Amazon.com: Information from Answers.com

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Company Perspectives:
We seek to offer the Earth's Biggest Selection and to be the Earth's most customer-centric company, where customers can find and discover anything they may want to buy online.
Key Dates:
1995: Amazon.com debuts on the Web.
1997: The company goes public; Amazon.com becomes the first Internet retailer to secure one million customers.
1998: Amazon.com enters the online music and video business; companies are acquired in the United Kingdom and Germany.
1999: The firm expands into selling toys, electronics, tools, and hardware; Bezos is named Time Magazine's "Person of the Year."
2001: Amazon.com reports its first net profit during the fourth quarter.

Incorporated:1997
NAIC:45411 Electronic Shopping and Mail-Order Houses

Considered a pioneer in online retailing, Amazon.com, Inc. expanded during the late 1990s to offer the "Earth's Biggest Selection" of books, CDs, videos, DVDs, electronics, toys, tools, home furnishings and housewares, apparel, and kitchen gadgets. Through third-party agreements, Amazon.com also sells products from well-known retailers including Toysrus.com Inc., Target Corporation, Circuit City Stores Inc., the Borders Group, Waterstones, Expedia Inc., Hotwire, National Leisure Group Inc., and Virgin Wines. Sometimes criticized for its focus on market share over profits, Amazon.com put investor fears to rest when it secured its first net profit during the fourth quarter of 2001.

Throughout the 1990s, the popularity of the Internet and World Wide Web swept across the world, and personal computers in most businesses and households got hooked up in some form or another to Internet providers and Web browser software. As use of the Internet became more prevalent in society, companies began looking to the Web as a new avenue for commerce. Selling products over the Internet offered a variety of choices and opportunities. One of the pioneers of e-commerce was Jeff Bezos, founder of Amazon.com.

In 1994, Bezos left his job as vice-president of the Wall Street firm D.E. Shaw, moved to Seattle, and began to work out a business plan for what would become Amazon.com. After reading a report that projected annual Web growth at 2,300 percent, Bezos drew up a list of 20 products that could be sold on the Internet. He narrowed the list to what he felt were the five most promising: compact discs, computer hardware, computer software, videos, and books. Bezos eventually decided that his venture would sell books over the Web, due to the large worldwide market for literature, the low price that could be offered for books, and the tremendous selection of titles that were available in print. He chose Seattle as the company headquarters due to its large high-tech work force and its proximity to a large book distribution center in Oregon. Bezos then worked to raise funds for the company while also working with software developers to build the company's web site. The web site debuted in July 1995 and quickly became the number one book-related site on the Web.

In just four months of operation, Amazon.com became a very popular site on the Web, making high marks on several Internet rankings. It generated recognition as the sixth best site on Point Communications' "top ten" list, and was almost immediately placed on Yahoo's "what's cool list" and Netscape's "what's new list." The site opened with a searchable database of over one million titles. Customers could enter search information, prompting the system to sift through the company database and find the desired titles. The program then displayed information about the selection on a customer's computer screen, and gave the customer the option to order the books with a credit card and have the books shipped in a just a few days.

Unlike its large competitors, such as Barnes & Noble and Borders, Amazon.com carried only about 2,000 titles in stock in its Seattle warehouse. Most orders through Amazon.com were placed directly through wholesalers and publishers, so no warehouse was needed. Amazon.com would simply receive the books from the other sources, then ship them to the customer. At first, the company operated out of Bezos' garage, until it was clear that it was going to be a success, necessitating a move to a Seattle office, which served as the customer support, shipping, and receiving area. It was interesting that, because of the Internet, such a small venture could realize such a broad scope so quickly; within a month of launching the web site, Bezos and Amazon.com had filled orders from all 50 states and 45 other countries.

As a pioneer in the world of Internet commerce, Amazon.com strived to set the standard for web businesses. With that goal in mind, Bezos went to work on making the web site as customer friendly as possible and relating the site to all types of customers. For those people who knew what book they were looking for and just wanted quick performance and low cost, Amazon.com offered powerful search capabilities of its expanded 1.5 million-title database. The company also began offering 10 to 30 percent discounts on most titles, making the prices extremely affordable. For other customers who were just looking for something to read in a general area of interest, Amazon.com offered topic areas to browse, as well as lists of bestsellers, award winners, and titles that were recently featured in the media. Finally, for people who could not decide, Amazon.com offered a recommendation center. There a customer could find books based on his or her mood, reading habits, or preferences. The recommendation center also offered titles based on records of books the customer had purchased in the past, if they were return customers to the site.

Other hits with customers were the little touches, such as optional gift wrapping of packages, and the "eye" notification service, which sent customers e-mails alerting them when a new book in their favorite subject or by their favorite author came into stock. The site also offered the ability for customers not only to write their comments about different books and have them published on the site, but to read other customers' comments about books they were interested in buying.

After less than two years of operation, Amazon.com became a public company in May 1997 with an initial public offering (IPO) of three million shares of common stock. With the proceeds from the IPO, Bezos went to work on improving the already productive web site and on bettering the company's distribution capabilities.

To help broaden the company's distribution capabilities, and to ease the strain on the existing distribution center that came from such a high volume of orders, in September 1997 Bezos announced that Amazon.com would be opening an East Coast distribution center in New Castle, Delaware. There was also a 70 percent expansion of the company's Seattle center. The improvements increased the company's stocking and shipping capabilities and reduced the time it took to fill customers' orders. The Delaware site not only got Amazon.com closer to East Coast customers, but also to East Coast publishers, which decreased Amazon.com's receiving time. With the new centers in place, Bezos set a goal for the company of 95 percent same-day shipping of in-stock orders, getting orders to the customers much faster than before.

Another growth area for Amazon.com was the success of its "Associate' program. Established in July 1996, the program allowed individuals with their own web sites to choose books of interest and place ads for them on their own sites, allowing visitors to purchase those books. The customer was linked to Amazon.com, which took care of all the orders. Associates were sent reports on their sales and made a 3 to 8 percent commission from books sold on their sites. The Associates program really began to take off in mid-1997, when Amazon.com formed partnerships with Yahoo, Inc. and America Online, Inc. Both companies agreed to give Amazon.com broad promotional capabilities on their sites, two of the most visited sites on the Web. As the success continued, Amazon also struck deals with many other popular sites, including Netscape, GeoCities, Excite, and AltaVista.

As the company continued to grow in 1997, Bezos announced in October that Amazon.com would be the first Internet retailer to reach the milestone of one million customers. With customers in all 50 states and now 160 countries worldwide, what had started in a Seattle garage was now a company with $147.8 million in yearly sales.

As Amazon.com ventured into 1998, the company continued to grow. By February, the Associates program had reached 30,000 members, who now earned up to 15 percent for recommending and selling books from their web sites. Four months later, the number of Associates had doubled to 60,000.

The company's customer database continued to grow as well, with cumulative customer accounts reaching 2.26 million in March, an increase of 50 percent in just three months, and of 564 percent over the previous year. In other words, it took Amazon.com 27 months to serve its first million customers and only six months to serve the second million. This feat made Amazon.com the third largest bookseller in the United States.

Financed by a $75 million credit facility secured in late 1997, Amazon.com continued to reshape its services in 1998. To its catalog of over 2.5 million titles, the company added Amazon.com Advantage, a program to help the sales of independent authors and publishers, and Amazon.com Kids, a service providing over 100,000 titles for younger children and teenagers.

Amazon.com also expanded its business through a trio of acquisitions in early 1998. Two of the companies were acquired to further expand Amazon.com's business into Europe. Bookpages, one of the largest online booksellers in the United Kingdom, gave Amazon.com access to the U.K. market. Telebook, the largest online bookseller in Germany, added its German titles to the mix. Both companies not only gave Amazon .com access to new customers in Europe, but it also gave existing Amazon.com customers access to more books from around the world. The Internet Movie Database (IMD), the third acquisition, was used to support plans for its move into online video sales. The tremendous resources and information of the IMD served as a valuable asset in the construction of a customer-friendly and informative web site for video sales.

Another big change in 1998 was the announcement of the company's decision to enter into the online music business. Bezos again wanted to make the site as useful as possible for his customers, so he appealed to them for help. Several months before officially opening its music site, Amazon.com asked its bookstore customers and members of the music profession to help design the new web site.

The music store opened in June 1998, with over 125,000 music titles available. The new site, which began operations at the same time that Amazon.com debuted a redesigned book site, offered many of the same helpful services available at the company's book site. The database was searchable by artist, song title, or label, and customers were able to listen to more than 225,000 sound clips before making their selection.

Amazon.com ended the second quarter of 1998 as strong as ever. Cumulative customer accounts broke the three million mark, and as sales figures for Amazon.com continued to rise, and more products and titles were added, the future looked bright for this pioneer in the Internet commerce marketplace. With music as a part of the company mix, and video sales on the horizon, Bezos seemed to have accomplished his goal of gathering a strong market share in the online sales arena. As Bezos told Fortune magazine in December 1996: "By the year 2000, there could be two or three big online bookstores. We need to be one of them."

As such, the company's focus on growth continued. In 1999, it launched an online auction service entitled Amazon Auctions. It also began offering toys and electronics and then divided its product offerings into individual stores on its site to make it easier for customers to shop for certain items. During the holiday season that year, the firm ordered 181 acres of holiday wrapping paper and 2,494 miles of red ribbon, a sign that Bezos expected holiday shoppers to flock to his site as they had in the two past years. Sure enough, sales climbed to $1.6 billion proving that the founder's efforts to create an online powerhouse had indeed paid off. In 1999, Bezos reached the upper echelon of the corporate world when Time magazine honored him with its prestigious "Person of the Year" award.

While Amazon.com's growth story was remarkable, Bezos' focus on market share over profits had made Wall Street uneasy and left analysts speculating whether the company would ever be able to turn a profit. Sales continued to grow as the company added new products to its site--including lawn and patio furniture and kitchen wares. The company however, continued to post net losses. To top it off, the "dot-com boom" of the late 1990s came to a crashing halt in the early years of the new millenium as many startups declared bankruptcy amid intense competition and weakening economies.

Bezos remained optimistic, even as Amazon.com's share price faltered. During 2001, the company focused on cutting costs. It laid off 1,300 employees and closed a distribution facility. The company also added price reduction to its business strategy, which had traditionally been centered on vast selection and convenience. Amazon.com inked lucrative third-party deals with such well-known retailers as Target Corporation and America Online, Inc. By now, products from Toysrus.com Inc., Circuit City Stores Inc., the Borders Group, and a host of other retailers were available on the Amazon.com site.

Amazon.com's strategy worked. In 2001, sales grew to $3.12 billion, an increase of 13 percent over the previous year. During the fourth quarter, Amazon.com reached a milestone that many had regarded as unlikely; it secured a net profit of $5 million. In 2002, the company launched its apparel store, which included clothing from retailers The Gap and Lands' End. Overall, the company reported a net loss of $149 million for the year, an improvement from the $567 million loss reported in 2001. In the fourth quarter of 2002 however, the firm secured a quarterly net profit of $3 million--the second net profit in its history.

While securing quarterly net profits was a major turning point for the young company, a July 2002 Business Week article warned, "after seven years and more than $1 billion in losses, Amazon is still a work in process." Indeed, the company's foray into providing the "Earth's Biggest Selection" had yet to prove it could provide profits on a long-term basis. Nevertheless, Bezos and his Amazon team remained confident that the firm was on the right track. With $3.9 billion in annual sales, Amazon.com had without a doubt come a long way from its start as an online book seller.

Principal Subsidiaries

Amazon Global Resources, Inc.; Amazon.com.dedc, LLC; Fulfillco.ksdc, Inc.; Amazon.com.kydc, Inc.; Amazon.com Commerce Services, Inc.; Amazon.com Holdings, Inc.; Amazon.com International Sales, Inc.; Amazon.com LLC; Amazon.com Payments, Inc.; NV Services, Inc.; Amazon Fulfillment Services, Inc.; Amazon.com@Target.com, Inc.

Principal Competitors

Barnes & Noble Inc.; CDNow Inc.; eBay Inc.

Amazon.com, Inc.

Type	Public (NASDAQ: AMZN)
Founded	1994
Founder	Jeffrey P. Bezos
Headquarters	Seattle, Washington, U.S.A.
Area served	Worldwide
Key people	Jeffrey P. Bezos (Chairman), (CEO) & (President)
Industry	Retail
Products	Amazon.com A9.com Alexa Internet IMDb Amazon Kindle Amazon Web Services
Revenue	▲ US$ 19.166 billion (2008)
Operating income	▲ US$ 842 million (2008)
Net income	▲ US$ 645 million (2008)
Employees	20,500 (2008)^[1]
Website	Amazon.com
Alexa rank	<40
Type of site	e-commerce
Advertising	web banners and videos
Available in	English, Chinese, French, German, & Japanese
Launched	1995

History and business model

Amazon was founded in 1994, spurred by what Bezos called "regret minimization framework", his effort to fend off regret for not staking a claim in the Internet gold rush.^[4] While company lore says Bezos wrote the business plan while he and his wife drove from New York to Seattle,^[5] that account appears to be apocryphal.^[6]

The company began as an online bookstore;^[6] while the largest brick-and-mortar bookstores and mail-order catalogs for books might offer 200,000 titles, an on-line bookstore could offer more. Bezos named the company "Amazon" after the world's biggest river. Since 2000, Amazon's logotype is an arrow leading from A to Z, representing customer satisfaction (as it forms a smile) and the goal to have every product in the alphabet.^[7]

In 1994, the company incorporated in the state of Washington, beginning service in July 1995, and was reincorporated in 1996 in Delaware. The first book Amazon.com sold was Douglas Hofstadter's Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.^[8] Amazon.com issued its initial public offering of stock on May 15, 1997, trading under the NASDAQ stock exchange symbol AMZN, at an IPO price of US$18.00 per share ($1.50 after three stock splits in the late 1990s).

Amazon's initial business plan was unusual: the company did not expect a profit for four to five years; the strategy was effective. Amazon grew steadily in the late 1990s while other Internet companies grew blindingly fast. Amazon's "slow" growth provoked stockholder complaints: that the company was not reaching profitability fast enough. When the dot-com bubble burst, and many e-companies went out of business, Amazon persevered, and, finally, turned its first profit in the fourth quarter of 2001: $5 million, just 1¢ per share, on revenues of more than $1 billion, but the profit was symbolically important.

The company remains profitable: net income was $35.3 million in 2003, $588.50 million in 2004, $359 million in 2005, and $190 million in 2006 (including a $662 million charge for R&D in 2006), nevertheless, the firm's cumulative profits remain negative. As of September 2007, the accumulated deficit stood at $1.58 billion. Revenues increased thanks to product diversification and an international presence: $3.9 billion in 2002, $5.3 billion in 2003, $6.9 billion in 2004, $8.5 billion in 2005, and $10.7 billion in 2006.

On November 21, 2005, Amazon entered the S&P 500 index, replacing AT&T after it merged with SBC Communications. On December 31, 2008, Amazon entered the S&P 100 index, replacing Merrill Lynch after it was taken over by Bank of America.

In 1999, Time magazine named Bezos Person of the Year, recognizing the company's success in popularizing on-line shopping.

Merchant partnerships

The Web site CDNOW (cdnow.com) is powered and hosted by Amazon. Until June 30, 2006, typing ToysRUs.com into a browser would similarly bring up Amazon.com's Toys & Games tab; however, this relationship was terminated as the result of a lawsuit.^[9]

Amazon.com powers and operates retail web sites for Target, Sears Canada, Benefit Cosmetics, Bebe Stores, Timex Corporation, Marks & Spencer, Mothercare, and Lacoste. For a growing number of enterprise clients, currently including the UK merchants Marks & Spencer, Benefit Cosmetics' UK entity and Mothercare, Amazon provides a unified multichannel platform whence a customer can interchangeably interact with the retail website, standalone in-store terminals, and phone-based customer service agents. Amazon Web Services also powers AOL's Shop@AOL.

Locations

Headquarters

Amazon.com's headquarters in the PacMed building in Beacon Hill, Seattle.

The company's global headquarters is located on Seattle's Beacon Hill. It has offices throughout other parts of greater Seattle including Union Station and The Columbia Center.

Amazon has announced plans to move its headquarters to the South Lake Union neighborhood of Seattle beginning in mid-2010, with full occupancy by 2011. This move will consolidate all Seattle employees onto the new 11-building campus.^[10]

Software development centers

The company employs software developers in medium- to large-sized centers across the globe. While most of Amazon's software development is in Seattle, other locations include:

Slough (United Kingdom)
Edinburgh (United Kingdom)
Dublin (Ireland)
Bangalore, Chennai, and Hyderabad (India)
Cape Town (South Africa)
Iaşi (Romania)
Shibuya (Tokyo, Japan)
Beijing (China)
Tempe, Arizona (United States)

Fulfillment and warehousing

Fulfillment centers are located in the following cities, often near airports. Amazon offers warehousing and order-fulfillment for third-party sellers including large companies such as Target Corporation:^[11]

North America:

Arizona, USA: Phoenix, Goodyear
Delaware, USA: New Castle
Indiana, USA: Whitestown, Munster
Kansas, USA: Coffeyville
Kentucky, USA: Campbellsville, Hebron (near CVG), Lexington, and Louisville
Nevada, USA: Fernley and Red Rock (near 4SD)
New Hampshire, USA: Nashua
Pennsylvania, USA: Carlisle, Chambersburg, Hazleton, and Lewisberry
Texas, USA: Dallas/Fort Worth
Ontario, Canada: Mississauga (a Canada Post facility)

In March 2009, Amazon announced plans to close three U.S. distribution centers: Red Rock, Nevada; Chambersburg, Pennsylvania; and Munster, Indiana.^[12]

Europe:

Amazon.co.uk warehouse, Glenrothes.

Bedfordshire, England: Marston Gate
Inverclyde, Scotland: Gourock
Fife, Scotland: Glenrothes
Neath Port Talbot, Wales: Crymlyn Burrows^[13]^[14] near Jersey Marine^[15]
Loiret, France: Orléans-Boigny (2000)
Loiret, France: Orléans-Saran (2007)
Hesse, Germany: Bad Hersfeld
Saxony, Germany: Leipzig

Asia:

Chiba, Japan
Guangzhou, China
Suzhou, China
Beijing, China

Product lines

Amazon has steadily branched into retail sales of music CDs, videotapes and DVDs, software, consumer electronics, kitchen items, tools, lawn and garden items, toys & games, baby products, apparel, sporting goods, gourmet food, jewelry, watches, health and personal-care items, beauty products, musical instruments, clothing, industrial & scientific supplies, groceries, and more.

The company launched Amazon.com Auctions, its own Web auctions service, in March 1999. However, it failed to chip away at industry pioneer eBay's juggernaut growth. Amazon Auctions was followed by the launch of a fixed-price marketplace business called zShops in September 1999, and a failed Sotheby's/Amazon partnership called sothebys.amazon.com in November.

Amazon no longer mentions either Auctions or zShops on its main pages and the help page for sellers now only mentions the Marketplace.^[16] Old links to zShops now simply redirect to the Amazon home page,^[17] while old links to Auctions take users to a transactions history page.^[18] New product listings are no longer possible for either service.

Although zShops failed to live up to its expectations, it laid the groundwork for the hugely successful Amazon Marketplace service launched in 2001 that let customers sell used books, CDs, DVDs, and other products alongside new items. Today, Amazon Marketplace's main rival is eBay's Half.com service.

Beginning August 2005,^[19] Amazon began selling products under its own private label, "Pinzon"; the initial trademark applications suggested the company intended to focus on textiles, kitchen utensils, and other household goods.^[19] In March 2007, the company applied to expand the trademark to cover a larger and more diverse list of goods, and to register a new design consisting of the "word PINZON in stylized letters with a notched letter O whose space appears at the "one o'clock" position.".^[20] The list of products registered for coverage by the trademark grew to include items such as paints, carpets, wallpaper, hair accessories, clothing, footwear, headgear, cleaning products, and jewelry.^[20]

On May 16, 2007 Amazon announced its intention to launch its own online music store.^[21] The store launched in the US in public beta September 25, 2007, selling downloads exclusively in MP3 format without digital rights management.^[22] This is especially notable as it was the first online offering of DRM-free music from all four major record companies.^[23]^[24]^[25]^[26]

In August 2007, Amazon announced AmazonFresh,^[27] a grocery service offering perishable and nonperishable foods. Customers can have orders delivered to their homes at dawn or during a specified daytime window. Delivery was initially restricted to residents of Mercer Island, Washington, and was later expanded to several ZIP codes in Seattle proper.^[28] AmazonFresh also operated pick-up locations in the suburbs of Bellevue and Kirkland from summer 2007 through early 2008.

In 2008 Amazon expanded into film production and is currently funding the film The Stolen Child with 20th Century Fox.^[29]

Review and recommendation feature

Website

The domain amazon.com attracted at least 615 million visitors annually by 2008 according to a Compete.com survey. This was twice the numbers of walmart.com.^[30]

Amazon allows users to submit reviews to the web page of each product. As part of their review, users must rate the product on a rating scale from one to five stars. In 2004 a software error accidentally showed the names behind reviews that were submitted anonymously, and some authors were shown to have written glowing reviews of their own books. Amazon created a feature in recent years that allowed users to comment on reviews. Amazon provides an optional badging option for reviewers, e.g., to indicate the real name of the reviewer (based on confirmation of a credit card account) or to indicate that the reviewer is one of the top reviewers by popularity. The U.S. site generally has the most reviews. A review posted on one site is not necessarily visible on another site.

"Search Inside the Book" is a feature which allows customers to search for keywords in the full text of many books in the catalog.^[31]^[32] The feature started with 120,000 titles (or 33 million pages of text) on October 23, 2003.^[33] There are currently about 250,000 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 but rather a picture of the matching page, disables printing, and puts limits on the number of pages in a book a single user can access. One author observed that his entire book could be read online by searching a few words.^[34] Additionally, customers can purchase online access to the some books via the "Amazon Upgrade" program, although the selection is currently quite limited.

According to information in Amazon.com discussion forums,^{[citation needed]} Amazon derives about 40 percent of its sales from affiliates whom they call Associates, and third party sellers who list and sell products on the Amazon websites. Associates receive a commission for referring customers to Amazon by placing links on their websites to the Amazon homepage or to specific products. If a referral results in a sale, the Associate receives a commission from Amazon. Worldwide, Amazon has "over 900,000 members" in its affiliate programs.^[35] 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, or linked to from, another website.

Amazon reported over 1.3 million sellers sold products through Amazon's World Wide Web sites in 2007. Selling on Amazon has become more popular as Amazon expanded into a variety of categories beyond media and built a variety of features to support volume selling. Unlike eBay, Amazon sellers do not have to maintain separate payment accounts; all payments and payment security are handled by Amazon itself.

According to the Internet audience measurement website Compete.com, Amazon attracts approximately 50 million U.S. consumers to its website on a monthly basis.^[36]

Acquisitions and spinoffs

This section may contain an inappropriate mixture of prose and timeline. Please help convert this timeline into prose or, if necessary, a list.

In April 1998, Amazon bought the Internet Movie Database (IMDb).
In August 1998, Amazon bought Cambridge, Massachusetts-based PlanetAll for 800,000 shares of Amazon stock. PlanetAll operated a web-based address book, calendar, and reminder service. In the same deal, Amazon acquired Sunnyvale-based Junglee.com, an XML-based data mining startup for 1.6 million shares of Amazon stock. The two deals together were valued at about $280 million at the time.
In June 1999, Amazon bought Alexa Internet, Accept.com, and Exchange.com in a set of stock deals worth approximately $645 million.
In 2003, Amazon purchased the rival online music retailer CD Now.
In 2004, Amazon purchased Joyo.com, a Chinese e-commerce website. It also debuted A9.com, a company focused on researching and building innovative technology.
In March 2005, Amazon acquired BookSurge, a print on demand company, and Mobipocket.com, an eBook software company.
In July 2005, Amazon purchased CreateSpace (formerly CustomFlix), a Scotts Valley, California-based distributor of on-demand DVDs.^[37] Since the acquisition, CreateSpace has expanded its on-line services to include on-demand books and CDs, as well as video downloads. On July 30, 2007, the National Archives announced that it would make thousands of historic films available for purchase through CreateSpace.^[38]
In February 2006, Amazon acquired Shopbop, a Madison, Wisconsin-based retailer of designer clothing and accessories for women.^[39]
In May 2007, Amazon acquired dpreview.com, a London-based digital photography review website created by Phil Askey as his personal hobby website and Brilliance Audio, the largest independent publisher of audiobooks in the United States.^[40]
In January 2008, Amazon announced that it would acquire audiobook provider Audible.com for $300 million in cash.
In June 2008, Amazon announced that it had acquired Fabric.com, an online fabric store.^[41]
In July 2008, Amazon's IMDb subsidiary purchased Box Office Mojo, a site that tracks movie sales in theatres.^[42]
In August 2008, Amazon announced it had an agreement to purchase Victoria, B.C. based AbeBooks, seller of new, used, out of print and rare books.^[43] Later that month Amazon announced that it would acquire Seattle-based Shelfari, a book-based social network site, for an undisclosed sum.^[44] As part of its acquisition of Abebooks Amazon also got an additional stake in Shelfari's competitor LibraryThing, which AbeBooks had previously purchased a 40 percent stake in, and whole ownership of Bookfinder.com, Gojaba.com, and listing-management service FillZ, all owned by AbeBooks at the time of acquisition.
In October 2008 acquired Reflexive Entertainment^[45], a casual video game development company.
In January 2007 created Endless.com, a separate e-commerce brand focusing on shoes^[46].

Products and services

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This section may contain an inappropriate mixture of prose and timeline. Please help convert this timeline into prose or, if necessary, a list.

Amazon.com has incorporated a number of products and services into its shopping model, either through development or acquisition.

2001: Honor System and donations: The Honor System was originally launched in 2001 to allow customers to make donations or buy digital content, with Amazon collecting 2.9 percent of the payment plus a flat fee of 30¢. The service was discontinued on December 11, 2008.^[47] It has been succeeded by Amazon Payments.

2002: Web Services: Amazon launched Amazon Web Services (AWS) in 2002. The service provides programmatic access to many features leveraged behind the scenes on its website.

2004

Amazon also created "channels" to benefit certain causes. In 2004, Amazon's "Presidential Candidates" allowed customers to donate $5–200 to the campaigns of 2004 U.S. presidential hopefuls. Amazon has periodically reactivated a Red Cross donation channel after such tragedies as 9/11 and Hurricane Katrina. After the 2004 earthquake and tsunami in the Indian Ocean, Amazon set up an online donation channel to the American Red Cross, waiving its processing fee. By January 2005, nearly 200,000 individuals had donated over $15.7 million in the US alone.^[48]

2005: Prime: Amazon Prime offers customers unlimited expedited shipping with no minimum purchase amount for a flat annual fee. The service also offers discounted priority shipping rates. Amazon launched the program in the continental United States in 2005, in Japan in June 2007, in the United Kingdom and Germany in November 2007, and in France (as "Amazon Premium") in October 2008.

Shorts: Launched in 2005, Amazon Shorts offers exclusive short form content, including short stories and non-fiction pieces from best-selling authors, all available for immediate download at 49¢. As of June 2007, the program has over 1,700 pieces and is adding about 50 new pieces per week.

Mechanical Turk: In November 2005, Amazon.com began testing Amazon Mechanical Turk, an application programming interface (API) allowing programs to dispatch tasks to human processors.

2006: S3: In March 2006, Amazon launched an online storage service called Amazon Simple Storage Service (Amazon S3). An unlimited number of data objects, from 1 byte to 5 gigabytes in size, can be stored in S3 and distributed via HTTP or BitTorrent. The service charges monthly fees for data stored and for data transferred.

SQS: In April 2006, Amazon introduced Amazon Simple Queue Service (Amazon SQS), a distributed queue messaging service.

Discussion boards: In August 2006, Amazon launched product wikis (later folded into Amapedia) and discussion forums for certain products using guidelines that follow standard message board conventions.

EC2: In August 2006, Amazon introduced Amazon Elastic Compute Cloud (Amazon EC2), a virtual site farm, allowing users to use the Amazon infrastructure with its high reliability to run diverse applications ranging from running simulations to web hosting. In 2008, Amazon improved the service adding Elastic Block Store (EBS), offering persistent storage for Amazon EC2 instances and Elastic IP addresses, static IP addresses designed for dynamic cloud computing.

2007: Amapedia: In January 2007 Amazon launched Amapedia, a collaborative wiki for user-generated content to replace ProductWiki.

Unbox: In March 2007, Amazon launched an online video on demand service, Amazon Unbox.

MP3 downloads: In September 2007, Amazon launched a new music store (currently in beta) called Amazon MP3, which sells downloadable tracks, all in the MP3 format and most recorded at 256 kilobits per second variable bitrate (VBR).^[49] Amazon's terms of use agreements legally restrict use of the music, but Amazon does not use DRM to enforce those terms.^[50]

Amazon MP3 sells music from the Big 4 record labels: EMI, Universal, Warner Bros. Records, and Sony BMG, as well as many independents. Previous to the launch of this service, Amazon made an investment in Amie Street, a similar music store with a variable pricing model based on demand.^[51]

Vine: In August 2007 Amazon launched Amazon Vine, which allows top product reviewers free access to pre-release products from vendors participating in the program. Reviewers may either return the used product to Amazon, or post a review and keep the product, within a few months of receipt.

FPS: In August 2007 Amazon launched a payment service specifically targeted at developers called Flexible Payment Service FPS. Amazon FPS has facilities for developing many different charging models including micro-payments. The service also gives developers easy access to Amazon customers.^{[citation needed]}

Kindle: In November 2007, Amazon launched Amazon Kindle, an e-book reader which downloads content over "Whispernet", a free EV-DO wireless service on the Sprint Nextel network. The screen uses E Ink technology to reduce battery consumption. In 2008 Amazon claimed its library had grown to 200,000 titles.

SimpleDB: In December 2007, Amazon introduced SimpleDB, a database system, allowing users of its other infrastructure to utilize a high reliability high performance database system.

AmazonFresh: In August 2007, Amazon launched an invitation-only beta-test for online grocery delivery. It has since rolled out in several Seattle, Washington suburbs.

2008: Amazon MP3: In January 2008 Amazon announced they would be rolling out their MP3 service to their subsidiary websites worldwide throughout the year.^[52] On December 1, 2008, Amazon MP3 was made available in the UK.

SoundUnwound: At the beginning of September, IMDB and Amazon.com launched a Music metadata browsing site with wiki-like user contribution. ^[53]

Frustration-Free Packaging: In November, Amazon partnered with manufacturers including Fisher-Price, Mattel, Microsoft and electronics manufacturer Transcend to offer products in minimal packaging. This reduces environmental impact of the packaging and frustration with opening "clamshell" type security packaging. ^[54]

EC2 Windows Client: In Amazon Web Services launched a public beta of Amazon Elastic Compute Cloud running Microsoft Windows Server and Microsoft SQL Server. ^[55]

Undated: Connect: Amazon Connect enables authors to post remarks on their book pages to customers who have bought their books.

WebStore: WebStore by Amazon allows businesses to create e-commerce websites using Amazon technology. Merchants can customize their sites using their own photos and branding. Sellers pay a commission of 7 percent, which includes credit-card processing fees and fraud protection, and a subscription fee of $59.95/month for an unlimited number of webstores and listings.

Controversies

This article's Criticism or Controversy section(s) may mean the article does not present a neutral point of view of the subject. It may be better to integrate the material in such sections into the article as a whole. (April 2009)

Trademark infringement

In 1999, the Amazon Bookstore Cooperative of Minneapolis, Minnesota sued Amazon.com for trademark infringement. The cooperative had been using the name "Amazon" since 1970, but reached an out-of-court agreement to share the name with the on-line retailer.^[56]

Patent use

The company has been controversial for its alleged use of patents as a competitive hindrance. The "1-click patent"^[57] is perhaps the best-known example of this. Amazon's use of the one-click patent against competitor Barnes and Noble's website led the Free Software Foundation to announce a boycott on Amazon in December 1999.^[58] The boycott was discontinued in September 2002.^[59]

On February 22, 2000, the company was granted a patent covering an internet-based customer referral system, or what is commonly called an "affiliate program". Reaction was swift and negative. Industry leaders Tim O'Reilly and Charlie Jackson spoke out against the patent,^[60] and O'Reilly published an open letter^[61] to Bezos protesting the 1-click patent and the affiliate program patent, and petitioning him to "avoid any attempts to limit the further development of internet commerce".

O'Reilly collected 10,000 signatures^[62] with this petition. Bezos responded with his own open letter.^[63] The protest ended with O'Reilly and Bezos visiting Washington, D.C. to lobby for patent reform.

On February 25, 2003, the company was granted a patent titled "Method and system for conducting a discussion relating to an item on Internet discussion boards".^[64]

On May 12, 2006, the USPTO ordered a re-examination^[65] of the "One-Click" patent, based on a request filed by Peter Calveley, who cited as prior art an earlier e-commerce patent and the Digicash electronic cash system.^{[citation needed]} <!!-- http://igdmlgd.blogspot.com igdmlgd blogspot is not a reliable source -->

Labor relations

Amazon has opposed efforts by trade unions to organize in both the United States and the United Kingdom.

In 2001, 850 employees in Seattle were laid off by Amazon.com after a unionization drive. The Washington Alliance of Technological Workers (WashTech) accused the company of violating union laws, and claimed Amazon managers subjected them to intimidation and heavy propaganda. Amazon denies any link between the unionization effort and the lay-offs.^[66]

Also in 2001, Amazon.co.uk hired a US management consultancy organization, The Burke Group, to assist in defeating a campaign by the Graphical, Paper and Media Union (GPMU, now part of Amicus) to achieve recognition in the Milton Keynes distribution depot. It was alleged that the company victimized or sacked four union members during the 2001 recognition drive and held a series of captive meetings with employees.^[67]^[68]

The Humane Society of the United States v. Amazon.com, Inc., et al.

Amazon at one time carried two cockfighting magazines and two dog fighting videos although the Humane Society of the United States (HSUS) contends that the sale of these materials is a violation of U.S. Federal law. The Humane Society of the United States has filed a lawsuit against Amazon.^[69] A campaign to boycott Amazon purchases gained momentum in August 2007 after the much publicized dog fighting case involving NFL quarterback Michael Vick.^[70]

On May 21, 2008, Marburger Publishing agreed to settle with the Humane Society by requesting that Amazon stop offering their magazine The Game Cock for subscription. The second magazine named in the Humane Society lawsuit, The Feathered Warrior, remains available.^[71]

Reader reviews credibility

A 2004 glitch in Amazon.ca's review system revealed that many well-established authors were anonymously giving themselves glowing reviews, with some revealed to be anonymously giving "rival" authors terrible reviews. The glitch in the system was fixed and those reviews have since been removed or made non anonymous.^[72]^[73]

BookSurge

In March 2008, sales representatives of Amazon's BookSurge division started contacting publishers of print on demand titles to inform them that for Amazon to continue selling their POD-produced books, they would need to sign agreements with Amazon's own BookSurge POD company. Publishers were told that eventually, the only POD titles that Amazon would be selling would be those printed by their own company, BookSurge. Some publishers felt that this ultimatum amounted to monopoly abuse, and questioned the ethics of the move and its legality under anti-trust law.^[74]

Interfering with publishers' direct sales

In 2008, Amazon UK came under criticism for attempting to prevent publishers from direct selling at discount from their own websites. Amazon's argument was that they should be able to pay the publishers based on the lower prices offered on their websites, rather than on the full RRP.^[75]^[76]

Dispute with Hachette Livre UK

In June 2008 Amazon UK drew criticism in the British publishing community following their withdrawal from sale of key titles published by Hachette Livre UK. The withdrawal is apparently intended to put pressure on the publisher to provide levels of discount described by the trade as unreasonable. Curtis Brown's managing director Jonathan Lloyd was quoted in The Bookseller magazine as saying: "I think the entire industry of publishers, authors and agents are 100% behind [Hachette]. Someone has to draw a line in the sand. Publishers have given 1% a year away to retailers, so where does it stop? Using authors as a financial football is disgraceful."^[77]^[78]

Lawsuits with the State of New York

In 2008 New York passed a law that would force online retailers to collect sales taxes on shipments to New York State residents.^[79] Shortly after the law was signed, Amazon.com filed a complaint in the New York Supreme Court objecting to the law.^[79] The complaint wasn't based on whether in-State customers should pay tax, but was based on the long standing practice of it being the responsibility of the customer to report the sales tax (known as use tax in this case) and not that of the out of State businesses.^[79] The lawsuit was tossed out of court in January 2009 when New York State Supreme Court Justice Eileen Bransten stated that "there is no basis upon which Amazon can prevail."^[80]

Deranking of erotic, LGBT, feminist, progressive and sex-positive content

On April 12, 2009, it was revealed that some erotic, lesbian, gay, bisexual, transgender, feminist and progressive books were being excluded from Amazon's sales rankings.^[81] Various books and media were flagged as "Adult content" (including children's books, self-help books, non-fiction, and non-explicit fiction), with the result that works by established authors like E. M. Forster, Gore Vidal, Jeanette Winterson and D. H. Lawrence were now unranked.^[82] The change first received publicity on the blog of author Mark R. Probst, who reproduced an e-mail from Amazon customer service describing a policy of de-ranking "adult" material.^[81]^[82] However, Amazon later said that there was no policy of de-ranking LGBT material and blamed the change first on a "glitch"^[83] and then on "an embarrassing and ham-fisted cataloging error" that had affected 57,310 books.^[84]

Taxes paid

In April 2009, BusinessWeek magazine reported that Amazon.com was one of 25 US companies that paid the least US taxes. Amazon.com paid a 4.1 percent annual tax rate, far less than the standard 35 percent corporate rate, based on an analysis of the company's financial figures for 2005-2008. According to SEC filings, this rate was caused in part by lower tax rates for Amazon.com's international subsidiaries. ^[85] Amazon.com did not respond to BusinessWeek's request for comment.

Entrepreneurship by former employees

A number of companies have been started and funded by former Amazon.com employees.^[86] This is despite a non-compete agreement Amazon employees must sign that prohibits starting a company with another Amazon employee.^{[citation needed]}

Hulu is led by Jason Kilar, a former SVP at Amazon.com.
Jambool/SocialGold was co-founded by former Amazon engineers Vikas Gupta and Reza Hussein.
TeachStreet was founded by Dave Schappell, an early Amazon.com product manager.
Trusera was founded by Keith Schorsch, an early Amazonian.
Twilio was founded by Jeff Lawson, an Amazon product manager.
Whrrl was founded by Jeff Holden, a former SVP at Amazon.com.
Wikinvest was founded by Michael Sha.
ZumoDrive was founded by David Zhao, a former Amazon.com developer.

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External links

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Companies portal

v • d • e Amazon.com

People	Jeff Bezos · Brian McBride · Tom Szkutak · Brian Valentine · Werner Vogels · Gregg Zehr Former: Rick Dalzell · Ram Shriram

Websites	A9.com · AbeBooks · Alexa (Ranking, Toolbar, Web Services) · Amapedia · Amazon China · Askville · CDNOW · Digital Photography Review · Fresh · IMDb · Marketplace · Payments · PlanetAll · Shelfari

Web Services	AAWS · CloudFront · EC2 · FPS · Mechanical Turk · S3 · SimpleDB · SQS

Digital	Audible.com · Kindle · Mobipocket · MP3 · Video on Demand

Technology	1-Click · aStore · Dynamo · Gurupa · Lab126 · Obidos

Investments	43 Things · Amie Street · LibraryThing · Sellaband

Other	Amazon Vine · ASIN · Breakthrough Novel Award · Fishbowl · Statistically Improbable Phrases

Annual Revenue: ▲US$14.84 billion (FY 2007) · Employees: 17,000 · Stock Symbol: NASDAQ: AMZN · Website: www.amazon.com

Companies of the NASDAQ-100 index

Activision Blizzard · Adobe · Akamai Technologies · Altera · Amazon.com · Amgen · Apollo Group · Apple · Applied Materials · Autodesk · Automatic Data Processing · Baidu · Bed Bath & Beyond · Biogen Idec · Broadcom · C. H. Robinson Worldwide · CA, Inc. · Celgene · Cephalon · Check Point · Cintas · Citrix · Cognizant Technology Solutions · Comcast · Costco · Dell · DENTSPLY International · Dish Network · eBay · Electronic Arts · Expedia · Expeditors International · Express Scripts · Fastenal · First Solar · Fiserv · Flextronics · FLIR Systems · Foster Wheeler · Garmin · Genzyme · Gilead Sciences · Google · Hansen Natural · Henry Schein · Hologic · IAC/InterActiveCorp · Illumina · Infosys · Intel · Intuit · Intuitive Surgical · J. B. Hunt · Joy Global · Juniper Networks · KLA-Tencor · Lam Research · Liberty Global · Liberty Media · Life Technologies · Linear Technology · Logitech · Marvell · Maxim Integrated Products · Microchip Technology · Microsoft · Millicom International Cellular · NetApp · News Corporation · NII · Nvidia · O'Reilly Automotive · Oracle · Paccar · Patterson Companies · Paychex · Pharmaceutical Product Development · Qualcomm · Research In Motion · Ross Stores · Ryanair · Seagate · Sears · Sigma-Aldrich · Staples · Starbucks · Steel Dynamics · Stericycle · Sun Microsystems · Symantec · Teva Pharmaceutical Industries · The DirecTV Group · Urban Outfitters · VeriSign · Vertex Pharmaceuticals · Warner Chilcott · Wynn Resorts · Xilinx · Yahoo!

Seattle-based Corporations (within the Seattle metropolitan area)

Seattle-based Fortune 500 Corporations (by size):
Amazon.com • Expeditors International • Nordstrom • Starbucks • Safeco

Seattle and SeaTac-based Fortune 1000 Corporations (by size):
Companies listed above, plus: Alaska Airlines • Plum Creek Timber

Puget Sound-based Fortune 1000 Corporations (by size):
Companies listed above, plus: Costco Wholesale • Microsoft • Weyerhaeuser • Paccar • Puget Sound Energy

Major Seattle- and Puget Sound-based non-public or externally owned corporations:
Nintendo of America • REI • T-Mobile USA • WestFarm Foods

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