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The Fire Phone Debacle and What It Means For Amazon's Future
HughPickens.com points out an article at Fast Company that dug into the creation of Amazon's floundering Fire Phone to figure out why the company pushed so hard to bring it to market. The piece is an indictment of Jeff Bezos's determination to make the Fire Phone into a competitor for an already-saturated high-end smartphone market. "This wasn't some vague guideline from an executive busy running other parts of the business; based on interviews with more than three dozen current and former employees, most of whom were deeply involved with the project, the CEO drove every aspect of the phone’s creation from the outset."
Now that Amazon's growth is slowing and profits have yet to be seen, investors and analysts have run out of patience for gambles like this one. "What makes the Fire Phone a particularly troubling adventure, however, is that Amazon’s CEO seemingly lost track of the essential driver of his company’s brand. It’s understandable that Bezos would want to give Amazon a premium shine, but to focus on a high-end product, instead of the kind of service that has always distinguished the company, proved misguided."
Now that Amazon's growth is slowing and profits have yet to be seen, investors and analysts have run out of patience for gambles like this one. "What makes the Fire Phone a particularly troubling adventure, however, is that Amazon’s CEO seemingly lost track of the essential driver of his company’s brand. It’s understandable that Bezos would want to give Amazon a premium shine, but to focus on a high-end product, instead of the kind of service that has always distinguished the company, proved misguided."
Growth is good and all, and short termism is bad, butyou can't "make a loss on every sale but make up for it in volume" forever.
The window is closing. Amazon is huge, but so big now they face similar logistics problems to bricks and mortar stores. In addition all the nice little tax loopholes they used to profit from are rapidly closing so they from a tax perspective have to compete on an even footing with those bricks and mortar stores.
So, what's the future? They were massively dominant, but recently I've noticed they are not reliably the cheapest source for stuff any more. There are often better deals to be had elsewhere.
I don't see them vanishing any time soon, but think the glory days are ending.
SJW n. One who posts facts.
I hear arguments like this a lot, in general, but they forget that the S&P 500 (or whatever) is a selection of stocks which is continuously changed, and if you "held" the S&P 500, you'd have to sell the companies that drop out of it or go bankrupt, and buy into the companies that enter it. And suddenly, the amazing returns of whatever basket of stocks disappears. It doesn't take many lemons in the mix to ruin the supposed gain.
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False, the effect is not very great. Plus, do you not know what an index fund is (per GP)? The fund management takes care of that for you.
For example, the Vanguard 500 Index fund is indeed up 48% in that time period. If you'd invested $10,000 in the fund on 12/1/2012, then the value in your account would today be $14,843.15, with zero additional work on your part.
http://quotes.morningstar.com/fund/VFINX/f?t=VFINX
We know where leadership by an anti-intellectual "strongman" who scapegoats minorities and likes boisterous rallies goes
Shares outstanding 2/18/2004: 404,330,593
Shares outstanding 1/22/2009: 428,583,135
Shares outstanding 1/17/2014: 459,264,535
Shares outstanding 10/17/2014: 463,006,452
The increases have virtually entirely been based on stock-based compensation to employees or stock issued as a method of acquiring other businesses. There have been no "stock sales to pay off existing shareholders".
Retained earnings at 9/30/2014: $1,735,000,000, i.e. inception to date they have accumulated more net income than net losses (albeit fairly thin compared to the sheer volume of revenue). They have indeed "turned a profit".
Meanwhile, they are fairly liquid depending on the time of year you look at them (they tend to be flush with cash right after Christmas, imagine that) and had added almost $5 billion in infrastructure between 12/2013 and 9/2014 alone, mostly with cash.
It's fine to hate on teh evil corporations but you should at least accuse them of things they actually do instead of things they don't (no pyramid schemes).