Is Amazon Taking Over the World?

I was recently reading the Wikipedia entry for Amazon.com. Turns out that Bezos' Seattle army has been very busy...

In addition to becoming the world's largest online retailer, swallowing Zappos earlier this summer, and beginning to sell everything from ATV winches to Platinum Ruby & Diamond sets, they have set up a cloud computing business and a grocery delivery service.

Not bad for a company that frustrated early investors by not earning a profit for several years after its IPO. But is Amazon getting too big for it's own good? Well, let's look at the previously mentioned cloud computing and grocery delivery business to evaluate this question.

Amazon Web Services (AWS) began in early 2006 and offers several remote IT infrastructure services like data storage, a Query service, dbsase management, and even a web driven market for human computer labor called mechanical turk. At first glance it seems that Amazon is stepping a bit outside of its "core business", decidedly retail, to offer a very lucrative product like web services. But upon further investigation it begins to make sense. Amazon has been providing IT infrastructure of every sort for its internal customers for 13 years. Along the way they have figured out how to manage IT assets efficiently and keep them very reliable. So why not take that expertise and sell it to a market full of companies that really don't have any expertise in or desire to run their own IT infrastructure? Maybe not so far off course after all.

But what about groceries? Well, Amazon Fresh is still restricted to select areas of Seattle for the time being, but it also appears to leverage some of the core business strengths Amazon has developed over the last several years. Amazon fresh requires expertise in wherehouse management, delivery logistics, and customer service. These are all strengths that Amazon can pul out of its Fulfillment center human resources. Add in a little outside grocery talent like a wine guy and produce guy and your in business. It also doesn't hurt that Amazon has been offering non-perishable goods in their retail store for some time now.

The truth of the matter is that Amazon has developed an expertise at business operation over the last decade in a half and very few things are truly outside its core business anymore. So maybe we are asking the wrong question. Maybe the question we should be asking is "What is the next logical step for Amazon?". It seems this young behemoth is just getting started and if Bezos has his way we will see a lot more of Amazon in all kinds of industries. I wonder what's next...