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Dec. 23, 2015 - 3:34 - MAXFunds.com Editor Jonas Max Ferris and Lido Isle Advisors’ Jason Rotman on Amazon’s relationship with UPS, the future of Jet.com and the state of the markets. Fox Business Channel …
 
 
 
 
 
 
Amazon Studios
Main article: Amazon Studios

Amazon Studios is Amazon.com's division that develops television shows, movies and comics from online submissions and crowd-sourced feedback.[250] It was started in late 2010.[250] Content would be distributed through Amazon Video, Amazon’s digital video streaming service, and a competitor to services like Netflix and Hulu.[251] For film, Warner Bros. is a partner.[252]

Subsidiaries

Companies owned by Amazon that operate under their own brand.

Audible.com
Audible headquarters

Audible.com is a seller and producer of spoken audio entertainment, information, and educational programming on the Internet. Audible sells digital audiobooks, radio, and TV programs, and audio versions of magazines and newspapers. Through its production arm, Audible Studios, Audible has also become the world's largest producer of downloadable audiobooks. On January 31, 2008 Amazon announced it would buy Audible for about $300 million. The deal closed in March 2008, and Audible became a subsidiary of Amazon.[253]

Brilliance Audio

Brilliance Audio is an audiobook publisher founded in 1984 by Michael Snodgrass in Grand Haven, Michigan.[254] The company produced its first 8 audio titles in 1985.[254] The company was purchased by Amazon in 2007 for an undisclosed amount.[69][255] At the time of the acquisition Brilliance was producing 12-15 new titles a month.[255] It operates as an independent company within Amazon.

In 1984, Brilliance Audio invented a technique for recording twice as much on the same cassette.[256] The technique involved recording on each of the two channels of each stereo track.[256] It has been credited with revolutionizing the burgeoning audiobook market in the mid-1980s since it made unabridged books affordable.[256]

ComiXology

ComiXology is a cloud-based digital comics platform with over 200 million comic downloads as of September 2013. It offers a selection of more than 40,000 comic books and graphic novels across Android, iOS, Kindle Fire, and Windows 8 devices, and over the Internet. Amazon bought the company in April 2014.[257]

Goodreads

Goodreads is a "social cataloging" website founded in December 2006 and launched in January 2007 by Otis Chandler, a software engineer and entrepreneur, and Elizabeth Chandler. The website allows individuals to freely search Goodreads' extensive user-populated database of books, annotations, and reviews. Users can sign up and register books to generate library catalogs and reading lists. They can also create their own groups of book suggestions and discussions. In December 2007, the site had over 650,000 members and over 10,000,000 books had been added. Amazon bought the company in March 2013.[258]

Shelfari

Shelfari is a social cataloging website for books. Shelfari users build virtual bookshelves of the titles which they own or have read, and they can rate, review, tag, and discuss their books. Users can also create groups that other members may join, create discussions, and talk about books, or other topics. Recommendations can be sent to friends on the site for what books to read. Amazon bought the company in August 2008.[258]

Website

The domain amazon.com attracted at least 615 million visitors annually by 2008, twice the number of Walmart.[259] Amazon attracts approximately 65 million customers to its US website per month.[260] The company has also invested heavily on a massive amount of server capacity for its website, especially to handle the excessive traffic during the December Christmas holiday season.[261]

Results generated by Amazon's search engine are partly determined by promotional fees.[262]

Amazon's localized storefronts, which differ in selection and prices, are differentiated bytop-level domain and country code:

Reviews

Amazon allows users to submit reviews to the web page of each product. Reviewers must rate the product on a rating scale from one to five stars. Amazon provides a badging option for reviewers which indicate the real name of the reviewer (based on confirmation of a credit card account) or which indicate that the reviewer is one of the top reviewers by popularity. Customers may comment or vote on the reviews, indicating whether they found a review helpful to them. If a review is given enough "helpful" hits, it appears on the front page of the product. In 2010, Amazon was reported as being the largest single source of Internet consumer reviews.[263]

When publishers asked Bezos why Amazon would publish negative reviews, he defended the practice by claiming that amazon.com was "taking a different approach ... we want to make every book available—the good, the bad, and the ugly ... to let truth loose".[264]

Although reviews are attributed to the credit-card name of the reviewer, there have been cases of positive reviews being written and posted by a public relations company on behalf of its clients,[265] and instances of writers using pseudonyms to leave negative reviews of their rivals' works.[266]

Following the listing of Untouchable: The Strange Life and Tragic Death of Michael Jackson, a disparaging biography of Michael Jackson by Randall Sullivan, his fans, organized via social media as "Michael Jackson's Rapid Response Team to Media Attacks" bombarded Amazon with negative reviews and negative ratings of positive reviews.[267]

Content search

"Search Inside the Book" is a feature which allows customers to search for keywords in the full text of many books in the catalog.[268][269] The feature started with 120,000 titles (or 33 million pages of text) on October 23, 2003.[270] There are currently about 300,000 books in the program. Amazon has cooperated with around 130 publishers to allow users to perform these searches.

To avoid copyright violations, amazon.com does not return the computer-readable text of the book. Instead, it returns a picture of the matching page, instructs the web browser to disable printing, and puts limits on the number of pages in a book a single user can access. Additionally, customers can purchase online access to some of the same books via the "Amazon Upgrade" program.

Third-party sellers

Amazon derives many of its sales from third-party sellers who sell products on Amazon (around 40% in 2008).[271] Associates receive a commission for referring customers to Amazon by placing links to Amazon on their websites, if the referral results in a sale. Worldwide, Amazon has "over 900,000 members" in its affiliate programs.[272] According toW3Techs the Amazon Affiliate Program is used by 1.2% of all websites, and it is the second most popular advertising network after Google Ads.[273] It is frequently used by websites and non-profits to provide a way for supporters to earn them commission.[274]Amazon reported over 1.3 million sellers sold products through Amazon's websites in 2007. Unlike eBay, Amazon sellers do not have to maintain separate payment accounts; all payments are handled by Amazon.

Associates can access the Amazon catalog directly on their websites by using the Amazon Web Services (AWS) XML service. A new affiliate product, aStore, allows Associates to embed a subset of Amazon products within another website, or linked to another website. In June 2010, Amazon Seller Product Suggestions was launched (rumored to be internally called "Project Genesis") to provide more transparency to sellers by recommending specific products to third-party sellers to sell on Amazon. Products suggested are based on customers' browsing history.[275]

Amazon sales rank

The Amazon sales rank (ASR) provides an indication of the popularity of a product sold on any Amazon locale. It is a relative indicator of popularity that is updated hourly. Effectively, it is a "best sellers list" for the millions of products stocked by Amazon.[276] While the ASR has no direct effect on the sales of a product, it is used by Amazon to determine which products to include in its best-sellers lists.[276] Products that appear in these lists enjoy additional exposure on the Amazon website, and this may lead to an increase in sales. In particular, products that experience large jumps (up or down) in their sales ranks may be included within Amazon's lists of "movers and shakers"; such a listing provides additional exposure that might lead to an increase in sales.[277] For competitive reasons, Amazon does not release actual sales figures to the public. However, Amazon has now begun to release point of sale data via the Nielsen BookScan service to verified authors.[278] While the ASR has been the source of much speculation by publishers, manufacturers and marketers, Amazon itself does not release the details of its sales rank calculation algorithm. In addition, it states:

Please keep in mind that our sales rank figures are simply meant to be a guide of general interest for the customer and not definitive sales information for publishers—we assume you have this information regularly from your distribution sources

— Amazon.com Help, [279]
Amazon technology

Customer Relationship Management (CRM) and Information Management (IM) support Amazon’s business strategy. The core technology that keeps Amazon running is Linux-based. As of 2005, Amazon had the world’s three largest Linux databases, with capacities of 7.8 TB, 18.5 TB, and 24.7 TB. The central data warehouse of Amazon is made of 28 Hewlett Packard servers with four CPUs per node running Oracle database software. Amazon’s technology architecture handles millions of back-end operations every day, as well as queries from more than half a million third-party sellers. With hundreds of thousands of people sending their credit card numbers to Amazon’s servers every day, security becomes a major concern. Amazon employs Netscape Secure Commerce Server using the Secure Socket Layer protocol which stores all credit card details in a separate database. The company also records data on customer buyer behavior which enables them to offer or recommend to an individual specific item, or bundles of items based upon preferences demonstrated through purchases or items visited.[280]

On January 31, 2013 Amazon experienced an outage that lasted approximately 49 minutes, leaving its site inaccessible to some customers.[281]

On May 5, 2014 Amazon unveiled a partnership with Twitter. Twitter users can link their accounts to an Amazon account and automatically add items to their shopping carts by responding to any tweet with an Amazon product link bearing the hashtag

AmazonCart
. Customers never leave the Twitter feed, and the product is waiting for them when they go to the Amazon website.[282]

Multi-level sales strategy

Amazon employs a multi-level e-commerce strategy. Amazon started off by focusing on Business-to-Consumer relationships between itself and its customers, and Business-to-Business relationships between itself and its suppliers but it then moved to incorporate Customer-to-Business transactions as it realized the value of customer reviews as part of the product descriptions. It now also facilitates customer to customer with the provision of the Amazon marketplace which act as an intermediary to facilitate consumer to consumer transactions. The company lets almost anyone sell almost anything using its platform. In addition to affiliate program that lets anybody post Amazon links and earn a commission on click through sales, there is now a program which let those affiliates build entire websites based on Amazon’s platform.[283]

Some other large e-commerce sellers use Amazon to sell their products in addition to selling them through their own websites. The sales are processed through Amazon.com and end up at individual sellers for processing and order fulfillment and Amazon leases space for these retailers. Small sellers of used and new goods go to Amazon Marketplace to offer goods at a fixed price.[284] Amazon also employs the use of drop shippers or meta sellers. These are members or entities that advertise goods on Amazon who order these goods direct from other competing websites but usually from other Amazon members. These meta sellers may have millions of products listed, have large transaction numbers and are grouped alongside other less prolific members giving them credibility as just someone who has been in business for a long time. Markup is anywhere from 50% to 100% and sometimes more, these sellers maintain that items are in stock when the opposite is true. As Amazon increases their dominance in the marketplace these drop shippers have become more and more commonplace in recent years.[citation needed]

Revenue

Over the 2000-2010 decade, Amazon has developed a customer base of around 30 million people. Amazon.com is primarily a retail site with a sales revenue model. Amazon makes its money by taking a small percentage of the sale price of each item that is sold through its website. Amazon also allows companies to advertise their products by paying to be listed as featured products.[285]