Amazon At 25: The Magic That Changed Everything

Source: Seattle Times, Benjamin Romano
Photo: Jeff Bezos poses with a cart of books two months after launching Amazon.com. (Jimi Lott, The Seattle Times, 1995)

The idea from the start was magic.

Jeff Bezos filed the paperwork July 5, 1994, to create Cadabra Inc. — as in abracadabra, presto change-o.

In the quarter century since, his erstwhile electronic bookstore changed nearly everything about publishing, retail, computing and how to run a company. It has ever-growing fleets of airplanes, drones, trucks and robots; it is moving deeper into entertainment, health care, groceries, advertising, home security, artificial intelligence and more.

In the process, it has transformed this city, recruiting tens of thousands of skilled workers, minting another round of tech millionaires and stamping new towers on the skyline. At the foot of the “Day 1” building, where Bezos has his office, is a trio of enormous glass spheres, just down the street from Seattle’s other symbol of futuristic ambition and industry, the Space Needle.

The wealth generated by the Amazon juggernaut fuels Bezos’ childhood dreams of rockets and moon landings, and enabled him to buy The Washington Post.

If you’ve fully bought in to Amazon’s system of systems, you can speak your wish aloud to a microphone installed in your home, triggering a chain of events across a sprawling mechanism of computers, machines and people that ends at your door as little as an hour later with the wish fulfilled.

It is tantamount to magic, the near perfection of consumer capitalism that has made Bezos the richest person on Earth. The name Cadabra was a reflection of this ambition. “He had that vision from the beginning,” said Tom Alberg, who invested in the company earlier than almost anyone and served as a board member for 23 years.

But Cadabra sounded too much like “cadaver,” so in November 1994, Bezos changed it to Amazon.com Inc. The reference to the lengthy South American river was meant to signal a vast selection, and the choice of a name beginning with “a” put the site high on early alphabetical web listings.

Amazon embarks on its second quarter century in business more visible and powerful than ever in Seattle, the nation and across the globe, but it also faces a mounting array of challenges and criticisms. Amazon was worth more than $937.5 billion at its closing price on Friday, making it the world’s second-most valuable public company by market capitalization, behind Microsoft. Amazon employed about 647,500 people at the end of 2018.

Amazon considers its anniversary to be the date it opened to the online public, July 16, 1995, a little more than a year after it incorporated in Washington. The first story on the company appeared in The Seattle Times two months later informing readers: “There’s a big, new bookstore in town, and there’s a catch — you won’t find it on any Seattle street map. So if you want to wander down its aisles and peruse the selection, you’ll have to hook up to the Internet.”

Amazon marks its birthday with an invented shopping holiday that many of its competitors now feel compelled to “celebrate” with sales of their own, illustrating its sway over the retail industry. But its impact stretches far beyond retail.

The dominant 20th century system of industrial mass production and consumption is sometimes referred to as Fordism, after Henry Ford and the Ford Motor Company.

Margaret O’Mara, a University of Washington historian, wonders if Amazon may be as influential. “Decades in the future,” she said, “are we going to be talking about Bezosism?”

Space and time

O’Mara sees an apt comparison in another era-defining business: the railroads of the late 19th century, which like Bezos’ company, rewrote the rules of space and time, compressing the gap between desire for a thing and possession of it.

The railroads at the height of their powers capitalized on technological advances and created infrastructure that drove broader societal and economic changes, but also attracted regulatory scrutiny, said O’Mara, whose forthcoming book “The Code” charts the rise of the modern technology titans, including Amazon.

“A lot of the political conversation a hundred-and-some years ago was around what role should the federal government play in regulating or creating a balance to these incredibly powerful companies,” she said.

Amazon, along with Google’s parent company and Facebook, have lately become a hot topic in academic antitrust circles, and the federal government is increasing its scrutiny of the companies, according to reports earlier this month.

“We’re at a very consequential moment in American history generally, but American business history in particular,” O’Mara said.

‘Kitty Hawk stage’

The Amazon origin story is well known. While working at a Wall Street hedge fund, Bezos encountered a statistic on the rapid growth of internet usage — 2,300% a year. That first Seattle Times story from 1995 estimated that between 2 million and 13.5 million people were using the World Wide Web. Last year, there were an estimated 3.8 billion.

“I picked books as the first, best product to sell online after making a list of like 20 different products that you might be able to sell,” the 33-year-old Bezos said in a 1997 interview taped outside a conference in Seattle for library professionals. With more than 3 million books in print, “you can literally build a store online that couldn’t exist any other way.”

He added, “This is the Kitty Hawk stage of electronic commerce. We’re moving forward in so many different areas.”

Early employees traded an anecdote passed down from Bezos called the “Kayaking Thing,” which was “the corporate equivalent of holy writ,” as employee No. 55, James Marcus, wrote in “Amazonia,” his 2004 memoir of early life inside the company. It was explained to him this way: Someone who visits the site interested in kayaking can of course find a book on the subject. “But Jeff wants to offer that same visitor the opportunity to buy a spare paddle, or a waterproof kayaking jacket.”

https://www.seattletimes.com/business/amazon/amazon-25-the-magic-that-changed-everything