>> I’m Jeff Bezos. >> What is your claim to fame? >> I’m the founder of Amazon.com. >> NARRATOR: From the award-winning producers of “The
Facebook Dilemma”. >> Richest guy in the world. >> NARRATOR: FRONTLINE investigates Amazon. >> Is Amazon taking over the world a good thing? >> NARRATOR: Questioning those who run the company… >> What would you say to someone who feels as though humans are
increasingly being treated like robots? >> That’s not the experience that I had in setting it up.
>> NARRATOR: And those no longer there. >> Most people would assume there’s a pretty high safety
standard on Amazon. >> And that assumption would be
incorrect. >> The tools are not what I call
battle tested. >> Some people asking if Amazon
is a monopoly. >> The question for the
democracy is, are we okay with one company essentially winning
capitalism? >> How do you and
Jeff think about the call to break you guys up? >> Simply because the company’s been
successful doesn’t mean it’s somehow too big. >> NARRATOR: Now on FRONTLINE… >> Domination was very much the idea. >> NARRATOR: “Amazon Empire”. >> Jeff Bezos has already
conquered the retail frontier. Now he's got a plan to colonize
the planets.
>> Bezos is laying out his plans
for colonizing space. >> Bezos is known for going big,
and now he's literally shooting for the moon. >> NARRATOR: In May of 2019, Jeff Bezos, the richest person
on the planet, unveiled his latest invention. >> This is Blue Moon. It's time to go back to the
moon, this time to stay. >> Jeff has said over and over
again that the most important work he's doing is work in
space.
What he's built in Amazon is
really important and really interesting, and it's, it's
revolutionized commerce. But it's only revolutionized
commerce. >> NARRATOR: Bezos's plan is to
chart a new course for the future of humanity. >> Manufactured worlds rotated to create artificial gravity
with centrifugal force. These are very large structures,
miles on end. And they hold a million people
or more each.
>> NARRATOR: It's an idea he's
had since he was a teenager. >> This is me in high school. And I want to highlight this quote: "The earth is finite, and
if the world economy and population is to keep expanding,
space is the only way to go." I still believe that. >> The way Jeff Bezos sees is it is that consumerism is an
example of how today's society lives better than our parents
did and our grandparents.
And he wants, you know, future
generations to continue to have an increasingly better
lifestyle. >> These are beautiful. People are going to want to live here. >> NARRATOR: Bezos unveiled his extra-terrestrial plans at a
time of growing concern about the empire he's built here on
earth. >> Amazon is the great
disrupter, from books to retail to grocery stores. >> NARRATOR: For more than 25 years, Jeff Bezos has been
disrupting and transforming almost every aspect of our
modern lives. >> Once you start connecting the
dots, you see that Amazon is building all of the invisible
infrastructure for our futures. >> Amazon announced a healthcare
partnership… >> Amazon is helping the C.I.A.
build a secure cloud… >> How much of the internet do
you run? >> That's a good question, um,
it's a lot, though. >> NARRATOR: But in recent
years, Amazon– and Bezos– have come under scrutiny for their
aggressive tactics and expanding power. (Bezos laughing) >> Everything that is admirable
about Amazon is also something that we should fear about it.
>> NARRATOR: For the past year, we've been investigating how
Jeff Bezos built his empire– and at what cost. >> And so think about this. Big things start small. ♪ ♪ >> NARRATOR: Jeff Bezos's empire
has its roots not in Silicon Valley, but on Wall Street. That's where the young Princeton graduate went to work in the
early 1990s, at a secretive hedge fund called D.E. Shaw. >> David Shaw was the one who
revolutionized Wall Street by introducing data. And I think Jeff really embraced that, that idea that, "Hey, if
you have data, ultimately, you win." >> One of the things that David Shaw asked Jeff Bezos to do was
to go and investigate new businesses, and in particular
this new thing in the early '90s called the World Wide Web.
(dial-up modem connecting) >> We all know that a
communications revolution is underway in this country. >> What is the internet? >> It's sort of the mother of
all networks. >> It's information highways. >> It's kind of like your remote control to the world. >> NARRATOR: Bezos was quick to see the untapped potential of
the new digital landscape and was determined to get in on it. >> I came across this startling statistic that web usage was
growing at 2,300% a year. So, I decided I would try and
find a business plan that made sense in the context of that
growth, and I picked books as the first best product to sell
online.
♪ ♪
Because books are incredibly unusual in one respect, and
that is that there are more items in the book category than
there are items in any other category by far. So, when you have that many items, you can literally build a
store online that couldn't exist any other way. >> NARRATOR: The store he was imagining didn't exist, so he
decided to build it himself. ♪ ♪
>> The reaction to Jeff's idea to start selling books on the
internet was pretty incredulous, you know, from a lot of the
people close to him. His mom tried to convince him to
just do it at night or over the weekends. She didn't want to see him give up his job. >> Jeff called, and he told me that he and MacKenzie were
quitting their jobs, and they were moving to Seattle and
starting a company. I said, "Great, well, what are
you going to do?" He said, "We're going to sell
books." I said, "Nice." He said, "On the internet." I said, "Oh.
Jeff, why will anybody buy anything from you?" And he said, "Well, we're going to have more books than anybody
else." >> NARRATOR: One of the first
names Bezos considered for his new website was Relentless.com. >> Why "Relentless?" >> Relentless meant, "We move on
no matter what." He ultimately, obviously,
decided that "Relentless" wasn't quite the right fit. Amazon, earth's largest river, was. Amazon means gigantic. >> In terms of
relentlessness, stopping at nothing, that's, is that an apt
description of Jeff? >> No. It's not that Jeff stops at nothing, it's that when Jeff
sets his mind on a goal that he thinks he can achieve, he won't
stop until he's proven wrong or until he achieves it. ♪ ♪ >> Jeff and MacKenzie had rented
a house in Bellevue. And then we moved to a small,
second-floor office in the south part of Seattle.
>> NARRATOR: Shel Kaphan was Amazon employee number one, one
of nine former Amazon insiders who agreed to talk on camera. >> What the company is now was nowhere in my wildest
imagination. Nowhere, so, the fact that it
could have the-the kind of position in the world that it
has now, I had no clue. >> NARRATOR: In July 1995,
Amazon.com went live. >> It was an incredible novelty,
it was tiny and obscure, and it's very hard to imagine, but
the entire universe that Amazon now dominates did not exist.
>> Amazon.com, this virtual shop claims to be the world's
largest bookstore. >> NARRATOR: It didn't take long
for Bezos's vision to prove prescient. >> What makes us different is vast selection, convenience– we
deliver right to the desktop. If our catalog were printed on
paper, it would be the size of seven New York City phonebooks. ♪ ♪ >> NARRATOR: The company quickly
outgrew the garage and soon had more than 50 employees. In 1996, James Marcus applied to be number 55. >> There was a very palpable excitement in the air at this
place, and of course at this point Jeff Bezos was the first
person to interview every prospective employee. So I was ushered into his office. He wanted to see how fast you were on your feet. He also always wanted to know your S.A.T. scores. >> He wanted to know your S.A.T. scores? >> Every time, yes. >> How old were you at
the time? >> I was 36 or 37.
>> This is the original sign that I made for Amazon.com. Blue spray paint on white poster board. >> Jeff wasn't a figure out of folklore at that point, he was
not the-the wealthiest man in the world. >> Here's my computer, Amazon.com up on the screen. "Hello, Jeff Bezos." >> He was a small, nondescript,
sandy-haired man sitting at a desk with quite a large and
eruptive laugh. (laughing in multiple scenes)
>> But he wasn't threatening, he was a normal guy to a sort of
amazing extent. >> HAL 9000 hat, very important. Hal and I share a birthday, we're both born on January 12. >> It belied, you know, an enormous, Napoleonic ambition. >> One of the people I really like, Thomas Edison, here's a
model of his original light bulb.
He's famous for saying, "One percent inspiration, 99 percent
perspiration." (laughs)
It turns out ideas are the easy part, execution is everything. >> Domination was on Jeff's mind from the beginning. One of his sort of second-in-command people said
to me, "You have to understand that Jeff wants to sell many
more things than books. And Jeff's idea is that in the
near-distant future, you could buy a kayak from Amazon. And if, and after you brought the kayak, you could figure out
good places to kayak and buy travel services from Amazon." So, those ambitions were very clear, and this was very early
on. But he was clearly thinking in
those terms from the get-go. >> How did that ring to
you at the time? >> A little bit exciting and a
little bit nutty. >> Amazon.com, very good
website. You should really try it. (Bezos laughs) >> If you signed on to work at
a-a kind of futuristic bookstore, and the guy who
owned it was suddenly talking about selling, you know, every
object in the universe, you just weren't sure how seriously to
take it.
(Bezos laughing)
(Bezos screaming playfully) >> NARRATOR: Though his public
image was often unserious… >> That was awesome! >> NARRATOR: Inside the company, Bezos was a hard-charging
manager relentlessly focused on the principle that would make
Amazon one of the most trusted brands in the world: the
customer always comes first. >> This culture of customer
obsession… Obsessive focus on customer… Obsesses over our customers…
Totally obsessing over the
customer experience. >> We used to call it customer
ecstasy. It means building, delivering,
focusing on your customer. And we did it, you know, in the
very, very early days at every stage. >> NARRATOR: Jennifer Cast was there in the early days and is
one of six top Amazon executives the company put forward to
speak to us. >> Customer obsession was our
North Star. And so, you know, it was a place
where we knew we were a part of something that was new, the
internet. There was an excitement that we
were doing something that hadn't been done before. It was exhilarating. We were all aligned around
building for customers. >> Hey, you guys.
>> Hey. (Bezos laughs)
>> I've heard there was an empty chair that would often
be put at meetings. >> Yeah. >> Who was in the empty chair? >> Yeah, so that empty chair was there to remind us all to
understand the customer, have empathy for the customer,
understand the details of the customer experience. The customer isn't there, we have to bring forward the voice
of the customer. (phone ringing)
>> Thank you for calling Amazon.com. >> NARRATOR: And Bezos quickly learned that in this new online
world, he could understand exactly how customers were
behaving. >> All orders do need to be
placed online. >> It was made clear from the
beginning that data collection was also one of Amazon's
businesses. All customer behavior that
flowed through the site was recorded and tracked.
And that itself was a valuable commodity. >> Have you visited our website? >> We could track how a customer
navigated through the site. So we could see what you looked
at, we could also see what you paused at, we could see what you
put in your basket but didn't order, we could see what you put
in your basket and did order. So that's when we started
realizing, "Man, this is rich. This is rich, rich, rich." And so we've used it for everything. >> What do you do with that information? >> That's the data that allows us to predict, or try to
predict, what books that you would like that you haven't
discovered yet. >> NARRATOR: Bezos treated the
site as a laboratory, where he studied customer behavior along
with his chief scientist Andreas Weigend. >> I was shocked to see how predictable people are.
If you take the time of the day into account, if you take maybe
when they were last on the site, how long they were on the site
last time, how long they're on the site today, you know what
they're falling for. >> Whoever owns, collects, the
data, if you have access to it and rights to data, then you are
king. It's all about the data. Everything. >> One of the most fascinating
kind of tools we have at our disposal is the ability to do
active experiments. It's, you know, it's kind of
this huge laboratory. >> We did not think about it as
exploiting, we thought about helping people make better
decisions. >> I was starting to feel that
that was less respectful toward the consumer, who was, after
all, supposed to be our god, the person whose ecstasy was our
very reason for being.
And it was closer to getting a
cow into a milking stall and extracting as many pails as
possible during each visit. And that felt a little more
unsavory. But that was the business of
Amazon. >> Amazon has added 880,000 new
customers… >> NARRATOR: While Bezos was
using these insights to bring more and more customers into
Amazon… >> The number of customers who
use the website has increased fourfold… >> NARRATOR: There was one thing he hadn't done yet. >> The company's never made a profit. >> That's right. >> Now, why… how does that…
why… how does that…? >> It seems like a new math,
doesn't it? >> It does. >> NARRATOR: Bezos would spend years losing money trying to
beat his competition, and he convinced investors to go along
with it.
>> One of Jeff Bezos' greatest
accomplishments has been his ability to get Wall Street to
accept the fact the first 20-some years, Amazon wasn't
going to be very profitable. And that's okay because they're
building infrastructure that will create huge opportunities
for them to gain scale and gain customers and gain business. >> NARRATOR: He spelled it out in a letter to shareholders
after the company first went public: "It's all about the
long term," he wrote, rather than short-term profits or Wall
Street reactions.
>> He essentially says,
"We are going to forego profits in order to take market share. That our strategy is to lose money, which enables us then to
put other companies out of business who can't afford to
lose money." >> NARRATOR: That strategy
wouldn't sit well with critics like Stacy Mitchell, who
advocates for small businesses. >> In essence, at the very
beginning, he's signaling to shareholders, "I have a strategy
to monopolize the market, and that's going to reward you, but
it's going to be far down the road, and will you come along
with me?" And they said yes. >> NARRATOR: Investors also recognized Bezos' essential
advantage over physical stores, which had to charge their
customers sales tax, unlike online businesses. >> So, not collecting sales tax gave Amazon a big leg up over
bricks and mortar retailers.
And that was central to their
early strategy of gaining market share as quickly as they
can. >> What booksellers were saying
to me is that, "This is driving my customers to Amazon. They'll come into the store, they'll browse, they find what
they want, but then they'll go buy it on Amazon, because they
can save that sales tax." >> So it was a very irksome,
early, big issue for the book vendors, first of all, they were
kind of the canaries in the mine, so to speak, and then lots
of other retailers. ♪ ♪
>> Amazon has added thousands of warehouse workers and three
million square feet of space. >> NARRATOR: Amazon's sales-tax
advantage would be central to its success as it expanded
beyond books, into other products.
>> And we have a fantastic selection of things you can
look at. Electronics and then of course
toys. Yeah, thank you, here is, we've
got have the friendly Pokémon. This is more than ten times the
selection that you will find in a typical, physical world
software store. >> NARRATOR: But Bezos was still
a long way from his goal of Amazon being the place where you
could buy everything online. (drills whirring)
And he saw a way to achieve it. >> Amazon could soon become the
Walmart of the internet. >> NARRATOR: There were
thousands of businesses eager to sell online.
Bezos offered them a way to do it. >> Amazon is transforming itself from an online bookstore to an
online mall. >> NARRATOR: He transformed
Amazon into a retail platform where anyone could sell their
goods to his customers and invited thousands of other
businesses to be a part of it. >> It's the easiest place for
anybody, small or large, who wants to set up shop online to
sell online, because they can access our 12 million-plus
customers.
Anybody, all comers. >> We're talking about hundreds of thousands of companies with
literally tens of millions of products. >> NARRATOR: Name-brand stores started selling on Bezos's
platform, and so did tens of thousands of small
entrepreneurs. >> Everyone knew Amazon.com. The only people that knew SuperDuperHoops.com were the
ones that were searching to buy a basketball hoop and saw our
name on an advertisement. To us it was really a
no-brainer. We knew that we would, you know,
increase our sales.
First year we did 100,000, next
year we did a million, we did two million, four million, we
were doubling every year in the early days. >> NARRATOR: It was great for the companies– and even greater
for Jeff Bezos. >> Amazon has become the most
recognizable name in e-commerce. >> NARRATOR: Not only would he
take a cut of everything other businesses sold, he'd also keep
his own store on the platform, competing against everyone else
in the marketplace he owned and controlled. >> He owns the Main Street. He has the Main Street real
estate. Not just one building on the
corner, the entire Main Street. ♪ ♪
>> NARRATOR: How Amazon would wield its power over the online
marketplace would eventually become a question for government
regulators, but early on, there were indications. The first to see them were book publishers. >> Amazon took over a large market share of the publishing
industry very, very fast.
They were very quickly in a
position to demand concessions. You know, I think that was a
moment where publishers started to realize, "Oh, wait a minute,
like, we… they're our partner, but they now have the
beginnings of a boot on our windpipe." >> NARRATOR: Inside the company, they had launched a strategy
that some called "the Gazelle Project," because they'd heard
Bezos wanted them to pursue publishers the way a cheetah
pursues a sickly gazelle. >> Well, you don't go after the
strongest. It's like the cheetah. The cheetah looks for the weak, looks for the sick, looks for
the small, that's what you go for. So don't start with, you know, number one publisher. Start with number seven publisher and then number six
publisher, and by the time you get to number three, two, and
one, the noise has gone, gotten back to them.
They're going to know this is coming, and chances are you may
be able to settle that without a full-on war. >> We were just this little mom and pop publishing company,
publishing poetry books and translated fiction. >> NARRATOR: In the early 2000s, the number of books Dennis
Johnson was selling on Amazon had been rising steadily. Then one day, he got a phone call. >> Our distributor called us up to talk about our Amazon
contract. And he said, "I went out to
dinner last night with Amazon, it was like going out to dinner
with the Godfather.
They want a kickback." That's the word he used, kickback. And he said they wanted four percent more of our sales. >> Was that unusual? >> It was… in our experience,
it was totally unprecedented, yes. >> NARRATOR: Randy Miller ran the European book team and says
he saw nothing wrong with Amazon's tough tactics to
challenge publishers on prices and profit margins. >> In order to bring them into line, we would actually take
them out of automated merchandising, take their prices
up to list price; we would put references on the product page,
their product page, saying, "You want it cheaper, you want this
book for, on this topic for a way cheaper price? Click here." And we'd send them to whoever we
thought their worst competitor was. That was how Amazon forced their vendors to-to comply. (stammering): But that's an old Walmart trick, I mean, it
wasn't like Amazon created that.
And it made, it made a
difference. And, you know, Jeff kind of got
excited about it. >> NARRATOR: When Dennis Johnson
still refused to give in to Amazon's terms, he says the buy
button on all Melville House books suddenly disappeared,
making it impossible for customers to purchase them on
Amazon. >> I mean, this is the company
that referred to little publishers like me as wounded
gazelles, I believe? That's how they think, that's
how he thought from the beginning. And we eventually had to pay what at the time I called a
bribe. And our attitude toward Amazon
was, you know, "Render unto Caesar that which is Caesar's." And then carry on as best as you can. >> Jeff Bezos may say that Amazon comes along and has
given publishers like yourself access to a huge distribution
channel for your books. Has Amazon been good for your
business? >> Well, absolutely they have.
Any bookseller that sells our books is good for our business. So, I'm not complaining that Amazon is selling our books. I'm just complaining of the way that their tactics are hurting
the industry I love. >> NARRATOR: In addition to
granting interviews, Amazon responded to written questions. Regarding Dennis Johnson's characterizations, it told us,
"Amazon disagrees with this account." >> Were you uncomfortable with that sort of
ruthlessness ever? >> Well, no, 'cause I was in
retail– I mean, people think that's ruthless. You know, I looked, and some people at Amazon, "Wow, that's
kind of mean," and I'm like, "Oh, a retailer and a supplier
having a disagreement? Stop the presses!" It happens all the time. I mean, you know, look, you've
got a finite margin, and somebody's going to have to
give. And-and a lot of times Amazon
wasn't the one giving. >> Kindle is a purpose-built
reading device. >> NARRATOR: The tension between
Amazon and book publishers would ramp up even further with the
unveiling of the Kindle, which helped the industry transition
to the digital age, but gave Amazon more power to set prices
lower.
>> And new releases are only
$9.99. >> NARRATOR: Around that time,
Barry Lynn, an advocate for broad antitrust enforcement, was
growing increasingly concerned by what he was hearing from
publishers. >> If the door was open, the
publisher would say, "Hey, you know, Amazon, they're just a
terrific customer, they're our biggest customer. They buy the most books, they sell the most books. We love them." Then you close the door, and
they say, "Amazon is destroying our business model, they're
destroying our business, they have way too much power, we
must do something about them." >> NARRATOR: Lynn wanted
publishers to speak up publicly and thought federal
antitrust regulators might investigate whether Amazon was a
monopoly, illegally abusing its market dominance in
anticompetitive ways.
>> And they'd say, "No way, I'm
not going to talk about Amazon in public. I'm not talking about them on Capitol Hill. They will take retribution against me." >> To which you responded? >> "Well, that's why we have to do something about it." >> NARRATOR: Jennifer Cast ran Amazon's books division in its
formative years. >> We've had a difficult
time in some ways getting publishers to talk to us on
camera about Amazon. In part, it seems the reason is
that they're afraid.
How do you react to that, that
publishers find it uncomfortable to talk about
Amazon publicly? >> I don't know, I mean, I-I
haven't seen that. >> Yeah. >> I haven't been in your shoes. I'm sure they have… I mean,
if you're saying that they-they don't talk negatively about us,
I mean, I know they have a lot of good things to say about us. Um, you know, I-I don't know why they wouldn't speak their minds. We certainly value speaking our minds. >> There is this well-known anecdote about
cheetahs and gazelles, this Gazelle Program.
Do you know about that? >> I don't. >> We've talked to former Amazonians about it,
where Jeff had said, "We should basically try to negotiate with
book publishers and try to get better terms and treat the
smaller publishers as a cheetah would go after a wounded
gazelle." >> I didn't hear the cheetah
and gazelle example, but what we were looking for was people that
were willing to move away from the old model of bricks and
mortar to a new model, which was, you know, a-a virtual store
that had many different types of opportunities to present their
books to customers. >> I want to talk a little bit
about how we think about innovation at Amazon.com. >> NARRATOR: Amazon would begin to accumulate even more power in
2005, when Bezos quietly rolled out a revolutionary new program:
Amazon Prime.
>> Now they have something
called the Prime shipping program. >> Amazon Prime– we only launched this a week ago–
you pay $79 a year, and you get two-day shipping for free. >> NARRATOR: It was a risky bet, and it paid off. >> The lynchpin, or the glue, if you will, and probably the
seminal moment in Amazon's business history, was the
introduction of what has become the most successful membership
program in history, and that's Prime.
>> Many of you in this audience will already be Amazon Prime
members, bless you. This is very much appreciated. >> It changes the way you shop. >> NARRATOR: Eventually more
than 150 million people would sign up for the free shipping–
a tremendous expense for Amazon. But to Bezos, it was worth it. >> The Prime program at Amazon is one of the most important
drivers of Amazon's growth. When you go on and look to buy a
product, and it's available in two days, delivered to your door
anywhere in the country, that Amazon Prime program becomes a
mechanism that keeps bringing you back as a customer to keep
buying and keep searching for new products on Amazon. >> NARRATOR: Two-day delivery anywhere in the country was a
big promise for a company that, at the time, had less than ten
warehouses.
So Bezos went on a building
spree. ♪ ♪
Across the country Amazon warehouses began to spring up,
filled with millions of products being sold on Bezos's
platform. He'd call them fulfillment
centers, and they'd create hundreds of thousands of jobs
in places hard hit by the Great Recession. >> Ten percent of Pennsylvania residents unemployed… >> Job market is in complete disarray. >> NARRATOR: Like Allentown, Pennsylvania. >> At that time, it was tremendous news that an employer
was coming and actually opening a facility and hiring people,
versus, you know, gutting half the staff. >> NARRATOR: Spencer Soper was a business reporter for the
"Allentown Morning Call" when Amazon opened in the area in
2010. He began hearing stories about
working in the warehouse. >> People are basically in this
big, sprawling warehouse that's stocked with goods in very
random fashion. And they have scanners that
tell them which things to get. And people are walking maybe
ten, 15 miles a day.
So people just kind of
crisscrossing this big warehouse all day long. >> NARRATOR: As workers told him about the punishing pace to meet
the daily quota of packages, and the intense heat, Soper and his
colleagues started to investigate further. >> People really felt like Amazon was playing fast and
loose with their, with their health. >> NARRATOR: Soper discovered there had been numerous
complaints to authorities at the Occupational Safety and Health
Administration, OSHA. >> They actually had a complaint
from an emergency-room doctor who called their hotline one day
saying, "Listen, you might want to check out this Amazon place. I've had, like, people parading through my emergency room to be
treated for heat stress." There was a security guard who
worked in the facility who sent a complaint to OSHA saying that
he saw pregnant women suffering heat stress in-in the facility.
And so there's just, like, these red flags right and left. >> NARRATOR: After an investigation, OSHA said Amazon
needed to keep the temperatures in the warehouses lower. In a statement at the time, the company said it installed new
industrial air conditioning and pledged that worker safety was
its number-one priority. >> Amazon is shrewd
businesspeople, shrewd businesspeople know when they
have leverage. And when you're the only shop
hiring people in town, you can push them a lot harder than
you can when-when they've got alternatives.
>> NARRATOR: Over the following years, Amazon would hire
hundreds of thousands of workers and become one of
the largest jobs creators in the country. At the fulfillment centers, Bezos experimented with new
techniques and technologies to boost productivity. >> Willingness to experiment is the key to be able to do new
things. So we do, you know, hundreds of
experiments every day in our fulfillment centers to get a
little bit better. Kind of like incremental
invention. ♪ ♪
>> NARRATOR: When a company called Kiva perfected a
warehouse robot, Amazon bought the whole company. >> Amazon has acquired Kiva Systems. They make shipping robots. >> NARRATOR: It helped transform
the work environment in Amazon's warehouses. >> When I first showed up at Amazon in 1999, I led our Global
Operations team. >> NARRATOR: Jeff Wilke created
the Amazon fulfillment center system and is one of two C.E.O.s
under Jeff Bezos.
>> As we've added 200,000
robots, in that same time frame since 2012 we've added 300,000
people in our fulfillment centers. So what happens is the robots change the work, so they allow
us… people don't have to walk as far, which is a complaint
that we've heard in the past. They make the job safer, they
make them higher quality, because we present a smaller set
of options to-to employees. And that's all good for
customers, and it's good for employees too. >> NARRATOR: But at the same time, complaints have persisted. >> People who've worked in warehouses for decades say,
"This is different. This is not the same." We're here today because we want to make sure that these
workers know about their rights in the workplace, especially
around heat. >> NARRATOR: Sheheryar Kaoosji
is an advocate for warehouse workers in the San Bernardino,
California, area– an Amazon hub, with ten fulfillment
centers and over 15,000 employees.
>> Because of the way that Amazon operates, because of the
way that they set their rates for productivity, it's a lot
harder work physically but also psychologically. >> NARRATOR: We sat down with a group in San Bernardino who'd
recently worked at Amazon. >> When they first got here, I
thought it was exciting. Like, for me, I was thinking
maybe I could find a-a place where, you know, I'm going to
set roots of a good job, you know, move up in-in the place. But after being there for a while, I was like, "There's no
way." >> It's like, "Okay, this is
where I can probably make a career." But once you worked there for a certain amount of time, it's
just like, it's just not realistic, how they expect you
to work. >> NARRATOR: Like dozens of
workers we've spoken to around the country, they say they've
struggled to keep up with the rate Amazon expected them to
pick and pack items.
>> How realistic are the
rates that they're giving you? I mean, what's… >> Not realistic at all. >> Not-not realistic? >> No. There's absolutely no way to
make rate, you know, you got to find little ways to-to cheat
it, because once you hit rate, by the end of the week, they
raised it, they bump it up again. Because they start seeing, "Hey, people can hit those rates,
can hit those numbers, hey, let's push them a little
harder." Every week it seemed like it was
going up. ♪ ♪
>> You have security cameras right behind you at all times,
that are looking at you 24-seven.
And if you don't meet standards or the rates, you're out the
door, you're just disposable. >> Every worker has a scanner at
all times that basically track exactly where you're at. >> And they have a little blue line at the bottom of the
screen, and it has, like, how many seconds that you have to
have it done by the time it hits zero, and it puts you into panic
mode. >> And pretty much you can't
talk to people, you can't be in the same aisle as them, you
just constantly have to sit there scanning like a robot all
day long. If they catch you not scanning,
you get a write-up. >> And what they're doing is
they're producing this mass of data that they are using to be
able to analyze the entire workforce.
>> We're not treated as human beings, we're not even treated
as robots. We're treated as part of the
data stream. >> It's the incentive at
any warehouse, on any assembly line, to get the most out of any
worker. >> Yes. >> To make rates, to-to be as efficient as possible, to
be as productive as possible. So, I don't see exactly what's
different about Amazon as opposed to any other warehouse. >> Amazon is the cutting edge. Other warehouses are starting to
adopt these technologies, other companies are definitely
interested in doing what Amazon is doing.
Data collection could become basically the standard for all
workers, and that there's… you're never good enough,
you're never able to keep up. ♪ ♪
>> NARRATOR: Amazon told us work rates are not based on
individual employee's performance, and that the
scanning devices workers use are not for tracking people but
inventory– a common practice in the warehouse industry. >> We've talked to workers around the country,
both current and former workers. They've described the pace of
work as being really grueling. In the early thinking about
rates and how far you could push human beings in terms of
their productivity, what was the thinking about that? >> Well, obviously if the rates are too high, you're not going
to have people showing up for work.
So, we have 600,000 people at the company, most of them are in
the fulfillment centers, and they-they come to work every
day, they stay for years. These are considered great jobs
in the hundreds of communities where we have fulfillment
centers all over the world, and in the U.S. we have, almost
every state has an operation in it, and people come to work
because these are great jobs. They're safe, we pay double the
minimum wage, the national minimum wage, we have terrific
benefits. The benefits for the folks that
work on the floor are the same benefits that my family has
access to– our family leave is like 20 weeks. So, the rates are set so that we can accomplish what we need to,
which is get orders to customers in a-a reasonable time and in a
high-quality way, and that creates a workplace that people
want to come back to, and they do. >> NARRATOR: Amazon wouldn't tell us how long
fulfillment-center workers stay on the job or how often they're
injured. But workers we spoke to say the
rates are higher than other warehouses– and that the
company rebuffs attempts to unionize.
>> We do not believe unions are in the best interest of our
customers, our shareholders, or most importantly, our
associates. >> NARRATOR: This is a clip from
a video the company says it used in the past to teach
managers about employees' rights and labor laws. >> The most obvious signs would include use of words associated
with unions or union-led movements like "living wage" or
"steward." >> Early on, Amazon took
a position to basically be anti-union. Why was that decision made? >> I don't think we made the
decision to be anti-union. We just feel that all of the
things that-that unions would-would want to-to get us
to do, we've already done. >> What-what about
setting rate, though? Do you not see that there's a
little bit more leverage in the hands of management in this
scenario than there would be in a unionized environment? >> I don't know, it's hard to speculate on that, but-but I do
think that we have the obligation to set rates that
are, again, going to encourage people to seek these jobs and
deliver for customers, you know, what we've promised.
>> What would you say to someone, though, who's, who's
worked in-in your fulfillment centers that feels as though
there's been… that-that humans are increasingly being treated
like robots? 'Cause it's something that we've
actually heard, and I don't sense it's hyperbole. >> Well, that's not the experience that-that I had in
setting it up or that I've seen.
It's, it's certainly true that-that these jobs are not for
everybody, and there-there may be people that don't want to do
this kind of work. >> NARRATOR: Amazon executives
also stress the company has become an industry leader in
training its workforce for career advancement. >> We just announced a pledge recently to spend $700 million
to upskill, which is basically creating career opportunities
for people, 100,000 of our employees. We pay 95% of tuition to go to-to college to get a skill
that isn't about Amazon, that's about creating options for the
employees, and I would expect those people to take advantage
of that, work for us for a couple of years and then go do
something that they would much rather do, and that's okay. >> There will be people that will hear what y'all are
saying, and they'll say, "Well, you signed up for physical
labor, a job is a job, there were benefits, and they are now
investing $700 million to do retraining for other types of
jobs. What's the real grievance? What is there to complain about?" >> I actually used to think that way for a while whenever I, when
I first started, whoever I heard complaints from, I was like,
"Well, it was in the job description, and you signed up
for it." The part they don't talk about
is the safety rules that you have to ignore to make rate.
It's not just you go in, okay, and you-you do your job, and
that's it. >> So, you're in, you're
in a weird bind. >> It's incredibly hard to meet
rate while following all the safety procedures. >> A complaint that we've heard from workers in
terms of the sort of automation of their work as humans, some of
them telling us that, yes, there are high safety standards in
these fulfillment centers, but that in order to make rate,
they're having to cheat the standard a little bit.
>> Well, I would say that's not okay. So I, from the moment that I arrived 20 years ago, I made it
very clear to our operations teams that we will not
compromise the safety of our employees to do anything else. So, we have, we have a culture that if-if we are asking people
to do something that is, that they have to do too fast to be
safe, they can raise their hand and say, "This isn't right,"
and-and we'll fix it. (phone vibrates)
>> NARRATOR: For years, Amazon has put a happy face on its
business and its workforce. ("Give a Little Bit" by
Supertramp playing) >> ♪ Give a little bit
Give a little bit of your love…
♪
>> Even in Amazon's commercials, the people are almost like
shadows and silhouettes. It's all about boxes, and
there's just like happy boxes singing and bumbling their way
to your door, like, oh, no, no. >> ♪ There's so much that we
need. ♪ >> Hello. >> Hey. >> They don't want you to even
think about how they do this. They just want you to be wowed
and, "Oh, how'd this, how'd this get here?" >> ♪ I'll give a little bit of my love to you.
♪
>> They wanted people to just think, "Whoa, magic!" ♪ ♪ >> NARRATOR: And magic was a big
part of Bezos' marketing strategy, with an emphasis on
the company's miraculous level of innovation and growth. >> We started Amazon Prime in 2005, but then something very
extraordinary happened. This. In 2011, the slope of that graph changed– a lot. >> NARRATOR: As Amazon grew, he wanted his top executives to
think about the kind of company it was becoming. He wrote a memo titled, "Amazon.love." A copy of it was obtained by Brad Stone.
>> The memo is another example of Jeff being very prescient
about the future. It's Jeff grappling with the
idea that not all big companies are loved. That there is something that we get uncomfortable with when we
talk about very big companies. "Rudeness is not cool. Defeating tiny guys is not cool. Risk taking is cool. Winning is cool. Polite is cool. Defeating bigger, unsympathetic guys is cool. Inventing is cool. Explorers are cool. Conquerors are not cool." >> Some businesses, you can
tell when you go in and have meetings with them, they have a
conqueror mentality. And there's a big difference
between being a conqueror and being an explorer. And I think in, you know, this very inventive space that we're
in, it pays to explore. ♪ ♪
>> NARRATOR: But to some watching Amazon's growth, the
company was falling short of that ideal, and taking steps to
make sure nothing got in its way.
♪ ♪ In 2013, Amazon was moving to
create its own delivery system and made a key decision: rather
than hire its own drivers, it built a network of independent
businesses to deliver packages. >> They weren't just going to
dabble here and dabble there. They were going to go and create
a system that would rival FedEx or UPS. >> NARRATOR: ProPublica reporter Patricia Callahan, in
conjunction with Buzzfeed, has investigated the system Amazon
set up. >> They figured out a way to get
around regulation. The cargo vans they choose are
big enough to stuff with hundreds of Amazon packages, but
they're small enough that they're not regulated by the
federal government. >> An 84-year-old woman struck
and killed by an Amazon delivery truck. >> A woman hit and killed in a parking lot. >> NARRATOR: ProPublica and Buzzfeed found that drivers are
under intense pressure to deliver packages.
>> After striking him, the van maneuvered around Salinas
and his dog. >> NARRATOR: And they documented
more than 60 crashes, including 13 deaths, since 2015. >> An infant critically injured in a car crash has died. >> When it came time to figure out who's responsible, Amazon
would always say, "It's a contractor, it's not our
responsibility." >> Now you've been able
to find 13 deaths. And that's over the course of
several years. Is that statistically
significant given all of the packages that they deliver in
any day or any given year? >> I don't pretend to claim
that there's only 13 deaths and that I found every single one. I just found enough to show that this is happening around the
country.
With UPS, there's a record. There's a federal record you can look at how many serious injury
and fatal accidents they have. With Amazon, that doesn't exist. No one knows the safety records of all of Amazon’s contractors. >> NARRATOR: Amazon disputed the ProPublica report. It would not release any data on crashes involving its driver
network but told us it had a "better than average" safety
record and that nothing is more important to them than safety. >> Any accident is one accident too many, so just as we were
focused on safety in the fulfillment centers and product
safety, we are… we set very high standards with all of those
partners for safe performance.
We have training videos for the
third parties that work with us to help them understand what we
expect in terms of the drive, we have mapping software that we
use to help them find the right routes. Every one of our drivers is required, including the third
parties, are required to have comprehensive insurance,
including liability insurance, so that if there is an accident
that the person who's injured is covered. >> Amazon wants to get Prime members their packages even
faster… >> NARRATOR: In the last year,
Amazon announced a change to the way it handles Prime deliveries. Instead of delivering packages in two days, they promised to do
it in one. >> Free next-day delivery all
across the U.S…. >> It's impossible for me to
imagine a world 20 years from now where a customer comes up
to me and says, "Jeff, I love Amazon. I just wish your prices were a little higher." Or, "I love Amazon. I just wish you delivered a
little more slowly." >> NARRATOR: At the same time
the delivery network was being set up, Amazon was also rapidly
expanding its product offerings, inviting more sellers onto the
site.
(computer plays tune)
Including those from China. >> It basically makes it to
where it's super-easy for these companies, who are maybe
not as careful with adhering to the law, where they're able to
just start a business up on Amazon, import some stuff, sell
it, cause some problems, and then disappear. >> NARRATOR: Rachel Greer worked in product safety at Amazon, and
worried that the site was being flooded with untested and
potentially unsafe products. >> Are there proper warnings? Has it been safety-tested for durability? If a child chews on it, will the paint come off? Is that paint leaded? >> Most people would
assume that there's a pretty high safety standard on Amazon. >> And that assumption would be incorrect. >> NARRATOR: She says that's because Amazon, like other tech
companies, takes the position that it's not legally
responsible if its customers are harmed by products sold by third
parties on the site. >> If someone buys something
that causes harm at Walmart or at Target, a consumer can sue
Walmart or Target. >> Right, 'cause no one's
forcing you, when you come into Walmart, to enter the doors
of Walmart.
They aren't making you sign
away your rights. >> But when do you sign
that when you go on Amazon.com? >> When you make your account. When you accept the terms and conditions. >> NARRATOR: People have been challenging Amazon's terms and
conditions in court. Some have even been successful. >> Ultimately, who's on the hook when a customer buys a
dangerous product on Amazon? Who takes ultimate
responsibility for that? >> Well, in the rare case where
that, where something like that happens, if it's a third-party
seller, the sale is by a third-party seller, and it is
the seller's responsibility to, to sell a legitimate product to
a customer, and then, when Amazon is the retailer, and we
sell a product to the, to a customer, then it's our
obligation to make sure that we understand the manufacturer and
the supply chain for that product and its, and its safety.
>> But when the other sellers are selling in your
store, you're not responsible for it ultimately, if they're
selling your customer a defective or dangerous product? >> I think the way things work in the U.S. is that the seller
of record is the person who is setting the price and who is
purchasing the product, and for things not sold by Amazon– and
it says on the detail page, it'll tell you who the seller
is– it's the seller's responsibility for those things,
and for us, it's very clear.
It says Amazon.com whenever we
sell it. >> Do you audit your
sellers in terms of whether they're actually providing safe
products to your customers? >> We do… You know, some of our sales… So about, almost 60% of our
sales are by third parties, and those sales, some of them
come directly from the third party, so we're not involved
at all. >> But you take a cut. I mean, it's on your infrastructure, it goes through
Amazon.com, so, I mean… >> Well, it's on our
infrastructure in terms of the website and payments, but we're
not… >> And fees that, you
know, you're taking a cut of the sale, right? >> Sure, sure, and we're providing, you know, traffic
that, that… You know, it's kind of the way
they think about marketing is why they would pay that fee,
but… It's harder to, before an
experience, inspect that, that product.
>> A South Carolina woman who bought a hair dryer on Amazon
said this happened. >> Fire is coming out of the
hair dryer. >> NARRATOR: Amazon's approach
has had consequences. >> A hoverboard caused a fire
that destroyed their home. >> NARRATOR: Dangerous products
were flagged by authorities in Washington State. >> …found dozens of school supplies that had high levels
of toxic metals. >> NARRATOR: And a recent report
found thousands of banned, unsafe, or mislabeled products. >> I'm having a hard time understanding something, which
is that, that… You know, Amazon's entire brand
is about the customer, right? >> Yes. >> That it's… >> Oh, I reminded them of this
over and over again. >> You reminded them of
what? >> I said that no customer
wants to buy an unsafe product. No customer wants selection
that harms their child. No customer wants to buy
something that burns down their house because it looks cool and
it's the latest, coolest thing. >> Sitting here today,
are you able to basically say that the products that you sell
on Amazon.com are safe? >> What I can say is, we work
really hard to make sure that they're safe.
We have… We've spent $400 million in the
last year on systems that seek out things that are not safe,
and, you know, there are millions of sellers and hundreds
of millions of products, and our job is to, as fast as we
can, weed out the ones that don't belong on our site. We're going to have to be vigilant as a retailer and as a
technology company, and we are definitely dedicated to, to
protecting the safety of our customers. >> NARRATOR: We heard that concern for the customer over
and over in our interviews with Amazon executives. >> Customer trust in a company like Amazon, it's sort of
foundational. >> Customer obsession is the
first leadership principle, and it, it's not a corporate slogan.
>> We try to stay really focused on customers. >> Very focused on, on delivering results for our
customers. >> Providing a great customer
experience that customers want. >> Delivering that, that
customer delight. >> NARRATOR: This commitment to
the customer, and to keeping prices low, had another benefit:
it helped them avoid running afoul of regulators who enforce
the nation's antitrust laws. >> It's important to understand
sort of that there's two fundamental philosophies of
antitrust, of anti-monopoly law. You know, there's the
traditional philosophy, in which you, you want to break up all
potential concentrations of power that you can. But for the last 30 years, there's been this change in how
we do antitrust. And this is the idea that the
only purpose of antitrust should be to drive prices lower, to
serve the interest of the consumer.
>> NARRATOR: Lynn had been urging regulators to take a more
traditional approach and examine whether the company was
gaining market power in exploitative ways: stifling fair
competition, but keeping prices low for consumers. >> We live in a society of consumers, though, and
seemingly there is some net benefit to all of us when
prices are low. So, what's wrong with that view
of things? >> It's obviously good for
people to… for all people if we can drive down prices, if we
have lower-priced drugs, if we have books that anybody could
buy.
That's a good thing. It's a good thing for society, and it's a good thing for us as
consumers. But we're not only consumers,
we're also citizens. We're also producers. We're also people who think and who make things and who grow
things, and we want to have access to open markets. >> NARRATOR: Once again, the tension was most pronounced
with book publishers. Amazon was selling around 40%
of all new books in America and two-thirds of all electronic
books, thanks to the success of the Kindle. Then, one of the world's largest publishers, Hachette, decided to
push back.
Franklin Foer was one of its
authors. >> Hachette and Amazon set out
to renegotiate their e-book contract. And Hachette said, "No, we don't accept the terms of your
contract." And Amazon basically said, "To
hell with you, Hachette. We're going to stop delivering
your books. If somebody searches for a
Hachette title, we're going to redirect them to another
publisher." >> Amazon's battle with Hachette
and the authors that Hachette publishes is heating up. >> NARRATOR: As Bezos's virtual blockade dragged on for months.
>> A bitter, seven-month standoff… >> NARRATOR: Thousands of authors, including bestsellers
like Douglas Preston, were caught in the middle. >> Some authors were losing 50% to 90% of their sales from
Amazon. It was absolutely devastating
to first-time authors. It actually destroyed their
careers. >> Did you see your
sales plummet? >> I did, yes. I saw my sales plummet tremendously. >> NARRATOR: In frustration, Preston penned an open letter
on behalf of all authors. It was published in "The New
York Times" with more than 900 signatures. >> We authors have loved Amazon. We have enthusiastically
supported it, and this is how they treat us? This is not right. >> Amazon has been accused of
doing everything from raising prices to deliberately delaying
shipments. >> Is this what happens when
Jeff Bezos decides to flex his muscles? >> NARRATOR: While Hachette and Amazon were at an impasse,
Douglas Preston, Franklin Foer, and other authors went to
Washington, and asked the Obama administration to open an
investigation.
>> I went to the Justice
Department and I went to the Federal Trade Commission with
the Authors Guild, and we tried to explain to them why this
power was so dangerous. We pointed it out of all the
ways in which Amazon was bullying the publishing
industry. >> The Department of Justice
listened to us. And their answer was essentially
this: "Amazon is one of the most popular companies in the
country.
(camera clicks)
They have brought tremendous services to consumers, and
they've brought lower prices." And that we hadn't given them
any kind of reason to open an antitrust investigation. >> NARRATOR: Eventually, Hachette and Amazon would
settle their dispute, with Amazon allowing Hachette to set
its own prices for e-books, but offering it incentives to keep
them low. >> It's great to be here at
Amazon. (crowd cheering)
>> NARRATOR: Amazon would thrive during the Obama years, and
eventually account for nearly 40% of all online commerce in
the country. >> Last year, during the busiest
day of the Christmas rush, customers around the world
ordered more than 300 items from Amazon every second.
>> NARRATOR: But the complaints about its tactics would
continue, with retailers of all kinds concerned that Amazon had
become the online-shopping gatekeeper. >> You've got to be on Amazon. You have to be there, because
that's where everyone is. That… 100 million Prime
subscribers. They are the de facto e-commerce
channel in the United States, period, end of list. >> Amazon executives have told us that there are many
other options out there. There is Walmart, there is
Alibaba. As a seller, you've got options.
>> I've heard that response from Amazon executives before, and we
did that, we were listed, we listed all of our products on
every other online marketplace. But it's a testament to just
how good Amazon is. All of the others that were
non-Amazon combined did about ten percent of what we were
doing on Amazon. >> NARRATOR: Businesses big and
small have been accumulating complaints about Amazon's hold
on them. >> On Amazon, the customer
belongs to Amazon– it doesn't belong to the third-party
seller. You're basically renting the
Amazon customer. >> NARRATOR: James Thomson used
to recruit brands to come onto Amazon and now advises them on
how to do business with the company. >> I represent brands today that face a number of challenges with
Amazon. >> NARRATOR: Among those
challenges, businesses say that Amazon has access to their
valuable data, which gives it an unfair advantage. They also complain about increasingly higher fees to stay
on the platform, and pressure to use Amazon's warehouses and
shipping services.
We spoke to numerous name-brand
companies, but none would share its grievances on camera. >> My account was suspended. >> NARRATOR: Some small
businesspeople have been talking about their
experiences– good and bad– online. >> When you're selling on Amazon, you're playing in
someone else's playground. >> Who gets placed where,
whether or not your product shows up in the search
results… >> They suspended my account
without warning. >> These are all things that are
governed by Amazon's rules. And if there's a dispute within
that arena, if you feel you are mistreated, you know, the judge
and jury is Amazon. >> They don't care, they'll just
kill your account like that or suspend it…
>> There are all sorts of crazy stories about why people get
their accounts shut down on Amazon. And it could take a week, it could take months, it could be
never before you're back online again. Amazon has the upper hand and the ability to basically take
your business away from you at any given moment. >> Selling on Amazon, take one. >> NARRATOR: Amazon said
third-party sellers account for more than half of everything
sold on the site. >> I sell mini-longboard
skateboards. >> I sell mineral water. This is what I do. >> NARRATOR: And it's
committed to its sellers' success– proactively contacting
them when their accounts are at risk of suspension and offering
an appeals process to resolve disputes. >> You already have great products. Scale up… >> NARRATOR: But in the eyes of
some businesses, Amazon has essentially become like the
railroads at the turn of the last century that controlled
the flow of commerce across the country.
>> Start selling today. >> Do you see yourself
as being kind of like the rails for e-commerce, that sellers
bring their goods to market on your rails, through your
marketplace? >> I don't think of it that way,
and here's why: the, the vast majority of stuff that's… Well, all of the stuff that's sold is manufactured, right? So it's manufactured, meaning there are brands and factories
that produce stuff and then sell it. We're one percent of the retail sales in the world, about. >> Well, you are the biggest marketplace online,
right? >> No, so, again, I, I don't… The idea that there's an online, distinct for brands to sell
their stuff and distinct from physical, just doesn't make
sense to me, and we're far from the largest retailer. So, I, I describe this as retail, and we're competing
against Walmart and Target and Costco and Carrefour and Alibaba
and Tmall and all kinds of folks who are, are now selling both
physical stores and online. >> NARRATOR: In addition to
pointing to other large retailers, inside the company
employees have been schooled in how to talk about
its size and power.
>> When I worked at Amazon, we
had training specifically on the use of terms like "monopoly." We were not allowed to use a term like "market share." Amazon has what's known as "market segment share." What is market segment? What is market segment share? I don't know, but I know that the lawyers at Amazon feel those
terms are, are much safer than using terms like market share. >> So market share was something they were really
concerned about. >> Clearly somebody with the
necessary legal training or PR training recognized that Amazon
was growing very quickly, and when we were asked to use the
term "market segment" and "market segment share," in
essence it's a polite way of saying, "I'm not going to talk
to you about how big we are." >> NARRATOR: Since leaving
Amazon 20 years ago, Shel Kaphan has been watching the
company with increasing concern, and he's speaking
about it for the first time. >> I think that the
characterization of Amazon as being a ruthless competitor is
true, and under the flag of customer obsession, they can do
a lot of things which might not be good for people who aren't
their customers.
>> I know you're not a
legal scholar, but are you basically concerned that Amazon
is a monopoly? >> I'm, I'm concerned that it
has that type of power. I think it, you know, whether
you technically can call it a monopoly or not, I don't know. ♪ ♪ >> NARRATOR: That question has
continued to loom over Amazon. >> I think that Amazon is
looking out, and the existential threat that they may face is
going to be from government. It's whether or not
policymakers are going to step in and intervene and say, "You
have too much power." >> NARRATOR: For years, Bezos
has been ramping up Amazon's profile in Washington. >> Amazon has been lobbying the F.A.A.
To lift… >> Trying to cozy up to politicians, so that they will
give him the biggest tax breaks around… >> NARRATOR: Spending millions a year on lobbying. >> Amazon lobbied more government entities than any
other tech company. >> NARRATOR: And hiring as its
spokesman the former White House press secretary Jay Carney. >> You've got an army of lobbyists, many of whom have
revolved in and out of government, including yourself. What are you hoping to get for all that lobbying spend and all
that influence? >> One of the things we
discovered is, because of the visibility of our company, but
also the range of businesses that we're in, we need
subject-matter experts on food safety, on transportation, on
drones, on privacy.
And also, we can be a resource,
an information provider to policymakers and regulators. It's not lobbying in the traditional sense, in terms of
trying to persuade somebody to do something, it's just
answering questions and, and providing data and information. >> NARRATOR: Bezos himself would also become a presence in the
capital, and eventually buy the largest private residence in
town. >> Jeff Bezos never really
showed much interest in politics, but as he's cemented
himself in the city, he's started to acquire this physical
presence. He bought a mansion, then
developed it into a place that is explicitly designed to be
social. >> It has a big ballroom, I
mean, it is designed to create a real presence for him in the
nation's capital, where he can hobnob with the people who make
decisions. >> NARRATOR: He'd even bought
the hometown newspaper… >> Jeff Bezos sent a thunderbolt
through the media world this week… >> NARRATOR: Spending a quarter of a billion dollars to rescue
the struggling "Washington Post." >> I do believe that democracy dies in darkness.
I think that the capital city of the United States of America
needs a paper like "The Washington Post." >> I got to say, you know, full credit to him, he hasn't
intervened in any of the coverage of the paper. And he's invested in the paper. Every dollar of profit that the
paper makes is plowed back into making it a better paper. >> Bezos allowed the "Post" to hire, to restock its newsroom,
he reversed what had been an atmosphere of sort of decline. I'd say "The Washington Post" has really flourished under,
under Bezos's ownership. >> Let's cut this digital
ribbon.
>> NARRATOR: At the time,
critics saw a more cynical motive. >> Perhaps he's buying "The Washington Post" to buy some
sort of protection. >> Precisely. >> This deal could give him more influence over politics. >> Nobody hangs out in Washington, DC, just to go to
the free museums. You buy a home in Washington,
you buy a newspaper in Washington, because it is the
most influential city in the world, and you want to lay your
hands on that power. ♪ ♪
>> NARRATOR: Bezos saw a business opportunity there, as
well.
The Obama administration planned
to modernize the federal government by embracing cloud
computing. Bezos had been quietly building
a revolutionary cloud computing business. He called it Amazon Web Services. >> It's basically computing power in the cloud, but really
it's Amazon's server farms around the world that give
people access to the kind of technology services they need. >> NARRATOR: To keep Amazon running, Bezos had developed an
unprecedented digital infrastructure. He realized he could rent parts of it out, not just to
businesses, but also to the government. >> Our infrastructure is built to satisfy the security
standards of the most risk-sensitive organizations. >> He's already got a huge edge over the other big competitors
in it. So he wants to take that lead
and capture the U.S. government. >> NARRATOR: In 2013, he got a
major boost when it was revealed that Amazon Web
Services had designed a computing cloud for the C.I.A.
>> Amazon Web Services was awarded a ten-year contract for
$600 million. >> Amazon is helping the C.I.A.
build a secure cloud computer network… >> The C.I.A. contract was probably one of the best things
that happened to Amazon's cloud business. It lifted all doubts about the security of the cloud and on
whether you could trust Amazon with your most precious data. >> The message to the world is, "If the C.I.A. trusts Amazon
with its data, then maybe other companies and government
institutions can, as well." >> NARRATOR: And they did. >> Experience it with Expedia. >> NARRATOR: A.W.S. became by
far the world's leading cloud-computing platform. >> On CBS. >> NARRATOR: Today, more than a
million businesses, as well as PBS, pay Amazon to
store and manage their data. >> NARRATOR: Bezos had again
anticipated the next frontier in technology, and had made himself
indispensable to it. >> What Jeff Bezos is after is
really creating a company that is the infrastructure, that owns
the infrastructure for how commerce is done.
And that's an incredibly powerful place to be. ♪ ♪ >> Please welcome chief
executive officer of Amazon Web Services Andy Jassy. >> NARRATOR: Andy Jassy created and runs A.W.S. He credits the service with making it easier to do business
and sparking innovation throughout the economy. >> Look at what A.W.S. has enabled with regard to change
in our society. Look at, Netflix changed the way
that we consume digital content, and Airbnb changed the way that
we get accommodations, and Hola and Grab and Lyft and Uber
changed the way that we get transportation. A.W.S. has enabled, has been a part of enabling all these huge
innovations and changes in consumer experiences that
have, have made life better for people. >> And we're the cloud with the most capabilities, the most
innovation, the most customers. >> NARRATOR: The division
generated $35 billion in sales last year. >> Amazon Web Services. >> Yes! >> Build On. >> NARRATOR: The success of
A.W.S. gave Bezos billions to expand Amazon from a company
that sells everything to a company that does everything.
A top priority… >> To boldly go where no man has
gone before. >> NARRATOR: …was to create
the sci-fi future he'd fallen in love with as a child. >> Gentlemen, this computer has an auditory sensor. It can, in effect, hear sounds. >> NARRATOR: A world of
artificial intelligence, in which computers can think and
make decisions for humans and about humans. >> Jeff Bezos is a big fan of "Star Trek." He, he admits that that was on his brain when he came up with
the idea that Amazon should be pursuing a little disk that you
can bark commands into. >> Stop. >> This is his "Beam me up, Scotty" fantasy realized.
>> We started working on this device. And our, our vision was, in the long term, it would become the
Star Trek computer. >> When it first arrived from
Amazon, I didn't know what it was. >> NARRATOR: In 2014, Bezos's talking computer, the Amazon
Echo, hit the market. >> Is it for me? >> It's for everyone. >> NARRATOR: The voice known as
Alexa would embed Amazon deeper into the lives of millions of
people.
>> Alexa, what do you do? >> I can play music, answer questions, get the news and
weather. >> They call it a personal
assistant, and just that term implies this intimate connection
that we then begin to develop with Amazon. >> Alexa, sing the ABC song. >> ♪ A, B, C, D, E, F… ♪
>> I believe that when we think about the future and the future
with artificial intelligence, given where we currently are
today, Alexa in some ways represents the moment that it
becomes seamlessly interwoven with our lives. >> Alexa, how many teaspoons are in a tablespoon? >> One tablespoon equals three teaspoons. >> Oh, okay. >> And the problem is that we
forget that it's there. >> Alexa, lights on. >> Okay. >> NARRATOR: But Alexa is also
listening– and she's learning. >> I'm answering questions and
learning more. >> NARRATOR: And that helps
Amazon in the race to dominate artificial intelligence. >> Alexa… >> Every time you ask Alexa
something, you're making the Alexa algorithm better.
It's one of the reasons why Amazon, having had a head start,
is able to kind of preserve that head start, because they've got
the most data of anyone. >> Alexa is one more way for
Amazon to gather extremely valuable data. And this data collection is extremely important to this
business model. It's extremely hard to do, and,
you know, convincing people to just deploy something like this
in their home is a brilliant trick. >> NARRATOR: Dave Limp is Amazon's head of devices. >> How is it that you convinced tens of millions of
people to put what is essentially a, a listening
device in their homes? >> Well, I, I would first
disagree with the premise. It doesn't, it's not a
listening device. The, the device in its core
is… It has a detector on it. We call it internally a "wake-word engine." And that detector is listening– not really
listening– it's detecting one thing and one thing only, which
is the word you've said that you want to get the attention of
that Echo. >> NARRATOR: Once the device is
awake and the blue light is on, it's recording.
And last year, it was revealed that Amazon employs thousands of
people around the world to listen and transcribe some of
those recordings to help train the system. >> Do you think that you did a good enough job of
disclosing that to consumers? That, that there are humans
involved in listening to these recordings? >> We, we try to articulate what we're doing with our products as
clearly as we can. But if I could go back in time,
and I could be more clear, and the team could be more clear, on
how we were using human beings to annotate a small percentage
of the data, I would, for sure. What I would say, though, is
that once we realized that customers didn't clearly
understand this, and within a couple of days, we added an
opt-out feature, so that customers could turn off
annotation if they, if they so chose. And then within a month or two later, we allowed people to
auto-delete data, which they also asked for within that,
within that time frame. You know, we're not going to
always be perfect, but when we make mistakes, I think the key
is that we correct them very quickly on behalf of customers.
>> NARRATOR: But even one of the founders of Amazon Web Services
approaches his Alexa devices with caution. >> When do you turn off your Alexa? >> I turn off my Alexa when I know for a fact that the
conversation that I am going to have, or, or whenever I just
want to have a private moment. I don't want certain
conversations to be heard by humans, conversations that I
know for a fact are not things that should not be shared, then
I actually turn off those particular listening devices. >> We have had an incredible year. The team has invented a lot on behalf of customers, and I
cannot wait to show you what we have. >> NARRATOR: So far, Limp and his team have made Alexa
compatible with more than 100,000 products. >> Echo Frames allow you to get done more around you and be more
present in the everyday. >> Now they're going to know
more about you than anyone knows. They're trying to move as intimately as possible and as
quietly as possible into everyday life. >> Echo Loop is a smart ring, packed with ways to stay on top
of your day.
>> Amazon wants to have the
entire environment essentially miked. >> Alexa, start my running playlist. >> They want your walk in the park, they want your run down
the city street. >> Nationwide's teamed up with
Amazon to bring you the all-new Echo Auto. >> They want what you do in your car, they want what you do in
your home. >> Amazon Smart Oven. >> Alexa, bake for 30 minutes at 350 degrees. (oven beeps) >> All these intimacies, all
this insight is being integrated, analyzed and
integrated. >> Alexa, alarm off. >> That is an extraordinary kind of power that has never before
existed. >> NARRATOR: After Alexa, Amazon
would go on to spend nearly a billion dollars to buy Ring…
>> Hey, bud, the police are on the way. >> NARRATOR: A doorbell camera and app that Amazon describes as
"the new neighborhood watch." >> Hey, get away! >> Get out of there! >> NARRATOR: To promote it,
Amazon has enlisted the help of hundreds of local police
departments. >> It's a phenomenal tool to
assist detectives. >> NARRATOR: They give them
access to a portal to request footage and have given free
cameras to hand out– and talking points. >> This system is so simple to use… >> You have Amazon in partnership with police
departments, who have basically turned policemen into, like,
Avon salespeople for Amazon Ring.
They have given police departments talking points and
marketing materials to encourage the installation of Ring by
community residents. None of this was public
knowledge. >> And this is Ring's first
indoor cam. It is… cute, is what I would
say. >> NARRATOR: Amazon has
continued to expand the scope of Ring. Last fall, Dave Limp unveiled a version designed to monitor the
inside of people's homes. Within weeks, hackers discovered
a way to terrorize Ring customers. >> Did you see that video? >> I did see that video. >> What did you think of
it? >> I think that that is a
industry problem.
It's not just about the, a Ring
camera– it could be about anybody's cameras. It's about any device in that… And we've already investigated
that one to make sure what, what the root cause was. What we want to be able to do in those cases is, we want to
minimize them. We'd like to detect them. And we also want to build tools that give them the ability so
that doesn't… that, that makes it harder for those kinds of
attacks to happen. There's a lot of bad people in
this world. >> Here's a device that
you had described as cute and seems harmless, and I'm just
wondering whether you're being straight with people about the
attendant risks to your customers that you are obsessed
with, supposedly.
>> Well, it's not supposedly, we
are obsessed with customers. I, I would say that we are
trying to build security features at every level of the
stack: operating systems, authentication, fraud detection. We offer things that customers can turn on that make it even,
make it even harder for those attacks to happen. >> Yo, what's up, how's your day? >> Who is that? >> What's going on, buddy? What are you watching? >> NARRATOR: There were a series
of similar attacks across the country. >> What's up, homie? I still see you. >> You hungry? >> What's going on, my main man
Shaq? >> NARRATOR: And it's not just
hackers. Ring has fired some of its own
employees for spying on customers.
>> In George Orwell's "1984," he describes a dystopia
in which, "You had to live, you did live from habit that became
instinct in the assumption that every sound you made was
overheard." And I wonder if you ever think
about how easily this could become dystopian to some degree? >> Well, I don't want to live in that world. So, I do not want to invent the technology that, or have my
teams invent the technology that would create that world. And so… but I am an optimist. I, I think if you take the, the
absolute view of that, we wouldn't invent anything. >> We're increasingly living in a world in which your
products and your designs are there. Do, can you see how it could be concerning in some ways that we
all can't opt out of that world at this point? >> Oh, sure, I can see why it could be concerning to some
customers. Our job in building that
technology is to build it in such a way that it, that it
takes into account for the scenarios that you just talked
about, as best as we possibly can.
You know, the, the reality of it is, that world happened way
before Ring or Alexa. ♪ ♪
>> NARRATOR: That's something that Bezos himself wrestled with
20 years ago. >> I believe that privacy is
going to be one of the prominent issues of the 21st century. The thing is, there are towns now in the United States that
have installed security cameras on every corner, and their
crime rates decreased by 80%, but do you really want cameras
on every corner? There are very strange things
that are going to happen over the next 100 years with respect
to technology that are going to challenge us as a society to
figure out how we want to deal with privacy.
>> NARRATOR: Decades later, Bezos would be at the vanguard
of expanding the use of that kind of technology. >> Introducing Amazon Rekognition Video. >> Rekognition allows you to pass an image to us. You can say, "Do these two faces match?" Which is incredibly useful for applications in the security
space. You can imagine… >> NARRATOR: After Amazon rolled out a facial recognition tool,
it marketed it to law enforcement. >> Recognize and track persons of interest from a collection
of tens of millions of faces. >> NARRATOR: Police we've spoken
to say it's a valuable tool to identify suspects quickly.
>> …appears to be a match, but I'm gonna make sure I look at
them all. >> NARRATOR: And while Amazon
has offered guidelines for how it should be used, there are few
laws governing the use of this technology. >> It returns anybody with warrants that look like her. >> NARRATOR: Civil liberties advocates have raised concerns,
as have computer scientists, who worry Amazon has released the
software before it's ready, and that police are essentially
field-testing it on the public on behalf of the company. >> The tools are not what I call battle-tested. And we still do not understand how well they work in the
environments in which they'll be applied. That's where I see a danger. >> NARRATOR: Anima Anandkumar
was the principal scientist for artificial intelligence at
Amazon. In her first interview about her
concerns she told us she was particularly alarmed by an
M.I.T.
Study that found the software prone to mistakes with
darker-skinned faces. Amazon has questioned the
study's methodology. >> As a researcher in A.I., I
feel it's my personal responsibility to educate the
public of where A.I. truly is today, right? Because they hear so much of A.I. being hyped up, you know,
it's supposed to be magical, it's supposed to solve all the
world's problems. I see the potential in doing
that, but at the same time we need a reality check. We need to ask, where is A.I. today? What can it truly do well? >> And when it comes to
facial recognition, you don't think it's ready for primetime. >> I don't think face recognition is ready for
primetime in challenging applications like law
enforcement. >> NARRATOR: Anandkumar and
other scientists have asked Amazon to stop selling
Rekognition to law enforcement because they say the system's
accuracy is still in question, and there are no clear
regulations about how it's used.
We asked Andy Jassy about it. >> I have a different view, and we've spent… We've had the facial recognition technology out for
use for over two-and-a-half years now. And in those two-and-a-half years, we've never had any
reported misuse of law enforcement using the facial
recognition technology and, you know, I think a lot of societal
good is already being done with facial recognition technology.
Already, you've seen hundreds of missing kids reunited with their
parents, and hundreds of human trafficking victims saved, and
all kinds of security and identity and education uses, so
there's a lot of good that's been done with it. But I also understand that it could be misused. And I think at the end of the day with any technology, whether
you're talking about facial recognition technology or
anything else, the people that use the technology have to be
responsible for it, and if they use it irresponsibly, they have
to be held accountable. >> There's been all
sorts of problems with policing in this country. So why allow police departments to experiment? >> We believe that governments and the organizations that are
charged with keeping our communities safe have to have
access to the most sophisticated, modern
technology that exists. We don't have a large number of
police departments that are using our facial recognition
technology, and as I said, we've never received any
complaints of misuse.
Let's see if somehow they abuse
the technology. They haven't done that, and to
assume that they're gonna do it and therefore you shouldn't
allow them to have access to the most sophisticated technology
out there, doesn't feel like the right balance to me. >> It's been difficult to even know how many police
departments are using the facial recognition technology, and
there's no public auditing to know whether there are
complaints about abuse. How would the public ever know? >> You know, again, I don't think we know the total number
of police departments that are using facial recognition
technology.
I mean, there's, you can use any
number– we have 165 services in our technology infrastructure
platform, and you can use them in whatever conjunction, any
combination that you want. We know of some, and the vast
majority of those that are using it are using it according to the
guidance that we've prescribed. And when they're not, we have
conversations, and if we find that they're using it in some
irresponsible way, we won't allow them to use the service
and the platform. ♪ ♪
>> NARRATOR: Andy Jassy and Jeff Bezos have said they want
governments to hurry up and regulate how law enforcement can
use facial recognition.
But in the meantime, Amazon has
forged ahead, and has even discussed its services with
Immigration and Customs Enforcement. >> At Amazon Web Services… >> NARRATOR: And the U.S.
military. >> …partner community to
deliver for our warfighters and defense leaders for when it
matters most. >> NARRATOR: Bezos himself has
made it clear that he sees Amazon playing a critical role
in national security, as well as in commerce. >> We are going to continue to support the D.O.D., and I think
we should. And if big tech companies are
gonna turn their back on the U.S.
Department of Defense, this
country is gonna be in trouble. >> NARRATOR: As Amazon has
revolutionized one industry after another, Jeff Bezos's
reputation has grown to mythic proportions. >> You've called what Jeff Bezos has built a miracle. >> Absolute miracle. I wish I could give him a blood
test or something so I could pick it out, but… >> You want to clone him? >> No, I want a transfusion,
actually. >> Amazon is now worth $1
trillion… >> NARRATOR: His every move
moves the markets. >> Amazon Advertising is just on
fire. >> NARRATOR: Starting a digital
advertising business to rival Facebook and Google. >> Some breaking news on Whole Foods… >> Holy cow. >> Jim, I heard you gasp just
now. >> Holy cow, this is such a
game-changer. >> NARRATOR: Buying the grocery
chain Whole Foods.
>> In a record-breaking deal,
Amazon is buying Whole Foods for $13.7 billion. >> The day the acquisition was announced, the nation's largest
grocery company lost billions of dollars because Amazon acquired
a company one-12th the size. >> Everybody thinks Bezos is the
smartest person in the world and he's gonna come and crush me. >> When Amazon announced the acquisition of Pill Pack… >> News of the deal sent shockwaves through an
industry… >> The retail pharmacy sector
shed billions of dollars. >> Look at this story– three
titans of industry…
>> When Amazon was mentioned in
a press release with Berkshire Hathaway and JP Morgan saying
they were looking at healthcare costs– no detail in what that
meant… >> Healthcare companies are
panicked about Amazon's forthcoming entry into the
healthcare market. >> On the opening bell the
next morning, the healthcare industry's largest players shed
billions of dollars. >> And insurance stocks are down
after Amazon announced a healthcare partnership with
Berkshire Hathaway and JP Morgan Chase. >> Bezos basically wants to own the whole economy, right? >> You think he will. >> I kind of think he will. I kinda think that in, like, ten years Jeff Bezos owns every
single thing there is. >> So Amazon has these Darth
Vader-like abilities to just look at a sector and begin
choking it of oxygen without even touching it.
Amazon can begin beating competitors without even
competing. >> You actually think
that Amazon is having a negative effect on competition in the
innovation economy right now? >> I think it's a mixed bag, I
think that you could argue, and there's evidence that they have
inspired innovation in certain sectors. But I think there's a lot of small companies that aren't
being formed, because if you go in to try and raise money for
an e-commerce company, it's, "Well, how are we going to
compete against Amazon?" And I say, "Well, the answer
can be summarized in one word: impossible." >> All right, let's move some earth. >> Every single area that he enters into, he manages to
succeed in a fairly major way. (crowd cheering)
>> We've had another great Prime Day. >> We've never seen anything like a company that is so
integrated into the fabric of existence, so, you know, at a
certain point, it becomes unavoidable.
>> Amazon just yesterday said… >> Bezos would even extend his
reach into the heart of popular culture. >> Can you imagine Macy's starting a media company? We couldn't even imagine that. But Amazon does it, and people
take it seriously. (explosion echoes)
(people screaming) >> NARRATOR: Amazon is investing
billions in new shows and movies. >> Oh. Hi. >> Hey.
>> NARRATOR: And on beefing up
its streaming service, which streams around four times as
many movies as Netflix, Major >> NARRATOR: And on beefing up
its streaming service, which streams four times as
many movies as Netflix, Major League Baseball, and PBS shows
like this one. (audience applauding)
>> And the Golden Globe goes to… "Transparent." Amazon Instant Video. >> I want to thank Amazon, Jeff Bezos. >> To Amazon, my new best… friend. (audience laughing) >> Bezos likes to joke about
how, every time he wins a Golden Globe…
>> …it helps us sell more shoes. And it does that in a very direct way, because when
people… if you look at Prime members, they, they buy more on
Amazon than non-Prime members, and one of the reasons they do
that is, once they've paid their annual fee, they're looking
around to see, "How can I get more value out of the program?" >> They're trying to use this entertainment to get people into
the pipeline.
>> Alexa, play "Jack Ryan" on
Fire TV. >> To keep them sitting within
this structure that is Amazon, where it becomes this unthinking
habit that's starting to pattern all these parts of our
existence. >> So you're doing the media
stuff to encourage people to use more of Prime. >> Correct. >> Amazon is represented at the
Academy Awards. Amazon is the first streaming
service nominated for Best Picture.
>> He's like one of the old studio bosses right now. He really enjoys having this place in the industry and
really seems to relish being at the center of attention there. >> I also want you to know, Jeff, if you win tonight, you
can expect your Oscar to arrive in two to five business days…
(audience laughing) >> What you see now is someone
who is so supremely self- confident. A guy who has become a titan. ♪ ♪
>> Amazon is about to get bigger. It's looking for another home in North America. >> NARRATOR: Bezos and Amazon's soaring stature would be on full
display in September 2017, when the company announced a contest
to find a location for a second headquarters. >> …called HQ2. >> NARRATOR: They promised $5
billion in capital investments. >> $5 billion…
>> …in local investment…
>> NARRATOR: And 50,000 jobs. >> 50,000… >> 50,000 people. >> 50,000 high-paying jobs. >> Cities are salivating over
the opportunity. >> It was unprecedented because
the number of jobs was head-and- shoulders more than had ever
been offered in a deal before. This was a super-high-profile
auction by the most popular consumer company in the, in the
country. >> NARRATOR: The company invited
cities across North America to pitch themselves. >> How about, I don't know, here? >> NARRATOR: 238 took them up on it. >> I chose, Miami– you should, too. >> Can't wait to see you, Amazon. >> I, Ebenezer Scrooge… >> NARRATOR: Some with
elaborately produced videos. >> …I live in Atlanta. >> Amazon is demonstrating that it has the power to get
thousands of elected officials to remake their workday and bow
down before Amazon. >> I'm Mark Bound, mayor of the
city of Danbury. >> And offer it huge tax breaks. >> Georgia offered $2 billion. >> Maryland offered $5 billion. >> $7 billion from New Jersey. >> Huge infrastructure promises,
huge prime parcels of land.
>> Philadelphia is offering the
most land– 28 million square feet. >> They know that these places all don't have a prayer. >> So to those who saw it as a kind of grotesque
display of corporate power, to dangle 50,000 jobs and potential
billions of dollars of revenue over metropolitan cities around
the country, you say what? >> Look, I, I think, I used to
work for the United States government, like, we want
businesses to invest in the United States. States want businesses to invest in states, cities, city
officials want businesses to invest in cities. The proposals we got, the cities made the proposals, they wanted
us to come, and they presented to us why they were an
attractive option. ♪ ♪
>> NARRATOR: In November 2018, Amazon announced there were two
winners: Arlington, Virginia, and New York City. ♪ ♪ >> This is by far the biggest
new jobs deal in the history of New York City, the history of
New York State. >> NARRATOR: New York City and
State had campaigned hard for it, offering up nearly $3
billion in subsidies and tax breaks.
>> I'll change my name to "Amazon Cuomo" if that's what it
takes. >> NARRATOR: In return, Amazon
promised 25,000 jobs, billions of dollars in capital
investments, and a small number of projects earmarked for local
community members. >> I thought it could be a great
thing for New York. We are more and more of a tech
center, we wanted to consolidate that reality. Having Amazon here would have helped immensely. >> Amazon has got to go! >> NARRATOR: But not everyone
was enthused about giving billions in tax breaks to a
trillion-dollar corporation. >> Corporate handout! >> Get out! >> Alexandria Ocasio-Cortez says
the tax break isn't worth it. (gavel pounding)
>> Welcome to today's oversight hearing on the deal…
>> NARRATOR: Though the deal had already been finalized, the New
York City Council insisted on a public hearing. It quickly turned contentious. >> Mr. Husman, you mentioned
that there are 5,000 employees that are currently working here
in New York City for Amazon, is that correct? >> Yes. >> NARRATOR: Council members
grilled Amazon executives on their position on unions, and
whether the company would pledge to remain neutral if
workers in New York State tried to unionize. >> How many of those employees are unionized? >> None, sir. >> None. Would you be okay with agreeing to neutrality so that workers
can unionize? >> No, sir, we respect… >> You wouldn't agree to that. >> Correct, sir, we would not.
>> To go to a city council hearing, as Amazon did, and
antagonize the city council– if they wanted to start a fight,
they did a great job. If they wanted to actually show
that they were willing to work with this community and our
values, they did a horrible job. >> You are in a union city. And one of the first answers to your question today, is– would
you be neutral?– you said no. That is not a way to come to our
city. >> NARRATOR: It was not the
reaction the company expected when it launched the contest. Two weeks later, Amazon pulled out. >> Amazon is pulling the plug on its New York plans. >> We decided we didn't have to be there in that political
dynamic. The fact of the matter is, when
it turned out the governor and the mayor supporting something
turned out not to be enough to persuade other critics that it
was the right kind of investment for New York to make, we
decided, that's fine, we can go elsewhere. >> He said to us that it turned out that the governor and
the mayor supporting something wasn't enough to persuade other
critics that it was the right kind of investment for New York
to make.
So we decided… we decided it's
fine, we'll go elsewhere. >> That's an idiotic statement
on its face. That is pure idiocy from a guy
who should know a hell of a lot better. The deal was done, Amazon knew it was done. There was noise, there was posturing by people in the
political world, but the deal was done, so all we're talking
about here is the background noise.
In what world are there no critics? Well, yeah, in an autocratic totalitarian world, maybe
they're not allowed, and maybe that's the world that Jeff Bezos
somewhere in his mind thinks he is entitled to. ♪ ♪ >> NARRATOR: At the time, Bezos
was involved in some personal turmoil. >> Amazon C.E.O. Jeff Bezos and his wife of 25 years
announcing they are splitting. >> The announcement coming amid
tabloid reports that Bezos is now in a relationship with
former news anchor Lauren Sanchez. >> NARRATOR: The "National Enquirer" had been pursuing him
for months. >> The tabloid claims it tracked
him across five states and over 40,000 miles. >> NARRATOR: Bezos saw the "Enquirer's" report as
politically motivated. >> So what would be the motive
here of getting that embarrassing material about
Bezos and his alleged affair to the "National Enquirer"? Who would want to get the dirt in the press? >> NARRATOR: The magazine's owner, David Pecker, was linked
to two powerful men who disliked how they were covered by Bezos's
"Washington Post." The first was President Trump.
>> It's put there for the benefit of "The Washington
Post," of Amazon… >> NARRATOR: The second: Saudi
Crown Prince Mohammad bin Salman, who the C.I.A. had tied
to the murder of one of the "Post's" journalists, Jamal
Khashoggi. >> Former C.I.A. director John
Brennan said, "I have no doubt that Saudi Arabia would want to
embarrass Jeff Bezos and hurt him financially." >> NARRATOR: David Pecker demanded that Bezos publicly
declare the "Enquirer's" coverage was not politically
motivated or he'd publish intimate photos of him.
>> Breaking news tonight, a stunner from the richest man in
the world. >> NARRATOR: Rather than give
in, Bezos fought back. >> Jeff Bezos calling out the
publisher of the "National Enquirer," David Pecker. >> Bezos published a personal account accusing the "National
Enquirer" of blackmail, of extortion. >> He turned the situation around and handled it so
brilliantly– he was very transparent, he was very
courageous, admitted some very embarrassing things about
himself, didn't try to deny it– and positioned the other
individual as the bully, and kicked the bully in the nuts,
and somehow turned this into a net positive. I mean, this really was the PR strategy and execution of the
ages. I've never seen anything like
this. ♪ ♪
>> NARRATOR: Publicly, Bezos has pushed ahead undaunted– a
world-famous celebrity. And even after a $38 billion
divorce settlement, still the richest person on the planet. (cheers and applause) But the calls to rein in his
company are growing louder. >> Amazon reported $10 billion
in profits and paid zero in taxes.
>> I will single out companies like Halliburton or Amazon that
pay nothing in taxes in our need to change that. >> Here's Bezos achieving this American dream and success. And, and he's now the target of, of all of this criticism. And basically, it becomes a symbol of all of his problems. >> Amazon is closing 30% of America's stores and malls and
paying… >> You're basically a piñata
dangling in front of any politician with a populist
message. Anyone who wants to talk about
wealth inequality, they're pointing their finger at you. >> This is why three people own more wealth than the bottom
half. >> If they want to talk about
problems with capitalism in general, they're pointing their
finger at you.
>> We need to enforce our
antitrust laws, break up these giant companies. >> NARRATOR: And it's coming from all sides. >> President Trump just sent a chill down the spine of Jeff
Bezos… >> The president again teed off
against Amazon on Twitter. >> NARRATOR: President Trump has
made Bezos's ownership of "The Washington Post" a regular
target. >> "Washington Post," Bezos uses
that as his lobbyist, okay? >> He kind of assumed that "The
Washington Post" was operated in the sort of way that he would
operate a newspaper. And so he thought that Bezos was
dictating coverage to the "Post," which we should be
careful to say is not the case.
>> NARRATOR: Trump has also
criticized Amazon, and accused the company of evading taxes. Last year, the company was competing for a $10 billion
cloud computing contract with the Department of Defense. >> This contract would have solidified Bezos's dominance in
cloud computing. This is a hugely important
thing. >> NARRATOR: But the company
claims President Trump intervened to scuttle the deal. >> And we're looking at it very seriously. It's a very big contract. One of the biggest ever given. >> A big win for Microsoft, beating out Amazon… >> Amazon can protest the outcome, especially given the
unusual, unprecedented comments by President Trump… >> It's an extraordinary times we live in that one of the
world's biggest corporations, Amazon, is now saying, "The
president of the United States has corrupted our ability to win
this contract." >> Is there any evidence
of that? >> The evidence is what the
president has publicly said. >> NARRATOR: And Amazon's
problems have continued to multiply. The Federal Trade Commission is now reconsidering its stance on
antitrust enforcement and is looking at Amazon– as are
regulators in the E.U.
>> This gatekeeper power and how
the platforms are exercising it is of tremendous concern. >> NARRATOR: In Washington, Democratic Congressman David
Cicilline has launched an antitrust investigation into
allegations of abusive conduct by Amazon and the other tech
giants. >> Given your experience, do you
agree with Amazon's statements suggesting that it seeks to act
in the best interest of independent sellers? >> I disagree with that. We get, I don't know, what I
might call bullying with a smile. >> We were able to get several C.E.Os. to come to a public
hearing. That required tremendous courage
because there's a real potential for economic retaliation for
their sharing that. >> We don't have the resources
to fight Amazon. We could use some help. >> In the course of your investigation thus far, and
you've had several public hearings, have you seen any
evidence of anti-competitive behavior by Amazon? >> Um, we have seen evidence of anti-competitive behavior by all
of the large platforms as a result of their market
dominance.
But it sort of doesn't fall on
the companies to fix this problem. It falls on us. Without objection, the hearing
is adjourned. >> NARRATOR: Cicilline's
committee is considering everything from imposing limits
on what businesses a company like Amazon can engage in, to
restricting the collection and use of data. ♪ ♪ The man who helped Jeff Bezos
build Amazon 25 years ago says it may be necessary to go even
further. >> On the one hand, I'm proud of
what it became, but it also scares me. And, um, I just feel like it's important for someone in my
situation to, you know, at least say what they think about what's
going on. >> This is sort of in
some ways a baby that you gave birth to, right? And so, I mean, you helped birth Amazon.
>> Um, yeah, very much so. In fact, I used to, um, you
know, get up several times during the night to, just to see
if it was working and… and, you know, take care of it if it
wasn't, so… >> And when you look at
what Amazon has grown into today, you see what? >> (chuckles) Well, um… you know, you
don't want to see your offspring, um, become, um,
antisocial adults, right? So I think not all of the
effects of the company on the world are for the best and,
um… And, you know, I, I wish it
weren't so, and I… you know, and I… but I had something to
do with bringing it into existence, so, it's partly on
me.
>> And, I mean, isn't… Isn't this just capitalism? Isn't this just a company doing
what a company does? >> Yes. Yes, it is, um, and I think they're doing what the business
schools teach people to do, and they're doing it aggressively
and skillfully and with great intelligence. And they will continue to do that unless they're constrained
by other forces in society. >> There are proposals
out there to break up Amazon. Is that something you'd promote,
the idea of breaking them up? >> Um, I think that they're now
at the scale where that could potentially make sense. >> How do you and Jeff and others at the senior
leadership level think about the call to break you guys up? >> We don't think about it very, very deeply.
You know, I've been at Amazon now for 22-and-a-half years,
and I always remember one of the first things I heard Jeff
Bezos say back when we could fit the whole company in just
one conference room for an all-hands meeting. He said, "I would not go to bed at night fearing your
competitors or fearing any external issues. I would go to bed at night fearing whether you're doing
right by your customers." And that really is a credo that
we live here and it's what we spend most of our time thinking
about. >> Well, I, I understand that
we're big, and that, that we deserve scrutiny, and I think
everything that's… that's large in the economy and in
society should deserve scrutiny. The problem is, when you think
about us, we're in a lot of verticals, yes. There's… there's video, and there's commerce, and there's,
you know, there's web services– there are all these things.
But in every one of them, we have intense competition, and I
do understand why, when you're in a lot of them, it can seem
like we're everywhere, but the global… If we were everywhere, that means we're talking about the
global economy, not just global retail– it's so vast, we're
just, you know, we're a speck. >> To the public, it may
sound strange coming from Amazon, which is a company with
basically a trillion-dollar market cap, your C.E.O. is the
richest man in the world, but Jeff Wilke said to me that
you're kind of just a speck in the scheme of things. Do you see how that could seem strange or incongruous? >> You know, Amazon as a whole has become, you know, has been
successful, but simply because the company's been successful in
a few different business segments doesn't mean it's
somehow too big. ♪ ♪
>> NARRATOR: As Jeff Bezos's company is coming under ever
greater scrutiny– for everything from how it wields
power to even its impact on the environment– he's continuing to
look beyond it all.
>> We get to preserve this
unique gem of a planet which is completely irreplaceable. There is no plan B. We have to save this planet, and
we shouldn't give up a future for our grandchildren's
grandchildren of dynamism and growth. We can have both. Who is gonna do this work? (rocket rumbling) >> NARRATOR: He's spending a
billion dollars a year of his personal fortune on a space
exploration company he created. >> And it's this generation's
job to build that road to space, so that the future generations
can unleash their creativity. >> NARRATOR: For Bezos, it's
always been about one thing: his vision for the future. >> I want you to think about this. This vision sounds very big, and it is. None of this is easy, all of it is hard, but I want to inspire
you, and so think about this. Big things start small. (audience applauding) Thank you. (audience cheers and applauds) ♪ ♪ >> Go to pbs.org/frontline for
extended excerpts of our interviews with top Amazon
executives and insiders, including employee number
one. >> On one hand I'm proud
of what it became, but it also scares me.
>> And more on Amazon's use of facial recognition software. >> I think a lot of societal good is already being done with
facial recognition technology. >> Connect to the FRONTLINE
community on Facebook and Twitter, and watch anytime on
the PBS Video App, or pbs.org/frontline. Captioned by
Media Access Group at WGBH access.wgbh.org
>> For more on this and other "Frontline" programs, visit our
website at pbs.org/frontline. ♪ ♪
To order FRONTLINE's, "Amazon Empire: The Rise and
Reign of Jeff Bezos", on DVD visit Shop PBS or call
1-800-PLAY-PBS. This program is also
available on Amazon Prime Video. ♪ ♪.