Who Can You Trust at Amazon?

New moves at the end of 2020 signal big changes to come

I hope you all had a lovely few days off for the Christmas weekend (I loved all those NBA games! Almost all of them since have been trash, though) and are looking forward to a fun, safe, and relaxing New Year’s Eve / New Year’s Day.

I hope you’ll forgive me for keeping this newsletter brief; I’m just going to do a quick link roundup with commentary. We are all ready to move on. So!


Amazon Buys Wondery

The rumors were true: Amazon has finally closed on a deal to acquire Wondery, a podcast production company a la Spotify’s Gimlet. This gives Amazon an ownership state not just in podcast distribution, but content and production. Wondery podcasts will continue to be available on other platforms, but it’s a significant step in (as I wrote last time) a growing industry not just for Amazon, but for tech companies and our media culture at large.

From Amazon’s release:

Amazon Music launched podcasts in September 2020, and together with Wondery, we hope to accelerate the growth and evolution of podcasts by bringing creators, hosts, and immersive experiences to even more listeners across the globe, just as we do with music. This is a pivotal moment to expand the Amazon Music offering beyond music as listener habits evolve. Our commitment to podcasts, our focus on high quality audio with the Amazon Music HD tier, and our recent partnership with Twitch to bring live streaming into the app, make Amazon Music a premiere destination for creators.

Kinda ambitious! And they didn’t even mention Audible! Wondery creators spinning off lengthier storytelling to make e-books and audiobooks for Amazon/Kindle/Audible feels like a natural move. And that content will likely NOT be quite so widely available.

Presumably, the Wondery standalone app will continue as well, at least for a little while; eventually, you could imagine it either folding into Amazon Music or becoming a different kind of dedicated Amazon podcasts app.

Podcasts have been the next been thing for years now, but all of the pieces finally seem to be coming together for a marketplace that’s both integrated and competitive. Big endgame energy! But on the plus side: never have listeners had so many options for platforms and creators they can choose to enjoy.


Spotify Is Looking Ahead

This is not explicitly about Amazon, but since we’re on the topic of podcasts, music, and media apps metastasizing into yet other forms of media, I’d be remiss if I didn’t link to my 2021 prediction for Nieman Journalism Lab. It’s pretty simple: Spotify is going to push into video.

The new video series will be on free Spotify (with video ads) and paid Spotify, as part of a subscription. It will be one-stop shopping for a big chunk of multimedia news and entertainment. It’s not just music, it’s not just podcasts; it’s a little bit of everything. It will be harder for vanilla podcast apps and “I don’t need to find them, good videos will find me” social media players to compete against an app that’s offering something closer to a general-purpose multimedia subscription. And digital and hybrid news organizations who might be wary of tying their fortunes to yet another media platform will have to figure out what they want to do.

On the other hand, Spotify’s and its subsidiaries’ labor problems (including reclassifying employees as contractors and dodging negotiations with their unions) won’t go away any time soon and could also continue to be a troubling model for other news organizations moving to multimedia. Platforms, media types, labor issues, new audiences: Spotify is going to be at the center of a lot of discussions around the future of journalism going forward, even if the company itself isn’t always mentioned by name.

In many ways, Amazon is the competitor best suited to match Spotify’s media ambitions. The Wondery acquisition is part of that; so is the continued development of Prime Video and Twitch. But I believe Spotify is in a good position to make a first push into news video in a way that Amazon isn’t.

Despite Jeff Bezos owning the Washington Post, and big promises in the past (remember how the Kindle DX was going to save newspapers?), Amazon has never really cracked the news business. Doesn’t matter whether it’s newspapers, magazines, weblogs, audio, or video. Amazon sells entertainment, consumer goods, and infrastructure first, everything else a very distant fourth. But that could always change.


MacKenzie Scott Continues To Give Her Fortune Away

From Bloomberg, on the Amazon co-founder (and former spouse of Jeff Bezos) and her philanthropy efforts:

“This pandemic has been a wrecking ball in the lives of Americans already struggling,” she wrote in the post on Medium. “Economic losses and health outcomes alike have been worse for women, for people of color and for people living in poverty. Meanwhile, it has substantially increased the wealth of billionaires.”

Scott’s gifts this year approach $6 billion, which “has to be one of the biggest annual distributions by a living individual” to working charities, according to Melissa Berman, chief executive officer of Rockefeller Philanthropy Advisors…

Scott’s advisers zeroed-in on 384 groups to receive gifts, she said in the post, after considering almost 6,500 organizations. Donations were focused on those “operating in communities facing high projected food insecurity, high measures of racial inequity, high local poverty rates, and low access to philanthropic capital.”

Recipients include more than 30 institutions of higher education, including several tribal colleges and historically Black colleges and universities. More than 40 food banks received money, as did almost four dozen local affiliates of Goodwill Industries International.

Bezos himself has given about $900 million to charitable causes this year, focusing on countering climate change and family homelessness. But Scott has given away almost seven times that, without creating an onerous philanthropic structure. She truly seems to be invested in getting as much of her money as she can to the most people in the most dire need as quickly as possible, in some cases without the recipient organizations even requesting charitable help. In a world where too many tech billionaires tie a lot of strings to their money or invest it in quixotic schemes that fulfill their fantasies but don’t do much to help other people, it’s frankly quite inspiring.


Bezos Takes Charge at Amazon

At Business Insider, Eugene Kim has a meaty story about how COVID-19 brought Amazon’s CEO back to full involvement in the company’s day-to-day business operations. Highlights:

After he had spent the past few years almost exclusively focused on long-term initiatives, like his space company Blue Origin and other secretive hardware projects at Amazon, Bezos is now fully back in the trenches, driving discussions on the most pressing issues facing the company, six people familiar with the matter told Business Insider. 

Bezos' daily oversight primarily centers around the company's response to COVID-19 but also includes addressing other immediate challenges, such as counterfeits, workplace diversity, and emerging competitive threats, like Shopify, said those people, who spoke on the condition of anonymity because they weren't authorized to discuss Amazon's business publicly.

It's a dramatic shift for Bezos, who had taken a more hands-off approach in recent years. The 56-year-old founder of Amazon has often said he prefers working two to three years into the future and that he rarely gets pulled into daily operational work because he's able to delegate most decisions.

The change first started to take shape earlier this year when COVID-19 upended Amazon's core operations, The New York Times previously reported. But 10 months into the transition, all signs point to Bezos continuing to keep a strong grip on the day-to-day action, at least until the pandemic becomes more stable and normal, these people said.

Specifically:

In recent months, Bezos has been directly involved in discussions about launching a new online store service that could compete with Shopify, according to people familiar with the matter. Shopify sells the software tools needed to build an e-commerce site and has become a popular alternative to Amazon for small businesses looking to sell their products online.

The talks at Amazon were more of a "defensive" move to Shopify's growing threat as a competitor, one of the people said, as there's been a scramble among Amazon executives to respond to Shopify's meteoric rise.

And:

Bezos also has been sharing some very specific ideas around Amazon's anti-counterfeit efforts lately, two people familiar with the matter said. The issue has become a major headache for Amazon in recent years, causing some high-profile brands, such as Nike, Birkenstock, and LVMH, to stop selling on its marketplace. 

The CEO's input was consequential in the company coming up with the idea for the new Counterfeit Crimes Unit, a new service that employs former federal prosecutors and investigators to track down and prosecute counterfeit sellers on Amazon. The service monitors only products sold on Amazon's marketplace, but Bezos has backed the idea of expanding it to crack down on counterfeits sold on other websites as well, these people said. Bezos' message has been that there's a huge counterfeit problem in the world and Amazon should take charge and encourage others to work on solving the problem together. The team has used superhero analogies to describe the project, such as the "Avengers," one of the people said.

Yeah: that Avengers analogy is really stupid. But counterfeiting is a huge problem for Amazon, eroding customer and partner trust, drawing unwanted government scrutiny, and generally making the world’s leading retailer seem like a crummy place to do business.

So for Bezos and Amazon to put a “we’re leading the industry to help us all police ourselves” effort is 1) shrewd and 2) typical. Anything to keep business humming, conquer competitors, and keep the government (every government) off your back. Good PR too? Frankly, this does not seem super operational, or at least not just operational: this really is big strategic thinking about the future position of the company.


What’s It Really Like Inside Amazon Now?

So this is less news and more rumor, but I am not above trafficking in such things when I think the result is both credible and readable. Fair warning, though: I did my best to confirm the authenticity of the “anonymous Amazonian” who gave an interview with Logic magazine, mostly to try to figure out whether they were simply repeating rumors they had heard or were really in a position to know some of these things. And I struck out. Not that anyone was super thrilled that I was asking about it! But I didn’t get anybody saying “that’s crap, don’t run it” either.

A lot of the juiciest content is admittedly speculation. The stuff specifically about Jeff Bezos and his motivations seems incredibly gossipy, and largely a product of armchair psychiatry, and most likely secondhand psychiatry at that. So take it all with two grains of salt; that’s what I’m doing.

This part about the effect of COVID-19 on retail, though, I thought was interesting:

The question on everybody's minds in retail is: can Walmart and Target use their local distribution infrastructure to get packages to people's doors faster than Amazon can? Walmart and Target’s only advantage is their physical stores. When the stores are closed, they can be used as distribution hubs. You can pick things up close to where people's homes are and deliver them. Buying Whole Foods gave Amazon the opportunity to reach, you know, 80 percent of the 1 percent. But vast swaths of America aren't reachable by Whole Foods. 

The rumors that I hear, both internal and external, are that we're very seriously interested in acquiring post office real estate. The reason why the post office is valuable to privatize is because of their real estate holdings. They have great real estate in every downtown of every city in the United States. Amazon may be interested in buying all of the post office locations, and we have the cash to do it. So why not? 

The other week we announced we're hiring one hundred thousand more workers again. We're expanding dramatically across the board, in part-time and full-time, at corporate and retail and fulfillment and logistics and devices and distribution and all the various pies we have our fingers in. 

Even if it’s not the post office locations—why exactly would they be for sale? Was this a live issue during the Trump administration, or is it one Amazon is in a position to pursue during Biden’s first term?—Amazon is clearly interested in getting its infrastructure closer to more people, and Whole Foods is pretty limited in getting it all the way there. So is Kohl’s and the UPS store or any other brick-and-mortar retailer with which the company might strike a deal. Target and Walmart do have real advantages there.

So what does that look like? More grocery stores? Cashierless convenience stores? Another push for Amazon lockers? Something like a post office, UPS store, or FedEx/Kinko’s, but run and owned by Amazon? Something more like an Apple Store, where you can try out Kindles and Fire sticks and Echo devices to your heart’s content and maybe grab some Amazon Basics USB cables or surge protectors while you’re there? Maybe it’s a bit of all of them, or different pieces embedded inside other partner stores. You don’t have to gut the United States Postal Service in order to do a little bit of what they do. But if it’s already happening anyway, maybe you might make a deal to pick up the pieces. That’s how I read the play here.

Amazon is trusted; Amazon is beloved. But so is the Post Office. Besides, as a last-mile delivery service, the USPS is fantastic for Amazon’s business. It’s not worth the hit in public perception or shooting yourself in the foot on delivery costs to take it over. And besides, that <redacted> lost.


Backlash and Counter-Backlash to the Amazon Halo

I’ve been thinking about this issue of trust in Amazon basically forever, but especially so this year and last. Trust, antitrust; it’s a rich tapestry. But where you land on Amazon and what kind of business, if any, you’re willing to do with them usually comes down to whether and how you trust Amazon to do what it says it will do.

John Herrman at the New York Times has a terrific little Styles article on Amazon abstainers, some of whom have a hard time keeping their abstinence as pure as they’d might like:

Most abstainers don’t suffer any illusions about what they’re doing; Amazon clearly hasn’t suffered from their absence, and their numbers aren’t large enough to make demands — many more people are currently turning to Amazon than are turning away. Instead, for some, opting out of an increasingly ubiquitous and assertive Amazon offers a sense of control and agency, however slight.

The sheer scope of Amazon’s business interests — including surveillance devices (Ring), government contracts (through Amazon Web Services), and a work force that includes both low-wage gig workers and the actual richest person in the world — makes finding a reason to opt out of Amazon nearly as easy as finding something to buy on it. But plenty of Amazon abstainers aren’t merely coping with guilt, reclaiming a lost sense of control, or fighting the thought that “ethical consumption” sounds oxymoronic.

And:

Reached by phone, Dr. [Harold] Pollack [a University of Chicago professor who studies public health, and a frequent critic and sometimes boycotter of Amazon,] said his critiques of Amazon had both widened and deepened, but that he’s also now a frequent customer. “It’s chastening,” he said, when asked to revisit his stance. “I do use Amazon more in my life than I’m entirely comfortable about. It’s part of the infrastructure of my life in the same way it is the infrastructure of others’ lives, during Covid especially.”

Dr. Pollack then offered a fresh analysis, one that attempted to incorporate, or at least acknowledge, his ambivalence. “I think my own trajectory is emblematic of why there need to be public policy solutions to this,” he said, mentioning concerns about antitrust, Amazon’s broader place in the economy, and, as was his focus in 2012, the welfare of the company’s work force. Amazon, he said, presents an “enormous collective action problem.”

In the absence of sweeping changes in social policy, however, most of us have to figure out how we want to negotiate our relationship with Amazon (and Google, and Microsoft, and Coca-Cola, and the National Football League, and the police) on our own. That process lands each of us in wildly different places.

Consider Amazon’s newest hardware product, the Halo. Amazon’s Halo is much like other, now ubiquitous, personal health and fitness tracking devices. Except the Halo is very different; it offers a couple of unique features, and it and the data it generates is sold, collected, and/or administered by Amazon.

The New York Times review (by my former Wired colleague Brian X. Chen) of the Halo hates it. The Washington Post (owned by Amazon CEO Jeff Bezos) called it “the most invasive tech we’ve ever tested” right in the headline.

Amazon has a new health-tracking bracelet with a microphone and an app that tells you everything that’s wrong with you.

You haven’t exercised or slept enough, reports Amazon’s $65 Halo Band. Your body has too much fat, the Halo’s app shows in a 3-D rendering of your near-naked body.

And even: Your tone of voice is “overbearing” or “irritated,” the Halo determines, after listening through its tiny microphone on your wrist.

We hope our tone is clear here: We don’t need this kind of criticism from a computer. The Halo collects the most intimate information we’ve seen from a consumer health gadget — and makes the absolute least use of it. This wearable is much better at helping Amazon gather data than at helping you get healthy and happy.

I’ll admit: the Halo sounds like a product I do not want. I’m not sure I needed these reviews to tell me that.

I used to have a Jawbone Up wristband that counted my steps, and could tell me how many steps I’d walked each day when I plugged it into my smartphone’s headphone jack. After I moved from New York City back to Michigan in 2014, the Up and I saw each other less and less. Eventually Jawbone stopped supporting the device, making it a pretty pricey paperweight. (It cost at least twice as much as the Halo, but that didn’t include an ongoing monthly subscription fee.) And these days, most smartphones don’t even have headphone jacks. You actually need a device that can network to other devices or directly to the cloud without wires to make them usable.

That generation of fitness bands turned out to be something of a dead end. After a bumpy start, smartwatches gobbled up that space of forward-looking customers’ bodies and budgets.

But surely, somebody must be interested in what the Halo offers? Not everyone needs a diving watch, or a Swiss army knife, or an exercise bike that offers video training built in. Yet these are not strangers to our land.

The review that best grapples with who might want Amazon’s Halo and why is by my friend and internet of things / smart home expert Stacey Higginbotham. Her review is titled “Amazon’s Halo band does what’s it’s designed to do.” But some of what the Halo is designed to do isn’t very nice. And Stacey actually grapples with how it feels to use it.

It took me two weeks before I gathered the courage to take a full-frame almost-naked picture of myself in order to get a body composition scan. Amazon says this scan is as accurate as medical scans such as DEXA and a BodyPod scan. It being a pandemic and I’m unwilling to take up a doctor’s time or visit a medical establishment without need, I didn’t check this against my own scan, but the New York Times questioned its accuracy. But I do have a scale that measures my body competition and Amazon’s body fat numbers were 4% above that. Based on Amazon’s algorithm I am in the too high category, which I already knew based on my muffin top, but still, seeing the number I cried.

Heck, seeing the photos I cried, and then promptly deleted them from my phone. I also didn’t take Amazon up on the offer to save the photos and scans in the cloud. Everything must go, I thought, while frantically punching the buttons to erase the knowledge that I was a huge quivering blob of fat. It was even worse two weeks later when I took the scan again to see if I had made any progress. Reader, I had not.

And yet, that scan, accurate or not, was the sort of shame-inspired motivation I needed to realize that my 40-year-old body probably needed a new fitness and eating routine. I did strength workouts three times a week and made sure I walked at least 35 miles weekly. Clearly, I need to ramp up my efforts in middle age and lay off the cookies and drinking. Maybe I should eat a salad?

This last part… would not have been my reaction to that experience. I probably would have been a lot more angry, and less favorably inclined toward what by almost all accounts, are Amazon’s useful fitness and workout suggestions it includes as part of the service.

The Halo is not for me. And, somewhat surprisingly, the review concludes that it’s not really for hard-core fitness buffs either, but people who need and want a service that prompts them to be more active. That is a strange niche, even if it includes millions and millions of people. How would they even know they want such a device, let alone that they want to trust Amazon with the data it needs in order to offer those services to them?

The review points out Amazon’s problem here right at the top:

Amazon has been the victim of its own success and a sea change in how citizens judge the companies they want to do business with. Amazon has spent decades sucking up data about the users of any of its services and using that data to make recommendations, launch new products and determine where to invest. It’s cutthroat and when something gets too big for it and yet serves an important niche Amazon wants to control, it buys it.

In the wake of the anti-trust backlash against big tech, concerns cover algorithmic bias, concerns over surveillance, and concerns over monopolistic practices, Amazon is a tank hitting landmines in multiple aspects of its business. It’s trying to avoid some of them with transparency and others it just rolls over assuming its size and the market will protect it.

All of that affects how we all respond to any product or service Amazon makes. It affects consumers. It affects journalists. It affects business partners and regulators. To riff on one of my favorite Paul Ford quotes (and whew boy is that a long list), Amazon is not just the elephant in the room. It may not even be one elephant; it could be five.


Amazon Shutters Its Goodreads APIs

To my mind, the most frustrating thing Amazon could do isn’t gobble up my data to sell me stuff I don’t want, exploit its workers and partners, or put its competitors out of business, bad as all three of those things are. It’s that it will destroy whole industries, whole spaces of our digital life, and then take its ball and go home.

That’s Google, you’re thinking. Not so fast; check out what’s happening at Goodreads, an Amazon company that’s cornered the market on online book reviews.

Joe Alcorn, who makes a competitor/complimentary product called Readng (no “I”), comes in hot:

In news that surprises nobody, Goodreads last week quietly announced the deprecation of their public APIs. And I mean really quietly – the only people who were told about this were those unfortunate enough to have their existing API keys disabled without warning. Other than a small banner at the top of the API docs which mentions vague “plans to retire these tools”, nobody else appears to have heard anything from Goodreads, including those whose API keys remain active. So far it seems any key unused for 30 days has been disabled.

So this is an “announcement” much in the way a windshield announces its presence to bugs on a highway, and with the same consequences: dead bugs. Some developers have taken to the API discussion boards and blogs, but the overall impression I’m getting is grim acceptance. Really the surprising thing is how long it took them: Amazon has been in charge at Goodreads for almost 8 years now, and I think we’ve all been expecting this to come at some point.

So why now? What’s changed? Well, the fact is the market’s changing – and Goodreads isn’t. Alternative options are starting to emerge, and since Goodreads has forgotten how to innovate, it wants to use its market position to stifle innovation instead.

This is an understandable reaction! It’s colored by who Joe Alcorn is and what he does, but it’s also shaped by Amazon’s history and the history of every other big company that runs the world.

So who can you trust at Amazon? What can you trust them with? What can you ultimately trust them to do?

At the end of the day, maybe the only answer is that you can only trust Amazon to be Amazon. The trouble, again, is that Amazon is not just one elephant. And when it comes to the future, all of us—Jeff Bezos included—remain, sadly, blind.

Happy New Year, everyone. See you again in 2021. Here’s to better things.

—Tim