Pixel Envy

Written by Nick Heer.

Amazon Is Working Towards Ownership of Its Entire Shipping Chain

Devin Leonard, Bloomberg:

Two months after the Ohio announcement, Amazon leased 20 more jets from Atlas Air, an air cargo company based in Purchase, N.Y. Amazon has also purchased 4,000 truck trailers. Meanwhile, a company subsidiary in China has obtained a freight-forwarding license that analysts say enables it to sell space on container ships traveling between Asia and the U.S. and Europe. In short, Amazon is becoming a kind of e-commerce Walmart with a FedEx attached.

With any other company, an expansion like this would be preposterous. But Amazon’s growth has been preposterous. In 2010 its annual revenue was $34 billion; last year, $107 billion. In 2010 the company employed 33,700 workers. By this June, it had 268,900. To have enough office space for its swelling headquarters staff, Amazon has swallowed Seattle’s South Lake Union neighborhood, and it’s building three tree-filled biospheres in the city that will allow workers to take contemplative breaks, like so many Ralph Waldo Emersons in Jetsonian luxury. The company is the fifth-most valuable in the world: Its market capitalization is about $366 billion, which is roughly equal to the combined worth of Walmart, FedEx, and Boeing.

Few companies are operating at the same kind of scale as is Amazon. The shipping and delivery chain is to Amazon what the supply chain is to Apple — the more they optimize and refine it, the better their company can perform. Of course, the best way for either company to do that is to own as much as possible of the chain, and it seems that Amazon wants to own every part of the process until the product gets to your door.