Daily Updates, Future Ear Radio

Land of the Giants Podcast (Future Ear Daily Update 8-6-19)

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I recently came across Jason Del Rey’s great new podcast, Land of the Giants, which looks at how the biggest tech companies have risen to power. Jason works with Recode media, which was originally founded by former Wall St. Journal tech writers, Walt Mossberg and Kara Swisher in 2014. In 2015, Vox Media bought Recode and integrated it into Vox.

The first season of Land of the Giants covers Amazon and how it became to be such a dominant force in the economy. There have been three episodes to date, with the first episode covering the history of Amazon prime. It’s fascinating to hear first-hand accounts of how Amazon’s flagship service came to be, especially in light of how many issues were plaguing the company at the time, such as too-frequent website crashes.

When Jeff Bezos initially pitched Prime, the core of his thesis was that he wanted to create an impenetrable moat around his top customers, and Prime was considered a long-shot by many internally and externally. One of the major breakthroughs that Amazon had with Prime, however, was from the work of Jeff Wilke, Amazon CEO of Global Consumer, and his operations team inside the fulfillment centers. Wilke’s team was able to shrink the average processing time of an order from 24 hours to 3 hours. These new order cycle times began to be implemented in 2003 and sparked the initial growth of Amazon Prime, which snowballed from there.

The second episode explores Alexa, with the focus being around Amazon’s desire to own the inside of the consumer’s home. As I have written about in great length on this blog, Amazon’s echo devices are proliferating at a staggering rate, representing the fastest adoption of any consumer device to date. While I believe Amazon’s ambitions for Alexa go far beyond the home, the home is absolutely the base for the technology to mature, while serving as a central hub to the internet-of-things (something that has been sorely lacking with the IoT).

Alexa not only represents an interface to facilitate “conversation” between previously rudimentary devices that have since been made voice-enabled, but it also stands change the way Prime members shop. The more Amazon integrates into IoT devices, the more echo devices it can sell to cater to more, “IoT access points” within one’s home. The more that Prime members begin to order through their voice, Amazon’s Prime Member moat becomes all the more defensible. If there’s one thing you’ll learn from this new podcast, it’s that Amazon absolutely obsesses over its customers and will continue to make Prime more unique and valuable, which means it will continue to drive the customer acquisition cost of its Prime members through the roof for any competitors trying to poach them away.

-Thanks for Reading-


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