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I think there's a much more simple, and clever, explanation. We're looking in the wrong direction. Bloomberg recently ran a story [1] that Amazon is planning on

I think there's a much more simple, and clever, explanation. We're looking in the wrong direction. Bloomberg recently ran a story [1] that Amazon is planning on opening up to 3,000 more cashierless 'grab and go' stores by 2021. They are clearly planning on trying to take over physical retail, and this is quite a nasty attack on current players such as WalMart or convenient store type locations. These companies will not be able to compete with Amazon's cashierless stores. And they absolutely will not be able to compete with them at $15/hour minimum labor costs. This will require these companies to start transitioning to automated systems. But this would be a PR disaster -- firing huge numbers of people earning a hair above minimum wage to replace them with machines? Yeah that'll go over well. By contrast since Amazon is coming in with [relatively] near 0 employees from the get go, they won't face such issues. And an even better side effect here is that this would have a double feedback mechanism. Amazon improves their image of working to do more for their employees at the same time that their competitors are ruining theirs, just to be able to compete! They just fired a huge salvo towards physical retail outlets. If Amazon does manage to successfully lobby (or create sufficient public pressure) to enact a $15 minimum wage, Amazon could practically won the physical retail game before they even meaningfully enter it. [1] - https://www.bloomberg.com/news/articles/2018-09-19/amazon-is-said-to-plan-up-to-3-000-cashierless-stores-by-2021 https://www.bloomberg.com/news/articles/2018-09-19/amazon-is...

ericd 8y ago
Nice analysis, this makes a lot of sense. Higher market wages benefit companies with labor-lite models by harming their labor-dependent competitors.
genericone 8y ago
Good point, I think its a definitely a multi-pronged approach, their labor right now is limited to factory workers and whole-foods right now. My view of whole-foods is that they may already be paying at or above $15/hr wages, so that leaves factory workers, who are being used mostly for sorting goods from large bins into smaller bins. Amazon fulfillment centers are right now using warehouse robots to retrieve large bins from really really tall 'shelves' because that is a solved problem for Amazon. The sorting into the smaller bins is left to humans because they are faster and more accurate at the moment for awkwardly shaped items. What is the state of computer-vision, part-identification, and compliant-actuator pick-place robots inside Amazon? Have they released any whitepapers or research papers on robotics of note recently, acquired any interesting automation companies recently?
jcims 8y ago
Have you tried one of the grab and go stores? Took us an hour to get our receipt (presumably after human validation, who probably got tired of my tendency to pull drinks from a few spots back on the shelf). You're probably right about the strategy, but it feels like there's a good bit of work to be done before they are ready for broader deployment (and even then are likely to be the small convenience style stores). Not sure it really matters if it's +/- a couple of years, doesn't seem like anyone else is thinking this way. Great prices too!

ericd 8y ago

Nice analysis, this makes a lot of sense. Higher market wages benefit companies with labor-lite models by harming their labor-dependent competitors.

genericone 8y ago

Good point, I think its a definitely a multi-pronged approach, their labor right now is limited to factory workers and whole-foods right now. My view of whole-foods is that they may already be paying at or above $15/hr wages, so that leaves factory workers, who are being used mostly for sorting goods from large bins into smaller bins. Amazon fulfillment centers are right now using warehouse robots to retrieve large bins from really really tall 'shelves' because that is a solved problem for Amazon. The sorting into the smaller bins is left to humans because they are faster and more accurate at the moment for awkwardly shaped items. What is the state of computer-vision, part-identification, and compliant-actuator pick-place robots inside Amazon? Have they released any whitepapers or research papers on robotics of note recently, acquired any interesting automation companies recently?

jcims 8y ago

Have you tried one of the grab and go stores? Took us an hour to get our receipt (presumably after human validation, who probably got tired of my tendency to pull drinks from a few spots back on the shelf). You're probably right about the strategy, but it feels like there's a good bit of work to be done before they are ready for broader deployment (and even then are likely to be the small convenience style stores). Not sure it really matters if it's +/- a couple of years, doesn't seem like anyone else is thinking this way. Great prices too!