Brad Stone, ‘Amazon Unbound’ Author & Bloomberg Senior Executive Editor joins the Yahoo Finance Live panel to discuss his new book that tells the story of the most powerful and feared entities in the global economy.
AKIKO FUJITA: A new book out today digs deep into the inner workings of one of the world's most valuable companies, from the origins of Alexa to the explosive growth of AWS and the acquisition of the "Washington Post," author Brad Stone navigates the increasingly layered Bezos empire. And Brad joins us. We should point out, Brad's not just the author of "Amazon Unbound," but also Bloomberg senior executive. And it's good to talk to you today.
Brad, this is kind of a follow-up to your original book, "The Everything Store," which sort of looked at the origins of Amazon, but I heard you say that you wanted to write this book to sort of talk about the trade-offs or to make Americans a little more aware of the trade-offs of the growth of Amazon. And I wonder what you meant by that, and what you discovered in the process.
BRAD STONE: Right. Well, thanks, Akiko. You know, "The Everything Store" is the origin story, right, the first 15 years, Amazon's rise and near collapse during the dotcom bust, and then revival. But so much had happened. The genesis of Alexa, the spread of Amazon into our roads and on our highways. They're delivering packages. The explosion of the marketplace. It's really a global marketplace now with many sellers from overseas.
And there are great advantages to that. Convenience, particularly during the pandemic. Pretty good prices, you know, a wide selection. But it's, you know, Amazon's a fierce competitor, and it has so many of the advantages. It had a lot of those advantages going into the pandemic. And then you think the entire economy reconfigures itself at a point where people are afraid to go into physical stores, and Amazon grows even further.
Of course, in the book I highlight its relationship with its employees and how there is really a constitutional allergy inside the company towards unionization. I get into why that is. And so there are, there's a ledger, there are positives about Amazon, there are negatives. And my hope is, that when people read this book, "Amazon Unbound," you know, that they come away with an appreciation for what it means when they click the button that says, buy now.
AKIKO FUJITA: Brad, you talk about the relationship with workers, especially at these fulfillment centers. It feels like at least publicly, Jeff Bezos' thinking has evolved around this. If you just look at the statements that have come out. Did you find that behind the scenes they've also sort of warmed up to this idea of increasing benefits, better treatment, and ultimately, the inevitability of unionization?
BRAD STONE: Well, I was going to agree with everything except for that last part. But we can get to it in a second. I do think they have warmed up to the idea that they have a responsibility to lead in terms of employee relations. And it wasn't because they were extremely visionary about it. In my opinion, it was because that they saw that the criticism was coming for them, that in some respects, they were going to be the Walmart of today. Walmart in the '90s getting a lot of attention and criticism for its relationship with workers. And that one way to kind of head that off has jumped to the front of the line on things like a $15 an hour wage, on things like health care benefits for employees.
And so, you know, they've done a lot. And of course, Bezos, in his recent investor letter, talks about going even further and figuring out ways to address problems like the need for drivers to go to the bathroom on their routes. But to get to your last point, they just don't want unions in their operations, and they've shown it again and again. And it starts with Jeff. And I report this in my book, and of course, Amazon would dispute this, but he said to colleagues early on the biggest danger to the company is an entrenched hourly workforce that becomes disgruntled over time.
And so a lot of things are architected in the fulfillment centers to keep employees moving if they're not moving up the chain. For example, after three years if you don't get promoted, you stop getting raises inside a fulfillment center. These are the very subtle ways in which I think they encode, they head off the possibility of unionization. And as we saw in Bessemer, Alabama recently, they fight like heck when one of these, when one of these processes gets underway.
ZACK GUZMAN: You know, Brad, I mean, the other key aspect here I don't want to overlook is kind of the personal element of Jeff Bezos. And in the book, I'd be curious to get your kind of learnings from what we saw go down. And I think one of the crazier stories here in his battle of the tabloids and everything that came out with his divorce there. Talk to me about what that says about the way this man works in running an Amazon when you put so much business personal stories, when you put him at the top. What'd you learn on that front?
BRAD STONE: Yeah, Zack, well, let me tell you something. When I set out to write this business book, the last thing I thought was that I would be going down these tabloid avenues. But of course, that is where the story and the reporting went at the end of 2018. And then in early 2019, if you guys remember, Bezos writes that remarkable "Medium" post where he turns the tables on the "National Enquirer," the newspaper that had published the news of his relationship with Lauren Sanchez, and sympathies swing to his side and the editor of the "Enquirer" is vanquished.
And he did it by attributing political motives, potential Trump-related motives or perhaps the government of Saudi Arabia had been involved. And what I found going down this alley and investigating it, was that it likely wasn't any of those things. It was Lauren Sanchez's brother that had tipped off the paper. It was a simpler story. But he did, Jeff had done something brilliant, which is he kind of assessed the weaknesses of the "Enquirer" and its parent company, AMI. They were in political hot water because of their relationship with Trump world characters.
I don't think it was disingenuous, but it was sort of masterful. And it's what Bezos has always done with Amazon. Think a little bit differently, a little bit out of the box. He's a master chess player. I don't know if that, I don't mean that literally, but certainly figuratively he is. And he outmaneuvered his enemies. And as we said on the cover of "Businessweek" this week in my book excerpts, Jeff wins. He does seem to always win.
AKIKO FUJITA: I mean, it's interesting to frame it in that way, because you also sort of get some insight on his sparring with now former President Trump, sort of not really backing off it and tapping into some advice from Jay Carney, who of course, is former White House spokesperson, now with Amazon too. I mean, would you argue that that was kind of how he treated his public spat with the president too?
BRAD STONE: Well, it's interesting. In the book, I have these emails between Jay Carney and Jeff. In late 2015, Trump is a candidate, and Trump is attacking Amazon and Jeff and the "Washington Post." And Jeff feels this need to defend the "Washington Post" and he wants to get into the fray. And Jay's telling him, don't do it, you're just going to feed the monster.
And actually, it's a case in which Jeff ignores Jay Carney's advice and asked them to fashion a tweet anyway, and he responds to then candidate Donald Trump and they get into a little bit of a Twitter war. And it's so interesting to see that enmity then blossom to the point where Trump is attacking Bezos over the course of four years because of the "Washington Post." Amazon loses to Microsoft, the JEDI contract. Amazon's relationship with the post office is called into question and criticized by Trump and his allies.
And it's just really interesting, and that's a thread that is throughout "Amazon Unbound" how Jeff's purchase of the "Washington Post" and his interest in saving this media institution inadvertently leads down this path where he gets into a tangle with the most powerful person in the world for a period of time, and it ends up hurting Amazon in some small ways, one of them being the loss of the JEDI contract for $10 billion. That could be significant, but that legal saga keeps going and they might, the Pentagon might scrap it and start over.
ZACK GUZMAN: For legacy discussions around all this, right, we know that he is stepping down from the CEO role, but when it comes to what's next for Jeff Bezos and reporting this book out, what you get is a sense of what he wants his lasting legacy to be, since we know Blue Origin's there and there's so much that he can do. But what legacy of Jeff Bezos be if it were up to him to write that script?
BRAD STONE: Yeah, he's very explicit about that actually, and there's a clue in his last investor letter. He likes to, he likes to be known, he wants to be seen as an inventor, OK? This is the person who came up with insights like Alexa and the Kindle and perhaps e-commerce and Prime, and of course, cloud computing. And just inventing and creating systems of invention that have helped revive the "Washington Post." That's where there's still a lot of work to be done at Blue Origin.
A friend of mine said something funny about this. She said, Taylor Swift wants to be seen as a songwriter. The world really doesn't see her that way, more as a performer. And I think this is the same way. Like, Jeff doesn't necessarily get to select what his legacy will be. I don't know if it will be as an inventor. I assume it's going to also be as a business operator.
But potentially as a monopolist. You know, as Amazon's grip gets ever tighter over our economy, over the global economy, over retail, that is going to be the question that I think defines the legacy. The next couple of years of antitrust scrutiny and regulation are going to in large part, govern his reputation going forward and the future of Amazon.
AKIKO FUJITA: And for Amazon, Brad, what do you think the change at the top will mean for the company's culture? I mean, Jeff Bezos's still staying on as executive chairman, but Andy Jassy's taking over now. How much of that do you think shifts the overall culture of the company?
BRAD STONE: It really depends on how far Jeff goes. You know, he says he's going to stay there and wants to continue to work on new projects. He said in the shareholder letter that he's going to be spending some time on redefining Amazon's relationship with its employees. And we just don't know. Like in the big meetings, is Jeff still in those meetings, is he speaking last, as he usually does, and leaving while everyone sits in a kind of respectful silence or is that Andy?
I do suspect that in the congressional hearings going forward, that Andy Jassy will be there presenting a far more humbler target than the wealthiest man in the world would. But I think for the short term, not a lot changes, because I do think Jeff will continue to be involved. But when you look at Blue Origin, which needs really his time and help right now, the "Washington Post," but his philanthropic commitments and the fact that he now has a $2 billion, $200 billion fortune to give away, there are a lot of competing demands on his time. And so eventually he will be stepping away more significantly from Amazon.
ZACK GUZMAN: That's fascinating stuff. We can sit here and talk it all day, or you can read the book. "Amazon Unbound," that out now here to go ahead and if you want to hear more, it's all there in the book. But Brad Stone, author of that book and Bloomberg senior executive editor, appreciate you coming on here to chat with us today. Be well.