“Amazon Empire”: 10 Key Takeaways from FRONTLINE’s Documentary on Jeff Bezos’ Rise and Reign

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February 20, 2020

On Feb. 18, the PBS investigative series FRONTLINE released a two-hour documentary investigating how Jeff Bezos turned Amazon from a tiny company run out of a garage into a business empire that is without precedent in the history of American capitalism.

Based on a year of reporting from a team led by James Jacoby and Anya Bourg, Amazon Empire: The Rise and Reign of Jeff Bezos raises tough questions about the cost of Amazon’s convenience, and reveals how the company that began as an online bookseller is now shaping our lives in both visible and invisible ways that go far beyond commerce.

The full documentary is now streaming at the top of this story, on the PBS Video App, on YouTube and on-demand. Here are ten key takeaways from FRONTLINE’s investigation of Amazon’s ascent and its consequences:

1. Bezos’ very first employee at Amazon, Shel Kaphan, now says he is concerned that Amazon has become a “huge and unstoppable force” and he goes so far as to say that it “could potentially make sense” to break up parts of the company.

In an exclusive interview, the man who helped Bezos build the foundation for Amazon 26 years ago speaks out about his concerns for the first time. “On the one hand, I’m proud of what it became, but it also scares me,” Kaphan tells FRONTLINE. “And I just feel like it’s important for someone in my situation to at least say what they think about what’s going on.” Kaphan is one of 15 former or current Amazon executives and insiders whom FRONTLINE interviewed while making the documentary; excerpts from 11 of those interviews can be explored here.

2. For Bezos, dominating online commerce is just the beginning — and gathering and analyzing data on customers has been a critical component of Amazon’s strategy from the start.

Through Amazon, which is now valued at nearly a trillion dollars and includes a cloud computing division that has a massive contract with the CIA, Bezos is in a unique position to play a role in shaping not just the future of commerce, but also the future of work, technology and national security. That position has been realized in part through the company’s command of data. Even in Amazon’s early days, Bezos treated the site as a laboratory where customer behavior could be studied, predicted and potentially influenced. “I was shocked to see how predictable people are,” former Amazon chief scientist Andreas Weigend tells FRONTLINE, adding that through what the site tracked, he could see what people “were falling for.” “We did not think about it as exploiting,” he says. “We thought about helping people make better decisions.”

3. In its early push to dominate bookselling, the company used tough tactics to challenge publishers on prices and profit margins — and Bezos reportedly compared small publishing companies to sickly gazelles.

Amazon took over a large market share of the publishing industry very, very fast,” James Marcus, a former senior Amazon.com editor, tells FRONTLINE — a situation that he says prompted publishers to realize, “’Oh, wait a minute, they’re our partner, but they now have the beginnings of a boot on our windpipe’.” Inside the company, the team had launched a strategy that some called “the Gazelle Project,” because they’d heard Bezos wanted them to pursue publishers the way a cheetah pursues a sickly gazelle. “Well, you don’t go after the strongest,” Randy Miller, who ran the European book team, says of the strategy. “He’s like, ‘The cheetah. The cheetah looks for the weak, looks for the sick, looks for the small.’” That way, by the time it comes to take on the publishers at the top, “the noise has gotten back to them. They’re going to know this is coming, and chances are you may be able to settle that without a full-on war.”

4. Bezos is now the richest man in the world. But Amazon wasn’t always so profitable — and that was actually part of his long-game-focused strategy.

In a letter Bezos sent to shareholders after the company first went public, “he essentially says we are going to forgo profits in order to take market share; that our strategy is to lose money, which enables us then to put other companies out of business who can’t afford to lose money,” says Stacy Mitchell, co-director of the Institute for Local Self-Reliance. That strategy would’t sit well with critics like Mitchell, who advocates for small businesses: “In essence, at the very beginning he’s signaling to shareholders, ‘I have a strategy to monopolize the market and that’s going to reward you, but it’s going to be far down the road, and will you come along with me?’ And they said yes.” Along with Amazon’s sales tax advantage (as an online retailer, the site wasn’t required to charge sales tax like physical stores), the strategy would help to support Amazon’s success as it expanded beyond books to other products.

5. The increasingly ubiquitous voice known as Alexa took Amazon’s data gathering to a new level.

Since it first launched its Echo smart speaker in 2014, Amazon has marketed the voice known as Alexa as a virtual assistant who makes navigating daily life more efficient and entertaining. But Alexa is also a way for the company to extend its data gathering: “Convincing people to just deploy something like this in their home is— it’s a brilliant trick,” says privacy expert Meredith Whittaker, co-director of the A.I. Now Institute at NYU. In the film, FRONTLINE presses Amazon’s head of devices, Dave Limp, on whether the company did a good enough job telling customers about Alexa’s privacy implications – including the revelation last year that Amazon employs thousands of people around the world to listen to and transcribe some voice recordings in an attempt to improve the Alexa algorithm. In the wake of that information going widely public, the documentary reveals that even one of the co-founders of Amazon Web Services approaches Alexa with caution: Robert Frederick, who left the company in 2006, tells FRONTLINE that he turns off his Alexa devices “whenever I want to have a private moment … I don’t want certain conversations to be heard by humans.” 

6. Amazon Web Services, the company’s cloud computing division, has marketed its facial recognition technology to police departments but its former chief AI scientist says such technology is not “battle-tested” and not “ready for prime time in challenging applications like law enforcement.”

In her first interview about her concerns, former AWS principal scientist Anima Anandkumar told FRONTLINE she was particularly alarmed by an MIT study that found the software prone to mistakes with darker-skinned faces; Amazon has questioned the study’s methodology. “The tools are not what I call battle-tested, and we still do not understand how well they work in the environments in which they’ll be applied,” Anandkumar says. “That’s where I see a danger.” In the film, AWS CEO Andy Jassy defends the sale of its facial recognition technology to law enforcement: ”We believe that governments and the organizations that are charged with keeping our communities safe have to have access to the most sophisticated, modern technology that exists,” he says. 

7. A former product safety manager at Amazon says the assumption that products sold on the platform meet a pretty high safety standard “would be incorrect.”

That former product safety manager, Rachel Johnson Greer, says that’s because Amazon, like other tech companies, takes the position that it’s not legally responsible if its customers are harmed by products sold by third parties on the site. She says she worried that Amazon was being flooded with untested and potentially unsafe products, and that she repeatedly told others at the company that “no customer wants to buy an unsafe product. No customer wants selection that harms their child.” In the documentary, Jeff Wilke, CEO of Worldwide Consumer at Amazon, defends the company’s product safety efforts, saying “we work really hard to make sure” items sold on the site are safe.

8. Questions about Amazon’s treatment of workers at its warehouses, which it calls “fulfillment centers,” persist.

In interviews with FRONTLINE, former fulfillment center employees describe a work environment in which they felt pressured to pick and pack items at productivity rates they say are “unrealistic.” “The part they don’t talk about is the safety rules that you have to ignore to make rate,” one former Amazon fulfillment center employee says. “It’s not just that you go in and you do your job and that’s it … it’s incredibly hard to meet rate while following all the safety procedures.” The former employees say the pressure they feel is heightened by Amazon’s use of technology to gather data on what’s happening — and how quickly — in its warehouses. Wilke strongly defends the company’s treatment of workers and its commitment to safety, saying, “From the moment I arrived 20 years ago, I made it very clear to our operations teams that we will not compromise the safety of our employees to do anything else.” But in recent weeks, 15 Democratic senators sent a letter to Bezos condemning what they said was the company’s “dismal” record on worker safety, and calling for change to its “profit-at-all costs culture.”

9. Amid potential antitrust scrutiny, Amazon has been very careful in how it talks about its size — even instructing employees around the use of terms like “monopoly.”

“When I worked at Amazon, we had training specifically on the use of terms like monopoly,” says James Thomson, a former senior manager at the company, adding that he was told to use a term called “market segment share” instead of “market share.” “What is market segment? What is market segment share?” he said. “I don’t know, but I know the lawyers at Amazon feel those terms are much safer than using terms like market share … in essence, it’s a polite way of saying, ‘I’m not gonna talk to you about how big we are.’” Top-level Amazon executives took a similar approach in interviews with FRONTLINE, downplaying the nearly-trillion-dollar company’s scope and size. In the context of the global economy, Amazon is just “a speck,” Wilke asserts. And Jassy says, “Simply because the company’s been successful in a few different business segments doesn’t mean it’s somehow too big.”

10. How Amazon wields its power over the online marketplace, and whether it’s doing so in anticompetitive ways, has now become a question for government regulators.

Amazon is under scrutiny by the Federal Trade Commission, European Union regulators, and the U.S. Congress, where Rep. David Cicilline (D-RI) has launched an antitrust investigation into Amazon and the other tech giants. “We have seen evidence of anticompetitive behavior by all of the large platforms as a result of their market dominance. But it sort of doesn’t fall on the companies to fix this problem,” Cicilline tells FRONTLINE. “It falls on us.” Shel Kaphan, Amazon’s first employee, makes a similar point: “I think they’re doing what the business schools teach people to do, and they’re doing it aggressively and skillfully and with great intelligence. And they will continue to do that unless they’re constrained by other forces in society.”

For the full story, stream Amazon Empire: The Rise and Reign of Jeff Bezos, and explore excerpts from interviews with 11 current and former Amazon executives and insiders.


Patrice Taddonio

Patrice Taddonio, Digital Writer & Audience Development Strategist, FRONTLINE

Twitter:

@ptaddonio

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