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I agree with Scott Galloway who has both predicted the outcome and has called this a sham 'contest.' Galloway said that Bezos was always going to pick one of th

by gkanai 8y ago

I agree with Scott Galloway who has both predicted the outcome and has called this a sham 'contest.' Galloway said that Bezos was always going to pick one of the coastal cities where he has a second/third home. By doing this 'contest' Amazon was able to get cities to compete with each other to provide tax incentives to Amazon and was also able to get valuable private information on the cities that Amazon can use in their business strategy. Galloway told cities not to participate.

ekun 8y ago
Which is exactly what professional sports teams do often even if they've been somewhere a while and have no intention of leaving.
- ofcrpls 8y ago
  San Diego was one of the only ones to call that bluff in recent history.
  - ghaff 8y ago
    Also the Patriots.
roymurdock 8y ago
Obviously Amazon was going to get a great bargain and bunch of info to boot - they have massive bargaining power. Not participating in the bid would have been suicide for the politicians of any major city save perhaps Kreuzberg, Berlin [1]. The amount of wealth creation and subsequent tax payments/land value boost that any FAANG company would bring with a new HQ is way too big to be ignored. [1] https://www.theguardian.com/cities/2018/may/09/fuck-off-google-the-berlin-neighbourhood-fighting-off-a-tech-giant-kreuzberg https://www.theguardian.com/cities/2018/may/09/fuck-off-goog...
- dunpeal 8y ago
  > they have massive bargaining power Wouldn't call it "massive" in NYC. The office size is projected to employ 25,000 people in total. Nice number, but not "massive" for a city of 8,623,000 people.
  - roymurdock 8y ago
    The average salary for these employees will be many x greater than the average NYC resident - you need to compare the relative size of the +25k employees to the ~200k subset of residents that make $200k+ in NY, not the entire 8M pop. Not to mention the knock-on effects of the many jobs the HQ will indirectly create - cleaning, food prep, waste mgmt, facilities, security, transportation, etc. But yes, I agree that NYC is probably the city with the highest bargaining power in the US due to its size and economic diversification. And yet they still submitted a bid, even while Mayor de Blasio was badmouthing the company [1] It will be interesting to see what the incentive package was - that's when we'll know just how much Amazon profited from the whole bid/selection process. [1] https://www.businessinsider.com/bill-de-blasio-amazon-hq2-destructive-to-communities-new-york-city-2017-10 https://www.businessinsider.com/bill-de-blasio-amazon-hq2-de...
    - hueving 8y ago
      >The average salary for these employees will be many x greater than the average NYC resident This isn't just an office for software developers so that's not likely to be true.
    - briandear 8y ago
      And NYC gives a tax deal to the corporation, while the workers get to pay city income tax, state income tax and federal income tax, high property and sales taxes, while also having one of the highest costs of living of most cities. Not great for the future workers at all while Amazon gets to cash in on tax incentives. Amazon could have gotten great tax benefits elsewhere in places that don’t tax their employees so damned much. Unless you are single, New York City isn’t much of a draw due to either a long commute or excessively high housing costs. Amazon could literally locate in Mobile, Alabama and be able to recruit just fine. A $200k salary in Mobile is worth $600 in NYC.
- Buldak 8y ago
  >Not participating in the bid would have been suicide for the politicians of any major city I find that pretty implausible. Foxconn didn't save Scott Walker (and I don't think that's because his would-be supporters later realized that it wasn't such a sweet deal, either).
  - SerLava 8y ago
    On the other hand, word got out pretty immediately that it was the worst deal of that type ever. And it was a Chinese company. Chinese.
    - threatofrain 8y ago
      It's a Taiwanese company but who knows about Taiwan's status going into the future.
  - Deimorz 8y ago
    This is a good recent article about that Foxconn deal: https://www.newyorker.com/news/dispatch/did-scott-walker-and-donald-trump-deal-away-the-governors-race-to-foxconn https://www.newyorker.com/news/dispatch/did-scott-walker-and...
  - code_duck 8y ago
    What is Foxconn’s name recognition and brand reputation compared to Amazon, though? Also an Amazon HQ means a much higher quality of jobs than a Foxconn facility.
wpietri 8y ago
Whoa. Bezos indeed has homes in NYC and Washington DC. (As well as Seattle, Beverly Hills, and a ranch in Texas. [1]) I can't find it now, but years ago The Economist ran an article about a study that said a key factor in corporate headquarter moves was where the CEO lives. Disappointing to see it play out like that on such a grand scale, and after such a pretense of a nationwide search. Yet another thing that convinces me I'd never want to work at Amazon. [1] https://www.businessinsider.com/jeff-bezos-owns-five-massive-homes-across-the-united-states-2017-10#manhattan-7 https://www.businessinsider.com/jeff-bezos-owns-five-massive...
- dunpeal 8y ago
  Doubt it was a factor with Bezos. The guy is rich enough to live anywhere, and has houses everywhere, as you also observed. Somehow the office didn't land in Beverly Hills or the Texas ranch. I expect the fact that he already has homes in NYC and DC is related to the fact they are in fact important locations for his business.
  - jeremyis 8y ago
    I think it’s where he wants to spend time
  - wpietri 8y ago
    Most CEOs are rich enough to move. But they are also powerful enough to get the company to move to a location more convenient or appealing to them.
    - dunpeal 8y ago
      Sure, but he has lived in Seattle for a long time, what makes you think he wants to move to NYC? The office in NYC is going to be nothing more than a big satellite office compared to the huge HQ in Seattle, so it's not like he's actually moving Amazon's HQ and himself to NYC. In fact I doubt he'd spend that much time there. Given his duties, he'll probably be in Seattle most of the time. Also, I very much doubt the office in DC is there because Bezos is just dying to spend more time in DC ;-)
mayukh 8y ago
Can you point us to some links (older than a few weeks) where SG says this. Everyone is a pundit when they know the outcome. Also what valuable private data did they gain from these cities exactly? Their proposed investment/infrastructure plans?? Amazon probably has better/more useful data than any local govt organization.
- m_ke 8y ago
  https://www.recode.net/2018/9/19/17878766/scott-galloway-predictions-amazon-hq2-apple-retail-code-commerce https://www.recode.net/2018/9/19/17878766/scott-galloway-pre...
deleted 8y ago
[deleted]

by gkanai 8y ago

ekun 8y ago

Which is exactly what professional sports teams do often even if they've been somewhere a while and have no intention of leaving.

ofcrpls 8y ago
San Diego was one of the only ones to call that bluff in recent history.
- ghaff 8y ago
  Also the Patriots.

roymurdock 8y ago

Obviously Amazon was going to get a great bargain and bunch of info to boot - they have massive bargaining power. Not participating in the bid would have been suicide for the politicians of any major city save perhaps Kreuzberg, Berlin [1]. The amount of wealth creation and subsequent tax payments/land value boost that any FAANG company would bring with a new HQ is way too big to be ignored. [1] https://www.theguardian.com/cities/2018/may/09/fuck-off-google-the-berlin-neighbourhood-fighting-off-a-tech-giant-kreuzberg https://www.theguardian.com/cities/2018/may/09/fuck-off-goog...

dunpeal 8y ago
> they have massive bargaining power Wouldn't call it "massive" in NYC. The office size is projected to employ 25,000 people in total. Nice number, but not "massive" for a city of 8,623,000 people.
- roymurdock 8y ago
  The average salary for these employees will be many x greater than the average NYC resident - you need to compare the relative size of the +25k employees to the ~200k subset of residents that make $200k+ in NY, not the entire 8M pop. Not to mention the knock-on effects of the many jobs the HQ will indirectly create - cleaning, food prep, waste mgmt, facilities, security, transportation, etc. But yes, I agree that NYC is probably the city with the highest bargaining power in the US due to its size and economic diversification. And yet they still submitted a bid, even while Mayor de Blasio was badmouthing the company [1] It will be interesting to see what the incentive package was - that's when we'll know just how much Amazon profited from the whole bid/selection process. [1] https://www.businessinsider.com/bill-de-blasio-amazon-hq2-destructive-to-communities-new-york-city-2017-10 https://www.businessinsider.com/bill-de-blasio-amazon-hq2-de...
  - hueving 8y ago
    >The average salary for these employees will be many x greater than the average NYC resident This isn't just an office for software developers so that's not likely to be true.
  - briandear 8y ago
    And NYC gives a tax deal to the corporation, while the workers get to pay city income tax, state income tax and federal income tax, high property and sales taxes, while also having one of the highest costs of living of most cities. Not great for the future workers at all while Amazon gets to cash in on tax incentives. Amazon could have gotten great tax benefits elsewhere in places that don’t tax their employees so damned much. Unless you are single, New York City isn’t much of a draw due to either a long commute or excessively high housing costs. Amazon could literally locate in Mobile, Alabama and be able to recruit just fine. A $200k salary in Mobile is worth $600 in NYC.
Buldak 8y ago
>Not participating in the bid would have been suicide for the politicians of any major city I find that pretty implausible. Foxconn didn't save Scott Walker (and I don't think that's because his would-be supporters later realized that it wasn't such a sweet deal, either).
- SerLava 8y ago
  On the other hand, word got out pretty immediately that it was the worst deal of that type ever. And it was a Chinese company. Chinese.
  - threatofrain 8y ago
    It's a Taiwanese company but who knows about Taiwan's status going into the future.
- Deimorz 8y ago
  This is a good recent article about that Foxconn deal: https://www.newyorker.com/news/dispatch/did-scott-walker-and-donald-trump-deal-away-the-governors-race-to-foxconn https://www.newyorker.com/news/dispatch/did-scott-walker-and...
- code_duck 8y ago
  What is Foxconn’s name recognition and brand reputation compared to Amazon, though? Also an Amazon HQ means a much higher quality of jobs than a Foxconn facility.

wpietri 8y ago

Whoa. Bezos indeed has homes in NYC and Washington DC. (As well as Seattle, Beverly Hills, and a ranch in Texas. [1]) I can't find it now, but years ago The Economist ran an article about a study that said a key factor in corporate headquarter moves was where the CEO lives. Disappointing to see it play out like that on such a grand scale, and after such a pretense of a nationwide search. Yet another thing that convinces me I'd never want to work at Amazon. [1] https://www.businessinsider.com/jeff-bezos-owns-five-massive-homes-across-the-united-states-2017-10#manhattan-7 https://www.businessinsider.com/jeff-bezos-owns-five-massive...

dunpeal 8y ago
Doubt it was a factor with Bezos. The guy is rich enough to live anywhere, and has houses everywhere, as you also observed. Somehow the office didn't land in Beverly Hills or the Texas ranch. I expect the fact that he already has homes in NYC and DC is related to the fact they are in fact important locations for his business.
- jeremyis 8y ago
  I think it’s where he wants to spend time
- wpietri 8y ago
  Most CEOs are rich enough to move. But they are also powerful enough to get the company to move to a location more convenient or appealing to them.
  - dunpeal 8y ago
    Sure, but he has lived in Seattle for a long time, what makes you think he wants to move to NYC? The office in NYC is going to be nothing more than a big satellite office compared to the huge HQ in Seattle, so it's not like he's actually moving Amazon's HQ and himself to NYC. In fact I doubt he'd spend that much time there. Given his duties, he'll probably be in Seattle most of the time. Also, I very much doubt the office in DC is there because Bezos is just dying to spend more time in DC ;-)

mayukh 8y ago

Can you point us to some links (older than a few weeks) where SG says this. Everyone is a pundit when they know the outcome. Also what valuable private data did they gain from these cities exactly? Their proposed investment/infrastructure plans?? Amazon probably has better/more useful data than any local govt organization.

m_ke 8y ago
https://www.recode.net/2018/9/19/17878766/scott-galloway-predictions-amazon-hq2-apple-retail-code-commerce https://www.recode.net/2018/9/19/17878766/scott-galloway-pre...

deleted 8y ago

[deleted]