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Special Edition On Amazon. Aired 4-4:10a ET
Aired April 05, 2021 - 04:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CARL AZUZ, CNN 10 ANCHOR: Hi, I`m Carl Azuz for CNN 10. We`ve got something special lined up for you today. This show is centered on a single big topic
because in the business world, there are few bigger topics than Amazon. In 1995, the company had launched as a retail Web site that sold books and not
much else. From there, well it`s grown a bit.
Amazon sells most of the stuff you can buy at a mall, at a grocery store and at a lot of other types of stores too. It offers online content, cloud
computing, movies, music and it not only still sells books, it helps people publish them. Today Amazon is one of the top five most valuable companies
on the planet. It`s worth more than $1.5 trillion and it grew that big in a relatively short amount of time.
Its founder Jeff Bezos is the richest person on the planet with a net worth of more than $180 billion according to the Forbes Business Magazine.
However, the company he founded has seen its share of bumps in the road. Amazon has been criticized in the past for what it paid its employees.
Three years ago, the average salary for an Amazon employee was $28,000 per year. That was $20,000 less than the average yearly salary in America.
Amazon has raised its minimum wage to $15 an hour for all employees since then. As people spent more time shopping online and less in retail stores,
the infamous Amazon effect occurred in America with thousands of physical stores shutting down and tens of thousands of retail jobs lost.
And while Alexa, Amazon`s virtual artificial intelligence assistant has found a place in many homes in recent years. Privacy advocates have raised
concerns about smart speakers because they`re always listening. As a company, Amazon is massive.
Even as other businesses laid off employees last year because of the effects of the corona virus pandemic, Amazon grew tremendously hiring half
a million people in 2020. Increasing its workforce to more than 1 million, 200 thousand. It`s a complicated company like some of the challenges it`s
faced. It`s also changed the way the world buys goods.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Welcome. Swipe in here.
UNIDENTIFIED MALE: Amazon does the ultimate grab and go shopping experience.
UNIDENTIFIED FEMALE: Right. You literally grab it off the shelves and go.
UNIDENTIFIED MALE: You use the app going to the store. Once you`re in, you can put the phone away and you shop the rest of the store just like you
would any other store with one key difference. When you`re done, you can just walk out.
UNIDENTIFIED FEMALE: Nothing is simple about the technology behind this cashier less store. The Amazon Go market uses artificial intelligence to
monitor what you`re reached for on the shelf and to make sure you`re charged for what you walked out with and nothing else.
UNIDENTIFIED MALE: What we had to do unique in this use case was build the sensors, the cameras --
UNIDENTIFIED FEMALE: All these cameras and sensors above us.
UNIDENTIFIED MALE: The -- the cameras in the ceiling. We had to build a specific machine learning algorithms. The problem that we have to solve in
Amazon Go is who took what. When I take this item off the shelf it`s in my virtual cart, when I put it back the item goes back. It`s an easy problem
to solve when you have a single person in the store but when there`s multiple people. More of the products of the products if you look all
around, they look very similar to each other.
UNIDENTIFIED FEMALE: Right.
UNIDENTIFIED MALE: So that`s where the challenge comes in.
UNIDENTIFIED FEMALE: The Amazon Go store is by no means the only place where Amazon uses AI.
UNIDENTIFIED MALE: We`ve got hundreds of teams working on artificial intelligence programs across Amazon. Artificial intelligence like machine
learning, powers the simplicity that we always want to offer to our customers.
UNIDENTIFIED FEMALE: Whether it`s fulfilling orders or delivering packages, those teams are working constantly to improve the customer`s experience.
Inside Amazon`s warehouses, AI is hard at work. These are Amazon robotics drive units.
UNIDENTIFIED FEMALE: Once a customer actually purchases an item either on their mobile app or on their computer or laptop, the system identifies the
pod where the item is actually located in the field. And the bot maps out the most efficient way through using machine learning to get that pod which
has that item that that customer purchased to the associate.
UNIDENTIFIED FEMALE: So there`s some people out there that will hear robots, machine learning, AI and think, jobs. They`re going to be gone.
UNIDENTIFIED FEMALE: Well, we`ve actually determined when we actually deployed our solutions in their fulfillment networks is that we`re actually
relying a lot more on our associates. We`ve increased their efficiency and it really give them the ability to work on different tasks and we`ve
actually grown our associates employments across the globe to date.
UNIDENTIFIED MALE: Alexa, order dog biscuits.
UNIDENTIFIED FEMALE: And of course, the AI tool you`re most familiar with - -
UNIDENTIFIED FEMALE: Here`s what I found.
UNIDENTIFIED FEMALE: -- is always learning new tricks.
UNIDENTIFIED MALE: Achieving what Alexa is right now is super hard challenge. Going from that to the future, I would like Alexa to respond to
the -- the -- your mood, your sentiment, your feelings as expressed in your speech. The one key advantage we have is we now have so much more data. So
is it a big challenge? Yes. Are we up to that challenge? Heck yes.
UNIDENTIFIED FEMALE: In the evolution of Alexa, is it still in its infancy? Is it a toddler now or is she a toddler now, an adolescent, teenager?
Certainly hasn`t graduated from college.
UNIDENTIFIED MALE: No. AI hasn`t graduated from college overall. I -- and I think AI as a field is in it`s infancy. Think of it as a older toddler, you
know, who`s going to grow up and be an adult that just stuns us with her brilliance, right, is where we are.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Is Amazon a monopoly? Well it`s not really an easy question to answer. First you have to understand the core tenant of Jeff
Bezos` business philosophy is, patience. Go back to the original letter that Jeff Bezos wrote investors in 1997.
He wrote that investors to Amazon shouldn`t expect Amazon to operate like most companies because Amazon wouldn`t judge itself by short term profits.
You know, the thing that every other company cares about only the long term and Bezos and Amazon stayed true to that. It`s first few years Amazon
barely made a profit.
It invested billions of dollars back into the business and it just kept growing and growing and growing and growing and now that patience has paid
off with incredible profits over the last few years. We all know on some level what a monopoly is.
We`ve played the game but in the context of anti-trust law, it`s a specific thing. It`s meant to stop a company from forming that can dominate the
market in such a way that competition is impossible. Those who do not think Amazon is a monopoly say that because Amazon is offering its customers
lower prices. It can`t possibly be an anti-trust case. Those low prices are a benefit to consumer welfare and it would be impossible to regulate
exactly how low is too low for prices.
UNIDENTIFIED MALE: The load star of anti-trust enforcement is how are consumers effected. Do consumers pay more? Do they have less choice? Then
it`s time for the anti-trust cops to get on the beat.
UNIDENTIFIED MALE: This is David Balto (ph). He worked on anti-trust cases for the Justice Department and the FDC for years and is skeptical about
Amazon being a monopoly.
UNIDENTIFIED MALE: When consumers are paying less and have a greater amount of choice which seems to be the simple message from Amazon`s business
model, there`s not a reason for an intense anti-trust scrutiny.
UNIDENTIFIED MALE: But some say that business model is a direct threat to customers. This is Lena Cannes (ph). She`s a lawyer who has really helped
shape the debate around Amazon and anti-trust law. To people like her, Amazon`s willingness to sustain massive losses isn`t just a savvy business
move. It`s an example of predatory pricing.
UNIDENTIFIED FEMALE: So predatory pricing is when a company prices a good below cost and is doing so basically in order to drive out its competitors
so that it is able to, kind of, enjoy a dominate place in the -- in the market.
UNIDENTIFIED MALE: All those things are a really high bar for the government to prove and because of that a successful case on predatory
pricing hasn`t been litigated in decades.
UNIDENTIFIED MALE: That`s not for a lack of will. We certainly at the FTC in the Clinton Administration had predatory pricing investigations. But at
the end of the day, you have to convince yourself that consumers would be better off if you stop these practices. And that`s like looking for a
UNIDENTIFIED MALE: But to those who do think Amazon right now is acting as a monopoly, the government`s view of predatory pricing is outdated.
UNIDENTIFIED FEMALE: The reality is with tech companies, you have a marketplace where that is winner take all. So if you`re a Facebook or an
Amazon or a Google, your main goal is to try and acquire as many users as possible at the very earliest stages. Because once you have a lot of users,
it`s going to be much more difficult for rivals to divert users away from you. And so in that scenario, predatory pricing actually becomes very
UNIDENTIFIED MALE: It`s important to know that the question of predatory pricing is really only one of the questions surrounding Amazon. There are
also concerns about how large Amazon has become as a business.
UNIDENTIFIED FEMALE: So in addition to being an online retailer, it also is a huge content producer. It is a book publisher. It has a huge cloud
computing service. The fact that Amazon is involved in all these different lines of business positions it to use its dominance in the online space in
order to benefit its other lines of businesses. And I think that`s something that`s really problematic.
UNIDENTIFIED MALE: What we want from a consumer`s perspective is for those people who provide services for us, to use the bargaining leverage of
having all those customers to lower costs as much as possible. And that`s fundamentally what Amazon has done.
UNIDENTIFIED MALE: So whether Amazon has an unfair advantage over its competitors, whether it`s a monopoly, all those things are an open debate.
But what is not a debate is right now, Amazon is winning.
(END VIDEO CLIP)