AMAZON.COM An Internet-enabled Business Growing into a Technology Company Basic Case Study Presented by: DAVID RAMIREZ PVAMU - September, 2008

HISTORY AND QUICK FACTS Founded in 1994 by Jeff Bezos (current CEO and president). Corporate office in Seattle, WA Business area: e-commerce Web site: www.amazon.com Product: amazon.com (launched in 1995) 17,000 employees (2007) Revenue: $14,84 billion (2007) Net income: $476 million (2007) IPO in 1997 Web visitors exceed 615 million/yr (as of 2008) Initial product: online virtual bookstore Progressive extension to other retail products: VHS, CD, DVD, software, video games, electronics, apparel, furniture, toys, food etc. Websites in different countries. Global shipping of products. Profitable since 2001. Partnered with other merchants powering and operating their retail sites (e.g. Target, Sears, Timex, Lacoste). Develops its own software (developer centers accross the globe). Fulfillment and warehouse centers around the globe, close to airports.

Founded in 1994 by Jeff Bezos (current CEO and president).

Corporate office in Seattle, WA

Business area: e-commerce

Web site: www.amazon.com

Product: amazon.com (launched in 1995)

17,000 employees (2007)

Revenue: $14,84 billion (2007)

Net income: $476 million (2007)

IPO in 1997

Web visitors exceed 615 million/yr (as of 2008)

Initial product: online virtual bookstore

Progressive extension to other retail products: VHS, CD, DVD, software, video games, electronics, apparel, furniture, toys, food etc.

Websites in different countries.

Global shipping of products.

Profitable since 2001.

Partnered with other merchants powering and operating their retail sites (e.g. Target, Sears, Timex, Lacoste).

Develops its own software (developer centers accross the globe).

Fulfillment and warehouse centers around the globe, close to airports.

HISTORY AND FACTS - continued 2000: Survived the dot-com bubble burst. Popularized on-line shopping (Bezos was TIME magazine's 1999 "Man of the Year")

2000: Survived the dot-com bubble burst.

Popularized on-line shopping (Bezos was TIME magazine's 1999 "Man of the Year")

CONTINUOUS INTRODUCTION OF NEW e-COMMERCE PRODUCTS New EC products have been introduced through own development or acquisitions, with diverse levels of success: 1999: Amazon Auctions (competing with eBay) - failure 1999: zShops (fixed price marketplace) - failure 2001: Amazon Marketplace (used books exchange) - success. 2007: Music store (competing with Apple's iTunes) - ? Several acquisitions, e.g. Alexa (Web Traffic), IMDB

New EC products have been introduced through own development or acquisitions, with diverse levels of success:

1999: Amazon Auctions (competing with eBay) - failure

1999: zShops (fixed price marketplace) - failure

2001: Amazon Marketplace (used books exchange) - success.

2007: Music store (competing with Apple's iTunes) - ?

Several acquisitions, e.g. Alexa (Web Traffic), IMDB

AMAZON WEB SERVICES Huge own infrastructure, developers base available worldwide. Starts selling inexpensive Web Services: S3 – Simple Storage Service : STORAGE EC2 – Elastic Compute Cloud : COMPUTER POWER SQS – Simple Queue Services : SYSTEM MESSAGING SimpleDB – STRUCTURED DATA

Huge own infrastructure, developers base available worldwide.

Starts selling inexpensive Web Services:

S3 – Simple Storage Service : STORAGE

EC2 – Elastic Compute Cloud : COMPUTER POWER

SQS – Simple Queue Services : SYSTEM MESSAGING

SimpleDB – STRUCTURED DATA

S3 – Simple Storage Service Developer-oriented Each stored item identified by user key, can be public, private (access rights management). Dependable, scalable, inexpensive Unlimited objects, from 1 byte to 5 GB 14 billion objects stored as of January, 2008 $0.15 per GB per month, plus charges for data transfers and requests.

Developer-oriented

Each stored item identified by user key, can be public, private (access rights management).

Dependable, scalable, inexpensive

Unlimited objects, from 1 byte to 5 GB

14 billion objects stored as of January, 2008

$0.15 per GB per month, plus charges for data transfers and requests.

EC2 – ELASTIC COMPUTE CLOUD Web Virtual Computer for rent by the hour. Elastic: create/eliminate instances on demand, managed or automatically. Can have repository of ready-to-go server images on S3. From basic servers to high-CPU ( 7 GB of memory, 8 virtual cores, 1690 GB of instance storage on a 64-bit architecture). Linux-based (Red Hat); Windows licensing not available yet. May use other Linux distros. Developer-oriented, to be used in conjunction with S3. No data transfer fees between EC2<-> S3. Fees from $0.10 to $0.80 plus bandwidth (max. 0.17 / GB)

Web Virtual Computer for rent by the hour.

Elastic: create/eliminate instances on demand, managed or automatically.

Can have repository of ready-to-go server images on S3.

From basic servers to high-CPU ( 7 GB of memory, 8 virtual cores, 1690 GB of instance storage on a 64-bit architecture).

Linux-based (Red Hat); Windows licensing not available yet. May use other Linux distros.

Developer-oriented, to be used in conjunction with S3. No data transfer fees between EC2<-> S3.

Fees from $0.10 to $0.80 plus bandwidth (max. 0.17 / GB)

SQS and SimpleDB Simple Queue Service : Messaging between instances, applications. Charge $0.01 per 10,000 messages. SimpleDB Access to structured data, simple model, does not require a schema, use with S3 to store objects. $0.14 per hour, plus $1.50 per GB/month

Simple Queue Service : Messaging between instances, applications.

Charge $0.01 per 10,000 messages.

SimpleDB

Access to structured data, simple model, does not require a schema, use with S3 to store objects.

$0.14 per hour, plus $1.50 per GB/month

Thank you.