SEATTLE - In a rich and wide-ranging conversation with the digital editor-in-chief of France's leading business daily Les Echos, Amazon founder Jeff Bezos, 47, reflects on the lightening fast evolution of the Internet, and his company's ability to compete in everything from e-commerce to media to cloud computing. And his plans for the future: trying to figure out what big things are going to change -- and what won't.
People in the U.S. now spend more time on mobile apps than on the Web. How far do you think we are in the digital revolution? Somewhere in the middle?
I doubt it. Were just at the beginning. Day One. Dont you think?
I dont know. Youre the expert.
I think so. With new technologies, its very tempting to think that youre further along than you are. But usually, youre more primitive than you think. My guess is were still pretty primitive. We as a society, as a civilization. I doubt we have figured out the new technologies very well yet.
And as Amazon, where are you ?
Were the same. Were part of that civilization (laughs). Were doing our part in trying to push things forward, but I have the feeling its Day One.
What has been the most stunning change since you founded Amazon in 1995?
The most amazing change Looking at over 15 years, the most stunning is the pace at which the Internet has developed. In 1995, I had to raise a million dollars from 22 angel investors who invested around $50,000 each to fund Amazon, and the question all those investors had was whats the Internet ? That was just 16 years ago Its been such an extraordinary change, weve never seen a change that rapid. Go back and look at other major technological changes, jet travel, the automobile, radio, television, the telephone: you can look at their growth rate, and nothing has ever swept in as quickly and as globally as the Internet. If you want something that qualifies as stunning, thats probably a first in the history of civilization.
And what will be the next stunning change in the digital world ?
That is difficult question. I spend most of my time trying to find what the Internet is not going to change Because we can build business plans on things that are stable, but its harder to build a business plan on something that is going to change rapidly. But if I stay focused on your question and say whats going change over the next 10 years, its probably mobile technology, wireless technology. These smart phones and tablets that we have today are going to become increasingly sophisticated.
Does it worry you?
No. It delights me ! (laughs) Its great for retail business. Historically, our business has been built on top of people buying from their desktop computer and their laptop computer, which you can only use in a couple of postures. And the tablets and the smartphones open up a completely new posture. The tablet for example means you can lay back on your sofa and shop on Amazon. I love that and I encourage you to do it ! (laughs)
Today, Amazon is retailing, and merchant, and cloud, and Kindle, and food, and Amazon studios Are you a specialist of anything ?
At the broadest level, I think there are three things that define Amazon, and they are cultural attributes more than business areas. One is customer obsession, as opposed to competitor obsession. A lot of companies have been successful on focusing on their competitors, but thats not our way. Second, is willingness to think long-term and third is willingness to invent, which includes the willingness to be misunderstood, otherwise you cant invent.
Inside that framework, were willing to learn new skills. So there is a tension between willingness to learn these new skills and deciding that youre an expert in something that youre gonna stay focused on.
Amazon Web services or Kindle are both good examples. They require us to learn new skills when some companies would say that you should stay focused on what youre good at. What that really says is dont learn new skills or only learn incremental new skills. Dont ever try to learn something new!
When we did Kindle, Im going back seven years now, we had to learn how to design hardware, how to manage a supply chain for hardware. A bunch of new skills. Now were going to hire sophisticated people, but still, we need to learn new skills institutionally as well, and so were bringing that skills set into practice. I think its essential for companies to be incremental learners, but also to be willing every once in a while to pick up a whole new skill set that you werent previously focused on.
You mentioned being misunderstood. Have you been misunderstood ?
Yes its normal.
Have you ever had doubts?
Everything important weve ever done had some level of misunderstanding. And there are at least two kinds of critics. There are people who sincerely misunderstand and they want everything to work out well but theyre worried about it. And theres a second kind of critic who has a self-interest to misunderstand If youre gonna do something new, something that has never been done before, people are going to misunderstand for one of those two reasons. And what you need to do when you hear that kind of criticism is first to open your mind and say Are they right? Are we doing something wrong? Are we make a mistake for some reason?. And if it the case, change your course. But if you look at it and you still have the conviction that your new way is worth pursuing, then you have to ignore those critics, otherwise you cant do anything new.
Have you ever changed a major decision ?
We have. Weve given up on projects that have failed. Many times. We have to stay stubborn on the vision but we can change on the details. Our third-party seller business is like that: we launched Amazon Auctions, and many people criticized it, and they turned out to be right (laughs) ; and then we launched The Shop, and many people criticized it, they were right, it didnt work ; and then we launched Market Place, which has become Merchant Sellers, and that was a big success. Thats an example of staying very stubborn on the vision when underneath, all the executional details got changed twice.
In terms of Amazon categories, what are the next ones youre dreaming of?
In most of the categories, the most were doing is adding depth. Were in most of the major categories already and well continue to roll things out. Our focused areas are on electronics, apparels, some consumable items. And in media, we really focus on digital, and thats true for books but also for video, music, audio books, video games... So we sort of have our media business undergoing a digital transformation that were working very hard on. In our physical products business, there are still so much opportunities to continue to add selection inside existing categories.
Food, cloud and Kindle How would you rate those three areas ?
(Laugh). Wow. I dont know if I could do that! But it reminds me of that famous quote : if I have a little money, Ill buy books. If theres any left over, Ill buy food (laugh). But I dont think I could rate those things for you. I apologize
Do you want to become the king of Cloud ?
Amazon Web services is operating in this new arena that is so big that there are going to be multiple winners. And I believe our team had done such a good job that they are likely to be the leader in that arena, and certainly I hope that they will be one of the major leaders.
How will you achieve that?
The big success drivers in our business are innovation, operation excellence, and cost structure. So were constantly driving new services that developers can use, thats the innovation piece. Operational excellence is making sure that the services are highly available, minimizing any downtime. We want our system to be operationally and statistically indistinguishable from perfect. And then becoming efficient so that we can continue to drive the cost structure down and offer these Web services at very good prices. Thats our approach.
Amazon has now 38000 employees. Has it changed your approach of management and the corporate culture?
The key points for corporate culture are customer obsession, willingness to invent and long term orientation. Those three things have not changed. I do worry, because other companies changed their culture when they got big. If we look out at the future, I dont what that to happen, and I like the culture that we have. I like the internal dynamics at Amazon: people are energetic around debate and controversy, and theyre candid with one another. In some other large companies, Ive observed that people sometimes sort of optimized for social cohesion instead of truth seeking. And I want us to avoid that change. Its a sort of mantra that I repeat over and over, because it takes energy to seek the truth. Its easier to just get along (laugh).
What were the last threes things you bought on Amazon ?
I bought soccer cleats, a science fiction novel on my Kindle called Robopocalypse, and a video episode of The new adventures of Old Christine. That was just last night.
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