Amazon and the “profitless business model” fallacy (2013)

Re:Amazon and the “profitless business model” fallacy (2013) by bushbaba on Thursday December 23, 2021 @11:35PM (#29670248)

Google and Microsoft had more to loose. Cloud is a profitable business but no where near as profitable as Ads or Office/Windows.

Google also had zero enterprise experience. Things like MySQL, RFC 1918, VMs were not native by their devs.

So of course boards of these companies held off. Making that move could have tanked the stock as profit went down while they re-invested in their business.

This is the genius of Amazon. Wall Street doesn’t expect growing profit. Instead it’s happy with growing revenues. Allowing Amazon to reinvest into business that have an initial low margin until economy of scale kicks in.

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Re:Amazon and the “profitless business model” fallacy (2013) by antonvs on Friday December 24, 2021 @02:14AM (#29671167)

> Google also had zero enterprise experience.

Same was true of Amazon.

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Re:Amazon and the “profitless business model” fallacy (2013) by bushbaba on Friday December 24, 2021 @11:48AM (#29675090)

Amazon’s internal stack was very similar to other tech companies. Google did everything custom and different than the pack. E.g. google web toolkit over JavaScript. Containers vs VMs. Bigtable/spanner vs Mongo/Cassandra.

At the time, Amazon might not have had enterprise sales teams. But they had deep expertise in running the familiar suite of enterprise software at scale.

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