Amazon’s Evolution From Retail Disrupter to Partner

From Spencer Soper, published at Wed Jan 22 2025

Welcome to Tech In Depth, our revamped daily newsletter with reporting and analysis about the business of tech from Bloomberg’s journalists around the world. Today, Spencer Soper looks at Amazon’s effort to play nice with its retail rivals.

Meta’s product plans: The owner of Facebook and Instagram is working on upgrades to its popular smart glasses, including an Oakley-branded model, and is exploring new wearable devices such as watches and camera-equipped earbuds. The company is trying to embed artificial intelligence features into more consumer products.

Staying independent: European AI startup Mistral AI is “not for sale” and is working toward an initial public offering, its chief executive officer says.

Sales under scrutiny: EFishery, an Indonesian startup that deploys feeders to fish and shrimp farmers, may have inflated its revenue by almost $600 million in the first nine months of 2024 — or 75% of sales — according to an internal investigation triggered by a whistleblower’s claim.

StackBlitz, a startup offering software that uses AI to build websites, is finishing a fundraising round that will value the company at $700 million. The $83.5 million round is led by Emergence Capital and GV, formerly Google Ventures.

Twelve years ago, Amazon founder Jeff Bezos received the National Retail Federation’s highest distinction: the Gold Medal Award. Amazon’s hometown paper The Seattle Times said the honor came from an “unlikely bunch” because the group is made up of brick-and-mortar retailers Bezos had been so ruthlessly beating by pioneering a new way of shopping through the internet.

Turned out to be a prescient move by the industry group that signaled Amazon’s evolution from an outside disrupter to a prominent retail fixture, with branded delivery vans navigating every city and warehouses sprouting beside freeway junctions.

That shift culminated last week with the appointment of Amazon consumer chief Doug Herrington to the National Retail Federation’s board of directors, a position that will have him mingling and strategizing with executives from Walmart Inc., Target Corp., Macy’s Inc., Dick’s Sporting Goods Inc. and Shopify Inc. The club seems to embody the adage of keeping your friends close, your enemies closer.

Amazon is increasingly hopeful the retail industry is ready to think about what the world’s biggest online retailer can do for them instead of to them. At the federation’s annual Big Show, which drew some 40,000 attendees to the Jacob K. Javitz Convention Center in New York City, the company hosted a large booth in the middle of the exhibition hall offering its cloud computing products as well as logistics and advertising services. If Amazon wants to keep increasing sales, it needs to convert more retailers from competitors into clients. The main online store and Whole Foods groceries are Amazon’s slowest-growing businesses. The sale of advertising and cloud computing services to other businesses are increasing at the fastest pace among the company’s units.

During a 30-minute keynote address, Herrington did his best to make nice with the crowd, saying “our thriving retail industry here in the US is a great national asset.” It was a curious word choice given the protectionist postures of President Donald Trump. But it highlights how Amazon may gain from being part of a national lobbying group when US lawmakers scrutinize the rise of China-backed consumer apps like Temu and Shein, which have bit into the company’s business.

Perhaps most revealing of Amazon’s place in the US retail establishment was a temporary booth in the Javitz Center stocked with sandwiches, chips and cold drinks behind turnstiles where shoppers used smartphones or credit cards to pay. It was a reincarnation of Amazon Go, the automated stores where shoppers could grab what they need and be charged automatically without seeing a cashier or going through a self checkout kiosk. Amazon once aspired to open thousands of the stores around the country, posing a threat to 7-Eleven Inc. and other convenience chains. Today, Amazon doesn’t have much to show for its efforts to reinvent physical retail with its own brick-and-mortar stores. So it’s trying to give existing retailers a tech makeover, one shop at a time.

OpenAI, SoftBank and Oracle are leading partners in a joint venture called Stargate to spend billions of dollars on artificial intelligence projects, including data centers, in the US. The effort was announced by President Donald Trump at the White House in an appearance with SoftBank’s Masayoshi Son, Oracle’s Larry Ellison and OpenAI’s Sam Altman.

US Representative Jake Auchincloss joins Bloomberg Technology to discuss President Donald Trump’s effort to block a US ban on popular video app TikTok.

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