unionisation effort and the lay-offs.
   Also in 2001, Amazon.co.uk hired a US union-busting organization, The Burke Group, to assist in defeating a union recognition campaign by the Graphical, Paper and Media Union (GPMU, now part of Amicus) to achieve recognition in the Milton Keynes distribution depot. It was alleged that the company victimised or sacked four union members during the 2001 recognition drive and held a series of captive meetings with employees.
   Some employees of Amazon in the United Kingdom are required to submit to drug tests and can have their employment terminated on a positive test. However, the reliability of the tests has been called into question, as in the case of an Amazon worker who won a tribunal case

against the company.

The Humane Society of the United States v. Amazon.com, Inc., et al.

Amazon continues to carry two cockfighting magazines and two dog fighting videos although the Humane Society of the United States (HSUS) contends that the sale of these materials is a violation of U.S. Federal law. The Humane Society of the United States has filed a lawsuit against Amazon. A campaign to boycott Amazon purchases gained momentum in August 2007 after the much publicized dog fighting case involving NFL quarterback Michael Vick.

Reader reviews credibility

A 2004 glitch in Amazon.ca's review system revealed that many well-established authors were anonymously giving themselves glowing reviews, with some revealed to be anonymously giving "rival" authors terrible reviews. The glitch in the system was fixed and those reviews have since been removed or made anonymous.

BookSurge

In March 2008, sales representatives of Amazon's BookSurge division started contacting publishers of print on demand titles to inform them that for Amazon to continue selling their POD-produced books, they'd need to sign agreements with Amazon's own BookSurge POD company. Publishers were told that eventually, the only POD titles that Amazon would be selling would be those printed by their own company, BookSurge. Some publishers felt that this ultimatum amounted to monopoly abuse, and questioned the ethics of the move and its legality under anti-trust law.

Easter eggs

Two easter eggs exist on Amazon.com's website. They are reached by invisible links at the center of the page below the last line of text.

An invisible link at the very bottom of the "Directory of All Stores

" page leads to a February 2002 tribute to retiring Amazon.com Senior Vice President David Risher, "Amazon.com's favorite site surfer

At the very bottom of Amazon.com's Sports & Outdoors store

, an invisible link leads to a November 2007 tribute to retiring Chief Information Officer Rick Dalzell, "Amazon.com's favorite fisherman

." Additionally, at the bottom of the source code for the main page the word 'MEOW' is written in a comment.

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