4 ms·

This seems like a misstep to me. Amazon is a conduit for content to be bought and sold - it shouldn't create content itself. Now, a game platform I could totall

by benwerd 14y ago

This seems like a misstep to me. Amazon is a conduit for content to be bought and sold - it shouldn't create content itself. Now, a game platform I could totally understand.

wtracy 14y ago
Indeed. Even the Kindle and Kindle Fire made sense as platforms for selling other stuff. I don't see that here, and I'm kind of scratching my head.
- potatolicious 14y ago
  The problem with selling other stuff is that you can never corner the market with it alone. As the Kindle book store has taken over, publishers have started actively resisting the store - giving better deals to competing stores, or even leaving the "Amazon network" entirely out of protest. A content distribution network is self-limiting since content producers are scared to death of being stuck with a single de facto monopoly distributor. Hence why the studios tried to kill Netflix, and damn near succeeded. If you want to have any hope of becoming the dominating, go-to distributor for all media of a particular sort, you'd have to drag a lot of producers in kicking and screaming - this means absorbing said creators into your fold, and also "incentivizing" dissidents by having so much grade-A content on your network that it cannot be ignored (see: Hollywood's relationship with multiplexes). This move makes a lot of sense if you consider also that Amazon has tried to open their own movie studio also - they're clearly trying to create AAA-level media as a way to bootstrap their distribution network off the ground and make it harder to ignore/protest against.
aasarava 14y ago
Amazon owns other "content creators" too, like dpreview.com, which it bought in 2007.
ghshephard 14y ago
Apple has already made huge inroads to content production already by starting their book publishing house. For better or worse, this is a logical extension of that strategy.
- azylman 14y ago
  I don't think I'd view book publishing as content production - a better analogy would be if they had writers on staff, writing the books, which they don't, as far as I'm aware.
duaneb 14y ago
I never got this attitude. "They are expanding beyond their core base, they shouldn't do that!" Why, exactly, this is the case mystifies me. A) Amazon is a better judge than anyone on what they can or cannot do, let alone should and shouldn't. B) Diversification is simply good business. C) Amazon is not expanding into drastically new markets. If anything, their initial jump into selling software (AWS) was a riskier proposition because it was unlike anything Amazon had done before, and a relatively untried business. Finally: People scoffed at the iPod and iPhone when they came out; it wasn't Apple's business to go into consumer electronics or even telecoms. The Michelin Tires company produces the most widely respected restaurant guide. Clearly, someone should have put a stop to them - they shouldn't have done that. Much like Bic is the maker for cheap, plastic tools (pens, razors, lighters), I don't see why Amazon can't continue to write software. There is virtually no risk and minimal investment.
- newbie12 14y ago
  Diversification is rarely good business, if it doesn't leverage some existing core competitive advantage. That's particularly true for public companies-- Amazon investors wanting some social game company exposure can easily buy some Zynga stock.
  - dman 14y ago
    How about the whole Virgin empire then? Or Reliance industries or Berkshire Hathway ? Maybe Amazon is morphing into a giant holding company over time (industrial robots, cloud computing, ecommerce, ebooks, games, consumer hardware, video streaming, selling non branded commodity versions of electronics under their own brand (amazon basics sells things like hdmi cables, mice etc))
    - rm999 14y ago
      Those are conglomerates, which are quite controversial in the investing world. They're usually stable businesses, but often come with a "conglomerate discount" that leads to lower investor returns. This is due to increased overhead, murkier financials, and the simple fact that the management can't be as focused. http://www.investopedia.com/terms/c/conglomeratediscount.asp http://www.investopedia.com/terms/c/conglomeratediscount.asp
commandar 14y ago
You don't think they were already dipping their toes in these waters with their book publishing programs? What about Amazon Studios, which is funding film making? While a change of direction, I don't think it's an abrupt one. Amazon has been slowly drifting toward creating their own content for a while now.

by benwerd 14y ago

This seems like a misstep to me. Amazon is a conduit for content to be bought and sold - it shouldn't create content itself. Now, a game platform I could totally understand.

wtracy 14y ago

Indeed. Even the Kindle and Kindle Fire made sense as platforms for selling other stuff. I don't see that here, and I'm kind of scratching my head.

potatolicious 14y ago
The problem with selling other stuff is that you can never corner the market with it alone. As the Kindle book store has taken over, publishers have started actively resisting the store - giving better deals to competing stores, or even leaving the "Amazon network" entirely out of protest. A content distribution network is self-limiting since content producers are scared to death of being stuck with a single de facto monopoly distributor. Hence why the studios tried to kill Netflix, and damn near succeeded. If you want to have any hope of becoming the dominating, go-to distributor for all media of a particular sort, you'd have to drag a lot of producers in kicking and screaming - this means absorbing said creators into your fold, and also "incentivizing" dissidents by having so much grade-A content on your network that it cannot be ignored (see: Hollywood's relationship with multiplexes). This move makes a lot of sense if you consider also that Amazon has tried to open their own movie studio also - they're clearly trying to create AAA-level media as a way to bootstrap their distribution network off the ground and make it harder to ignore/protest against.

aasarava 14y ago

Amazon owns other "content creators" too, like dpreview.com, which it bought in 2007.

ghshephard 14y ago

Apple has already made huge inroads to content production already by starting their book publishing house. For better or worse, this is a logical extension of that strategy.

azylman 14y ago
I don't think I'd view book publishing as content production - a better analogy would be if they had writers on staff, writing the books, which they don't, as far as I'm aware.

duaneb 14y ago

I never got this attitude. "They are expanding beyond their core base, they shouldn't do that!" Why, exactly, this is the case mystifies me. A) Amazon is a better judge than anyone on what they can or cannot do, let alone should and shouldn't. B) Diversification is simply good business. C) Amazon is not expanding into drastically new markets. If anything, their initial jump into selling software (AWS) was a riskier proposition because it was unlike anything Amazon had done before, and a relatively untried business. Finally: People scoffed at the iPod and iPhone when they came out; it wasn't Apple's business to go into consumer electronics or even telecoms. The Michelin Tires company produces the most widely respected restaurant guide. Clearly, someone should have put a stop to them - they shouldn't have done that. Much like Bic is the maker for cheap, plastic tools (pens, razors, lighters), I don't see why Amazon can't continue to write software. There is virtually no risk and minimal investment.

newbie12 14y ago
Diversification is rarely good business, if it doesn't leverage some existing core competitive advantage. That's particularly true for public companies-- Amazon investors wanting some social game company exposure can easily buy some Zynga stock.
- dman 14y ago
  How about the whole Virgin empire then? Or Reliance industries or Berkshire Hathway ? Maybe Amazon is morphing into a giant holding company over time (industrial robots, cloud computing, ecommerce, ebooks, games, consumer hardware, video streaming, selling non branded commodity versions of electronics under their own brand (amazon basics sells things like hdmi cables, mice etc))
  - rm999 14y ago
    Those are conglomerates, which are quite controversial in the investing world. They're usually stable businesses, but often come with a "conglomerate discount" that leads to lower investor returns. This is due to increased overhead, murkier financials, and the simple fact that the management can't be as focused. http://www.investopedia.com/terms/c/conglomeratediscount.asp http://www.investopedia.com/terms/c/conglomeratediscount.asp

commandar 14y ago

You don't think they were already dipping their toes in these waters with their book publishing programs? What about Amazon Studios, which is funding film making? While a change of direction, I don't think it's an abrupt one. Amazon has been slowly drifting toward creating their own content for a while now.