Amazon.com, Online shopping, Amazon Web Services Meet The New CEO Of Amazon
The second quarter just came to an end and andy. Jassy just became the new leader of amazon, but who even is andy? Jazzy and how did he become bezos top choice? Taking a look back andrew jazzy was born on january 13, 1968 in scarsdale, new york, andy’s childhood wasn’t lavish or opulent per se, but he did have a well off childhood. As his father everett jassy was a senior partner at a law firm called dewey valentine. This allowed andy to focus on his education and eventually land a seat at harvard for his bachelor’s andy would major in government, which is quite not major. Maybe the plan was to eventually attend law school and join his father’s company i’m, not quite sure, but anyway, andy would score a job as a project manager at a company called mbi inc after graduation during his time at mbi, andy and one of his colleagues would Try to open a business as a side hustle, but they soon came to the realization that the business they were building was not something they wanted to do long term, so they decided to shut it down soon after andy would end up working at mbi for five Years before, returning to harvard to get an mba after getting his mba, many of his colleagues from harvard and andy would join amazon in 1997.. At the time, amazon was only three years old, so they were able to score management and direct roles off the bat.
During his first couple of years, at amazon andy took on a multitude of roles from leading the customer relationship management team to serving as the director of marketing, but by far his most notable role was being jeff. Bezos technical assistant in the early 2000s andy describes that being bezos technical assistant was one of his most valuable experiences as it allowed him to learn how bezos ran amazon amazon. However, wasn’t doing that. Well, at the time, fundamentally speaking, the company was still growing rapidly as internet adoption skyrocketed, but the problem was that amazon was not profitable. Combine this with the dot com crash and it’s, not hard to see why investors dumped all of their amazon stock driving the stock price down from 113 dollars to just six dollars. Considering this rap return in market sentiment, amazon decided to expand their business plan and focus on profitability. This way they wouldn’t be wiped out by the next market crash. One of the original ideas to diversify amazon was starting a service called merchant.com. This service would allow third party retailers to design their own online websites. You see the main reason that amazon was losing so much money was because of the high cost of fulfilling online orders. If they could shift the responsibility of fulfilling orders to the sellers, amazon could quickly become profitable, but when they actually tried to develop, merchant.com amazon ran into massive obstacles like most startups amazon’s technical side, wasn’t the most organized – and this made it extremely difficult for amazon to Create a powerful digital store development platform, ironically shopify would do exactly this six years later and go to a valuation of a 182 billion dollars anyway.
Realizing the technical disorganization of the company amazon would turn their focus onto cleaning up this side of the business, but despite their efforts, the company saw no tangible results in terms of development efficiency. At one point, amazon was hiring dozens of new software engineers, but this was not helping them build merchant.com any faster, so andy would decide to look into the problem and it didn’t take long for him to identify the culprit. The primary reason that new developments took way longer than expected was because of the massive amount of time engineers were spending on setting up databases, servers and other backend infrastructure determined to solve this issue. Amazon would set up a common infrastructure service that the entire company could use this way engineers wouldn’t have to set up new infrastructure for every project. Setting up this common infrastructure did wonders for amazon, as it finally eliminated their technical issues. In the meantime, amazon had also heavily leaned up on the logistics side of their business. This made amazon one of the most lean and efficient businesses out there, but even with that, amazon was still losing money due to how razor tender margins were so jeff. Bezos would host an executive meeting at his house where they discussed the strengths and weaknesses of the company. All of them knew that amazon was extremely efficient at fulfilling orders, but what they didn’t yet consider was that amazon was also extremely efficient when it came to backend infrastructure.
According to andy, the team never had an aha moment to drastically change the path of the company, but the team did identify the possibility of selling infrastructure services to other companies. They knew how hard it was to build up efficient back end infrastructure, so they thought they could provide massive value to startups by allowing them to rent amazon’s, already efficient infrastructure. This service was just meant to be a side household that padded amazon’s losses, though so amazon wasn’t no rush to launch a service, and they would just let it slowly materialize in the background. Eventually, in 2006, amazon would launch amazon web services or aws, which provided infrastructure as a service. Andy jazzy was officially known as the senior vice president of amazon, but he was basically the ceo of aws. The reason they didn’t originally give him. This title is because they didn’t expect aws to actually evolve into basically its own standalone company. After all, the aws segment only had a total of 57 employees. At the start, aws became profitable quite early on as the service had pretty nice margins, but, like the team anticipated aws was by no means a game changer when it came out demand for back end infrastructure was still rather low, as computer, and especially smartphone. Adoption were yet to take off. Fortunately, though, aws did wonders for amazon during the 2008 financial crisis. Amazon stock would crash 83 at the end of 2008, along with the broader market, but amazon would bounce back within a year and they would never look back after the recession.
Andy jazzy would turn aws focus onto winning government contracts. You see, the federal government had just directed its agencies to transition from data centers to the cloud, and this seemed like the preferred market to leverage convincing government agencies to actually use aws. However, wasn’t the easiest of tasks as you would guess, the government deals with highly sensitive information and they weren’t sure how safe it was to store this information on the service of a private company that were also used by hundreds of other businesses. One agency, however, was ecstatic to switch over to aws, and this was nasa’s jet proportion lab the cto of the lab described. The agency knew that cloud computing was the future eight years ago and that they were just waiting for federal approval to make the transition. So nasa would become one of aws’s first government customers and one of their first projects with aws was the curiosity rover. The images captured by the rover would be hosted on aws and available for public viewing. Nonetheless, other federal agencies still weren’t quite convinced. However, they would outline a list of standards that would allow companies to meet their safety protocols in 2013. Amazon would become the first company to meet these requirements, and aws would go on to win a 600 million contract from the cia in 2014.. It didn’t take long for aws to dominate the government infrastructure space. The government wasn’t, the only sector in which aws dominated, though, as smartphones exploded in popularity.
During the early 2010s. We would see the rise of a plethora of different startups who needed infrastructure support startups, including airbnb stripe, lyft, robinhood, slack, coinbase uber, and many many more leverage aws after their first quarter of 2015 amazon would release the financial details about aws. For the first time, aws had brought in 1.57 billion revenue, which was 50 higher than the first quarter of 2014.. The best part, though, was that 265 million of that was operating profit. This was critical for amazon, as the retail business was still only breaking, even at best, amazon would turn around and use a profit from aws to invest into prime vans trucks, planes and, of course, amazon, prime warehouses. In the meantime, amazon separated aws into more of a standalone company in 2016 and andy jassy would become the ceo of aws as aws solidified, their dominant position amongst government agencies and tech startups. Andy jassy started to focus on flying much larger fish winning over large companies. However, was much more difficult as they had the resources to build their own backend infrastructure. Andy knew that the key to convincing large players to go with aws instead of building their own was cost efficiency. Fortunately, aws had economies of scale that basically no one else could match, and this allowed them to be extremely competitive when it came to price between 2006 and 2018 aws reduced the price of their services 67 times that’s more than five price cuts every single year.
Considering the frequency of price cuts, it’s not surprising that the cost of aws services dropped 73 between 2014 and 2018. and, as andy hoped, this was extremely effective at winning over the big boys. Today, aws boasts customers, including pfizer disney sony, ge, comcast, bmw and the biggest one samsung in may of 2019. One analyst estimated that aws accounted for 500 billion dollars worth of amazon’s 900 billion market cap at the time, given that aws accounted for the vast majority of the profit generated by amazon as a whole, it’s not surprising that aws has been amazon’s most valuable asset at The start of this year, amazon’s retail business, actually finally overtook aws in terms of profit, but given amazon’s 1.77 trillion market cap aws is likely worth upwards of one trillion dollars. Nonetheless, so at the end of the day, who is andy jazzy? Well, andy jazzy is the mastermind behind aws, which is arguably the primary reason that amazon was able to achieve unbelievable economies of skill and grow into the global ecommerce giant that they are today. So it’s really, no wonder that andy jazzy is the one succeeding jeff bezos as a new ceo of amazon. What do you guys think about the story of andy jazzy and aws comment that down below also drop a like? If you think andy jazzy was the perfect choice and, of course, consider joining our discord community to suggest future video ideas and consider subscribing to see more questions logically answered.