Steve Jobs occupies rarefied air on any ranking of entrepreneurs, having shaken up the computer, movies, music, tablet, and phone industries. The only other person breathing the same molecules is Jeff Bezos. From my perspective, this is somewhat forgotten because he is outside of Silicon Valley, but the case is obvious. Starting with books, Amazon has grown to revolutionize numerous retail markets. But, like Jobs, what is most impressive is Bezos’s ability to create new markets, disregarding the limiting management notion of sticking to your “core competency.”
Of course, there is the Kindle. A hardware business, completely different than the shipping of books, that Amazon now has mastered, even withstanding the tablet assault. In creating the beloved Kindle, it has accelerated the digitalization of books, making it happen despite the foot-dragging of the publishing industry. Two other examples come to mind today.
First, on Amazon’s website today, a note explains the increased content on its video streaming service, which comes bundled with Amazon Prime. Streaming provides a big additional reason for consumers to pay that $79 for the Amazon Prime expedited shipping service, and consequently for those consumers to transfer more of their retail spend online, having paid the fee. For consumers who see the fee as substituting for a Netflix screaming subscription, it helps overcome whatever hesitation there is to spend $79 for shipping upfront. So, in addition to jumping into the streaming business in a big way, Amazon is also bolstering its retail business.
Second, is Amazon’s cloud service. As part of Marc Andressen’s WSJ essay on software today he notes that:
On the back end, software programming tools and Internet-based services make it easy to launch new global software-powered start-ups in many industries—without the need to invest in new infrastructure and train new employees. In 2000, when my partner Ben Horowitz was CEO of the first cloud computing company, Loudcloud, the cost of a customer running a basic Internet application was approximately $150,000 a month. Running that same application today in Amazon’s cloud costs about $1,500 a month.
To put a number on it, what Amazon has done is help cut the cost of launching an application by 99%. Not only is Amazon’s cloud services an amazing business for it, Amazon,along with others surely, but with significant credit due to it, has made the world an innovation platform, enabling the low-cost, lean, prototyping innovation culture of today. For this, and his willingness to jump into completely different businesses, Bezos, like Jobs, deserves to be recognized as occupying another plane among innovators.