Amazon and patents

I've just finished reading Brad Stone's book The everything store: Jeff Bezos and the age of Amazon. If you are interested in how businesses are created and change, and the Web, then this is the book for you.

It emphasized for me how Amazon is so good at grinding costs down in every conceivable way, and deliberately offering promotions which lose it money, in order to build up market share. This is a very Japanese idea, by the way, increasing market share (although when Japanese banks tried applying it to loans they soon built up big books of risky loans). Nice for customers -- not so good for others trying to compete. What will happen if Amazon becomes the last one standing as a retailer ?

Amazon has vast numbers of patents. The company has over 1600 granted US patents, with 221 so far this year -- more than one a day. Some are about the details of how the stock is handled at the fulfilment centres (warehouses), such as Filling an order at an inventory pier, illustrated below, and

Replenishing a retail facility, illustrated below.

The book also talks of the way multiple vendors would be offering items on the Amazon website -- so that the company makes a percentage on vendors who are shipping the items themselves. Out of curiosity, I made a list of the 38 US patents by Amazon which had the word "multiple", and it's quite a mixture, with many involving software algorithms. As Stone says, Amazon is in many ways more a technology company than a retailer.

I would have liked it if Stone had gone into more details about the company's turnover, profits and taxes. Especially its arrangements and efforts to avoid paying sales tax in American states, and tax in European countries, channelling income through low-tax Luxembourg. Also more on compensation for the fulfilment centre workers.

I have only bought books from Amazon -- and now try to avoid doing so if possible.