Amazon, a company with a long term view

A lot of articles and analysis on Amazon, a company with increasing revenues but with low profits and operating even at loss in certain quarters. A strategy that focuses on the long term view, world domination and expansion.

A great recent book is The Everything Store by Brad Stone.

A take from famous VC, Fred Wilson Profitless Prosperity

A view from Benedict Evans Amazon’s profits

an article from the Atlantic, The Amazon Mystery: What America’s Strangest Tech Company Is Really Up To

Blog posts by a former Amazon employee, Eugene Wei Amazon and the “profitless business model” fallacy and  Amazon, Apple, and the beauty of low margins

Slate magazine Amazon’s Jeff Bezos Is Like King Midas in Reverse

Digital Convergence and business models

The interesting fact about digital convergence is that many things can change, disrupting existing players,  and industries.
Established business models are not anymore valid and are challenged.

A simple example.

Apple has just announced that the upgrade to the new version of their OS Mavericks will be FREE, and people that will buy their devices will also get the iWork productivity suite for FREE (Page, Numbers and Keynote). Money are made on the hardware.

In the meantime, Google is giving all its software for FREE and eventually selling its hardware at cost, making money with ads.

Amazon, is selling its hardware at cost, making money on the content sold through its devices.

Microsoft makes money on the software that all the others are now giving away for FREE.

And the FREE software or the FREE hardware is actually great, not bad copies of the paid versions. Let’s be clear, nothing is really FREE. They are only monetizing in a different way using asymmetrical business models, that is giving something for free, while making money with something else.

That’s the challenge for Microsoft that used to get paid for what it sold, software. And probably that’s the reason it has acquired Nokia. With hardware and software it can decide to monetize in different ways. Will it be enough?





Smartphones and China

The world’s biggest smartphone market China will likely ship in more than 450 million devices in 2014, at least a quarter more than this year, research firm IDC said.

From Digitimes Research Tablet AP shipments to China to rise 53% in 3Q13

Shipments of tablet-use application processors to the China market are set to register growth of 24.9% sequentially and 53.3% on year in the third quarter of 2013. The top-3 suppliers – Allwinner, Rockchip and MediaTek – are expected to contribute a combined 70.2% to the overall tablet AP shipments to China in the third quarter.

China Passed U.S. as Top Smartphone Market by Volume in Q3 2011, according to Strategy Analytics.  China Mobile, the largest Chinese operator, has 700 million subscribers.

China will easily remain the world’s largest market for smartphones, specifically low-cost handsets based on the Android operating system and to a lesser degree iOS.

Chinese smartphones will be made by:

With Chinese services on top, like: Tencent, Sina, Baidu, Alibaba, RenRen.

A huge market but very competitive and Chinese companies are becoming more and more relevant, not only in China. The next step will be their international expansion.