Tuesday, 2 January 2007

Amazon's Technology Leadership: The Long Tail of Web Services

Vanessa has a must read post on her site talking about the technology leadership of Amazon vs. Google and the The Long Tail of Web Services.

While most people think of Amazon as a bookseller, or retailer in general, that really isn't what they have been up to underneath it. Similar to say a Walmart who might be a retail brand but has as much value in their supply chain processes, Amazon is becoming a leader in technology. I remember being surprised a couple years when a friend of mine who owned a small Web shop here in Toronto, lost a major retailer piece of business for building a dynamic content management and e-commerce site to Amazon. I had no idea that they were selling their process to other retailers.

When we consider the extent to which technology choices can become competitive advantages for corporations, and where the streamlining of business processes can impact and affect margin and profitability, it is easy to see Vanessa's argument that it will be Amazon that will emerge as the leader in the coming years.

And what about Google? Vanessa says:

"For Google to become the sort of web services platform so many people seem to expect, they'd have to radically change their business model."

Centralizing eyeballs or even centralizing the data around the eyeballs forces Google's technology hand while Amazon's are free and clear to innovate.


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