Jeff Bezos explains the next step in Amazon’s strategy — the ‘hardest and coolest’ part

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Jeff Bezos at a media event last year. (GeekWire file photo)

In a series of briefings with reporters this week at Amazon’s Seattle headquarters, Jeff Bezos started by going to the white board and describing the company’s strategy in three steps. The first two were familiar to anyone who has been following the company closely.

  1. “Premium products @ non-premium prices.”
  2. “Make money when people use our devices not when they buy our devices.”

But then he added a third bullet point. Here’s how I captured it in my notes.

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“This area here is really where some of the hardest and coolest things happen,” Bezos said, standing at the white board and pointing to the intersection of the Venn diagram. “What do I mean by the entire stack? Hardware, OS, key apps, cloud and services. Some of these things that you want to do in here, you just can’t do them unless you can operate at all levels of the stack and coordinate those pieces.”

KindleFireHDX89HorizontalLater in the briefing, he would demonstrate the company’s new Kindle Fire HDX “Mayday” feature as an example of this approach, with a customer service rep appearing in a live video on the screen of the tablet and helping the user with a support request, drawing on the screen and taking control when necessary.

The Mayday feature is impressive, and it will get people talking. But my key takeaway from Bezos’ comments was that Mayday is just one example of what promises to be a fundamental part of Amazon’s strategy, taking advantage of the company’s unique position at “all levels of the stack.”

That was one of the highlights from a wide-ranging briefing with the Amazon CEO. I was in the room with journalists from Bloomberg News and NBCNews.com, and each of us asked questions following Bezos’ demonstration of the Kindle Fire HDX’s key features.

Here are edited excerpts from his remarks on a variety of topics, even including his Blue Origin space venture.

On Amazon’s position in the tablet market: It’s very early days in the tablet arena. If it’s horses running, we haven’t even come around the first bend. It’s early. The second thing is, it’s a big arena, and there’s room for lots of winners. The third thing is, we are taking — as we always endeavor to do — our own unique approach on things. We have a very differentiated user interface. We try to make it content first. … And then we’re also trying to differentiate by building cloud features, and then we’re trying to differentiate by doing these deep integrations, including things that require lots of heavy lifting. Mayday is a feature that very few companies would attempt.

But the basic strategy is, differentiate in areas that we believe are meaningful and matter to customers. The content ecosystem is really unmatched, when you think about Prime Instant Video, the Kindle Bookstore, the MP3 store, all of it is integrated deeply. The customer can use this product right out of the box, before they even install one thing, or set one setting.

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Bezos with the new Kindle Fire HDX tablets. (Amazon.com photo)

On the extreme seasonality in Amazon’s Kindle Fire sales: I can’t corroborate that, but I also won’t debate it. We do have a very healthy business come the holidays. There’s no doubt about that. The third-party data that I see says that our tablets are the most used. After people buy them, they actually use them.

On the role of Amazon’s “Mayday” support reps: Their job is to help with things on the tablets. But of course, they can help transfer you to somebody. They can help you with “cup of sugar” kind of help, if they can. Think of it as a waiter in a restaurant. Is it their job to tell you what their personal favorite dish is? Maybe not, but they will.

Q: Your wife is a novelist. How much does she influence the e-readers and what are her thoughts on digital reading?

Bezos: She helps me in many, many ways, but not so much on the tablet development or the reader development. She occasionally acts as my editor, and she’s unbelievably good at it. If we’re going to have a gateway letter, I ask, “What do you think of this gateway letter?” and she’ll mark it up for me, and make improvements. She’s a fantastic writer.

Q: A lot of writers like print books.

Bezos: She’s a complete lover of Kindle books. She’ll read whatever books she has. If she has a paper book, she’s happy to read a paper book. But I think she will probably tell you that if she had both, she’d prefer the Kindle, because it’s lighter and easier to carry. … If you like to read as you fall asleep, a Kindle is better than a physical book because otherwise you end up sleeping with the light on.

Q: Are you ever going to go into suborbital flight, and if so will you take a Kindle Fire with you? 

Bezos: Absolutely. I definitely want to go, and now that you’ve suggested it, it seems like a terrific idea to take a Kindle Fire with me.

Q: When would you use it? Is re-entry the boring part? 

Bezos: There’s no boring part of going into suborbital space, I have a feeling.

As we were walking out, Bezos was asked for his opinion about Washington Post employees weighing in publicly on what sort of management style he should have as the new owner of the newspaper.

“I will take all the advice I can get, that’s what I think about that,” he said, punctuating the comment with his trademark laugh. “Bring it on.”

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