When most people think of Amazon, they think of Jeff Bezos and the Amazon.com company. They don’t usually think about Amazon’s relationship with the Pentagon or that Bezos is connected to the CIA. But, if you have been paying attention in recent years, then you would probably have heard that Amazon has been getting more aggressive in pushing its technology into the DOD sector, pushing for the Pentagon to work more closely with the companies it owns, expanding its relationship with the Military Industrial Complex.
Of course, the way Bezos justifies this strategy is that Bezos sees Amazon as the “disruptor” in the business that has to continue to get in-front of its competition, so it must be the “disruptor” in the computer business. The problem is that Amazon isn’t even a computer company, and hasn’t been for many years. Amazon is an online retail giant, but not the sort of online retail giant that can make large purchases from the Pentagon’s massive supply chain.
The two major opportunities, the Pentagon has been looking at is having Amazon do the shopping for the troops, or Amazon having a major role in the e-book distribution business. So, how does Amazon fit into these two different opportunities? Well, if we look at the e-book market, it seems to me that Amazon and Barnes & Noble’s lead in e-books is going to be pretty substantial for the Pentagon.
But, the market will be a lot smaller, so the Pentagon will be fighting against a major e-book distributor with hundreds of millions of potential customers. Amazon, on the other hand, is a much smaller e-book distributor with maybe one percent of the e-book market share. What this means is that the Pentagon will be competing directly with smaller firms and also with direct competitors like Best Buy and Wal-Mart.
But, Amazon can offer a solution to the military. If we look at Amazon’s history, it’s proven it has been able to go head-to-head with big name, larger companies. In fact, when Amazon decided to go after the grocery industry, it not only was a major player in that industry, but it ended up being a giant.
So, Bezos thinks that Amazon is the “disruptor” that must be fought head-on, and he has some military companies working with Amazon on the logistics side of this push. Of course, there are major differences between a product like e-books, and a supply chain like computer products.
Amazon is doing well, but it seems like it’s business model is more about selling advertising and payment processing rather than making electronic goods that actually help the military do its job. So, Bezos is trying to open up Amazon’s operation into the world of electronic goods and hopefully Amazon can be a major force in the electronics market in the long run.
Hopefully Bezos and Amazon can be an unstoppable force in the world of e-books and electronics. Until then, we will just have to take what we can get from Amazon.