Amazon Unbound: Jeff Bezos and the Invention of a Global Empire / Amazon Unbound: Джефф Безос и изобретение глобальной империи (by Brad Stone, 2021) - аудиокнига на английском

To my father, Robert Stone “His genius was not in inventing; rather, it was in inventing a system of invention. Dozens of researchers and engineers and developmental tinkerers labored beneath Edison in a carefully constructed hierarchical organization that he founded and oversaw.” —Graham Moore, The Last Days of Night: A Novel “It has always seemed strange to me…. The things we admire in men—kindness and generosity, openness, honesty, understanding, and feeling—are the concomitants of failure in our system. And those traits we detest—sharpness, greed, acquisitiveness, meanness, egotism, and self-interest—are the traits of success. And while men admire the quality of the first, they love the produce of the second.” —John Steinbeck, Cannery Row Introduction It was the kind of large indoor gathering that would soon feel anachronistic, like an ancient custom from a lost civilization. On a Sunday night in November 2019, one month before Covid-19 first appeared in Wuhan, China, kicking off the worst pandemic in modern history, luminaries from the worlds of politics, media, business, and the arts gathered at the Smithsonian’s National Portrait Gallery in Washington, D.C. Michelle Obama, Hillary Clinton, Nancy Pelosi, and hundreds of other guests packed the museum courtyard for an invitation-only, black-tie affair. They were there to celebrate the addition of six new portraits to the gallery’s permanent collection, honoring iconic Americans such as Hamilton creator Lin-Manuel Miranda, and Vogue editor Anna Wintour, as well as the richest person in the world: Amazon founder and CEO, Jeff Bezos. Bezos’s lifelike portrait by the photorealistic painter Robert McCurdy depicted him against a stark white background, wearing a crisp white shirt, silver tie, and the severe gaze that had flustered Amazon employees over the last twenty-five years. In his speech that night, accepting the Portrait of a Nation Prize for commitment to “service, creativity, individuality, insight, and ingenuity,” Bezos thanked his large coterie of family and colleagues in the audience and struck a characteristic note of public humility. “My life is based on a large series of mistakes,” he said, after an eloquent introduction from his oldest son, nineteen-year-old Preston. “I’m kind of famous for it in the business realm. How many people here have a Fire Phone?” The crowd guffawed and was silent—Amazon’s 2014 smartphone had infamously bombed. “Yeah, no, none of you do. Thanks,” he said to laughs. “Every interesting thing I’ve ever done, every important thing I’ve ever done, every beneficial thing I’ve ever done, has been through a cascade of experiments and mistakes and failures,” Bezos continued. “I’m covered in scar tissues as a result of this.” He recalled selecting McCurdy from binders of artists provided by the museum, and said he was looking for “someone who would paint me hyper-realistically, with every flaw, every imperfection, every piece of scar tissue that I have.” The audience responded to Bezos’s speech with a rapturous standing ovation. It was that kind of evening. The band Earth, Wind and Fire played, guests drank and danced, and the comedian James Corden presented an award to Wintour while impersonating her in a blond wig, black sunglasses, and fur-lined coat. “Ask Jeff Bezos to get me a coffee!” he vamped. The well-heeled crowd roared in delight. Outside that prosperous gathering though, the feelings toward Amazon and its CEO in the midst of the company’s twenty-sixth year were far more complicated. Amazon was booming, but its name was stained. Wherever there was applause, there was also discordant criticism. Amazon was admired and even beloved by customers while its secretive intentions were often mistrusted, and the towering net worth of its founder, set against the plight of its blue-collar workforce in company warehouses, provoked unsettling questions about the asymmetric distribution of money and power. Amazon was no longer just an inspiring business story but a referendum on society, and on the responsibilities that large companies have toward their employees, their communities, and the sanctity of our fragile planet. Bezos had attempted to address that latter concern by conceiving the Climate Pledge, a promise that Amazon would be carbon neutral by 2040, ten years before the most ambitious goals set by the Paris climate accords. Critics were hammering Amazon to follow other companies and reveal its carbon footprint—its contribution to the harmful gasses that were rapidly warming the globe. Its sustainability division had labored for years to create more efficient standards for its buildings and to cut down on wasteful packaging materials. But it wasn’t enough to simply publicize their work and follow other companies by releasing a carbon impact report. Bezos insisted that Amazon approach the issue creatively, so that it might be viewed as a leader and its millions of customers around the world could still feel good about visiting the site and clicking the buttons labeled “Buy Now.” No concrete way existed to achieve this goal, particularly in the face of Amazon’s growing armada of pollution-spewing airplanes, trucks, and delivery vans. Nevertheless, Bezos wanted to unveil the pledge and invite other companies to sign it with a grand gesture. One idea actively discussed inside the company was for him to announce the initiative with a video that he would personally record from one of the polar ice caps. Employees in Amazon’s sustainability and public relations departments actually spent a few days contemplating how to pull off that nightmarishly complex and carbon-intensive feat, until they mercifully gave up the notion. Bezos would do it in the far more accessible and warmer confines of the National Press Club in Washington, D.C. On the morning of September 19, 2019, two months before the gala at the Smithsonian, a few dozen members of the press gathered for a rare audience with Amazon’s CEO. Bezos sat on a small stage with Christiana Figueres, former executive secretary of the United Nations Framework Convention on Climate Change. “Predictions made by climate scientists just five years ago are turning out to be wrong,” he began. “The Antarctic ice sheets are melting 70 percent faster than predicted five years ago. Oceans are warming 40 percent faster.” To help meet its new goals, he continued, Amazon would move to power its operations with 100 percent renewable energy. It would start by placing an order for one hundred thousand electric vans from the Plymouth, Michigan–based startup that Amazon had helped fund, Rivian Automotive. In the QandA session that followed, a reporter asked Bezos about a group of workers who had banded together under the mantle “Amazon Employees for Climate Justice.” They were demanding, among other things, that the company withdraw financial support for climate-denying politicians and break its cloud computing contracts with fossil fuel companies. “I think it’s totally understandable,” said Bezos of the group’s concerns, while noting that he didn’t agree with all of their demands. “We don’t want this to be the tragedy of the commons. We all have to work together on this.” A few months later, in the midst of the Covid-19 pandemic, Amazon would fire two of the group’s organizers. I was in the audience that day as well, and raised my hand to ask Bezos the last question of the morning: Was he confident that humanity could move quickly enough to escape the direst scenarios for a warming planet? “I’m congenitally optimistic,” he replied, fixing me with the laser-eyed stare that the artist Robert McCurdy so faithfully captured. “I really do believe when ingenuity gets involved, when invention gets involved, when people get determined, when passion comes out, when they make strong goals—you can invent your way out of any box. That’s what we humans need to do right now. I believe we’re going to do it. I’m sure we’re going to do it.” His answer suggested total faith in the underlying virtues of technology, and in the ability of the cleverest, most determined innovators to navigate out of any jam. At least in that moment, he seemed like the same old Jeff, and not at all the billionaire who founded and operated a business that, depending on your perspective, was either propelling the world into an exciting future or helping to blot out the nurturing sun of fair competition and free enterprise itself. Today, Amazon sells nearly everything and delivers its packages promptly, powers much of the internet in its data centers, streams television shows and movies to our homes, and sells a popular line of voice-activated speakers. But nearly three decades ago, it was just an idea, circulating on the fortieth floor of a midtown Manhattan skyscraper. In case you’re not familiar with that foundational piece of internet lore, the story went like this: Vowing upon the age of thirty to risk the entrepreneurial path, Jeffrey Preston Bezos quit his high-paying job at the esteemed Wall Street hedge fund D. E. Shaw to start a seemingly modest business: an online bookstore. With his twenty-four-year-old wife, MacKenzie, he flew from New York City to Fort Worth, took his family’s ’88 Chevy Blazer out of storage, and asked her to drive northwest while he sat in the passenger’s seat, tapping financial projections into a spreadsheet on his laptop. It was 1994, the paleolithic year of the internet. He set up his startup in the enclosed garage of a three-bedroom ranch house in an eastern Seattle suburb, with an old iron potbellied stove at its center, and fashioned the first two desks himself out of sixty-dollar wooden doors from Home Depot. He called the company Cadabra Inc., then wavered and considered the names Bookmall.com, Aard.com, and Relentless.com, before finally deducing that the Earth’s largest river could represent its biggest selection of books—Amazon.com. He financed the startup himself at first, along with a $245,000 investment from his devoted parents, Jackie and Mike. When the website went live in ’95, Amazon immediately got caught up in a dawning mania for a novel technology called the World Wide Web. There was 30, 40, 50 percent growth in orders each week, undermining any attempts at careful planning and pushing that earliest batch of eclectic recruits into such a frenetic pace that they would later share a palpable sense of amnesia about those early times. The first potential investors mostly balked, distrustful of the internet and this geeky, self-assured young man from the East Coast with a crazy, barking laugh. But in 1996, Silicon Valley venture capitalists got ahold of the startup, and the abundance of money flipped a switch in the brain of the budding CEO, sparking a bullish fervor of wild ambitions and fever dreams of domination. The first company-wide motto was “Get Big Fast.” Amazon’s rapid expansion, during what became known as the dot-com boom in the late 1990s, was epic. Bezos hired new executives, opened new warehouses, staged a well-publicized IPO in 1997, and fought off a desperate lawsuit from his first rival, the bookseller Barnes and Noble. He thought the Amazon brand could be malleable, like Richard Branson’s Virgin, so he dove headlong into new product categories and started selling CDs, DVDs, toys, and electronics. “We are going to take this thing to the moon,” he told then fellow Seattle CEO Howard Schultz of Starbucks. Bezos wanted to set his own metrics for success, without interference from impatient outsiders, so he encoded his operating philosophy in his first letter to shareholders, vowing a focus not on immediate financial returns or on satisfying the myopic demands of Wall Street, but on increasing cash flow and growing market share to generate value over the long term for loyal shareholders. “This is Day 1 for the Internet and, if we execute well, for Amazon.com,” he wrote, coining the sacred phrase “Day 1” that inside Amazon would come to represent the need for constant invention, fast decision-making, and the eager embrace of broader technology trends. Investors signed on for the ride, bidding the stock price to unimaginable heights. The CEO became a millionaire and a celebrity, landing on the cover of Time magazine as “Person of the Year” in 1999, at the twilight of the century, his balding head peeking goofily out of a cardboard box filled with colored Styrofoam peanuts. But behind the scenes, things were a mess. Amazon’s profligate investments in other dot-com startups were souring, a host of acquisitions hadn’t worked, and many of the early hires, from traditional retailers like Walmart, looked askance at the sprawling chaos and fled. The first warehouses were so overwhelmed by orders over the Christmas holidays that employees from Seattle had to leave their desks every December, roll up their sleeves, and work on the front lines, packing and wrapping gifts while doubling up in economy hotel rooms. Over the next two years, the company bled money and almost died during the period known as the dot-com bust. A financial paper dubbed the company “Amazon.bomb”—declaring that “Investors Are Beginning to Realize This Storybook Stock Has Problems”—and it stuck. Bezos was widely ridiculed and in 2001 was even frivolously investigated by the SEC for insider trading. One analyst generated frequent headlines by repeatedly predicting that the company was about to run out of money. By then, Amazon had moved into a 1930s-era art deco VA hospital that sat on a hill facing downtown Seattle. When the Nisqually earthquake struck the Pacific Northwest in February 2001, bricks and mortar rained down in what seemed like an ominous prophecy. Bezos and his employees survived by diving under their thick door desks. Amazon’s stock sank into the single digits, ruining dreams of quick fortune. The thirty-seven-year-old Bezos scrawled “I am not my stock price!” on a whiteboard in his office and doubled down on giveaways to customers, like rapid delivery of the latest Harry Potter novel on the day of publication. Employees were scared, but Bezos seemed to have ice in his veins. Through some well-timed debt offerings and a last-minute $100 million infusion from the online service AOL in the summer of 2001, the company raised enough money to cover its obligations and evade the fate that befell most other dot-coms. When Amazon finally cut enough costs to notch a quarter of profitability in the spring of 2003, the grudge-holding CEO hid an acronym, milliravi, in an earnings press release, an inside joke ridiculing the analyst who had predicted Amazon’s demise. The company had survived, but there was little about it that seemed special. The rival online store eBay had a far larger selection of products for sale. The discount physical retailer Walmart had lower prices. The growing search engine Google was attracting the world’s best engineers and siphoning away online shoppers to its eponymous website, then charging Amazon to place advertisements within search results to lure them back. What followed was one of the most remarkable turnarounds in business history. After failing to match eBay’s success with online auctions, Bezos opened the site to third-party sellers and allowed them to list their wares alongside Amazon’s own products and let customers decide who to buy from. Then he had an epiphany, recognizing the flywheel, or virtuous cycle, that was powering his business. By adding outside vendors and additional selection to Amazon.com, the company drew in new shoppers and earned commissions on those sales, which it could use to lower prices or subsidize faster delivery. That in turn drew in more shoppers and attracted more sellers—and the process repeated itself. Invest in any part of the loop, Bezos reasoned, and this cycle would accelerate. Bezos also hired an executive named Jeff Wilke from the aerospace and automotive giant AlliedSignal. Wilke was a lot like Bezos: precocious, ambitious, and focused on satisfying customers over just about everything else, including the feelings of his employees. Together they redesigned the warehouses, christening them “fulfillment centers” or FCs, and rewrote their logistics software from scratch. The ability to efficiently and predictably fulfill customer orders allowed Amazon to resume expansion into new product categories, like jewelry and apparel—and eventually, to introduce the enticing $79-a-year two-day shipping guarantee, Amazon Prime. With another like-minded deputy, Andy Jassy, Bezos also expanded in an even more surprising direction. Contemplating the way his own engineers worked, and the expertise the company had developed in building a stable computing infrastructure that could withstand enormous seasonal spikes in traffic, he conceived of a new business called Amazon Web Services. The idea was that Amazon would sell raw computing power to other organizations, who could access it online and use it to economically run their own operations. The business plan was barely understandable to many of Amazon’s own employees and board members. But the forty-year-old Bezos believed in it, micromanaging the project and sending extraordinarily detailed recommendations and goals to AWS team leaders, often late at night. “This has to scale to infinity with no planned downtime,” he told the beleaguered engineers working on the project. “Infinity!” At the same time, Bezos was shocked by Apple’s rapid ascendance in music sales with its iPod music player and iTunes store. Concerned about a similar incursion into books, he initiated a secret project to create Amazon’s own digital book reader, the Kindle. Colleagues thought it was crazy for the perennially money-losing Amazon to make gadgets. “I absolutely know it’s hard, but we’ll learn how to do it,” Bezos told them. He put another deputy, Steve Kessel, in charge and asked him to drop his responsibilities running Amazon’s original bookselling business and to “proceed as if your goal is to put everyone selling physical books out of a job.” The resulting skirmishes with traditional publishers over the terms for the new e-book market spanned years and generated charges that Amazon was engaging in predatory conduct. Paradoxically, it also resulted in an antitrust case against five large book publishers and Apple, alleging they had illegally conspired to fix digital prices for e-books above the Kindle’s $9.99 standard. The confluence of those three initiatives—in the fulfillment centers, and with AWS and the Kindle—vaulted Amazon back into the graces of Wall Street. In 2008, Amazon surpassed eBay in market capitalization and was beginning to be mentioned in the same breath as Google, Apple, and a new Silicon Valley upstart, Facebook. Bezos then used every bit of leverage at his disposal to outduel Walmart and acquire two emerging online rivals: the shoe-retailer Zappos and a seller of consumable goods called Quidsi, which owned the popular website Diapers.com. Antitrust authorities approved those deals quickly—decisions that would later be regarded skeptically in light of Amazon’s growing dominance. It turned out that there was more depth than anyone had suspected to the increasingly fit CEO with the now clean-shaven head. He was a ravenous reader, leading senior executives in discussion of books like Clayton Christensen’s The Innovator’s Dilemma, and he had an utter aversion to doing anything conventionally. Employees were instructed to model his fourteen leadership principles, such as customer obsession, high bar for talent, and frugality, and they were trained to consider them daily when making decisions about things like new hires, promotions, and even trivial changes to products. PowerPoint presentations, with their litany of bullet points and incomplete thoughts, were banned inside the company despite being popular in the rest of corporate America. Instead, all meetings started with almost meditative readings of data-rich, six-page documents, called “narratives.” The act of business building at Amazon was an editorial process, with papers subject to numerous revisions, debate over the meaning of individual words, and meticulous consideration by company leaders, most of all from Bezos himself. Meanwhile, working groups inside Amazon were broken into small versatile units, called two-pizza teams (because they were small enough to be fed with two pizzas), and were ordered to move quickly, often in competition with one another. This unusual and decentralized corporate culture hammered into employees that there was no trade-off between speed and accuracy. They were supposed to move fast and never break things. Goals, accountability, and deadlines were pushed down into the organization, while metrics were fed upward, via weekly and quarterly business reports and biannual companywide reviews, called OP1 (for operating plan, in the late summer) and OP2 (after the holidays). The performance of each team was evaluated by Bezos’s hallowed leadership council of like-minded math whizzes: the S-team (for senior team). Sitting atop it all was Bezos himself, who would home in on promising new projects, or on fixing teams whose results were disappointing, with the same focus and exacting standards that he had brought to Amazon’s earliest days. He took nothing for granted, including Amazon’s increasing success. His blasts of annoyance, directed at employees who failed to meet those standards, were legendary inside the company. “Why are you wasting my life?” he’d ask, scoffing at disappointing underlings. Or he leveled them with “I’m sorry, did I take my stupid pills today?” While the brutal leadership style and distinct culture was enervating to many employees, it was also proving unmistakably effective. In the spring of 2011, Amazon was valued at $80 billion. Buoyed by the rise of his stock holdings, the forty-seven-year-old Bezos was the thirtieth richest person in the world, with an $18.1 billion net worth. That outsized success started to draw attention. State legislatures recognized that the growing flood of tax-free sales over the internet was depleting their coffers, and they passed legislation requiring online retailers to pay sales taxes, closing a loophole that had been created before the internet age for mail-order companies. Bezos was prepared to fight to protect a significant price advantage over offline rivals, and even backed a California ballot initiative to undo a new state law that would force online retailers to collect sales tax. But in the middle of the fight, he changed course; sales tax avoidance had tied the company in knots, requiring it to limit where it opened facilities and even where employees could travel. By agreeing to collect sales tax, Bezos surrendered his prized advantage. Instead, he took the longer view, making it possible for Amazon to open up offices and fulfillment centers in more populous states, much closer to its customers, laying the groundwork for one of the largest expansions in business history. Amazon was sprawling out in every direction, both online and back home. It moved from a scattered collection of offices around Seattle to nearly a dozen buildings in a developing office district by the freshwater Lake Union, north of downtown. In early 2012, anonymous fliers taped around South Lake Union found a derogatory name for the growing cadre of employees spreading out over the area with their identifiable badges: “Am-holes.” It presaged a growing unease between the company and its left-leaning, blue-collar hometown. While he had triumphed against enormous odds, Jeff Bezos preferred those negative articles, like the old “Amazon.bomb” cover story in Barron’s, to be posted on his office walls, so that he and his colleagues would remain frightened and motivated. “It’s still Day 1!” he dutifully reminded his employees and investors in the shareholder letter published that spring. After all, there was so much more to do to augment the nearly endless selection of physical and digital goods on the virtual shelves of the everything store. I published a book by that title in October 2013, right into the grip of the world’s growing fascination with Amazon. It was an attempt to explain a classic modern business story—how the impresario of online books had fought off near ruin and upended not only retail but digital media and enterprise computing. There were generally positive reviews and a few infamous negative ones. “I wanted to like this book,” wrote MacKenzie Bezos in a one-star brickbat posted to Amazon.com. She alleged factual inaccuracies, a “lopsided and misleading portrait of the people and culture at Amazon,” and criticized my characterization of Bezos’s disciples, who channeled his maxims and leadership style, as “Jeff Bots.” Later, I also learned that Bezos was upset with how I had handled tracking down his biological father, the now-deceased Ted Jorgensen, a man who had left his family when Bezos was a toddler and did not know what had become of his son until I visited him forty-five years later. At the time I thought I had written the comprehensive book on Amazon’s rise. But then a strange thing happened. In 2014, Amazon released the first Echo, a voice-activated speaker running the virtual assistant Alexa. The product was a hit, and over the next five years the company sold more than a hundred million devices, initiating a new wave of voice-connected computing and eliminating the odor of Amazon’s previous failure in consumer gadgets, the Fire Phone. Amazon was moving from its customers’ doorsteps to their living rooms, with access to their broad range of requests and questions, and potentially their most intimate conversations. At around the same time, Amazon’s AWS division expanded its line of database services to lure large enterprises and government agencies into that ethereal future of enterprise computing known as “the cloud.” Amazon reported AWS’s financial results for the first time in the spring of 2015, shocking investors with its profitability and growth, only to generate another round of feverish enthusiasm for Amazon’s stock. A few years later, Amazon opened its first prototype Amazon Go physical retail store in Seattle, using artificial intelligence and computer vision so customers could walk out of the store and be automatically charged rather than checking out with a human cashier. The company also expanded geographically, pushing into India, Mexico, and other countries, at massive expense and in direct competition with the largest company in the world by sales: Walmart. Meanwhile, its investments in Hollywood, via Amazon Studios, yielded critical hits like Transparent, The Marvelous Mrs. Maisel, and Jack Ryan, along with a few notorious bombs, like Woody Allen’s Crisis in Six Scenes. It put Amazon right behind Netflix in the race to redefine home entertainment for a new age. While all this was unfolding, Amazon was also reinvigorating its older businesses. Amazon Marketplace, where independent sellers hawked their wares on Amazon.com, exploded with a surge of low-priced products (including counterfeits and knockoffs) manufactured in China. In 2015, the total value of the products sold on the marketplace surpassed the value of the units that Amazon sold itself on its own site. Amazon acquired the organic supermarket chain Whole Foods Market in 2017, saving the iconic American grocer from an unwelcome incursion by activist investors, and boosting its own ineffectual efforts to crack the food business. Amazon also remade its delivery operations, lessening its reliance on partners like UPS with its own network of sortation centers, drivers, and cargo aircraft branded with the Amazon Prime logo. And it revived its advertising business, embedding ads in its search results just as Google had pioneered a decade before to Amazon’s annoyance, generating a profitable new revenue line for the company. The Amazon that I had written about was worth nearly $120 billion at the end of 2012. The company’s market capitalization touched a trillion dollars for the first time in the fall of 2018—eight times more valuable in less than six years—and returned to surpass that threshold, apparently for good, in early 2020. My Amazon had under 150,000 employees. By the end of 2020, it had an astounding 1.3 million employees. I was writing about the Kindle company, but this was now the Alexa company. Also, the cloud company. And a Hollywood studio. And a video game maker, robotics manufacturer, grocery store owner—and on and on. While Amazon seduced investors and customers, it also moved to the center of an acrimonious political struggle that had the potential to redefine free market capitalism. Its vocal critics believed that such brazen accumulation of wealth and power had a significant cost, exacerbating income inequality and stacking the odds against workers and locally owned businesses. “Today’s big tech companies have too much power—too much power over our economy, our society, and our democracy,” wrote Senator Elizabeth Warren at the debut of her unsuccessful bid for the White House in 2019. “Amazon crushes small companies by copying the goods they sell on the Amazon Marketplace and then selling its own branded version.” She urged that Jeff Bezos’s meticulous creation be forced to spin off Zappos and Whole Foods Market and be stamped into smaller parts. As Amazon changed, so too did Bezos undergo his own startling transformation. In the company’s early years, he usually sported pleated khakis and navy-blue button-down shirts and rode his two-wheel Segway scooter around the office, his laugh ricocheting off the walls. He lived with his wife and four children in the opulent waterfront suburb of Medina, Washington, outside Seattle, and fiercely guarded their privacy. Despite his budding wealth, he appeared to have little interest in collecting assets like vintage sports cars or expensive paintings won at exclusive auctions. He was not, by any means, an aficionado of luxury yachts. Only his private jet seemed to kindle his overt enthusiasm, because avoiding public air travel saved him a resource that money couldn’t buy: time. But by the late 2010s, Bezos as the unfashionable, single-minded geek was largely obsolete. Even the half-reformed nerd from the Fire Phone launch in 2014, who delighted in reciting the technical specifications of the fated smartphone, had bowed from the stage. Shedding this image as an awkward though self-assured geek, Bezos emerged as a business kingpin who, at first, seemed to have an almost mystical aura of invincibility. Over the summer of 2017, Bezos became the wealthiest person in the world, a mathematical eventuality produced by Amazon’s rising stock price and the relatively slower growing fortune of Microsoft cofounder Bill Gates, who was giving his money away in philanthropy, a process Bezos had yet to start in any meaningful way. As Bezos rose to the top of the world’s wealthiest chart, a widely circulated photo from the prestigious Allen and Company’s conference in Sun Valley showed him wearing a pair of stylish Garrett Leight folding sunglasses and a short-sleeved polo shirt and down vest that exposed enormous biceps. The photo went viral. Jeff Bezos was the action hero of the business world. At first it was difficult for insiders to discern how much Bezos had truly changed. Colleagues said he remained absorbed in the mechanics of new businesses at Amazon, like Alexa. But other demands required his time, including his fledgling philanthropic efforts, his newly ambitious space company, Blue Origin, and the Washington Post, the prestigious newspaper he bought in 2013 that was a frequent target of the impetuous U.S. president, Donald J. Trump. JPMorgan CEO Jamie Dimon, a longtime friend, said that the “Jeff I know is the same old Jeff.” But as Dimon worked with Bezos in forums like the Business Council, a D.C. organization that meets several times a year to discuss policy, and Haven Healthcare, the failed joint initiative between Amazon, JPMorgan, and Berkshire Hathaway to lower employee healthcare costs, he observed his friend’s eyes gradually opening. “Jeff was like a kid in a candy store. It was all new to him. He was so focused on Amazon for a long time. Then he gradually became a citizen of the world.” To others, Bezos’s metamorphosis indicated the presence of something else: the hubris that comes with unimaginable success. In the fall of 2017, he directed Amazon to stage a contest called HQ2, a bakeoff among cities in North America to land a new Amazon headquarters outside of Seattle. The unprecedented public competition created a seventeen-month frenzy, with 238 regions contorting themselves to attract the tech giant. New York City and Northern Virginia were dubbed the winners, but by then political sentiment had turned sharply against Amazon for (among other things) seeking out rich local tax incentives. Progressive legislators in Queens, like popular congresswoman Alexandria Ocasio-Cortez, and their allies in organized labor were able to make enough noise that Amazon ignominiously rescinded its offer to open the office in Long Island City, New York. From there things took an even stranger turn. In January 2019, Bezos tweeted the surprising news of his divorce from MacKenzie, his wife of twenty-five years, stunning even those who believed they knew the couple well. The next day, the National Enquirer, the infamous supermarket tabloid, published a eleven-page spread divulging Bezos’s extramarital relationship with TV personality Lauren Sanchez that included salacious private text messages between the pair. Bezos ordered an investigation into how the paper obtained his texts and intimate photographs; over the next year, that tawdry drama grew to involve charges of global espionage and hints of a conspiracy that involved Mohammed bin Salman, the crown prince of Saudi Arabia. How does one of the most disciplined men in the world get himself into a situation like that? more than one Amazon executive wondered privately at the time. Amazon’s founder was now so many things in the public eye, all at once: an inventor, arguably the most accomplished CEO in the world, a space entrepreneur, a newspaper savior and swashbuckling proponent for a free press—as well as a menacing monopolist, the foe of small business, an exploiter of warehouse workers, and the subject of prurient tabloid fascination. Such a disparate range of responses was also on display in the varied reaction to his February 2021 announcement that he would devote himself more fully to new products and projects at Amazon, as well as to his other interests, by giving the CEO job to longtime deputy Andy Jassy and becoming executive chairman. Despite his optimism about solutions to global warming at the Climate Pledge press conference, this was clearly not the same old Jeff. So I resolved to write this sequel, and to investigate how Amazon had grown to such tremendous size in such a little amount of time. I would once again pose the critical question of whether Amazon and Jeff Bezos were good for business competition, for modern society, and even for our planet. The task was completed with help from Amazon, the Washington Post, and Blue Origin, which facilitated interviews with many senior executives. Amazon did not, in the end, make Bezos himself available, despite repeated requests and personal entreaties. I also interviewed several hundred current and former employees, partners, competitors, and many others caught up in the whirling cyclone of Bezos and his multiple enterprises and personal dramas. The result is this book. It’s the story of a hard-driving CEO who created such a fertile corporate culture that even at massive size it repeatedly shucked its own bureaucracy to invent exhilarating new products. It’s also the story of how a leading technology company became so omnipotent over the course of a single decade that many started to worry that it might definitively tilt the proverbial playing field against smaller companies. And it shows how one of the world’s most famous businesspeople appeared to lose his way, and then tried to find it again—right in the midst of a terrifying global pandemic that further augmented his power and profit. It’s a tale that describes a period in business history when the old laws no longer seemed to apply to the world’s most dominant companies. And it explores what happened when one man and his vast empire were about to become totally unbound. PART I INVENTION Amazon, December 31, 2010 Annual net sales:$34.20 billion Full- and part-time employees:33,700 End-of-year market capitalization:$80.46 billion Jeff Bezos end-of-year net worth:$15.86 billion CHAPTER 1 The ?ber Product Manager There was nothing particularly distinctive about the dozen or so low-rise buildings in Seattle’s burgeoning South Lake Union district that Amazon moved into over the course of 2010. They were architecturally ordinary and, on the insistence of its CEO, bore no obvious signage indicating the presence of an iconic internet company with almost $35 billion in annual sales. Jeff Bezos had instructed colleagues that nothing good could come from that kind of obvious self-aggrandizement, noting that people who had business with the company would already know where it was located. While the offices clustered around the intersection of Terry Avenue North and Harrison Street were largely anonymous, inside they bore all the distinguishing marks of a unique and idiosyncratic corporate culture. Employees wore color-coded badges around their necks signifying their seniority at the company (blue for those with up to five years of tenure, yellow for up to ten, red for up to fifteen), and the offices and elevators were decorated with posters delineating Bezos’s fourteen sacrosanct leadership principles. Within these walls ranged Bezos himself, forty-six years old at the time, carrying himself in such a way as to always exemplify Amazon’s unique operating ideology. The CEO, for example, went to great lengths to illustrate Amazon’s principal N10, “frugality”: Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing headcount, budget size, or fixed expense. His wife, MacKenzie, drove him to work most days in their Honda minivan, and when he flew with colleagues on his private Dassault Falcon 900EX jet, he often mentioned that he personally, not Amazon, had paid for the flight. If Bezos took one leadership principle most to heart—which would also come to define the next half decade at Amazon—it was principal N8, “think big”: Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers. In 2010, Amazon was a successful online retailer, a nascent cloud provider, and a pioneer in digital reading. But Bezos envisioned it as much more. His shareholder letter that year was a paean to the esoteric computer science disciplines of artificial intelligence and machine learning that Amazon was just beginning to explore. It opened by citing a list of impossibly obscure terms such as “na?ve Bayesian estimators,” “gossip protocols,” and “data sharding.” Bezos wrote: “Invention is in our DNA and technology is the fundamental tool we wield to evolve and improve every aspect of the experience we provide our customers.” Bezos wasn’t only imagining these technological possibilities. He was also attempting to position Amazon’s next generation of products directly on its farthest frontier. Around this time, he started working intensively with the engineers at Lab126, Amazon’s Silicon Valley RandD subsidiary, which had developed the company’s first gadget, the Kindle. In a flurry of brainstorming sessions, he initiated several projects to complement the Kindle and the coming Kindle Fire tablets, which were known internally at the time as Project A. Project B, which became Amazon’s ill-fated Fire Phone, would use an assembly of front-facing cameras and infrared lights to conjure a seemingly three-dimensional smartphone display. Project C, or “Shimmer,” was a desk lamp–shaped device designed to project hologram-like displays onto a table or ceiling. It proved unfeasibly expensive and was never launched. Bezos had peculiar ideas about how customers might interact with these devices. The engineers working on the third version of the Kindle discovered this when they tried to kill a microphone that was planned for the device, since no features were slated to actually use it. But the CEO insisted that the microphone remain. “The answer I got is that Jeff thinks in the future we’ll talk to our devices,” said Sam Bowen, then a Kindle hardware director. “It felt a bit more like Star Trek than reality.” Designers convinced Bezos to lose the microphone in subsequent versions of the Kindle, but he clung to his belief in the inevitability of conversational computing and the potential of artificial intelligence to make it practical. It was a trope in all his favorite science fiction, from TV’s Star Trek (“computer, open a channel”) to authors like Arthur C. Clarke, Isaac Asimov, and Robert A. Heinlein whose books lined the library of hundreds of volumes in his lakefront Seattle-area home. While others read these classics and only dreamed of alternate realities, Bezos seemed to consider the books blueprints for an exciting future. It was a practice that would culminate in Amazon’s defining product for a new decade: a cylindrical speaker that sparked a wave of imitators, challenged norms around privacy, and changed the way people thought about Amazon—not only as an e-commerce giant, but as an inventive technology company that was pushing the very boundaries of computer science. The initiative was originally designated inside Lab126 as Project D. It would come to be known as the Amazon Echo, and by the name of its virtual assistant, Alexa. As with several other projects at Amazon, the origins of Project D can be traced back to discussions between Bezos and his “technical advisor” or TA, the promising executive handpicked to shadow the CEO. Among the TA’s duties were to take notes in meetings, write the first draft of the annual shareholder letter, and learn by interacting with the master closely for more than a year. In the role from 2009 to 2011 was Amazon executive Greg Hart, a veteran of the company’s earliest retail categories, like books, music, DVDs, and video games. Originally from Seattle, Hart had attended Williams College in Western Massachusetts and, after a stint in the ad world, returned home at the twilight of the city’s grunge era, sporting a goatee and a penchant for flannel shirts. By the time he was following Bezos around, the facial hair was gone and Hart was a rising corporate star. “You sort of feel like you’re an assistant coach watching John Wooden, you know, perhaps the greatest basketball coach ever,” Hart said of his time as the TA. Hart remembered talking to Bezos about speech recognition one day in late 2010 at Seattle’s Blue Moon Burgers. Over lunch, Hart demonstrated his enthusiasm for Google’s voice search on his Android phone by saying, “pizza near me,” and then showing Bezos the list of links to nearby pizza joints that popped up on-screen. “Jeff was a little skeptical about the use of it on phones, because he thought it might be socially awkward,” Hart remembered. But they discussed how the technology was finally getting good at dictation and search. At the time, Bezos was also excited about Amazon’s growing cloud business, asking all of his executives, “What are you doing to help AWS?” Inspired by the conversations with Hart and others about voice computing, he emailed Hart, device vice president Ian Freed, and senior vice president Steve Kessel on January 4, 2011, linking the two topics: “We should build a $20 device with its brains in the cloud that’s completely controlled by your voice.” It was another idea from the boss who seemed to have a limitless wellspring of them. Bezos and his employees riffed on the idea over email for a few days, but no further action was taken, and it could have ended there. Then a few weeks later, Hart met with Bezos in a sixth-floor conference room in Amazon’s headquarters, Day 1 North, to discuss his career options. His tenure as TA was wrapping up, so they discussed several possible opportunities to lead new initiatives at the company, including positions in Amazon’s video streaming and advertising groups. Bezos jotted their ideas down on a whiteboard, adding a few of his own, and then started to apply his usual criteria to assess their merit: If they work, will they grow to become big businesses? If the company didn’t pursue them aggressively now, would it miss an opportunity? Eventually Bezos and Hart crossed off all the items on the list except one—pursuing Bezos’s idea for a voice-activated cloud computer. “Jeff, I don’t have any experience in hardware, and the largest software team I’ve led is only about forty people,” Hart recalled saying. “You’ll do fine,” Bezos replied. Hart thanked him for the vote of confidence and said, “Okay, well, remember that when we screw up along the way.” Before they parted, Bezos illustrated his idea for the screenless voice computer on the whiteboard. The first-ever depiction of an Alexa device showed the speaker, microphone, and a mute button. And it identified the act of configuring the device to a wireless network, since it wouldn’t be able to listen to commands right out of the box, as a challenge requiring further thought. Hart snapped a photo of the drawing with his phone. Bezos would remain intimately involved in the project, meeting with the team as frequently as every other day, making detailed product decisions, and authorizing the investment of hundreds of millions of dollars in the project before the first Echo was ever released. Using the German superlative, employees referred to him as the ?ber product manager. But it was Greg Hart who ran the team, just across the street from Bezos’s office, in Fiona, the Kindle building. Over the next few months, Hart hired a small group from in and outside the company, sending out emails to prospective hires with the subject line “Join my mission” and asking interview questions like “How would you design a Kindle for the blind?” Then, just as obsessed with secrecy as his boss, he declined to specify what product candidates would be working on. One interviewee recalled guessing that it was Amazon’s widely rumored smartphone and said that Hart replied, “There’s another team building a phone. But this is way more interesting.” One early recruit was Amazon engineer Al Lindsay, who in a previous job had written some of the original code for telco US West’s voice-activated directory assistance. Lindsay spent his first three weeks on the project on vacation at his cottage in Canada, writing a six-page narrative that envisioned how outside developers might program their own voice-enabled apps that could run on the device. Another internal recruit, Amazon manager John Thimsen, signed on as director of engineering and coined a formal code name for the initiative, Doppler, after the Project D designation. “At the start, I don’t think anybody really expected it to succeed, to be honest with you,” Thimsen told me. “But to Greg’s credit, halfway through, we were all believers.” The initial Alexa crew worked with a feverish sense of urgency due to their impatient boss. Unrealistically, Bezos wanted to release the device in six to twelve months. He would have a good reason to hurry. On October 4, 2011, just as the Doppler team was coming together, Apple introduced the Siri virtual assistant in the iPhone 4S, the last passion project of cofounder Steve Jobs, who died of cancer the next day. That the resurgent Apple had the same idea of a voice-activated personal assistant was both validating for Hart and his employees and discouraging, since Siri was first to market and with initial mixed reviews. The Amazon team tried to reassure themselves that their product was unique, since it would be independent from smartphones. Perhaps a more significant differentiator though was that Siri unfortunately could no longer have Jobs’s active support, while Alexa would have Bezos’s sponsorship and almost maniacal attention inside Amazon. To speed up development and meet Bezos’s goals, Hart and his crew started looking for startups to acquire. It was a nontrivial challenge, since Nuance, the Boston-based speech giant whose technology Apple had licensed for Siri, had grown over the years by gobbling up the top American speech companies. Doppler execs tried to learn which of the remaining startups were promising by asking prospective targets to voice-enable the Kindle digital book catalog, then studying their methods and results. The search led to several rapid-fire acquisitions over the next two years, which would end up shaping Alexa’s brain and even the timbre of its voice. The first company Amazon bought, Yap, a twenty-person startup based in Charlotte, North Carolina, automatically translated human speech such as voicemails into text, without relying on a secret workforce of human transcribers in low-wage countries. Though much of Yap’s technology would be discarded, its engineers would help develop the technology to convert what customers said to Doppler into a computer-readable format. During the prolonged courtship, Amazon execs tormented Yap execs by refusing to disclose what they’d be working on. Even a week after the deal closed, Al Lindsay was with Yap’s engineers at an industry conference in Florence, Italy, where he insisted that they pretend they didn’t know him, so that no one could catch on to Amazon’s newfound interest in speech technology. After the purchase was finalized for around $25 million, Amazon dismissed the company’s founders but kept its speech science group in Cambridge, Massachusetts, making it the seed of a new RandD office in Kendall Square, near MIT. Yap engineers flew to Seattle, walking into a conference room on the first floor of Fiona with locked doors and closed window blinds. There Greg Hart finally described “this little device, about the size of a Coke can, that would sit on your table and you could ask it natural language questions and it would be a smart assistant,” recalled Yap’s VP of research, Jeff Adams, a two-decade veteran of the speech industry. “Half of my team were rolling their eyes, saying ‘oh my word, what have we gotten ourselves into.’ ” After the meeting, Adams delicately told Hart and Lindsay that their goals were unrealistic. Most experts believed that true “far-field speech recognition”—comprehending speech from up to thirty-two feet away, often amid crosstalk and background noise—was beyond the realm of established computer science, since sound bounces off surfaces like walls and ceilings, producing echoes that confuse computers. The Amazon executives responded by channeling Bezos’s resolve. “They basically told me, ‘We don’t care. Hire more people. Take as long as it takes. Solve the problem,’ ” recalled Adams. “They were unflappable.” A few months after the Yap purchase, Greg Hart and his colleagues acquired another piece of the Doppler puzzle. It was the technological antonym of Yap, which converted speech into text. Instead, the Polish startup Ivona generated computer-synthesized speech that resembled a human voice. Ivona was founded in 2001 by Lukasz Osowski, a computer science student at the Gdan?sk University of Technology. Osowski had the notion that so-called “text to speech,” or TTS, could read digital texts aloud in a natural voice and help the visually impaired in Poland appreciate the written word. With a younger classmate, Michal Kaszczuk, he took recordings of an actor’s voice and selected fragments of words, called diphones, and then blended or “concatenated” them together in different combinations to approximate natural-sounding words and sentences that the actor might never have uttered. The Ivona founders got an early glimpse of how powerful their technology could be. While students, they paid a popular Polish actor named Jacek Labijak to record hours of speech to create a database of sounds. The result was their first product, Spiker, which quickly became the top-selling computer voice in Poland. Over the next few years, it was used widely in subways, elevators, and for robocall campaigns. Labijak subsequently began to hear himself everywhere and regularly received phone calls in his own voice urging him, for example, to vote for a candidate in an upcoming election. Pranksters manipulated the software to have him say inappropriate things and posted the clips online, where his children discovered them. The Ivona founders then had to renegotiate the actor’s contract after he angrily tried to withdraw his voice from the software. (Today “Jacek” remains one of the Polish voices offered by AWS’s Amazon Polly computer voice service.) In 2006, Ivona began to enter and repeatedly win the annual Blizzard Challenge, a competition for the most natural computer voice, organized by Carnegie Mellon University. By 2012, Ivona had expanded into twenty other languages and had over forty voices. After learning of the startup, Greg Hart and Al Lindsay diverted to Gdan?sk on their trip through Europe looking for acquisition targets. “From the minute we walked into their offices, we knew it was a culture fit,” Lindsay said, pointing to Ivona’s progress in a field where researchers often got distracted by high-minded pursuits. “Their scrappiness allowed them to look outside pure academia and not be blinded by science.” The purchase, for around $30 million, was consummated in 2012 but kept secret for a year. The Ivona team and the growing number of speech engineers Amazon would hire for its new Gdan?sk RandD center were put in charge of crafting Doppler’s voice. The program was micromanaged by Bezos himself and subject to the CEO’s usual curiosities and whims. At first, Bezos said he wanted dozens of distinct voices to emanate from the device, each associated with a different goal or task, such as listening to music or booking a flight. When that proved impractical, the team considered lists of characteristics they wanted in a single personality, such as trustworthiness, empathy, and warmth, and determined those traits were more commonly associated with a female voice. To develop this voice and ensure it had no trace of a regional accent, the team in Poland worked with an Atlanta area–based voice-over studio, GM Voices, the same outfit that had helped turn recordings from a voice actress named Susan Bennett into Apple’s agent, Siri. To create synthetic personalities, GM Voices gave female voice actors hundreds of hours of text to read, from entire books to random articles, a mind-numbing process that could stretch on for months. Greg Hart and colleagues spent months reviewing the recordings produced by GM Voices and presented the top candidates to Bezos. They ranked the best ones, asked for additional samples, and finally made a choice. Bezos signed off on it. Characteristically secretive, Amazon has never revealed the name of the voice artist behind Alexa. I learned her identity after canvasing the professional voice-over community: Boulder-based singer and voice actress Nina Rolle. Her professional website contained links to old radio ads for products such as Mott’s Apple Juice and the Volkswagen Passat—and the warm timbre of Alexa’s voice was unmistakable. Rolle said she wasn’t allowed to talk to me when I reached her on the phone in February of 2021. And when I asked Amazon to speak with her, they declined. While the Doppler team hired engineers and acquired startups, nearly every other aspect of the product was hotly debated in Amazon’s offices in Seattle and in Lab126 in Silicon Valley. In one of the earliest Doppler meetings, Greg Hart identified the ability to play music with a voice command as the device’s marquee feature. Bezos “agreed with that framework but he stressed that music may be like 51 percent, but the other 49 percent are going to be really important,” Hart said. Over the ensuing months, that amicable consensus devolved into a long-standing tug-of-war between Hart and his engineers, who saw playing music as a practical and marketable feature, and Bezos, who was thinking more grandly. Bezos started to talk about the “Star Trek computer,” an artificial intelligence that could handle any question and serve as a personal assistant. The fifty-cent word “plenipotentiary” was used inside the team to describe what he wanted: an assistant invested with full powers to take action on behalf of users, like call for a cab or place a grocery order. With his science fiction obsession, Bezos was forcing his team to think bigger and to push the boundaries of established technology. But Hart, facing pressure to actually ship the product, advocated for a feature set he dubbed “the magical and the mundane” and pushed to highlight basic, reliable features like allowing users to ask for weather reports as well as setting timers and alarms. The debate manifested itself in endless drafts of the “PR FAQ”—the six-page narrative Amazonians craft in the form of a press release at the start of a new initiative to envision the product’s market impact. The paper, a hallowed part of Amazon’s rituals around innovation, forces them to begin any conversation about a new product in terms of the benefit it creates for customers. Dozens of versions of the Doppler PR FAQ were written, presented, debated, obsessed over, rewritten, and scrapped. Whenever the press release evolved to highlight playing music, “Jeff would get really mad. He didn’t like that at all,” recalled an early product manager. Another early Doppler employee later speculated that Bezos’s famous lack of sophisticated musical tastes played a role in his reaction. When Bezos was testing an early Doppler unit, for example, he asked it to play one of his favorite songs: the theme to the classic TV show Battlestar Galactica. “Jeff was pushing really hard to make sure this product was more than just music,” said Ian Freed, Greg Hart’s boss. “He wouldn’t let go of it being a more generalized computer.” A related discussion centered around the choice of a so-called “wake” word—the utterance that would rouse Doppler out of passive mode, when it was only listening for its own name, to switch into active listening, where it would send user queries over the internet to Amazon’s servers and return with a response. The speech science team wanted the wake word to have a distinct combination of phonemes and be at least three syllables, so the device wouldn’t be triggered by normal conversation. It also needed to be distinctive (like “Siri”) so that the name could be marketed to the public. Hart and his team presented Bezos with hundreds of flash cards, each with a different name, which he would spread out on conference room tables during the endless deliberations. Bezos said he wanted the wake word to sound “mellifluous” and opined that his mother’s name, Jacklyn, was “too harsh.” His own quickly discarded suggestions included “Finch,” the title of a fantasy detective novel by Jeff VanderMeer; “Friday,” after the personal assistant in the novel Robinson Crusoe; and “Samantha,” the witch who could twinkle her nose and accomplish any task on the TV show Bewitched. For a while, he also believed the wake word should be “Amazon,” so that whatever aura of good feeling the device generated would be reflected back onto the company. Doppler execs argued that people would not want to talk to a corporate entity in their homes, and that spawned another ongoing disagreement. Bezos also suggested “Alexa,” an homage to the ancient library of Alexandria, regarded as the capital of knowledge. This was also the name of an unrelated startup Amazon had acquired in the 1990s, which sold web traffic data and continued to operate independently. After endless debates and lab testing, “Alexa” and “Amazon” became the top candidates for the wake word as the device moved into limited trials in the homes of Amazon employees at the start of 2013. The devices employees received looked very much like the original Echo that would be introduced by Amazon less than two years later. The industrial designers at Lab126 called it the “Pringles can”—a cylinder elongated to create separation between the array of seven omnidirectional microphones at the top and the speakers at the bottom, with some fourteen hundred holes punctured in the metal tubing to push out air and sound. The device had an LED light ring at the top, another Bezos idea, which would light up in the direction of the person speaking, reproducing the social cue of looking at someone when they are talking to you. It was not an elegant-looking device, Bezos having instructed the designers to let function dictate the form. The experimental Doppler devices in the homes of hundreds of Amazon employees were not smart—they were, by all accounts, slow and dumb. An Amazon manager named Neil Ackerman signed up for the internal beta, bringing one home to his family in early 2013. Both he and his wife had to sign several confidentiality agreements, promising they would turn it off and hide it if guests came over. Every week they had to fill out a spreadsheet, answering questions and listing what they asked it and how it responded. Ackerman’s wife called it “the thing.” “We were both pretty skeptical about it,” he said. “It would hardly ever give me the right answer and the music coming out of it was inconsistent and certainly not the family favorites.” Inexplicably it seemed to best understand their son, who had a speech impediment. Other early beta testers didn’t mince words either. Parag Garg, one of the first engineers to work on the Fire TV, took home a device and said it “didn’t work for shit and I didn’t miss it when it was gone. I thought, ‘Well, this thing is doomed.’ ” A manager on the Fire Phone recalls liking the look of the hardware, “but I could not foresee what it was going to be used for. I thought it was a stupid product.” Two Doppler engineers recall another harrowing review—from Bezos himself. The CEO was apparently testing a unit in his Seattle home, and in a pique of frustration over its lack of comprehension, he told Alexa to go “shoot yourself in the head.” One of the engineers who heard the comment while reviewing interactions with the test device said: “We all thought it might be the end of the project, or at least the end of a few of us at Amazon.” Alexa, it was clear, needed a brain transplant. Amazon’s ongoing efforts to make its product smarter would create a dogmatic battle inside the Doppler team and lead to its biggest challenge yet. The first move was to integrate the technology of a third acquisition, a Cambridge, England–based artificial intelligence company called Evi (pronounced Evee). The startup was founded in 2005 as a question-and-answer tool called True Knowledge by British entrepreneur William Tunstall-Pedoe. As a university student, Tunstall-Pedoe had created websites like Anagram Genius, which automatically rearranged the letters in words to produce another word or phrase. The site was later used by novelist Dan Brown to create puzzles in The Da Vinci Code. In 2012, inspired by Siri’s debut, Tunstall-Pedoe pivoted and introduced the Evi app for the Apple and Android app stores. Users could ask it questions by typing or speaking. Instead of searching the web for an answer like Siri, or returning a set of links, like Google’s voice search, Evi evaluated the question and tried to offer an immediate answer. The app was downloaded over 250,000 times in its first week and almost crashed the company’s servers. Apple threatened to kick it off the iOS app store for appearing “confusingly similar” to Siri, then relented when fans objected. Thanks to all this attention, Evi had at least two acquisition offers and a prospective investment from venture capitalists when Amazon won out in late 2012 with a rumored $26 million deal. Evi employed a programming technique called knowledge graphs, or large databases of ontologies, which connect concepts and categories in related domains. If, for example, a user asked Evi, “What is the population of Cleveland?” the software interpreted the question and knew to turn to an accompanying source of demographic data. Wired described the technique as a “giant treelike structure” of logical connections to useful facts. Putting Evi’s knowledge base inside Alexa helped with the kind of informal but culturally common chitchat called phatic speech. If a user said to the device, “Alexa, good morning, how are you?” Alexa could make the right connection and respond. Tunstall-Pedoe said he had to fight with colleagues in the U.S. over the unusual idea of having Alexa respond to such social cues, recalling that “People were uncomfortable with the idea of programming a machine to respond to ‘hello.’ ” Integrating Evi’s technology helped Alexa respond to factual queries, such as requests to name the planets in the solar system, and it gave the impression that Alexa was smart. But was it? Proponents of another method of natural language understanding, called deep learning, believed that Evi’s knowledge graphs wouldn’t give Alexa the kind of authentic intelligence that would satisfy Bezos’s dream of a versatile assistant that could talk to users and answer any question. In the deep learning method, machines were fed large amounts of data about how people converse and what responses proved satisfying, and then were programmed to train themselves to predict the best answers. The chief proponent of this approach was an Indian-born engineer named Rohit Prasad. “He was a critical hire,” said engineering director John Thimsen. “Much of the success of the project is due to the team he assembled and the research they did on far-field speech recognition.” Prasad was raised in Ranchi, the capital of the eastern India state of Jharkhand. He grew up in a family of engineers and got hooked on Star Trek at a young age. Personal computers weren’t common in India at the time, but at an early age he learned to code on a PC at the metallurgical and engineering consulting company where his father worked. Since communication in India was hampered by poor telecommunications infrastructure and high long-distance rates, Prasad decided to study how to compress speech over wireless networks when he moved to the U.S. to attend graduate school. After graduating in the late 1990s, Prasad passed on the dot-com boom and worked for the Cambridge, Massachusetts–based defense contractor BBN Technologies (later acquired by Raytheon) on some of the first speech recognition and natural language systems. At BBN, he worked on one of the first in-car speech recognition systems and automated directory assistance services for telephone companies. In 2000, he worked on another system that automatically transcribed courtroom proceedings. Accurately recording conversation from multiple microphones placed around a courtroom introduced him to the challenges of far-field speech recognition. At the start of the project, he said that eighty out of every hundred words were incorrect; but within the first year, they cut it down to thirty-three. Years later, as the Doppler team was trying to improve Alexa’s comprehension, Bill Barton, who led Amazon’s Boston office, introduced Prasad to Greg Hart. Prasad didn’t know much about Amazon and showed up for the interview in Seattle wearing a suit and tie (a minor faux pas) and with no clue about Amazon’s fourteen leadership principles (a bigger one). He expressed reservations about joining a large, plodding tech company, but by the time he returned to his hotel room, Hart had emailed him a follow-up note that promised, “We are essentially a startup. Even though we are part of a big company, we don’t act like one.” Persuaded, Prasad joined to work on the problems of far-field speech recognition, but he ended up as an advocate for the deep learning model. Evi’s knowledge graphs were too regimented to be Alexa’s foundational response model; if a user says, “Play music by Sting,” such a system may think he is trying to say “bye” to the artist and get confused, Prasad later explained. By using the statistical training methods of deep learning, the system could quickly ascertain that when the sentence is uttered, the intent is almost certainly to blast “Every Breath You Take.” But Evi’s Tunstall-Pedoe argued that knowledge graphs were the more practical solution and mistrusted the deep learning approach. He felt it was error-prone and would require an endless diet of training data to properly mold Alexa’s learning models. “The thing about machine learning scientists is that they never admit defeat because all of their problems can be solved with more data,” he explained. That response might carry a tinge of regret with it, because to the ?ber product manager, Bezos himself, there was no question about which way time’s arrow was pointed—toward machine learning and deep neural networks. With its vast and sophisticated AWS data centers, Amazon was also in the unique position of being able to harness a large number of high-powered computer processors to train its speech models, exploiting its advantage in the cloud in a way few of its competitors could. Defeated, Tunstall-Pedoe ended up leaving Amazon in 2016. Even though the deep learning approach won out, Prasad and his allies still had to solve the paradox that confronts all companies developing AI: they don’t want to launch a system that is dumb—customers won’t use it, and so won’t generate enough data to improve the service. But companies need that data to train the system to make it smarter. Google and Apple solved the paradox in part by licensing technology from Nuance, using its results to train their own speech models and then afterward cutting ties with the company. For years, Google also collected speech data from a toll-free directory assistance line, 800-Goog-411. Amazon had no such services it could mine, and Greg Hart was against licensing outside technology—he thought it would limit the company’s flexibility in the long run. But the meager training data from the beta tests with employees amounted to speech from a few hundred white-collar workers, usually uttered from across the room in their noisy homes in the mornings and evenings when they weren’t at the office. The data was lousy, and there wasn’t enough of it. Meanwhile Bezos grew impatient. “How will we even know when this product is good?” he kept asking in early 2013. Hart, Prasad, and their team created graphs that projected how Alexa would improve as data collection progressed. The math suggested they would need to roughly double the scale of their data collection efforts to achieve each successive 3 percent increase in Alexa’s accuracy. That spring, only a few weeks after Rohit Prasad had joined the company, they brought a six-page narrative to Bezos that laid out these facts, proposed to double the size of the speech science team and postpone a planned launch from the summer into the fall. Held in Bezos’s conference room, the meeting did not go well. “You are going about this the wrong way,” Bezos said after reading about the delay. “First tell me what would be a magical product, then tell me how to get there.” Bezos’s technical advisor at the time, Dilip Kumar, then asked if the company had enough data. Prasad, who was calling into the meeting from Cambridge, replied that they would need thousands of more hours of complex, far-field voice commands. According to an executive who was in the room, Bezos apparently factored in the request to increase the number of speech scientists and did the calculation in his head in a few seconds. “Let me get this straight. You are telling me that for your big request to make this product successful, instead of it taking forty years, it will only take us twenty?” Prasad tried to dance around it. “Jeff, that is not how we think about it.” “Show me where my math is wrong!” Bezos said. Hart jumped in. “Hang on, Jeff, we hear you, we got it.” Prasad and other Amazon executives would remember that meeting, and the other tough interactions with Bezos during the development of Alexa, differently. But according to the executive who was there, the CEO stood up, said, “You guys aren’t serious about making this product,” and abruptly ended the meeting. In the very same buildings in Seattle and Sunnyvale, California, where the Doppler team was trying to make Alexa smarter, Amazon’s campaign to build its own smartphone was careening toward disaster. A few years before, Apple, Google, and Samsung had staked out large positions in the dawning smartphone market but had left the impression that terrain might remain for innovative newcomers. Typically, Jeff Bezos was not about to cede a critical strategic position in the unfolding digital terrain to other companies, especially when he believed the ground was still fertile for innovative approaches. In one brainstorming session he proposed a robot that could retrieve a carelessly discarded phone and drag it over to a wireless charger. (Some employees thought he was joking, but a patent on the idea was filed.) In another, he proposed a phone with an advanced 3D display, responsive to gestures in the air, instead of only taps on a touchscreen. It would be like nothing else in stores. Bezos clung to that idea, which would become the seed of the Fire Phone project. The original designers settled on a handset with four infrared cameras, one in each corner of the phone’s face, to track the user’s gaze and present the illusion of a 3D image, along with a fifth camera on the back (because it could “see” from both sides of its head, the project was code-named Tyto, after a genus of owl). The custom-made Japanese cameras would cost $5 a handset, but Bezos envisioned a premium Amazon smartphone with top-of-the-line components. Bezos met the Tyto team every few days for three years, at the same time he was meeting the Alexa team as frequently. He was infatuated with new technologies and business lines and loved spitballing ideas and reviewing the team’s progress. And while he was inordinately focused on customer feedback in other parts of Amazon’s business, Bezos did not believe that listening to them could result in dramatic product inventions, evangelizing instead for creative “wandering,” which he believed was the path to dramatic breakthroughs. “The biggest needle movers will be things that customers don’t know to ask for,” he would write years later in a letter to shareholders. “We must invent on their behalf. We have to tap into our own inner imagination about what’s possible.” But many Tyto employees were skeptical of his vision for smartphones. No one was sure the 3D display was anything more than a gimmick and a major drain on the phone’s battery. Bezos also had some worrisome blind spots about smartphones. “Does anyone actually use the calendar on their phone?” he asked in one meeting. “We do use the calendar, yes,” someone who did not have several personal assistants replied. As in the Doppler project, the deadlines Bezos gave were unrealistic, and to try to make them, the team hired more engineers. But throwing more engineers at failing technology projects only makes them fail more spectacularly. Kindle was strategically important to Amazon at the time, so instead of poaching employees internally, the Tyto group had to look outside, to hardware engineers at other companies like Motorola, Apple, and Sony. Naturally, they didn’t tell anyone what they’d be working on until their first day. “If you had a good reputation in the tech industry, they found you,” said a Fire Phone manager. The launch was perpetually six months away. The project dragged on as they tried to get the 3D display to work. The original top-of-the-line components quickly became outdated, so they decided to reboot the project with an upgraded processor and cameras. It was given a new owl-themed code name, Duke. The group started and then canceled another phone project, a basic low-cost handset to be made by HTC and code-named Otus, which would also use the Amazon flavor of the Android operating system that ran on Amazon’s new Fire tablets, which were showing promise as an economical alternative to Apple’s iPad. Employees on the project were disappointed when Otus was scrapped because they quietly believed Amazon’s opportunity was not in a fancy 3D display but in disrupting the market with a free or low-priced smartphone. Morale on the team started to sour. One group was so dubious about the entire project that they covertly bought a set of military dogtags that read “disagree and commit,” after Amazon leadership principle N13, which says employees who disagree with a decision must put aside their doubts and work to support it. In his annual letter to shareholders released in April 2014, Bezos wrote, “Inventing is messy, and over time, it’s certain that we’ll fail at some big bets too.” The observation was curiously prophetic. The team was preparing to launch the phone at a big event that summer. Bezos’s wife, MacKenzie, showed up for rehearsals to offer support and advice. On June 18, 2014, Bezos unveiled the Fire Phone at a Seattle event space called Fremont Studios, where he attempted to summon some of the charismatic magic of the late Steve Jobs and waxed enthusiastic about the device’s 3D display and gesture tracking. “I actually think he was a believer,” said Craig Berman, an Amazon PR vice president at the time. “I really do. If he wasn’t, he certainly wasn’t going to signal it to the team.” Reviews of the phone were scathing. The smartphone market had shifted and matured during the painful four years that the Fire Phone was in development, and what had started as an attempt at creating a novel product now seemed strangely out of touch with customer expectations. Because it did not run Google’s authorized version of Android, it did not have popular apps such as Gmail and YouTube. While it was cheaper than the forthcoming iPhone 6, it was more expensive than the multitude of low-cost, no-frills handsets made by Asian manufacturers, which were heavily subsidized at the time by the wireless carriers in exchange for two-year contracts. “There was a lot of differentiation, but in the end, customers didn’t care about it,” said Ian Freed, the vice president in charge of the project. “I made a mistake and Jeff made a mistake. We didn’t align the Fire Phone’s value proposition with the Amazon brand, which is great value.” Freed said that Bezos told him afterward, “You can’t, for one minute, feel bad about the Fire Phone. Promise me you won’t lose a minute of sleep.” Later that summer, workers in one of Amazon’s fulfillment centers in Phoenix noticed thousands of unsold Fire Phones sitting untouched on massive wooden pallets. In October, the company wrote down $170 million in inventory and canceled the project, acknowledging one of its most expensive failures. “It failed for all the reasons we all said it was going to fail—that’s the crazy thing about it,” said Isaac Noble, one of the early software engineers who had been dubious from the start. Ironically, the Fire Phone fiasco augured well for Doppler. Without a smartphone market share to protect, Amazon could pioneer the new category of smart speakers with unencumbered ambition. Many of the displaced engineers who weren’t immediately snapped up by Google and Apple were given a few weeks to find new jobs at Amazon; some went to Doppler, or to a new hit product, Fire TV. Most importantly, Bezos didn’t penalize Ian Freed and other Fire Phone managers, sending a strong message inside Amazon that taking risks was rewarded—especially if the entire debacle was primarily his own fault. On the other hand, it revealed a worrisome fact about life inside Amazon. Many employees who worked on the Fire Phone had serious doubts about it, but no one, it seemed, had been brave or clever enough to take a stand and win an argument with their obstinate leader. After Jeff Bezos walked out on them, the Doppler executives working on the Alexa prototype retreated with their wounded pride to a nearby conference room and reconsidered their solution to the data paradox. Their boss was right. Internal testing with Amazon employees was too limited and they would need to massively expand the Alexa beta while somehow still keeping it a secret from the outside world. The resulting program, conceived by Rohit Prasad and speech scientist Janet Slifka over a few days in the spring of 2013, and quickly approved by Greg Hart, would put the Doppler program on steroids and answer a question that later vexed speech experts—how did Amazon come out of nowhere to leapfrog Google and Apple in the race to build a speech-enabled virtual assistant? Internally the program was called AMPED. Amazon contracted with an Australian data collection firm, Appen, and went on the road with Alexa, in disguise. Appen rented homes and apartments, initially in Boston, and then Amazon littered several rooms with all kinds of “decoy” devices: pedestal microphones, Xbox gaming consoles, televisions, and tablets. There were also some twenty Alexa devices planted around the rooms at different heights, each shrouded in an acoustic fabric that hid them from view but allowed sound to pass through. Appen then contracted with a temp agency, and a stream of contract workers filtered through the properties, eight hours a day, six days a week, reading scripts from an iPad with canned lines and open-ended requests like “ask to play your favorite tune” and “ask anything you’d like an assistant to do.” The speakers were turned off, so the Alexas didn’t make a peep, but the seven microphones on each device captured everything and streamed the audio to Amazon’s servers. Then another army of workers manually reviewed the recordings and annotated the transcripts, classifying queries that might stump a machine, like “turn on Hunger Games,” as a request to play the Jennifer Lawrence film, so that the next time, Alexa would know. The Boston test showed promise, so Amazon expanded the program, renting more homes and apartments in Seattle and ten other cities over the next six months to capture the voices and speech patterns of thousands more paid volunteers. It was a mushroom-cloud explosion of data about device placement, acoustic environments, background noise, regional accents, and all the gloriously random ways a human being might phrase a simple request to hear the weather, for example, or play a Justin Timberlake hit. The daylong flood of random people into homes and apartments repeatedly provoked suspicious neighbors to call the police. In one instance, a resident of a Boston condo complex suspected a drug-dealing or prostitution ring was next door and called the cops, who asked to enter the apartment. The nervous staff gave them an elusive explanation and a tour and afterward hastily shut down the site. Occasionally, temp workers would show up, consider the bizarre script and vagueness of the entire affair, and simply refuse to participate. One Amazon employee who was annotating transcripts later recalled hearing a temp worker interrupt a session and whisper to whoever he suspected was listening: “This is so dumb. The company behind this should be embarrassed!” But Amazon was anything but embarrassed. By 2014, it had increased its store of speech data by a factor of ten thousand and largely closed the data gap with rivals like Apple and Google. Bezos was giddy. Hart hadn’t asked for his approval of the AMPED project, but a few weeks before the program began, he updated Bezos with a six-page document that described it and its multimillion-dollar cost. A huge grin spread over Bezos’s face as he read, and all signs of past peevishness were gone. “Now I know you are serious about it! What are we going to do next?” What came next was Doppler’s long-awaited launch. Working eighty to ninety hours a week, employees were missing whole chunks of their family’s lives, and Bezos wasn’t letting up. He wanted to see everything and made impetuous new demands. On an unusually clear Seattle day, with the setting sun streaming through his conference room window, for example, Bezos noticed that the ring’s light was not popping brightly enough, so he ordered a complete redo. Almost alone, he argued for a feature called Voice Cast, which linked an Alexa device to a nearby Fire tablet, so that queries showed up as placards on the tablet’s screen. When engineers tried to quietly drop the feature, he noticed and told the team they were not launching without it. (Few customers ended up using it.) But he was also right about many things. As launch neared, one faction of employees worried that the device wasn’t good enough at hearing commands amid loud music or cross talk and lobbied to include a remote control, like the one the company made for the Fire TV. Bezos was opposed to it but agreed to ship remotes with the first batch of speakers to see if customers would use them. (They didn’t, and the remote disappeared.) He also headed off a near disaster when it came to what to actually call the device. For four years there had been no consensus on that topic. The team debated endlessly whether there should be one name or two for the virtual assistant and the hardware. After opting for separate names, they cycled through various options for the speaker and settled on… the Amazon Flash. The news updates would be called “Flash briefings,” and packaging with the Flash brand printed on it was ready to ship. But then less than a month before the introduction, Bezos said in a meeting, “I think we can do better.” Searching for a replacement, they opted to pilfer the name of an Alexa feature, Echo, which allowed a customer to ask Alexa to repeat a word or phrase. (The command was then changed to “Simon says.”) There wasn’t enough time to print new boxes or user manuals, so the Echo’s earliest buyers ended up receiving plain black boxes. Toni Reid, a director Hart hired to launch the product, had to write the user manual without ever actually naming the product. “That’s a skill everyone should have,” she said. The introduction of the Amazon Echo on November 6, 2014, was molded by the failure of the Fire Phone only months before it. There was no press conference or visionary speech by Bezos—he was seemingly done forever with his halfhearted impression of the late Steve Jobs, who had unveiled new products with such verve. Instead, Bezos appeared more comfortable with a new, understated approach: the team announced the Echo with a press release and two-minute explanatory video on YouTube that showed a family cheerfully talking to Alexa. Amazon execs did not tout the new device as a fully conversational computer, but carefully highlighted several domains where they were confident it was useful, such as delivering the news and weather, setting timers, creating shopping lists, and playing music. Then they asked customers to join a waiting list to buy an Echo and reviewed the list carefully, considering factors like whether applicants were users of Amazon Music and owned a Kindle. Recognizing that it was an untested market, they also ordered an initial batch of only eighty thousand devices, compared to a preliminary order of more than three hundred thousand Fire Phones, and distributed them gradually over the next few months. “The Fire Phone certainly made folks a little cautious,” said Greg Hart. “It led us to revisit everything.” After four years of development, more than one Doppler veteran suspected that the Amazon Echo might leave another smoking crater in the consumer technology landscape, right next to the Fire Phone’s. On launch day, they huddled over their laptops in a “war room” from their new offices in the Prime building, a few minutes’ walk from Fiona, to watch as the waiting list swelled past even their most hyperbolic projections. In the midst of the vigil, someone realized they were letting a significant accomplishment slide by unappreciated. “It was our launch moment and we weren’t ready for it,” said Al Lindsay. So, a hundred or so employees headed to a nearby bar for a long-awaited celebration, and a few of the weary executives and engineers on the project closed it down that night. Over the next few weeks, a hundred and nine thousand customers registered for the waiting list to receive an Echo. Along with some natural skepticism, positive reviews rolled in, with quotes like “I just spoke to the future and it listened,” and “it’s the most innovative device Amazon’s made in years.” Employees emailed Alexa executives Toni Reid and Greg Hart, pleading for devices for family members and friends. After the Echo shipped, the team could see when the devices were turned on and that people were actually using them. Bezos’s intuition had been right: there was something vaguely magical in summoning a computer in your home without touching the glass of a smartphone, something valuable in having a responsive speaker that could play music, respond to practical requests (“how many cups are there in a quart?”), and even banter with playful ones (“Alexa, are you married?”). Many Doppler employees had expected they could now catch their breath and enjoy all their accrued vacation time. But that is not what happened. Instead of stumbling ashore from choppy seas to rest, another giant wave crashed over their heads. Bezos deployed his playbook for experiments that produced promising sparks: he poured gasoline on them. “We had a running success on our hands and that’s where my life changed,” said Rohit Prasad, who would be promoted to vice president and eventually join the vaunted Amazon leadership committee, the S-team. “I knew the playbook to the launch of Alexa and Echo. The playbook for the next five years, I didn’t have.” Over the next few months, Amazon would roll out the Alexa Skills Kit, which allowed other companies to build voice-enabled apps for the Echo, and Alexa Voice Service, which let the makers of products like lightbulbs and alarm clocks integrate Alexa into their own devices. Bezos also told Greg Hart that the team needed to release new features with a weekly cadence, and that since there was no way to signal the updates, Amazon should email customers every week to alert them to the new features their devices offered. Bezos’s wish list became the product plan—he wanted Alexa to be everywhere, doing everything, all at once. Services that had originally been pushed to the wayside in the scramble to launch, like shopping on Alexa, now became urgent priorities. Bezos ordered up a smaller, cheaper version of the Echo, the hockey puck–sized Echo Dot, as well as a portable version with batteries, the Amazon Tap. Commenting on the race to build a virtual assistant and smart speaker, Bezos said, “Amazon’s going to be fine if someone comes along and overtakes us,” as part of the annual late-summer OP1 series of planning meetings, the year after Alexa’s introduction. “But wouldn’t it be incredibly annoying if we can’t be the leader in creating this?” Life inside the Prime building, and in the gradually increasing number of offices around South Lake Union inhabited by the Alexa team, became even busier. Many of the new features would be rushed out the door, so that Amazon could start gathering customer feedback. Silicon Valley startups call this style of product development “minimum viable product,” or MVP. At Amazon, Jeff Wilke had popularized the idea of calling it “minimum lovable product,” or MLP, asking, “What would we be proud to take to the market?” It didn’t seem to matter that many Alexa features, such as the voice calling, were initially half-baked and rarely used. Over the course of the 2015 holiday season, Amazon sold a million Echo devices. Alexa’s division-wide motto became “Get Big Fast,” the same slogan used in the early years for Amazon. History was repeating itself. An organization of a few hundred employees swelled to a thousand in the first year after the launch, and then, incredibly, to ten thousand over the next five years. Through it all, like a crazed pyromaniac, Bezos kept spraying lighter fluid on the fire, promoting Alexa by paying an estimated $10 million for Amazon’s first ever Super Bowl ad in January 2016, starring Alec Baldwin, Missy Elliott, and former Dolphins quarterback Dan Marino. Despite all this attention, there was a sense inside Amazon that the Alexa organization was not moving fast enough. Greg Hart, who had produced the device out of nothing more than a Bezos email and whiteboard drawing, left the division and moved over to help run Prime Video. “The thing that I got up every day loving doing was the creation of Alexa,” he said wistfully years later. But with the Alexa group growing fast, “it was probably a better fit for another leader.” In his place came a longtime Bezos favorite, Mike George, a bald, charismatic, cowboy boot–wearing Amazonian with a penchant for face paint, who liked to walk into meetings with an Amazon Tap under his arm, blasting music. Mike George had what Bezos called a “fungible” energy. Over the years, Bezos deployed him like a firefighter to douse the flames of chaos and instill order in divisions like human resources, marketplace, payments, and later, Bezos’s private philanthropy, Day 1 Academies Fund. Various colleagues endearingly referred to him as a “brute,” a “high school jock who never unjocked,” and “totally cleaved from Jeff’s rib.” Mike George ran Alexa for a year, but the impact is still broadly felt. The Alexa division couldn’t recruit fast enough to fulfill its hiring needs, so Amazon instituted a sort of company-wide draft, giving every new hire to other parts of Amazon—like AWS and retail—an alternate job offer to join the Alexa division instead. Unhappy Amazon managers suddenly lost sought-after engineers they thought they had recruited. George also instituted a dramatic change in the Alexa group’s structure. It had been a functional organization, with centralized engineering, product management, and marketing teams. But that wasn’t growing smoothly or fast enough for Bezos’s liking. George instead reorganized Alexa around the Amazonian ideal of fast-moving “two pizza” teams, each devoted to a specific Alexa domain, like music, weather, lighting, thermostats, video devices, and so on. Each team was run by a so-called “single-threaded leader” who had ultimate control and absolute accountability over their success or failure. (The phrase comes from computer science terminology; a single-threaded program executes one command at a time.) Alexa, like Amazon itself, became a land of countless CEOs, each operating autonomously. To yoke them all together, George oversaw the creation of a “north star” document, to crystalize the strategy of a global, voice-enabled computing platform. Meanwhile Bezos approved all these changes and stayed intimately involved, attending product reviews and reading the Friday night compilation of updates from all the various two-pizza teams, and responding with detailed questions or problems that the groups would then have to fix over the weekend. Alexa execs, like leaders elsewhere in Amazon, became frequent recipients of the CEO’s escalation emails, in which he forwarded a customer complaint accompanied by a single question mark and then expected a response within twenty-four hours. He was also the chief evangelist for Alexa within the company. “What are you doing for Alexa?” he asked other executives, as he had for AWS years before. Everyone in the company had to include Alexa in the OP1 documents they presented to the S-team, describing their plans for the coming year. At the end of 2016, after eight million U.S. households had purchased an Echo or Echo Dot, device exec Dave Limp announced internally that Amazon had become the top-selling speaker company in the world. It validated the entire crusade. But of course, Bezos wanted to become the top AI firm in the world, and in that respect, he was about to have significant competition. That fall, Google introduced the Google Home smart speaker. It looked considerably more stylish, “like something you might plant a succulent in,” said Wired. It also had a crisper sound and, predictably, searched the web and retrieved answers with aplomb. The Alexa team had “gone into every holiday season just waiting for either Apple or Google to announce something, and when they didn’t, we would just high-five each other,” said former Alexa exec Charlie Kindel. Even though those companies were allergic to what they considered copycat products, eventually they couldn’t resist the fast-growing smart speaker market. That added to the pressure on the Alexa team to move faster and stay ahead with new features and variations on the hardware. In early 2017, a Swedish customer emailed Bezos to ask why Amazon was waiting to develop language-specific versions of Alexa before introducing the Echo in Europe. Why couldn’t they just sell it everywhere in English first? This was actually on the product road map but wasn’t a priority. According to one executive, Bezos got that email at 2 a.m. Seattle time, and by the following morning there were a half dozen independent groups working to sell Alexa in eighty new countries. Later, Alexa execs would say that Bezos’s close involvement made their lives more difficult but also produced immeasurable results. Jeff “gave us the license and permission to do some of the things we needed to do to go faster and to go bigger,” Toni Reid said. “You can regulate yourself quite easily or think about what you’re going to do with your existing resources…. Sometimes, you don’t know what the boundaries are. Jeff just wanted us to be unbounded.” But there were drawbacks to the frenetic speed and growth. For years the Alexa smartphone app looked like something a design student had come up with during a late-night bender. Setting up an Echo, or networking Echos throughout the home, was more complicated than it needed to be. It was also difficult and confusing for users to phrase commands in the right way to trigger third-party skills and specialized features. The decentralized and chaotic approach of countless two-pizza teams run by single-threaded leaders was manifested in aspects of the product that had become overly complex. Basic tasks, like setting up a device and connecting it to smart home appliances, had become “painful, very painful to the customer,” agreed Tom Taylor, a sardonic and even-keeled Amazon executive who took over from Mike George as leader of the Alexa unit in 2017. He set out to “find all the places that customers are suffering from our organizational structure.” There was plenty of turmoil that Taylor and his colleagues couldn’t quell. In March 2018, a bug caused Alexas around the world to randomly emit crazed, unprompted laughter. A few months later, an Echo inadvertently recorded the private conversation of a couple in Portland, Oregon, and inexplicably sent the recording to one of the husband’s employees in Seattle, whose phone number was in his address book. Amazon said the device thought it had heard its wake word and then a series of commands to record and forward the conversation. It was an “extremely rare occurrence,” the company said, and that, “as unlikely as this string of events is, we are evaluating options to make this case even less likely.” After those incidents, employees had to write a “correction of error” report, which analyzes an incident in detail and tries to get to its underlying root causes by going through a series of iterative questions and answers called “the five whys.” The memo went all the way to Bezos, describing what had happened and recommending how the process that created the problem in the first place could be fixed. Some errors could not be undone, such as Alexa’s penchant for assassinating Santa Claus in the minds of younger users. One such incident took place during the Alexa Prize, an Amazon contest among universities to build artificial chatbots that could carry on a sophisticated multipart conversation. When Alexa users said, “Alexa, let’s chat,” they got to talk to one of the chatbots and rate its performance. During the first competition in 2017, the chatbot from the University of Washington was retrieving some of its answers from Reddit, an online discussion board, and errantly informed a child that Santa was a myth. The parents complained and the chatbot was temporarily pulled from the rotation (but later won the $500,000 grand prize). The periodic problems with Alexa underscored how far it had come and how far it still had to go. By 2019, Amazon had sold more than 100 million Echo devices. In the span of a decade, a product spawned by Bezos’s love of science fiction and infatuation with invention had become a universally recognized product whose miscues and challenges to conventional notions of privacy were widely covered by the media. Yet Alexa still wasn’t conversational, in the way Bezos and Rohit Prasad had originally hoped. And though it had spawned a small cottage industry of startups and other companies pinning their hopes on voice-enabled services and devices, not many people used Alexa’s third-party add-ons or “Skills,” and developers still weren’t seeing much revenue, compared to the way they did on the app stores of Apple and Google. Bezos fervently believed all that would come in the next few years. Awed employees and Amazon fans who had watched him visualize Alexa and will it into existence believed the CEO could practically see the future. But in at least one respect, he did not. In 2016, he was reviewing the Echo Show, the first Alexa device with a video screen. Executives who worked on the project recalled that on several occasions when Bezos demoed the prototype, he spent the first few minutes asking Alexa to play videos that ridiculed a certain GOP presidential candidate. “Alexa, show me the video, ‘Donald Trump says “China,” ’ ” he asked, or “Alexa, play Stephen Colbert’s monologue from last night.” Then “he would laugh like there’s no tomorrow,” said a vice president who was in the demos. Bezos had no idea what was coming. CHAPTER 2 A Name Too Boring to Notice In November 2012, when Donald Trump was still the host of a reality TV show and Alexa prototypes were about to start moving into the homes of employees, Jeff Bezos was asked by the TV interviewer Charlie Rose a question that had become a recurring favorite of journalists: Will Amazon ever buy or open physical stores? “Only if we can have a truly differentiated idea,” he replied. “We want to do something that is uniquely Amazon. We haven’t found it yet, but if we can find that idea, we would love to.” The answer was only partially true. Because inside Amazon, a small team was already converging on a novel concept for a chain of physical stores, under the direction of Bezos himself. They were getting ready to make what would turn out to be one of the most quixotic and expensive bets in the company’s history. At the time, Bezos was not only observing how advancements in processing power and decreases in computing costs were helping computers understand human speech. He was also tracking the potential for computers with cameras to actually see—to recognize and understand images and video. Earlier that year, he had circulated among Amazon’s senior engineers an article in the New York Times that described how a Google supercomputer had pored over ten million images and taught itself to recognize cats. “Jeff had faith that this was a really important trend that we should pay attention to,” said Joseph Sirosh, chief technology officer of Amazon’s retail business at the time. “Just as he got really enthusiastic about computer voice recognition, he was also really excited about computer vision.” The allure of computer vision, along with his interest in pressing Amazon’s advantage in the cloud to push the frontiers of artificial intelligence, again sparked the fertile imagination of Amazon’s founder. More than 90 percent of retail transactions were conducted in physical stores, according to the U.S. Census Bureau. Perhaps there was a way to tap this vast reservoir of sales with a completely self-service physical store that harnessed emerging technologies like computer vision and robotics. In 2012, Bezos pitched this broad idea at an off-site meeting to the S-team. Bezos alone handpicked members for the leadership council, and they held such brainstorm sessions every year, usually at some nearby corporate retreat, to spark new ideas and reaffirm the importance of “thinking big.” Members were required to write a paper with an inventive idea that might expand Amazon’s business. Judging from the executives he assigned to follow up on his challenge, Bezos considered the opportunity of entering physical retail with a self-service store to be significant. To lead the project, he appointed Steve Kessel, the deputy who had started the Kindle business nearly a decade before. Kessel, a Dartmouth graduate and recreational hockey player who had worked for Amazon since 1999, had the first discussions about the job while he was on sabbatical with his family in the south of France. His new task, in Amazonspeak, was to have a “single-threaded focus” on creating a new line of innovative stores. To manage the project, Kessel in turn lured back Gianna Puerini, a vice president who over the years had run Amazon’s home page and recommendations businesses. Puerini, the wife of S-team member Brian Valentine, was happily retired at the time, restoring and flipping houses in the Seattle area, and had no plans or financial need to return to work. She said she found Kessel’s pitch compelling. “When I asked Steve ‘Why me?’ a key part of his answer was that while we had a lot in common, he thought we would approach problems from different angles and look at things in different ways,” Puerini said. “I loved that he acknowledged the diversity of perspective and thought process…. I think I emailed Steve that night and said, ‘I’m in!’ ” Bezos’s technical advisor at the time, Dilip Kumar, the successor to Greg Hart in the coveted aide-de-camp role, would join Kessel and Puerini in early 2013 to run engineering. Because Bezos thought traditional retailers played their appointed roles well, the group had to meet a high bar before they could proceed. “Jeff was very particular that he didn’t want to just build any store. He wanted the store to be disruptive—something that no one had attempted before, something that would change the way brick-and-mortar retail had been done for hundreds of years,” said Bali Raghavan, who joined as one of the first engineering directors. The project was to be kept a secret even from other Amazon employees. So the team set up shop above a sporting goods store in a nondescript six-floor building on Westlake Avenue. One of Puerini’s first tasks was selecting a code name so boring that no one would pay any attention to them. For the next few years, the team would go by the initials, IHM, short for the nonsensical “Inventory Health Management.” Much later, after years of laborious progress toward their ambitious goal, the project would be known by the name of the peculiar store they would create and try to bring to nearly every major city in North America: Amazon Go. In those early weeks of brainstorming, the IHM crew considered whether they should develop Macy’s-style department stores, electronics stores, or Walmart-style supercenters. Bezos had no particular opinion about what they should sell, just that he wanted to disrupt traditional retail. One discarded idea involved two-floor outlets, with mobile robots swarming over an upper level packed with merchandise. Conveyor belts and other robots would then deliver them to customers’ waiting vehicles below. Amazon executives like to say and repeat compulsively that they start with the needs of the customer and “work backwards.” Ruminating on the act of shopping in regular stores, Puerini’s team made lists of their advantages, such as the instant gratification of walking out with desired items. They also made a list of the drawbacks, chief among them the frustration of waiting in checkout lines. People “are busy. They probably have something they’d rather be doing,” Puerini said. After months of research into customer needs and feasible technology, Amazon’s crack team of type A disrupters felt that the waiting problem was one they could solve with technology. The PR FAQs from the time—with Bezos’s handwriting scrawled in the margin, according to people who saw drafts—coined a trademark for a system that didn’t yet exist: “Just Walk Out technology.” Having envisioned the outcome, they would now try to invent a system that would allow shoppers to select items from shelves and get automatically charged without ever queueing up to pay. An excited Bezos approved the approach in 2013, not knowing that it would take five arduous and expensive years of research to bring it to fruition. “I think in the beginning, even the scientists were a little suspicious whether or not they could actually pull the thing off,” said Doug Herrington, the Amazon senior vice president in charge of the North American e-commerce business. The Amazon Go engineers initially considered using RFID chips in the product packaging to track which items were removed from shelves or asking customers to use their smartphones to scan product barcodes. But Bezos didn’t want them to take an easy path; he wanted them to innovate in the field of computer vision, which he saw as important to Amazon’s future. So they settled on the idea of cameras in the ceiling and algorithms behind the scenes that would try to spot when customers selected products and charge them for it. Scales hidden inside the shelves would provide another reliable sensor to determine when products were being removed and corroborate who was buying what. Over the next few years, Dilip Kumar recruited experts from outside Amazon, such as the University of Southern California’s renowned computer vision scientist, G?rard Medioni, as well as engineers from inside who worked on complex technologies like Amazon’s pricing algorithms. They were entering the hottest crucible at Amazon—a Jeff project, one that had the attention of the ever-curious and demanding boss. During a normal week, they would put in seventy to eighty hours, pushing against impending deadlines and the boundaries of science. At nights and over the weekends, they answered email, wrote six-page narrative memos, and like their counterparts on the concurrent Alexa and Fire Phone projects, prepared incessantly for regular reviews with Bezos. “We were all living in a cave,” said engineering director Bali Raghavan. Toward the end of 2013, they decided to focus on groceries. Americans on average shopped for clothes and electronics just a few times a year. They shopped for food an average 1.7 times a week in 2013, according to the Food Marketing Institute, magnifying the inconvenience of waiting in line. The Go team started to hire executives with grocery experience, who were asked not to change their LinkedIn profiles and were furnished with burner phones and credit cards with no link to Amazon. “In the beginning, it was very 007-like, and it felt cool and important,” said Steve Lamontagne, a veteran of the Albertsons and SuperValu grocery chains. “It’s a lonely way to work though, particularly not being able to leverage the contacts you’ve established over decades.” The Go team presented every few weeks to Jeff Bezos. One notable meeting took place late in the day on June 24, 2014. Team members remember it because Amazon reported weak quarterly earnings that day and its stock sank 10 percent—the biggest drop in a year when Amazon was beset by the failure of the Fire Phone and unusually tepid sales growth. But Bezos was unperturbed. While he could be a remorseless boss capable of terrifying employees when they failed to meet his exacting standards, he seemed to have an unusual wellspring of patience for those at the company who practiced the challenging art of invention. “If there was any time the guy should have been agitated, that was it,” said Lamontagne. “Every time I was in a room with him, he never asked us, ‘How much is this going to cost me?’ or ‘Can we make money in X amount of time?’ He would look at us and say, ‘I know this is really hard and there is a lot of fatigue that comes with inventing something new. You’re heading in the right direction.’ ” Go execs envisioned large-scale stores of about thirty thousand square feet, roughly the size of a suburban supermarket. After a few months, they decided such a megamarket was overly ambitious and cut the proposed store in half. The midsized grocery store would offer a mix of services, not only rows of shelves with grab-and-go items, but counters with cheesemongers, baristas, and meat butchers. Employees envisioned a warm and welcoming experience and became attached to the idea of selling hot meals and coffee. Puerini’s team designed the first concept store in one of their conference rooms, using children’s blocks and standard-issue Amazon bookshelves and door desks to conceptualize how customers might behave in such an environment. As the project neared a hoped-for introduction in mid-2015, Amazon anonymously leased the ground floor of a new luxury apartment building in Seattle’s wealthy Capitol Hill neighborhood. Permits filed with the city included plans for a large produce department, dairy coolers, and an on-site kitchen for preparation of fresh foods. The Go team then sought Bezos’s sign-off. It would be a typical “Jeff meeting”—the documents endlessly rewritten and polished, the day choreographed to within an inch, and everyone holding their breath and hoping that things didn’t go haywire. To show off the concept, they leased a warehouse in south Seattle, near Starbucks headquarters, and converted part of the ground floor into a fifteen-thousand-square-foot mock supermarket. Plywood faux walls conveyed the perimeter, modular shelves could be moved around, and turnstiles mimicked technology that would scan shoppers’ smartphones when they walked in. Bezos and members of the S-team arrived and sat around an imported conference table to peruse the six-page document. Bezos is usually one of the slowest readers in these sessions; he seems to carefully consider every sentence. But this time, halfway through, he put down the document and said, “You know what, let’s go shop,” and led the S-team into the dummy store. They pushed grocery carts down the faux aisles with shelves stocked with canned food and plastic fruit and vegetables. Go employees posed as the baristas, butchers, and cheesemongers, taking orders and adding items to their imaginary bills. It seemed to go well, and afterward Bezos gathered the group in the makeshift conference room. He told them that while they all had done a fine job, the experience was too complicated. Customers would have to wait in line for meat, seafood, and fruit to be weighed and added to their bill, which contrasted with the store’s major selling point: the absence of time-wasting queues. He felt the magic was walking out without waiting—the physical equivalent of Amazon’s famous one-click ordering—and wanted to focus the effort on that, with a smaller and simpler experience. “It was one of those Amazon things, ‘We love it—let’s change everything!’ ” recalled Kristi Coulter, who worked on the project as a brand designer. Steve Kessel reconvened the Go team in their offices and broke the news: they would be losing the fresh produce, meat, and cheese, and pivoting to a much smaller convenience store format. For the next five years, the storefront on Capitol Hill, where they were going to build the midsized supermarket, would sit abandoned, in the heart of one of Seattle’s most well-trafficked neighborhoods, its windows mysteriously covered in brown paper. By the start of 2016, the Amazon Go project had reached a critical juncture: the path ahead was going to be difficult and expensive. Kessel called another meeting of Go execs and asked whether they thought they should proceed, move the project into a gestational RandD phase, or cancel it. While a few execs were skeptical, the consensus was to push forward. Some of the engineers were relieved that they were reducing complexity in the stores by eliminating items with variable weights and prices, like steaks. Others were exhausted from two years of nonstop work and felt captive to an abrasive personality who pushed them relentlessly, generating numerous sprints toward artificial deadlines even as the race started to resemble a grueling marathon. Surprisingly, this time it was not Bezos but the executive who had worked by Bezos’s side and exhibited some of the trademark characteristics that executives often need to be successful at Amazon, Bezos’s former TA, Dilip Kumar. Kumar was from Salem, India, the son of a three-star general in the Indian Army. His family moved around when he was a child and spent about “two years everywhere,” as he put it. Kumar attended the prestigious Indian Institute of Technology and moved to the U.S. in ’94 to get a master’s degree in computer science and engineering from Penn State University and an MBA from Wharton. He joined Amazon in 2003, as it was still staggering after the dot-com bust. Over the years, Kumar relieved stress by locking himself in a conference room and teaching himself to juggle and later by performing stand-up comedy at local open-mic nights. Kumar inhabited a few aspects of the Amazonian leadership template forged by Bezos in his younger, more tempestuous years as CEO: hard-driving, maniacal about the customer, IQ over EQ, raw force of will over innate leadership ability. Colleagues said that Kumar had a remarkable memory and ability to recall even complex technical details. They also say he created an environment in which there were no other options but to succeed. Like every leader at Amazon, he could handily recite the company’s fourteen leadership principles—and like his boss, believed that the only way to get to good decisions was to passionately debate hard problems. “If I have to choose between agreement and conflict, I’ll take conflict every time,” Bezos often said. “It always yields a better result.” But unlike Bezos, Kumar was a skillful wielder of profanity in the workplace, colleagues said. They recall such epic shouting matches between him and Gianna Puerini that once Steve Kessel had to step in. Though instead of breaking up the dispute, Kessel asked them to fight more quietly. “If he was treating you nicely, it meant you were not important,” said a senior scientist on the project. Added Bali Raghavan, “He’s an intense guy to work for, and it used to drive me nuts. He also brings out the best in people.” Of course, the same thing was often said of Bezos as well. As Go execs decided to move forward, Kumar would need every bit of drive and prickly ingenuity. After the ill-fated demo to Bezos and the S-team, the Go group reduced the project to the size of a 7-Eleven-type convenience store, so that they could focus solely on the capabilities of the technology. Kumar’s engineers set up a secret lab on the ground floor of a new Amazon building, called Otter, on the corner of 5th Avenue and Bell Street. Workers could only access it from the inside, swiping their key cards to enter a pair of locked doors. The shelves were packed with fake food fashioned from clay and Styrofoam; shredded green construction paper stood in for lettuce. Kumar asked Go employees to visit and try to fool the overhead cameras and computer-vision algorithms. They wore heavy coats or walked in on crutches or pushed wheelchairs. One day, everyone was asked to bring in umbrellas to see if they would obscure the view of the cameras; on another, employees all wore Seattle Seahawks jerseys to confuse algorithms that partly distinguished shoppers using the color of their clothing. The challenge was that while the technology wasn’t fooled frequently, it was wrong often enough that it could create vexing problems if Amazon deployed it widely. Changes in lighting conditions and drifting shadows, the depth of a product’s placement on shelves, and hands and bodies that concealed customized stickers on products could easily confound the system. Toddlers were a special challenge—small, difficult for computers to distinguish from their parents, and the source of all kinds of anomalous mischief inside stores. Adults might also hoist them on their shoulders, for example, hold them in their arms, or push them in strollers, further confounding the customer identification algorithms, which determined which account would be charged. While Kumar and his engineers were addressing these challenges, Bezos and Kessel were getting impatient. Despite three years of work, Amazon hadn’t opened a single store. So in the peculiar fashion of invention at Amazon, they created separate teams to pursue the singular goal of bringing the company into the vast realm of physical retail. Bezos liked to say Amazon was “stubborn on vision, flexible on details,” and here was an illustration: groups working on parallel tracks would essentially compete to fulfill the “Just Walk Out” ideal and solve the problem of the cashierless store. Kumar’s group continued to develop a store with futuristic computer vision technology embedded in the ceilings and shelves. Meanwhile, Kessel asked Jeremy De Bonet, an Amazon technology director based in Boston, to form his own internal startup of engineers and computer vision scientists. They would end up flipping the problem around and integrating computer vision technology and sensors into a shopping cart, instead of blanketing them around the store. In some ways, this was a harder problem. While the Go store could partially deduce the identity of an item based on where in the store it was located, a so-called “smart cart” would have to account for the possibility of a shopper selecting, say, a bag of oranges from the produce aisle but scanning them somewhere else in the store. This group’s efforts would also take years to develop and would culminate in several technologies that were integrated into the Go store, as well as the Amazon Dash Carts equipped with computer vision scanners and touchscreens that would allow customers to check out as they roamed the aisles of a supermarket. Bezos and Kessel formed a third team to pursue a more modest and immediately obtainable goal: opening bookstores with a more conventional checkout line. Books were the opposite of food—nonperishable, consistently priced, easy to stock—and, of course, the product category Amazon had pioneered online. Customers shopped for books less frequently than food, so waiting to pay was less of a hassle. And books could once again be bait, drawing in shoppers to experience devices like the Fire TV, the latest Kindles, and the new Amazon Echo. In the fall of 2015, as the company prepared its first Amazon Books outlet in an upscale mall in Seattle, speculation over how it would finally enter physical retail was so feverish that a reporter for the local tech blog GeekWire used a pole with a camera attached to it to peek inside. Around the same time, Bezos sneaked in through a back door to see the outlet for the first time and was delighted. He said he felt as if Amazon’s business was coming full circle. The store opened a few weeks later, on November 2, 2015. Employees who worked on the project got to contribute their favorite books to a “staff selections” bookshelf. Bezos himself selected three titles, and in a way, they foreshadowed an unexpected turn of events that lay ahead: Traps, a novel by his wife, MacKenzie Bezos; The 5 Love Languages, by Gary Chapman, about preserving romantic relationships; and The Gift of Fear, by his friend, the famed security consultant Gavin de Becker. To some longtime Go members, watching Amazon Books open within a few months was disheartening. But by the beginning of 2016, the team was finally preparing for their eventual launch. To decide on a formal name for the store, Puerini’s team conducted a series of branding exercises, brainstorming and writing tenets on what the name should communicate to the public. They settled on “Amazon Go” to convey speed. “Even the word itself is only two characters,” she said. “You can literally grab and go.” Inside the Otter lab, fake food was replaced with real items, and Go employees were asked to shop under specific scenarios. For example, Puerini recalled, “You’re running to a meeting: buy a salad and a drink for lunch,” or “You’re in a rush to pick up the kids from day care: grab milk, strawberries, and cereal for tomorrow morning.” Continuing to puzzle over the toddler challenge, they asked parents to bring in their kids, who fidgeted, ran around, and grabbed things, further stress-testing the system. Employees had mixed feelings about their progress. Many loved the convenience, reveling in the ability to run to the Otter lab before an afternoon meeting, grab a sandwich, and return, experiencing the just-walk-out magic they had once hypothesized about in the PR FAQs. But behind the scenes, the technology was not perfect and humans were needed to backstop it. Teams of employees were formed to review footage when the system wasn’t certain about a purchase, a so-called “low-confidence event.” The creation of these groups, the equivalent of the wizard-behind-the-curtain work being done by contractors that reviewed and improved Alexa’s responses, led some employees to question the entire effort. It “was a tricky thing,” said designer Kristi Coulter. “If we have an army of people looking at footage, is that scaling properly?” Humans had another role to play as well: to develop meal-kit recipes and prepare the daily lunch fare, such as lamb sandwiches and caprese salads. To get ready for the opening of an eighteen-hundred-square-foot prototype store on Amazon’s Seattle campus in late 2016, the company hired chefs and staff from industrial kitchens and chain restaurants. It then opened both a kitchen inside the prototype store and a commercial-grade cookhouse in south Seattle, to serve as a model for kitchens that the company planned to build around the country as part of a massive rollout of Go stores. Uncharacteristically, Amazon splurged, buying German commercial ovens that cost tens of thousands of dollars each. The kitchens brought with them another set of unexpected challenges. When something smelled off in the store’s kitchen, Amazon hired a pair of professional smellers to solve the mystery (the culprit: pickled daikon). Because food safety was a top priority, the commercial kitchen was kept bitterly cold, and Amazon initially declined requests from the hourly staff to install mats on the facility’s chilly concrete floor, one employee recalled. After a senior manager from headquarters spent a day observing operations at the cookhouse, the company issued the staff hoodies and other cold-weather gear and finally acceded on the mats. The people involved in the food service industry, it turned out, were proving as tricky to manage as Dilip Kumar’s algorithms. The original Amazon Go store opened to all employees in December 2016. The public opening was scheduled for a few weeks later but ended up being delayed a year after an entirely new series of problems surfaced. According to the Wall Street Journal, the system tended to freeze when twenty or more shoppers were in the store at the same time, and it lost track of products when shoppers picked them up and set them down on a different shelf. Clerks had to be notified to restock the items in the proper place. The system was also not perfectly accurate, even under the best of circumstances, and Amazon executives could not risk the possibility of it making mistakes, falsely charging shoppers and threatening customer trust. Shoppers themselves also tended to get confused by the novel format. “We noticed lots of customers hesitating at the exit, asking the entry associate if they really could leave,” Puerini said later. “In tests, we put up a big poster that said, ‘No, really, you can just walk out!’ ” A version of the sign is still there in the original store. When the first Amazon Go store finally opened to the public in January 2018, it was heralded as a peek into the future. (“The whole process was so quick and seamless, I almost forgot the items weren’t free,” wrote CNET.) But with the small size of the store, limited selection of items, and enormous expenses on salaries and operations, the numbers behind the project horrified finance execs. One told me that the original Go store, its adjoining kitchens and data center cost more than $10 million. “If you were a venture capitalist, this just did not make sense anymore,” said another executive privy to the decision-making. But Bezos wanted to forge ahead. “Jeff is master of ‘this isn’t working today, but could work tomorrow.’ If customers like it, he’s got the cash flow to fund it,” this exec said. In 2017, Amazon spent $22.6 billion on RandD, compared to Alphabet ($16.6 billion), Intel ($13.1 billion), and Microsoft ($12.3 billion). The tax-savvy CEO likely understood that these significant RandD expenses for projects like the Go store and Alexa were not only helping to secure Amazon’s future but could generate tax credits or be written off, lowering Amazon’s overall tax bill. Over the next few years, Amazon Go stores opened across Seattle, San Francisco, New York, and Chicago. Amazon closed its kitchens and instead bought food from the same vendors that make the middling salads and sandwiches for Starbucks and 7-Eleven. The pricey German ovens sat unused in the original store and the kitchen staff was dismissed. Disgruntled, the laid-off staff told tales of declining food quality and of giving away unsold meals to food banks and homeless shelters. “The only thing that’s fresh anymore is the vegetables,” groused one former employee. “It’s heartbreaking to see this project go to hell.” Bezos had envisioned thousands of Amazon Go stores, in urban areas around the country. Seven years into the project there were only twenty-six, hardly producing the financial results he’d had in mind when he conceived the concept. The stores also instigated a political backlash against Amazon for eliminating cashier jobs, the second most popular job in the country according to the U.S. Bureau of Labor Statistics. The stores also threatened to exclude low-income and older shoppers who did not have smartphones loaded with credit cards. Cities such as New York, Philadelphia, and San Francisco passed legislation mandating such stores accept cash. I spoke to Dilip Kumar in 2019, after he was promoted to run all of physical retail. Kumar alone remained from the original IHM trio—by then, Steve Kessel and Gianna Puerini had both retired. He insisted that it was “still early” for the Go project and noted that “customers love the experience” of walking out without stopping to pay. That, Kumar said, gave the project “a lot of latitude and degrees of freedom to be able to try other kinds of things.” One of those was moving the maturing technology back into midsized urban grocery stores. In 2020, right before the onset of the Covid-19 pandemic, Amazon opened its long-dormant site in Seattle’s Capitol Hill neighborhood, calling it Amazon Go Grocery. The cheese, meat, and seafood were back, and Kumar hinted that the cashierless system could work even in larger venues. “We’ve learned a lot,” he told the Wall Street Journal. “There’s no real upper bound. It could be five times as big. It could be ten times as big.” Amazon Go remained a money loser. But Bezos was still looking at it as a bet on computer vision and artificial intelligence, the kind of long-term, high-stakes experiment that was necessary to produce meaningful outcomes for large companies. As he wrote in his 2015 shareholder letter: We all know that if you swing for the fences, you’re going to strike out a lot, but you’re also going to hit some home runs. The difference between baseball and business, however, is that baseball has a truncated outcome distribution. When you swing, no matter how well you connect with the ball, the most runs you can get is four. In business, every once in a while, when you step up to the plate, you can score 1,000 runs. This long-tailed distribution of returns is why it’s important to be bold. Nearly a decade after it was conceived, it was still unclear whether the Go store would produce a 1,000-run windfall for Amazon. But it did lead in interesting new directions. Amazon began licensing the “Just Walk Out” system to several other retailers, such as convenience stores and airport kiosks. Amazon Books spawned a few dozen 4-star stores, where the company used its trove of data about people’s buying habits to tailor stores with an eclectic mix of locally popular items. And in 2020, Amazon started opening large Amazon Fresh grocery stores, without Go technology but with the long-gestating Amazon Dash Carts, which allowed shoppers to scan items as they walked the aisles and skip the checkout line. Another significant outcome was the realization, in early 2016, that Amazon needed to get smarter about physical retail if it ever wanted to seriously compete against giants like Walmart and Kroger in the $700-billion-a-year U.S. grocery industry. Around that time, Steve Kessel joined a cabal of Amazonians that included senior vice president Doug Herrington and members of the Go and MandA teams, to answer a momentous question: whether Amazon should acquire a supermarket chain. They looked at local grocers, regional chains, and the big national players. Among the calls they placed that year was to the Austin-based Whole Foods Market, the beleaguered organic food chain with cratering same-store sales, a reputation for high prices, and a stock price at a five-year low. But its iconoclastic founder, John Mackey, was confident in his turnaround plan and not ready to sell—yet. CHAPTER 3 Cowboys and Killers As Jeff Bezos chased Amazon’s next wave of growth by backing ambitious technology projects like the Go store, Alexa, and Fire Phone, he also opened an online store in India, the country of 1.3 billion people whose cosmopolitan cities were rapidly embracing smartphones and broadband internet access. Over the course of several years, Amazon would sink billions of dollars into the country. His bet there was a renewal of Amazon’s manifest destiny—to sell not only everything, but everywhere. Bezos had missed an earlier opportunity to invest in India. In 2004, Amazon opened one of its first overseas software development centers in Bangalore, in a small office above an auto dealership. Employees working on its floundering search engine, A9, and its nascent cloud business, Amazon Web Services, repeatedly pitched plans to start a local online store. But as Amazon recovered from the dot-com bust and concentrated its energies on launching in China, India was practically an afterthought. As a result, some of Amazon’s early employees in India quit to start their own firms. In 2007, two engineers, Sachin Bansal and Binny Bansal—unrelated friends and former classmates at the Indian Institute of Technology (IIT) in New Delhi—left Amazon to start their own company, Flipkart, to try to replicate Bezos’s original magic of selling books online. If Amazon wasn’t going to serve India’s increasingly connected and prosperous upper classes, they would do it themselves. The Amazon executive who had helped start and run the Bangalore development center was a Bezos disciple and ardent workaholic named Amit Agarwal, also a graduate of IIT. From 2007 to 2009, Agarwal returned to Seattle to become the technical advisor to Bezos, preceding Greg Hart and Dilip Kumar in the crucial role of shadowing the CEO in all of his meetings. At the end of his tenure, he and Bezos had a critical discussion about what the TA would do next. Agarwal asked to join the international division and wrote a business plan to finally introduce Amazon into the country where he grew up. At the time, Diego Piacentini, Amazon’s then senior vice president for its international consumer division, had mixed feelings about expanding into India. Though companies like IBM and Microsoft had large and successful operations in India, the country had complex laws in place to protect its vast, decentralized sector of mom-and-pop retail shops. These “foreign direct investment” regulations prohibited overseas companies from owning or directly operating a retail business. Piacentini, an Italian who had left Apple to join Amazon in early 2000, also felt that countries with larger gross domestic products should take priority. In 2010, he asked Agarwal to help him bring Amazon to his native country, Italy. A year later, they opened another foreign-language website, in Spain. Those successful introductions, Agarwal said, gave them confidence about “reigniting global expansion.” As Amazon finally prepped for its incursion into India in 2012, the execs carefully considered some of the difficult lessons they were learning in China. Amazon had entered China propitiously in 2004, acquiring the bookselling startup Joyo.com for about $75 million with the belief that the same approach that had worked elsewhere could succeed in the world’s most populous country. Amazon planned to patiently invest, winning customers with wide selection, low prices, and reliable customer service. But after a few years of steady progress, everything seemed to suddenly go wrong in China. A well-capitalized e-commerce competitor, Alibaba, opened a popular fixed-price online store for well-known brands, called Tmall, an offshoot of its eBay-like website, Taobao. A few years later, Alibaba expanded a tool called Alipay to let shoppers pay digitally for the products they ordered, while Amazon was still accepting cash from homebound buyers upon delivery. Alibaba and another mounting rival, Jingdong, or JD.com, had cluttered but arresting websites, which catered to the overall design tastes of Chinese internet users. The Amazon.cn website looked like Amazon’s other home pages around the world. Amazon’s China employees were dependent on technical support and other kinds of help from Seattle, and thus were slow to respond to these and other obvious market signals. A year prior in 2011, Amazon dusted off another page from its global playbook to introduce a marketplace in China, allowing independent businesses to sell their products on the site. This was a key piece of the heralded flywheel: by adding outside vendors, the company drew in new shoppers and earned money from the fees it charged sellers. The extra revenue was then used to lower prices, which in turn attracted more buyers. But again, Amazon failed to adapt to the idiosyncrasies of the China internet—Chinese sellers were accustomed to paying about 2 to 5 percent of their sales to Alibaba, in addition to ads to make their listings more prominent. Amazon execs were skeptical of the advertising model so instead charged 10 to 15 percent of sales, which seemed unusually high to sellers. As a result, Alibaba raced further ahead. Then a damaging report on China’s state-sponsored television, CCTV, drew attention to counterfeit goods, such as fake brand-name cosmetics, on Amazon’s third-party marketplace; any signs of progress in the country quickly evaporated. Amazon.cn executives from that time said that Bezos was totally uninterested in understanding the inner machinations of the Chinese government, cultivating ties with Chinese leaders, or using his budding fame to help Amazon’s cause in the country, as Elon Musk would do years later to set up a Tesla Gigafactory in Shanghai. Without a closer relationship with the Chinese Communist Party, Amazon ended up losing even more ground. In an analysis of the struggling China business they delivered to the S-team in 2014, the international team estimated the company had lost a billion dollars in the decade since the Joyo acquisition. Wary of the gathering red ink, Bezos decided to curtail Amazon’s investment in China and set out on a plan to become profitable there instead of accepting the additional losses that would be required to stay competitive in the country. An Amazon finance exec later described it as the equivalent of “shooting the business in the head.” Between 2011 and 2016, Amazon’s market share in China fell from 15 percent to less than 1 percent. “There was always the fear that if we invested a lot in China, we’d get screwed anyway and waste a lot of money,” Piacentini explained years later. “We were not bold enough to go head-on and compete. We always acted as a timid follower.” On the eve of Amazon’s long-awaited incursion into India, Bezos could consider some of those hard-earned lessons: the company hadn’t invested or innovated boldly enough in China, didn’t cultivate ties with the government, and hadn’t set up operations with enough independence from Seattle. With his former shadow Amit Agarwal eager to bring Amazon to his native country, he wouldn’t make the same mistakes again. One of Amazon’s first moves in India was to try to entice its two famous alumni back. Four years after striking out on their own, Binny Bansal and Sachin Bansal had built Flipkart into a nationally recognized brand that sold not only books but mobile phones, CDs, and DVDs. Amit Agarwal met his former employees at the upscale ITC Maurya hotel in central Delhi to discuss an acquisition. Feeling confident about their progress, the Bansals asked for $1 billion. Agarwal scoffed at the amount, and the talks fell through. After the Bansals thumbed their noses at Amazon, Agarwal started to build a team to compete against them. He prowled headquarters in South Lake Union, zealously pitching a “once-in-a-lifetime opportunity” to impact Amazon and “change the trajectory” of Indian democracy itself. His target was native Indian Amazonians who understood both the company and the cultural peculiarities and varied languages of the vast Indian market. By 2012, an Amazon India team of a few dozen engineers occupied an office on the eighth floor of the grandiosely named “World Trade Center,” a curved glass high-rise in northern Bangalore. At first, they were uncertain how to proceed. India’s foreign direct investment rules seemed to preclude them from opening a standard Amazon web store, where the company bought products from manufacturers at wholesale prices and then sold them to online shoppers. So in typical Amazon fashion, they tried to get clever, introducing a comparison-shopping website in February 2012 called Junglee.com. By scouring the web and listing all the prices and products for sale on other websites, Amazon could start collecting data and earning referral fees without brokering actual transactions and violating the law. But Flipkart recognized the move as a dangerous giant dipping its toe in their waters and declined to let Junglee trawl its site to gather information. After an initial burst of attention, Junglee failed to get any traction. By 2013, Agarwal and his team had settled on another approach. They would deviate from the company’s playbook and operate Amazon India purely as a third-party marketplace. This would allow outside vendors to sell their wares on the newly christened Amazon.in, with Amazon brokering the transaction and collecting fees but never owning actual inventory. The glaring weakness was that, for the time being, Amazon couldn’t set prices or ensure the availability and quality of the most popular products. After repeated delays, Amazon.in went live on June 5, 2013. A shaky handheld video of the launch posted on YouTube shows a conference room packed mostly with giddy young Indian men. After flipping the switch at 2 a.m., they burst into riotous applause. “Shop with Confidence” the new site blared. Within a few weeks, Amazon India expanded from media products like books and DVDs to sell smartphones and digital cameras. Beauty products, kitchen gadgets, and Amazon’s Kindle Fire tablet soon followed. Agarwal wanted to introduce a new category each week—and, like his boss back in Seattle, he liked to set high expectations. “If there was a week when we didn’t launch selection in a category, we used to sit down and say this was a disappointing week,” he later recalled. Although the new Amazon offshoot was eight thousand miles away from home base, Agarwal had managed to import key elements of Amazon’s culture. He asked movers to transport the door desk he had built for himself as a new employee in 1999—partly, he says, because he felt bad that his family didn’t have enough personal furniture for the shipping company to haul. He introduced Amazon practices like writing six-page narratives and correction of error or “COE” reports, to systematically address problems like delivery delays during the monsoon season. Like Bezos, Agarwal would regularly forward customer emails to his staff with a single question mark—they called them “Amit A. escalations” instead of “Jeff B. escalations”—to highlight problems to be immediately solved, or else. A few months after launching, in the fall of 2013, Agarwal and his deputies returned to Seattle to present their annual road map to Bezos and the S-team as part of the company’s annual OP1 planning process. Their six-page narrative offered a range of conservative to more aggressive investment options for how to expand in India and catch up with six-year-old Flipkart in sales and other critical benchmarks. It also outlined prospects for an experimental advertising campaign, so that the company could test what resonated with Indian consumers. By then, Amazon’s China bet was souring, so Bezos did not want to relinquish his shot at what seemed like the world’s next largest prize. In most OP1 sessions, he usually spoke last, not to sway the group with his formidable opinion. But this time, he interjected while Agarwal was still giving his presentation. “You guys are going to fail,” he bluntly told the Indian crew. “I don’t need computer scientists in India. I need cowboys. “Don’t come to me with a plan that assumes I will only make a certain level of investment,” Bezos continued, according to the recollection of two executives who were there. “Tell me how to win. Then tell me how much it costs.” Another Indian executive at the meeting, Amit Deshpande, says the message was: “Go big and take risks. Make it happen. We have your backs.” Amit Agarwal, a computer scientist with degrees from IIT and Stanford, was momentarily taken aback. But upon his return to India, he turned that directive into a rallying cry. Bezos’s command became such a part of the core mythology of Amazon India that execs would occasionally dress up in cowboy outfits at all-hands meetings. They scotched their meek OP1 marketing plan and became one of the largest advertisers in India, promoting Amazon.in on the front page of newspapers like the Times of India and in catchy commercials during Indian Premier League cricket games. One of their new team goals, as Amazon India execs described it, was to grow so fast that it practically forced Bezos to come to India. The next few months were a blur. Members of the team worked all day, every day, traveling often and taking the first plane in the morning and the last at night. When they weren’t flying around the country, they went to China to observe the tactics of Amazon, Alibaba, and JD.com in a similarly competitive environment. “I had a suitcase in my room and a suitcase in the office,” says Vinoth Poovalingam, an operations manager who was setting up Amazon warehouses across India. “A couple of folks used to joke, ‘Dude, we are working in a labor camp.’ ” Amazon had to operate differently in India. Without critical infrastructure like the multilane highways and credit card networks the company enjoyed in the West, execs had to devise distinctive logistics and payment strategies for the country, like hiring bike messengers and accepting cash on delivery. Where the company usually employed a single code base for the retail website across all of its regions, in India Amazon engineers developed new code and a less memory-intensive smartphone app since customers predominantly accessed the site on their phones and via sluggish wireless networks. To move more nimbly, all departments reported into Agarwal, instead of to their peers in Seattle. “At a fundamental level, we questioned everything and asked, ‘Is this the right thing for India?’ ” said an Amazon India executive. Agarwal, international chief Diego Piacentini, and Peter Krawiec, Amazon’s corporate development chief, also found a solution to operating a pure third-party marketplace without being able to have a retail arm that could set prices and ensure the availability of products. In mid-2014, with billionaire Narayana Murthy, cofounder of the Indian outsourcing giant Infosys, Amazon formed a joint venture called Prione Business Services, which Amazon would own 49 percent of. Prione would then run a firm called Cloudtail that would sell popular items like the latest smartphones and consumer electronics. Cloudtail immediately became the largest vendor on Amazon.in, responsible for around 40 percent of sales. Prione was a transparent hack of India’s somewhat murky foreign direct investment regulations. (“Test the Boundaries of what is allowed by law,” read an internal Amazon slide from the time, Reuters later reported.) The arrangement allowed Amazon to offer customers exclusives on the hottest new smartphones from companies like Samsung and India’s OnePlus. Flipkart, backed by overseas venture capitalists, had paved the way here, setting up its own proxy seller, called “WS Retail,” and offering exclusives on phones from Motorola, Xiaomi, and Huawei. The two companies would play this game for years—duking it out with discounts and exclusives, which the vast assortment of mom-and-pop stores around the country couldn’t possibly hope to match. By mid-2014, traffic was exceeding both Amazon’s and Flipkart’s most optimistic projections. On July 29, a few months after it acquired fashion rival Myntra, Flipkart announced a fresh infusion of $1 billion in venture capital, valuing the company at $7 billion—more than the total of all other Indian internet startups put together. A day later, Amazon, approaching $1 billion in total sales in the country after just a year of operation, put out a rival press release, loudly announcing a $2 billion capital infusion into Amazon India. The e-commerce opportunity in India was a lucrative echo of the previous battle in China—and this time, Bezos was determined not to lose. That September, he fulfilled his promise to Agarwal, visiting India to use his budding business fame to advance Amazon’s cause. Flipkart greeted his arrival with an advertising campaign of billboards outside the Bangalore airport and around Amazon’s offices, promoting a new Flipkart-minted online holiday, Big Billion Day, to mark the upcoming Diwali festival. Bezos planned his public appearance himself, hoping to make a big enough statement that even Flipkart’s investors might hear it. He wanted to present an oversized $2 billion check to Agarwal while riding an elephant—a symbol in India that represents wisdom and strength. But all the elephants were occupied in a religious festival at the time, and after stubbornly pressing his colleagues to find one, he agreed to perform the publicity stunt instead atop a Tata flatbed truck festooned with ceremonial decorations. Sporting a formal cream-colored bandhgala suit and maroon dupatta scarf, Bezos presented the mock check as Agarwal played along. The local press devoured the pageantry and the crosstown rivalry between Amazon and Flipkart. Bezos tried to play it down, even as he worked to defeat Flipkart in battle. “My own view is that most companies spend too much time thinking about the competition,” he told the Indian publication Business Today. “What they should be doing is thinking about their customers.” Meanwhile, responding to Big Billion Day, Bezos conceived of a competing day of deals celebrating the successful orbit of Mars by an India-launched space probe, which dovetailed with his own passion for space. Amazon initiated a fresh marketing blitz to advertise the promotion, and traffic poured into both Amazon.in and Flipkart. During a quieter moment of his trip, Bezos talked to his local executives at a nearby hotel. He reiterated that he wanted them to think like cowboys, with India as the Wild West frontier of e-commerce. “There are two ways of building a business. Many times, you aim, aim, aim, and then shoot,” he said, according to three executives who were there. “Or, you shoot, shoot, shoot, and then aim a little bit. That is what you want to do here. Don’t spend a lot of time on analysis and precision. Keep trying stuff.” Bezos, Piacentini, and Agarwal also had lunch with their new corporate partner, Narayana Murthy, the sixty-eight-year-old Infosys cofounder. He regaled them with stories of backpacking through Europe as a broke college graduate, and about Infosys University, the company’s massive internal training program to furnish recent college graduates with practical technical skills. Bezos listened intently; Piacentini recalled that Bezos and the elder Murthy had “an immediate chemistry.” From there, Bezos and Agarwal flew to Delhi to meet with the true figure who controlled Amazon’s prospects in India: Prime Minister Narendra Modi. In interviews before the meeting, Bezos touted India’s entrepreneurial spirit, dangled the possibility of placing AWS data centers in the country, and said of the newly elected leader, “I am completely at his disposal; he has a fantastic international reputation.” But Modi said little publicly in return. Local merchants, a key part of his governing coalition, were eyeing Amazon suspiciously. If Modi ever needed to shore up their support by tightening the rules around foreign investment, he could blow up the economics of Amazon’s most promising overseas venture in an instant. Back in Seattle, Amazon’s progress in India was emboldening. Bezos and the S-team figured that if e-commerce could take off in India, there must be untapped opportunity in other developing countries. Their next priority for international expansion, in 2014, came via the French-Canadian Amazon executive Alexandre Gagnon. Having served as the technical advisor to S-team member Diego Piacentini and helped with the launches in Italy and Spain, Gagnon had also been in charge of bringing Amazon north into Canada. He realized that one of their primary advantages in that move had been the proximity of U.S. warehouses, which helped to fulfill some items that were not popular enough to be stored in Canada’s local FCs. A single, networked continental supply chain could also work in Mexico, which had the fifteenth largest GDP in the world at the time. The episode that unfolded over the next year would include one of the more curious experiments in Amazon’s international expansion as well as one of the most notorious characters in its history. At the time, Walmart was the largest physical retailer in Mexico and had the largest e-commerce presence. The Argentine startup MercadoLibre also operated there, but the country represented less than 7 percent of its total sales in Latin America. E-commerce was constrained in Mexico by the same factors that had stifled it in India: low internet usage, balky wireless networks, and low credit card penetration. But Amazon now had experience solving these problems. Gagnon brought his plan for Mexico to the S-team in March 2014. His six-page proposal drew parallels with India. It also pointed out that many wealthy Mexicans were already buying from the U.S. website, paying extra to ship products across the border. One of Gagnon’s colleagues later said they were nervous going into the meeting, after hearing that Bezos was in a particularly foul mood that day. But the session, scheduled for ninety minutes, lasted only forty-five—always a good sign. “His reaction was generally that we were not early but not too late either,” Gagnon said. “He felt that we had a good plan and that we should launch as soon as we could.” Mexico received only a fraction of the multibillion-dollar investment that flowed into India. And while Bezos would make most of the important decisions about investment levels in India himself—a sign of the importance he placed on the country—Gagnon reported to Jeff Wilke, the head of the global consumer business, who was in charge of “anything that touches the I-5,” the interstate that threads down the western coast of the U.S. One of the first orders of business in Mexico was finding a local CEO who could manage the rollout and be the face of Amazon in the country. After a months-long search, Amazon’s lead recruiter, Susan Harker, reached out to Walmart de M?xico e-commerce executive Juan Carlos Garcia, who was ready for a change after an infamous bribery scandal in the country had forced several of his colleagues to resign and eroded company morale. Garcia had previously founded and sold several e-commerce startups. Garcia visited Amazon headquarters that October and spent two days in back-to-back interviews. He was asked to write a six-page document explaining “the most innovative thing I’ve ever done” and “the most customer obsessed thing I had ever done in my career.” At the end of the grueling session, he was ushered into a surprise final meeting that wasn’t on his schedule: with Bezos himself. Bezos likes to say that he gets “all weak-kneed around entrepreneurs,” and the ten-minute talk stretched into an hour. Bezos revealed what no one had yet explicitly stated to Garcia—that Amazon was launching a business in Mexico. Garcia got the job and took over the small Amazon Mexico team, which moved into an office at a Regus coworking space in the affluent Polanco neighborhood of Mexico City. And they started planning. Garcia’s initial six-page proposal for the project—dubbed Project Diego, after Mexican painter Diego Rivera—was rejected by Bezos for being too conservative. Garcia had modeled the approach after the methodical rollouts in Italy and Spain, where the company introduced a few product categories to start, then later added others along with a third-party marketplace. But Bezos, capitalizing on what he had learned in China and India, wanted to quickly catch up with Walmart and MercadoLibre. Garcia rewrote the plan and “threw everything in.” The following March, as Amazon Mexico approached its launch date, Garcia was skiing on Whistler Mountain north of Vancouver when he was summoned to Seattle for an emergency meeting. Jeff Wilke was tired of paying Google $3–4 billion a year for search ads to promote product listings at the top of its monolithic search engine. At the time, Google was also expanding the Google Express shopping service to more cities and investing in a number of e-commerce startups to challenge Amazon around the world. Wilke wanted to know if it was possible to launch Amazon in a foreign country without using search advertising at all—as a test, to see if Amazon could wean itself from its dangerous dependency on an avowed rival. Wilke suggested using Mexico as the guinea pig. Garcia joined the meeting and pored over the document outlining the plan. He recalled Bezos walking in after an hour and asking anyone who was against it to raise their hand. Garcia later told me he was the only one who did. Google was the dominant search engine in Mexico, with some 24 million unique visitors a month. According to the analysis in the document, which I later obtained, Amazon estimated it would forgo 20 percent of its overall potential traffic to Amazon Mexico by spurning paid Google search. The document also estimated that cutting off Google ads would reduce the overall percentage of visitors who clicked on regular free search links from 14 to 11 percent. To recover that lost traffic, the paper concluded, they’d have to dangle discounts, offer free shipping, and wage a brand advertising campaign to get customers to begin their shopping searches on Amazon instead of Google. Later, Jeff Wilke explained his support for such a move by saying, “We have a reliance to varying degrees on Google in all of our established countries. I always want to ask the question, ‘Is the advertising that we do worth it?’ ” In the meeting, Bezos was circumspect, Garcia recalled. He seemed to side with Garcia against the plan. But then Wilke convinced him that it was a “two-way door”—Bezos’s phrase for a decision that can always be reversed later, as opposed to “one-way doors,” in which the choice is permanent. He agreed to try it out. Garcia had to “disagree and commit,” Amazon’s lingo for committing to a course of action you oppose. Amazon.com.mx went live on June 30, 2015, becoming the company’s first comprehensive online store in Latin America. The site was entirely in Spanish, promising “millones de productos en nuestra tienda en l?nea.” The Amazon Mexico team flew to Seattle for the launch, since the Wi-Fi in their local Regus office was spotty. They held a small party that night in a lounge on the ground floor of Day 1 North, where Wilke introduced Garcia to international chief Diego Piacentini, who told him, “Enjoy your five minutes of fame.” A few weeks later, the Amazon Mexico execs held a flashier affair at the St. Regis Hotel in Mexico City, where Garcia hired a popular Mexican party band, Moderatto, to play. For the next few quarters, Amazon avoided buying Google ads in Mexico and tried to compensate with billboards, radio, and TV ads, and shipping discounts. As Garcia had feared, it hobbled the site. The offline ads were more expensive and less effective. Google brought in $70 billion in annual advertising revenues because search ads worked and were a relatively inexpensive way for websites to attract visitors. “I wanted to see if we could get traction in a country launch without using Google,” Wilke later said, “and it turned out, the answer was no…. We weren’t reaching enough customers.” Garcia and his colleagues then ended the experiment, employing the internal system Amazon uses to manage its massive Google ad-buying campaigns, called Hydra (for the multiheaded sea organism, but also, Amazon employees snickered, for the terrorist organization in Marvel comics). A year later, in 2016, Amazon Mexico’s PandL statement recovered and started to show promise. Nevertheless, in Seattle, Garcia’s reputation was declining. Some executives complained that he “didn’t get Amazon culture,” and according to several accounts, he did not get along with Jeff Wilke or his direct manager, Alexandre Gagnon. While several Amazon Mexico employees remembered Juan Carlos Garcia as an approachable leader who often stayed at work late at night and represented the company well in the press, one colleague recalled a moment when Garcia revealed an alarming temper, leading up to Black Friday in 2015. He was arguing about matching a smaller website’s heavily discounted price on a sixty-inch television with a category manager, who insisted that the rival’s price must be a mistake and that Amazon would lose too much money if it matched it. As the debate grew tense, Garcia banged his hand on the table and said, “I am CEO! Do it!” Amazon matched the price, quickly sold thousands of TVs, and indeed lost a lot of money. In late 2016, Garcia later recalled, tensions with his Seattle bosses reached a boiling point when an Amazon board member ordered a shipment of shoes from his vacation home in Punta Mita and only some of them arrived. The problem was relayed to Jeff Wilke, to see if it might indicate a larger issue. Wilke forwarded it to Garcia and then asked him about it in a meeting. The resulting discussion grew heated, and Garcia later said he felt disrespected. He was fired from the company shortly after, in February 2017. Garcia reached out to me in September 2019 to relay his Amazon story over a long conversation in a caf? and a walk around downtown San Francisco. He said that he had looked into the board member’s shoe purchase and concluded that he had mistakenly ordered from the U.S. website, not the Mexican one. He said that before he was fired, he pointed that out to Wilke, who never responded. Alexandre Gagnon spent more time in Mexico after Garcia left, and eventually handed over the role to one of his U.S. deputies. Under their management, with full access to Google ads, Amazon Mexico thrived. By the end of that year, it was a leading player in the country’s $7.1 billion e-commerce market—slightly ahead of MercadoLibre and Walmart. But there’s a startling postscript to this story. After our talk, Garcia and I agreed to keep in touch. Despite sending a few follow-up emails, I didn’t hear from him for several weeks. Then, in November 2019, a news report caught my eye: ex–Amazon Mexico CEO Juan Carlos Garcia was wanted for questioning in the murder of his wife, Abril P?rez Saga?n. The horrifying tale started the previous January, eight months before I met with Garcia. After a fight, he had allegedly beaten his wife with a baseball bat and slashed her face with a knife. Their fifteen-year-old son witnessed the incident and their teenage daughter documented her mother’s injuries in grisly photographs. P?rez recovered and obtained a restraining order against Garcia, who was sentenced to pretrial detention for the next ten months. News reports differ on when he was actually held, but somehow he was allowed to travel to San Francisco. I was clueless about the earlier incident, which hadn’t made the news. Then a few weeks later, on November 25, 2019, P?rez flew to Mexico City for a custody evaluation for their three children. On the trip to the airport afterward, she was sitting in the passenger seat of an automobile driven by her lawyer, with two of the children in the back seat, when an assassin on a motorcycle drove alongside the car and shot her twice through the window. She died that night. The killing sparked a furor in Mexico and abroad. “Ex–Amazon Mexico CEO on the Run in the U.S. After Wife’s Mysterious Murder” one newspaper headline blared. Protests erupted around the country, with activists accusing the government of failing to protect women in abusive relationships or to take seriously the crime of femicide. In a terrible irony, an Amazon Mexico employee told me the company had to temporarily suspend its Google ad buying program, so that Amazon ads didn’t inappropriately pop up when users searched for updates on the crime. In March 2020, two men were arrested and charged with the murder. But police and even his children were convinced that Juan Carlos Garcia had hired the assassins, and he remained the primary suspect. According to Mexican police, he entered the U.S. on foot near Tijuana days after the killing and, as of this writing, hasn’t been seen since. Back in India in 2015, Amazon and Flipkart swung at each other like heavyweight prizefighters. They jockeyed for exclusive deals with smartphone makers, offered steep discounts during their holiday bonanzas, and built warehouses around the country at a dizzying pace. Amazon’s catchy TV ads (“Aur Dikhao,” or “Show Me More,” what Indian customers tell salespeople at small shops) littered the airwaves. To help teach small Indian vendors how to buy and sell online, Amazon procured a fleet of three-wheeled wagons, dubbed Chai Carts, which rolled into India’s colorful local markets offering free tea, water, and lemon juice. Employees introduced sellers to tools like email and apps and showed them how to register on Amazon.in and upload their inventory. That fall, Agarwal and his execs returned to Seattle for the annual OP1 planning sessions. Two years prior, they had been asked to revise their conservative projections, and by now, Agarwal had internalized Bezos’s directive to put aside caution and pesky concepts like operating profit. The plan for the next year showed dramatic levels of investment, sales growth, and red ink. Still buzzing from the entrepreneurial energy he had witnessed in India, Bezos was inspired. “The future is going to be the U.S., China, and India,” he declared, according to a colleague who reports hearing him say it multiple times. “For Amazon to be a truly world-class global company, we have to be relevant in two out of the three markets.” At the end of the discussion, Agarwal and the India execs received a standing ovation from the S-team, an unusual commendation in a usually solemn and intimidating environment. On the ground in India, little applause existed, just intricate problems to solve. Agarwal realized early on he couldn’t depend solely on logistics partners like the India Post, the federal mail carrier. So Amazon, like Flipkart, created its own network of couriers in vans, motorcycles, bikes, and even boats to reach the remotest parts of the country. To get Indians more comfortable with the idea of digital payments, it introduced the option to deposit the change from a cash transaction as credit in their Amazon accounts. All these moves showed promise. By the summer of 2016, Amazon was preparing to introduce its Prime two-day shipping guarantee in the country. And in a momentous turn of market leadership, it was set to surpass Flipkart in sales. Galvanized, Bezos again met with Prime Minister Modi that June at the U.S.-India Business Council in Washington, D.C., and announced that Amazon would plug another $3 billion into Amazon India. Modi, on a goodwill tour to cultivate foreign investors, seemed more receptive to Bezos’s entreaties this time. He posed for photos with business leaders, and called India “much more than a market” and a “reliable partner” that would continue to make it easier to conduct business in the country. As Amazon doubled down on its progress, its rival began to look shaky. Flipkart’s CEO, thirty-three-year-old Sachin Bansal, was grappling with the same problem of Google’s web dominance that had led Amazon to suspend search advertising in Mexico. Studying Google’s ad fees and India’s relatively low level of PC ownership, Bansal declaimed that Flipkart and the fashion site it had acquired, Myntra, would concentrate their energies and investments on their smartphone apps and scrap their desktop and mobile websites altogether. He then fired most of his management team, which had strenuously objected to the move. The strategy backfired. Customers were alienated by the inconvenience of having to download apps; meanwhile, Amazon took out full-page newspaper ads with a letter from Jeff Bezos, thanking Indians for making Amazon.in the most visited e-commerce site in the country. Flipkart sales slowed and the company laid off workers. Nevertheless, private investors were still besotted; the following year, Flipkart raised an additional $1.4 billion from a consortium that included the Chinese tech giant Tencent, eBay, and Microsoft. But it had to accept a reduced valuation of $11.6 billion from its previous round. “If someone gave us a model of how to fuck it up, we followed it,” said a Flipkart board member. Soon after, Sachin Bansal was replaced as CEO by his cofounder, Binny Bansal, though he remained executive chairman, a largely ceremonial role at Flipkart. The company’s stumble was one factor in a complex strategic landscape that Jeff Bezos was surveying by 2017. Investors had bid Flipkart’s valuation into the stratosphere, but both Amazon.in and Flipkart were losing well over a billion dollars a year. The retail giant Walmart, under CEO Doug McMillon, was looking afresh at global e-commerce and trying to stem Amazon’s advance around the world; it had previously explored the prospect of investing in Flipkart. Meanwhile, as Modi prepared to run for a second term, he was making it more, not less, difficult to conduct business in India, despite his previous promises. His ruling Bharatiya Janata Party proposed a new set of rules that would prevent a single seller on a foreign-owned online marketplace like Amazon.in from brokering more than 25 percent of the site’s total sales. This was a dart aimed directly at Amazon and Flipkart’s arm’s-length subsidiaries, Cloudtail and WS Retail—and a way for Modi to placate his powerful base of small retailers, which were increasingly unsettled by the e-commerce frenzy. Amid that piquant set of facts, Sachin Bansal met Jeff Bezos at The Weekend, an elite conference in Aspen, Colorado, organized by Ari Emanuel, CEO of the entertainment and media agency Endeavor, and Google chairman Eric Schmidt. He pitched an acquisition that would end the capital-intensive conflict between the two companies but keep both websites independent. Amazon.in would broker everyday items like groceries and books, while Flipkart would sell higher-value products, giving it additional leverage to reach better deals with vendors like smartphone makers. After being sidelined following the disastrous attempt to go mobile only, Bansal could use this as his route back into Flipkart’s leadership. Bezos, as always “weak-kneed” around a brash young entrepreneur, was intrigued by the proposal. He asked MandA chief Peter Krawiec to start negotiations. Krawiec started off with a lowball offer, backed up by numbers that showed Amazon India had grown larger than Flipkart. Flipkart disagreed with that market analysis. Both sides, which professed publicly not to care about the competition, adamantly insisted that they were winning. Since they couldn’t even agree on a common set of facts, negotiations proceeded slowly over the next few months. In October, some of Walmart’s management team heard about the talks from Goldman Sachs bankers. Intoxicated with India’s potential and with fear of losing out to Amazon in a critical growth market, they jumped back into the fray. That month Flipkart executives made a pilgrimage to Walmart headquarters in Bentonville, Arkansas. Amazon then heard about those talks and got more serious as well. Flipkart’s investors and board members split into camps favoring three different strategies: sell to Amazon, sell to Walmart, or stay independent. Sachin Bansal backed a deal with Amazon since it might allow him to resume running the company. But most Flipkart investors were skeptical that India’s antitrust authorities would sanction a merger with Amazon, which would consolidate around 80 percent of the e-commerce market. Bezos seemed to have faith in his budding relationship with Narendra Modi and expressed confidence that he could get the deal done. He pursued the acquisition earnestly, according to several colleagues—even over any concerns from Amit Agarwal, who would have the frightening responsibility of integrating two disparate brands and money-losing supply chains. In March 2018, Bezos hosted Sachin Bansal and Flipkart CEO Kalyan Krishnamurthy in the boathouse behind his home on Lake Washington. A few weeks later, he spoke over the phone with two of Flipkart’s most influential backers, Tiger Global partner Lee Fixel and SoftBank chairman Masayoshi Son, aka “Masa,” who particularly favored a deal with Amazon over Walmart and seemed determined to enlist Bezos as a long-term ally. The sticking point in the Amazon-Flipkart talks was a breakup fee. Flipkart’s investors feared the uncertainty of the regulatory review process and knew of Amazon’s infamous reputation for engaging in discussions only to not follow through, or to try to raise the price for a more determined rival. So Flipkart demanded a $4 billion breakup free, with the cash paid up front, so that if the merger review took eighteen months and resulted in rejection, Amazon wouldn’t benefit from having impeded a competitor. Amazon balked at that arrangement, which would amount to funding its rival. Though Masa clung to hope until the end, the Flipkart board turned down the Amazon deal. Meanwhile, Walmart had played its hand well. CEO Doug McMillon, Walmart International CEO Judith McKenna, and board member Greg Penner built a rapport with the Flipkart executive team, never forced exclusivity provisions into the talks (which would have required Masa to relinquish his dreams of a bromance with Bezos), and dangled the prospect of allowing Flipkart to continue to operate independently. After a process that stretched on for six months and had assaulted the calendars of everyone involved with never-ending conference calls, the fractious Flipkart board finally agreed to sell a stake to Walmart. At first the deal talks had called for the retailer to only take a minority position, but by then most of Flipkart’s weary investors wanted to sell their shares and cash out. Even at this late moment, drama dogged Flipkart; Sachin Bansal almost scuttled the deal by insisting Walmart guarantee him future control in the management of the company. Exasperated, the Flipkart board finally insisted that he leave the company for good. In May 2018, the companies announced that Walmart would pay $16 billion for a 77 percent stake in Flipkart. Walmart CEO Doug McMillon visited India after the deal was announced and told Flipkart employees, “It is our intention to just empower you and let you run. Speed matters. Decisiveness matters.” Despite the stormy previous months, Sachin and Binny Bansal were now billionaires and widely lauded as two of the most successful entrepreneurs in Indian history. But who can say what assails the judgment of exorbitantly wealthy and famous men as they enter middle age? Binny Bansal was promptly ousted from his role as chief executive of the Flipkart Group in late 2018 after Walmart investigated an allegation that he had conducted a consensual extramarital relationship with a former employee and tried to cover it up. And in 2020, ugly divorce proceedings between Sachin Bansal and his wife spilled into public view. Inside Amazon India, which had lost out on the hard-fought deal, executives were consumed with more pedestrian affairs. While they had a formidable new rival in India, they were confident that Walmart would find the road ahead as difficult to navigate as a rutted Indian highway. “If there was one thing we all knew, it was that Walmart had no idea what they were buying,” said a longtime Amazon India executive. “It really requires seven or eight years of living out here and working in an environment like this before you truly understand how complicated this mess is.” At noon on a Saturday in the fall of 2018, SP Road, Bangalore’s wholesale electronics market, felt desolate. In the tiny, mostly empty stores that lined the street, shop attendants arranged and rearranged their goods. As sales of smartphones and computers skyrocketed on Amazon and Flipkart, they were cratering here. Caught in the downdraft was Jagdish Raj Purohit, the owner of a store that billed itself as Sunrise Telecom. In a shoebox of a space, Purohit was seated behind the cash register at the entrance. Along one side were hundreds of cases for every conceivable smartphone model. On the other was a combination of low-end and mid-price phones, as well as a Vivo V11, an upscale model from China that sold for 26,000 rupees. Purohit didn’t expect to sell many phones. “All mobile sales have gone online,” he groused, when asked the customary Hindi question “Dhanda kaisa hai?” (“How’s business?”). “Flipkart and Amazon are always advertising discounts on such phones, so who will come here?” He was trying to make up the shortfall by selling accessories. At Raj Shree Computech down the street, Mahendra Kumar and his two brothers had been selling computers and accessories for a dozen years. For the last few, business had been “thoda thanda”—a bit cold. It wasn’t a great mystery why. “Whoever comes here quotes laptop prices from Flipkart and Amazon straightaway, even before we say anything,” said Kumar. Or “they’ll come here and try many headphones for sound and then walk out saying they’ll be back later. We know they aren’t coming back.” Like his fellow shop owner down the street, Kumar was reluctant to become a seller on Amazon or Flipkart because margins were slim and returns created headaches. India’s competition regulations had been created to prevent this sort of bloodletting. Amazon and Walmart were trading blows, expanding into the delivery of apparel and fresh food and groceries, and each losing more than a billion U.S. dollars a year. It seemed like the noose of global capitalism was being fitted over the necks of millions of Indian small businesses. After Modi won reelection in 2019 amid the country’s most serious economic slowdown in years, the pendulum swung dramatically against the overseas retail giants. As Modi’s government had threatened, it tightened foreign investment laws. Amazon and Flipkart had to sell their ownership stakes in their affiliated subsidiaries and were barred from entering into exclusive arrangement with manufacturers or offering steep discounts. Small retailers and their trade organizations weren’t the only ones trying to enlist the state to protect them from the U.S. giants. India’s wealthiest person, Mukesh Ambani, was also lobbying the government to strengthen foreign investment rules for his own interest. In 2019, his company, Reliance Industries, which owned India’s largest chain of grocery stores, also entered the e-commerce fray. Its site, JioMart, would not be subject to the same restrictions as Amazon and Flipkart. Ambani, a political ally of Modi, tapped into growing strains of Hindu nationalism and called on his fellow citizens to “collectively launch a new movement against data colonization.” In response to the new hurdles, Bezos diversified his investments in India and expanded his ambitions, investing in a digital payments service, promoting the Kindle and Alexa, and adding a catalog of Bollywood films and various Indian-language TV shows to its local Prime Video service. Amit Agarwal would not concede that Amazon’s India adventures were veering off course. “Jeff would say, ‘it’s still day one,’ and I think it’s not even minute one of day one in India from where we are,” he told me. By many measures, Amazon had made remarkable progress in India. Customers in not just cosmopolitan cities but around the country were buying online, paying digitally instead of with cash, and leaning into the technological future that Jeff Bezos had envisioned for them. Small businesses were learning how to sell online and finding buyers well outside the outdoor markets whose essential character hadn’t changed in a century. But Amazon would remain grossly unprofitable in India for the foreseeable future, and its intense competition with Flipkart had created a disorienting set of social and economic discontinuities that helped to summon the dogs of nationalism and divisive populism. The entire saga was a preview of the political headaches that were waiting for Bezos back home. CHAPTER 4 A Year for Eating Crow In October 2014, a few weeks after Jeff Bezos returned from his first trip to India, former Microsoft CEO Steve Ballmer appeared on the talk show Charlie Rose and threw serious shade at his company’s crosstown rival. “I don’t know what to say about Amazon. I like Amazon. Nice company. [But] they make no money, Charlie! In my world, you’re not a real business until you make some money.” Amazon’s performance at the time seemed to merit Ballmer’s assessment. The company had lost $241 million that year, and over the holiday season it logged its slowest growth in sales since the disastrous days of the dot-com bust. By December 31, 2014, after declining 20 percent over the previous twelve months, Amazon’s market capitalization sat at a meager $143 billion. Which is why 2015 was such a critical year for the company and its CEO: it marked the true beginning of Amazon’s climb toward the lofty altitudes beyond a trillion dollars in market capitalization. Ballmer and other Amazon skeptics, like the hedge fund investor David Einhorn, who added Amazon to his “bubble basket of stocks” that fall, were looking at Amazon’s reported losses and significant investments in new initiatives. They were also underestimating the true performance of its older business units, which the company shrouded in secrecy. Amazon was profitable, particularly mature retail categories like books and electronics in the U.S. and UK. But rather than accumulating record amounts of cash and reporting it on its income statement, as companies like Microsoft and Apple were doing at the time, Bezos invested Amazon’s winnings like a crazed gambler at the craps table in Las Vegas. Years ago, he had learned that there were no annuities in retail. Customers were fickle and could change their loyalties at the moment they were presented with a better offer elsewhere. Amazon could only stay ahead of rivals if it kept inventing new technologies and improving levels of service. As we have seen, Bezos avidly pursued that goal by plunging billions into projects like Alexa, the Fire Phone, and the Go store, as well as future dominance in India and Mexico and other secret initiatives never known to the public. None of those bets had yet borne fruit. But in 2015, an earlier wager finally started to pay off. In its April earnings report, Amazon revealed for the first time the financial health of its ten-year-old cloud business, Amazon Web Services, and shocked Wall Street with its underlying sales growth and profitability. Then in June, Amazon copied a competitor in China and introduced the first Prime Day, capitalizing on a decade of growth from its two-day shipping program. Both Wall Street and the media began to show a newfound interest in Amazon, and shortly after the twentieth anniversary of its launch, the company came under a new kind of scrutiny commensurate with its growing size. That August, an explosive newspaper article in the New York Times turned Amazon’s combative corporate culture into the subject of national attention. Over the course of that eventful year, 2015, Amazon stock more than doubled. Because he owned about 18 percent of the company, Bezos was vaulted into the ranks of the top five wealthiest people in the world, according to Bloomberg’s Billionaire’s Index. It turned out that Steve Ballmer’s broadside against Amazon was a perfect contrarian indicator; it would mark almost precisely the start of one of the most dramatic increases in corporate value and personal wealth in the entire history of capitalism. Of course, Ballmer had little grasp of how Amazon’s eventual engine of profitability, Amazon Web Services, was performing—and that was how Jeff Bezos wanted it. Over its first decade, AWS’s revenues and profits were a closely guarded secret. The division generated $4.6 billion in sales in 2014 and was growing at a 50 percent annual clip. But Amazon disguised those numbers, along with nascent advertising revenues, in a sundry “other” category on its income statement, so that potential competitors like Microsoft and Google would not recognize how attractive a business cloud computing actually was. Observers and analysts could only guess at the financial dimensions of a unique enterprise computing business, anomalously tucked inside an online retailer. In the years after the introduction of its first products in 2006, AWS was used mostly by startups and university labs that needed extra processing power and signed up with a credit card to run their software over the internet on Amazon’s servers. When engineers inside corporations and governments wanted to run their computing experiments via AWS, they often quietly routed around their organizations’ stringent procurement processes. Like many other technology revolutions, cloud computing was first the provenance of geeks, and then spread outward. The first companies to embrace AWS became its beta testers and evangelists. Silicon Valley startups like Uber, Airbnb, Dropbox, and the photo-sharing site SmugMug ran their operations on AWS and could quickly order up more servers as their businesses grew at unprecedented rates. It was one of the greatest enablers of the post-recession technology boom—arguably more important than even the iPhone, though outsiders understood very little about it. NASA’s Jet Propulsion Lab in Pasadena, California, signed up in 2009 and used AWS to store and stream images from the Curiosity Rover on the surface of Mars. “I still have the presentation I gave to colleagues,” said Tom Soderstrom, JPL’s chief technology officer. “They thought I was talking about earth science, literal clouds.” Even some of AWS’s earliest executives had little sense for cloud computing’s enormous potential. “This business could be really big someday, maybe even $1 billion in revenue,” product manager Matt Garman once told an incredulous fellow Amazon newbie, Matt Peterson, his former business school classmate, over lunch in 2006. “Are you kidding, there is no way this will be a billion dollars. Do you know how big that would be?” Peterson responded. Garman is now an AWS vice president and member of the S-team; Peterson is an Amazon corporate development director; and AWS generated $45.4 billion in sales in 2020. Amazon’s original cloud products were conceived by Jeff Bezos in concert with other technical leaders between the years 2004 and 2006. The Simple Storage Service, or S3, and the Elastic Compute Cloud, or EC2, provided most of the functionality of a back-office computer room—but one that could be accessed remotely, and existed inside the massive, air-conditioned data centers that Amazon would construct elsewhere in the country. These would be the dial tones of the twenty-first-century internet explosion. In 2007, Amazon also introduced a primitive database called SimpleDB, to allow customers to store and retrieve organized or “structured” sets of their data. Entering the business of databases, a seemingly boring bit of commerce that is actually a thriving and competitive $46-billion-a-year industry, would be one of AWS’s most important pathways to success. Amazon itself used Oracle’s relational database to manage Amazon.com, and the company’s ever-growing traffic strained the software and periodically threatened the stability of the site, frustrating Bezos. Across its fulfillment centers and in its online store, Bezos always wanted to minimize Amazon’s dependencies on other companies, because their own primitive database capabilities weren’t up to the task. When SimpleDB also proved to be too clunky and complex to use, AWS engineers started working on a more fast and flexible version, called DynamoDB, to handle the massive volumes of traffic that were endemic to the internet. SimpleDB was also used avidly by another early AWS customer to store the titles and thumbnail images of its entertainment catalog: Netflix. Reed Hastings’s DVD-by-mail startup wanted to move other parts of its technology operation to the cloud as it transformed itself into a streaming company. To accommodate that, Amazon would need to build the cloud versions of relational databases and a tool called a data warehouse. In 2010, Andy Jassy, the head of the AWS unit, and a vice president named Raju Gulabani started working on the project and then updated the S-team on their progress. In the meeting, according to a participant, Gulabani projected it would take a decade for Amazon to succeed in relational databases. “I will bet you it will take more than ten years to get this done,” Bezos said, causing momentary consternation among the assembled AWS crew. “So, you better get started now.” Understanding that robust databases would be one of the biggest opportunities in cloud computing, Bezos significantly increased Jassy’s budget request. Gulabani poached another Indian-born executive, Anurag Gupta, from Oracle, and they opened an office in Silicon Valley. Over the next few years, Gupta assembled a team that would build several AWS databases around free and increasingly popular open-source software tools like MySQL and Postgres. In 2012, AWS introduced Redshift, a so-called data warehouse that allowed companies to analyze the data they stored in the cloud; in 2015, it rolled out Aurora, a relational database. These were typically Amazonian names: geeky, obscure, and endlessly debated inside AWS, since according to an early AWS exec, Bezos had once mused, “You know, the name is about 3 percent of what matters. But sometimes, 3 percent is the difference between winning and losing.” The name “Redshift” was suggested by Charlie Bell, a former engineer for Boeing on NASA’s space shuttle and the senior vice president in charge of AWS’s operations; it’s the term for the change astronomers see in light, the fastest thing in existence, that’s emitted from a celestial object like a star as it moves away from the observer. Nonetheless, Larry Ellison, then the CEO of Oracle—whose logo happens to be red—saw it as corporate trash talk and began to see red himself. That “never even occurred to us,” Jassy said. “When we were told later that Oracle believed that, we thought it was kind of funny.” A bitter rivalry between Oracle and Amazon, already simmering with Amazon’s entry into databases, intensified. AWS’s portfolio of cloud-based databases, on top of the classics like S3 and EC2, drew companies big and small toward cloud computing and further into Amazon’s embrace. Once they moved their data onto Amazon’s servers, companies had little reason to endure the inconvenience of transferring it back out. They were also more likely to be attracted to the other profitable applications that AWS introduced. Over the next few years AWS sales and operating margins started to shoot upward. “Of all the services we added, it was the database portfolio that broadened AWS’s appeal,” said Taimur Rashid, a former AWS manager. Nearly as remarkable as AWS’s evolution into a profitable business over the first half of the 2010s was its emergence as its own distinctive organization, an ablation calved from the glacier of Amazon itself. In 2011 the division broke off from the company’s main campus in South Lake Union and moved a half mile away to 1918 Eighth Avenue, a five-hundred-foot-tall glass skyscraper that Amazon dubbed Blackfoot. Ever the Bezos disciple, Jassy hung on the walls not the admiring articles but the critical ones, including a 2006 Businessweek story whose sub-headline read: “Amazon’s CEO wants to run your business with the technology behind his Web site. But Wall Street wants him to mind the store.” AWS’s culture was a microcosm of Amazon’s: tough, unrelenting, and focused on meeting impossibly high standards. Jassy and his fellow managers asked searing questions of their underlings and hammered anyone without suitable answers or who didn’t embrace accountability for a problem within their purview. Daily operations were driven by data-filled six-page narratives and the obsessive contemplation of the needs of customers. When employees returned strong results, attention always turned to the ways in which they could have done better. One former executive described the mentality this way: “We were really good at going up to the gold medal podium and complaining that our medals weren’t shiny enough.” Engineers were given pagers and were assigned to on-call rotations, when they were expected to be available at all hours to address system outages. If a serious technical problem erupted while the pagers were muted during meetings at AWS, Amazon’s pager program would automatically circumvent “silent mode” and the meeting would erupt in a rolling orchestra of electronic pings. In many respects, Jassy’s business philosophies were a distillation of Bezos’s. A few years after he joined Amazon from Harvard Business School in 1997, Jassy had narrowly avoided getting fired in an early purge of Amazon’s marketing department. Bezos saved him, dubbing him as “one of our most high potential people,” according to former S-team member Diego Piacentini. For eighteen months, he was Bezos’s first full-time shadow, or technical advisor. This brand-new role entailed the almost slavish following of the CEO, and colleagues gently teased Jassy for it. Jassy totally embodied Amazon values like frugality and humility. He usually wore inexpensive sport coats and loudly trumpeted his enthusiasms for diversions like New York sports teams, buffalo wings, and the Dave Matthews Band. Even as his net worth skyrocketed along with AWS’s value—he received a $35 million stock grant in 2016 alone—he shunned the ostentatious trappings of success, like traveling via private aircraft. He held an annual Super Bowl party in the replica sports bar that he’d fashioned inside the basement of his own Seattle home. Bezos attended every year until 2019, when in another glimpse of dramatic changes ahead, he showed up at the actual game, sitting in the commissioner’s box. Bezos liked to say that “good intentions don’t work, but mechanisms do.” Inside AWS, Jassy applied that adage ferociously. The rhythms of a week at AWS revolved around several formal “mechanisms” or well-honed processes or rituals. Ideas for new services, their names, pricing changes, and marketing plans were meticulously written as six-page documents and presented to Jassy in his twentieth-floor meeting room, dubbed “the Chop” (the name Jassy and his roommate had given their Harvard dorm room, from a novel they were assigned in European literature, Stendhal’s The Charterhouse of Parma). Executives asked hard technical questions and Jassy usually spoke last. Colleagues said he exhibited almost inhuman levels of discipline, sitting in meetings for ten hours a day and digesting dense and complex documents without flagging. The highlights of the AWS week were two Wednesday morning meetings. Jassy ran the ninety-minute midday business review, where the top two hundred managers discussed the minute details of customers, competitive developments, and the financial health of each product unit. But the real centerpiece of the week was the forum that preceded that meeting: the two-hour operations review to assess the technical performance of each web service. Held in the large conference room on the third floor, it was run by the intimidating and direct Charlie Bell, the former space shuttle engineer. AWS execs and engineers typically describe this remarkable session with a combination of awe and post-traumatic stress disorder. Around the big table at the center sat more than forty vice presidents and directors, while hundreds of others (almost all of whom are men) stood in the wings or listened over the phone from around the world. On one side of the room was a multicolored roulette wheel, with different web services, like EC2, Redshift, and Aurora, listed around the perimeter. Each week the wheel was spun (until 2014 when there were too many services and software mimicked the function of the wheel), with the goal being, Jassy said, to make sure managers were “on top of the key metrics of their service all week long, because they know there’s a chance they may have to speak to it in detail.” Getting selected could be a career-defining moment at AWS. Managers could boost their prospects with a comprehensive and confident presentation. But if they employed ambiguous language, erred with their data, or conveyed even the whiff of bullshit, then Charlie Bell swooped in, sometimes with awesomely patronizing flair. For managers, a failure to deeply understand and communicate the operational posture of their service could amount to career death. Nevertheless, as AWS approached its ten-year birthday, and as its revenues increased and profits mounted, it became the most desirable division for Amazon’s tech elite, a kind of Ivy League among all of its business units. Staying and thriving amid the geniuses and their diabolical rituals amounted to earning the medal of honor. In the early years, Bezos waded into the details of AWS himself, editing web pages for the first products and reviewing revenue reports from EC2 and occasionally replying with smiley faces. Over time, as he fixated on newer things, like Alexa and the Amazon Go stores, he allowed Jassy to run AWS autonomously. He receded from regular view, save for reviewing significant investment decisions and overseeing the annual OP1 and OP2 sessions, where he usually pressed for ways to connect AWS with other parts of Amazon’s business. “Jeff was very involved almost as an investor in AWS,” said Joe DePalo, a former AWS exec. “He would ask questions and poke and review. But day to day, Andy operated it independently.” Bezos also served as a kind of strategic guru for Jassy and his leadership team. As Google and Microsoft awoke to the potential of cloud computing and began investing heavily in their competing initiatives, he urged Jassy to think about ways to protect Amazon’s advantages. “You’ve built this lovely castle, and now all the barbarians are going to come riding on horses to attack the castle,” Bezos said, according to a former AWS exec who reports hearing the comment. “You need a moat; what is the moat around the castle?” (Amazon denied that Bezos said this.) In January 2015, one of Jassy’s answers was Amazon’s $400 million acquisition of an Israel-based chipmaker, Annapurna Labs, to build low-cost, high-performance microprocessors for Amazon servers, and seek a cost advantage in Amazon’s data centers that competitors couldn’t match. Bezos had one other impact at AWS: both he and Jassy lobbied to conceal the division’s financial details from public view, even amid the widespread skepticism that throttled the company and its stock price in 2014. But in 2015, Amazon’s finance department argued that the division’s revenue was approaching 10 percent of Amazon’s overall sales and would eventually trigger reporting requirements under federal law. “I was not excited about breaking our financials out because they contained useful competitive information,” Jassy admitted. Nevertheless, that January, Amazon signaled that it would report AWS’s financial results in its quarterly report for the first time, and investors girded in anticipation. Many analysts predicted that AWS would be revealed as just another Amazon “science project”—a lousy, low-margin business that was sapping energy from the company’s more advanced efforts in retail. In reality, the opposite was true. That year, AWS had a 70 percent growth rate and 19.2 percent operating margin, compared to the North American retail group’s 25 percent growth rate and 2.2 percent operating margin. AWS was gushing cash, even as it rapidly consumed most of it to build even more computing capacity and keep up with the fast-growing internet companies like Snapchat that were piling onto its servers. This reporting was a huge surprise for the analysts and investors who monitored and scrutinized Amazon, and likely even a bigger one for Microsoft, Google, and the rest of the enterprise computing world. Analyst Ben Thompson facetiously called that April 2015 earnings report “one of the technology industry’s biggest and most important IPOs.” After the reveal, Amazon’s valuation jumped almost 15 percent in a day, crossing the $200 billion mark for the first time and laying to rest the myth of Amazon as a perpetually money-losing machine. A few months before that earnings report, the S-team had been analyzing their deteriorating competitive position in China and the success of Alibaba’s annual holiday shopping extravaganza, Singles Day. For the last five years, Jack Ma’s e-commerce juggernaut had turned the date of 11/11 into a hybrid of Black Friday and Valentine’s Day, offering a frenzy of deals which in 2014 generated more than $9 billion sales and a dependable tsunami of free press. In his presentation on China, international boss Diego Piacentini proposed that Amazon might fashion its own such shopping holiday. Jeff Bezos thought it was a good idea, but at the time he was consumed with linking everything to Amazon’s seductive Prime service. He suggested that the company roll out the holiday globally and use it to try to add new members to Prime. The assignment was passed to Greg Greeley, a vice president in charge of Prime, who in turn handed it to one of his deputies, longtime Amazon executive Chris Rupp. Rupp knew that Amazon customers were accustomed to spending freely on Black Friday and Cyber Monday and that another Christmas shopping event would simply shift their discretionary spending by a few weeks. She also knew that Amazon was not particularly adept at tapping the summer shopping season known as “back to school,” a period marked by such retail rituals as Nordstrom’s Anniversary Sale. Rupp’s subsequent proposal to hold the event midsummer sparked contentious debate inside Amazon. She argued that customers had money to spend over the summer, while Amazon could exploit the excess warehouse space built for the peak season. Amazon’s supply chain executives, who spent their comparatively tranquil summers preparing for the holidays, had little interest in handling a midyear surge. “I got every kind of pushback on that, but I had darn good reasons for doing it,” Rupp said. Greeley and Rupp presented the paper to the S-team in January 2015 and got a sign-off from Bezos. “Don’t make this convoluted. Prime Day needs to mean one thing, and we have to do it really well,” he told them. In the appendix, he highlighted a section that targeted ten thousand deals for Prime Day, a larger selection than Black Friday. To accomplish that, they would have to persuade Amazon’s merchandising teams to coalesce behind the goal and harangue their vendors to supply the discounts. In early March, the event was assigned to a member of Rupp’s team, a thirty-year-old product manager named Meghan Wulff. Wulff would be Prime Day’s “single-threaded leader,” with her sole focus on the event (as well as trying to blot out the characteristically Amazonian paranoia that, at any moment, she might screw things up and get fired). Because it was a global event and meant to be chock-full of surprises, Wulff and a colleague code-named it “Project Pi?ata,” requiring an awkward keyboard maneuver every time she wrote the name in a document or email. “I will never put an enye in a project name ever again,” Wulff joked. Wulff now had to mint an entirely new shopping holiday on an impossible deadline. Amazon wanted to hold it on July 15, to mark the twentieth anniversary of the first sale on Amazon.com. In May, she embarked on a whirlwind trip, traveling to Tokyo, London, Paris, and Munich, to try to yoke together a confederation of Amazon’s merchandisers, marketers, and supply chain executives to get behind an initiative that almost everyone was dubious about. Prime Day did not exist yet, so there was little reason for Amazon’s retail and advertising teams to drop everything and convince suppliers to support it. “I felt like I was running a Ponzi scheme,” Wulff said. Only the imprimatur of Bezos motivated other Amazon execs to abandon their apathy and fall into line. As the date approached, Wulff and Rupp started to realize there might be more riding on Prime Day than they’d suspected. Bezos wanted to wade into the details and review the promotional materials. Good Morning America was interested in previewing the event. “At first we thought, ‘this is fantastic,’ ” Rupp said, “and then ‘uh-oh, wait a minute, this might be bigger than we thought.’ ” Amazon in 2015 had moved into the zeitgeist in a way that perhaps even its own executives hadn’t yet recognized. The event kicked off in Japan, where the local website promptly crashed due to overwhelming interest, then cascaded into Europe, and finally into the U.S., where social media reaction was swift—and brutally negative. Armchair shoppers ignored Amazon’s proposed hashtag, NHappyPrimeDay and took to Twitter to criticize the company for sold-out items, discounts on trivial products like dishwashing detergent, and an abundance of underwhelming deals. “I keep going back to the Amazon NPrimeDay sale like a girlfriend who is convinced it’s going to get better,” said one typical Twitter post. “The best deal I’ve seen so far is 15% off a box of pop tarts,” read another. Rupp and Wulff and their team had turned a Seattle conference room in Amazon’s Arizona building into their designated war room. They spent two days and nights monitoring the traffic and promoting whatever deals they could. Wulff recalled going home to sleep for a few hours and then returning. In the middle of the chaos, Jeff Wilke stopped by and gave a pep talk. The event was ultimately the biggest shopping day in Amazon’s history, but considering her struggles to bring Amazon’s merchandisers on board that first year, Wulff was not surprised by the negative reaction on social media. Behind the scenes, “Jeff lost his mind” over the negative online reaction, said Craig Berman, a senior PR vice president, who was at his son’s swim meet in Oregon when all hell broke loose. “He was screaming at me and my team that we needed to be clear that these aren’t shitty deals. He was being maniacal, saying, ‘Get this fixed! You’ve got to show this is a success!’ ” Berman and a PR colleague, Julie Law, started poring through the sales numbers and releasing as much data as they could find on what products were being discounted and how quickly they were selling out. It didn’t satisfy the social media mob, but press accounts of the first Prime Day were more balanced. “To Jeff’s credit,” Berman said, “you only get one chance to make a first impression. He was personally vested.” A few days later, the Prime Day team gathered in their office kitchen in the Arizona building to acknowledge the end of their exhausting journey and took turns whacking a real pi?ata. But there was little time for celebration. Rupp and Wulff were asked to write a six-page narrative summarizing the day’s mixed results: 34.4 million items purchased, including twenty-four thousand Instant Pot 7-in-1 Programmable Pressure Cookers, and 1.2 million new Prime accounts started worldwide, according to an internal document. It also highlighted that a “subset of our members and the press were quite vocal, particularly in the U.S., claiming the deals were random, the experience was clunky, and that the event was a disappointment.” Years later, Wulff reflected on that wistfully and considered it an illustration of the Amazon leadership principle that stipulates leaders must be “vocally self-critical.” “That’s when I learned a lesson that regardless of whether you just delivered the biggest revenue day in Amazon’s history, your first sentence is, ‘We fucked up.’ ” After the Prime Day review, Chris Rupp was exhausted. She took time off for an overdue sabbatical and while on leave, she accepted an offer to join Microsoft’s Xbox unit. Of that first Prime Day, she said, “It was hard, hard, hard.” In the wake of her globe-trotting stint as a single-threaded leader, Meghan Wulff was just as tired. “I was totally depleted, emotionally and physically, and took a few weeks off to recover and reflect,” she said. As Greg Greeley and the Prime team got to work on next year’s event, Wulff declined to lead it again and sought another job inside the company. Over the next few years, she would take a variety of roles at Amazon, including serving as technical advisor for the new senior vice president of human resources, Beth Galetti. In 2019, Wulff took a sabbatical from the company and went to visit family in North Carolina. She had grown up with four older brothers, in a family with financial hardships. In an unguarded moment, she used some of that Amazon-style critical feedback on her adored mother, who responded quietly, “Please stop using the leadership principles in our relationship.” As if a heavy fog had suddenly lifted, Wulff started to think about her time at Amazon in a new light. She was grateful for the experience but conflicted about it. She loved the “beautiful collaboration machine,” how she had learned about operational discipline and made lasting friendships. At the same time, she also felt like she had “given more than I got back” and didn’t like who she was becoming as a leader or a person. Wulff started to ask herself: Was the overall impact of Amazon’s customer obsession on local businesses, the climate, and warehouse workers worth it? Why weren’t there more women and underrepresented minorities on the S-team? Why was the work environment so punishing, and why was she perpetuating it? As an Amazonian, she had to earn the trust of her colleagues and superiors every day she had worked at Amazon. Had Jeff Bezos, she wondered, earned her trust? Now Wulff joined the ranks of a crowded club: she was a disillusioned former Amazon employee. “At some point along the way it moved from an admirable mission to an uncomfortable awareness that, for me, Jeff Bezos too often didn’t make admirable choices,” she said. “He continues to amass an obscene amount of money and do very little with it for the good of society.” She even questioned the annual spree of discounts that she had helped create. When an article in Fast Company suggested that Prime Day cynically manipulated shoppers into buying things they didn’t need, it resonated with her. “It was a shopping holiday,” Wulff said flatly. “We were convincing people to buy Instapots and join a loyalty program geared at having them spend more at Amazon.” Wulff left the company in 2019 and joined the Seattle online real estate company Zillow. She canceled her Prime membership shortly after, recycled her Amazon Echos, and closed her Amazon account permanently. Only a week after the first Prime Day, Amazon announced its second consecutive gangbuster earnings report on July 23, 2015, recording another profit and capitalizing on its AWS-fueled momentum. The stock surged 18 percent overnight and yielded a momentous realignment of the business universe. For the first time, Amazon’s market capitalization surpassed Walmart’s; it was now the most valuable retailer on the planet. To celebrate both the official twentieth anniversary of the company’s first sale, but also undoubtedly their new success, employees flooded into Seattle’s CenturyLink Field the day after earnings to enjoy a private concert by the local hip-hop duo Macklemore and Ryan Lewis. But the revelry would be fleeting. If the emergence of AWS and the rapid execution of Prime Day were testaments to Amazon’s fleet-footed and inventive culture, negative effects were on display as well—namely, the relentless pace and self-criticism that unmoored many employees and contributed to the company’s robust turnover rate. That August, those discontents burst into the open when the New York Times published a 5,800-word gut punch of an article, titled “Inside Amazon: Wrestling Big Ideas in a Bruising Workplace.” The reporters, Jodi Kantor and David Streitfeld, described an environment of combative meetings, unreasonably high standards, eighty-hour workweeks, and employees who regularly wept at their desks. They reported that some workers who suffered from critical illnesses, miscarriages, or other personal crises were penalized professionally. And they described the practice of “stack ranking,” or regularly dismissing the least-productive workers, amounting to “purposeful Darwinism” that created an environment of fear. In response to the piece, Amazon’s combative new senior vice president of policy and communications, Jay Carney, broke with the company’s aversion to battling publicly with critics and penned a Medium post charging that the story “misrepresented Amazon.” A high-profile hire earlier that year, Carney was the former White House press secretary to President Barack Obama and director of communications for then Vice President Joe Biden. He claimed the reporters violated journalistic standards and attacked a primary source with private details of his Amazon employment record, alleging he was fired for impropriety and had an axe to grind with the company. From that point forward, Amazon would become far more outspoken and confrontational when it came to defending itself in the press. Executives were no longer comfortable simply telling themselves that they were “misunderstood.” Carney’s post had followed an internal email that Jeff Bezos sent to all of its 220,000 or so full-time employees, encouraging them to read the article but asserting that it “doesn’t describe the Amazon I know or the caring Amazonians I work with every day.” Bezos asked employees to send any similar stories of callous management behavior to the human resources department or directly to him at his well-known email address, [email protected]. A few hundred of them would, and those responses would get directed to one of Amazon’s longest serving human resources executives, David Niekerk. A West Point graduate and U.S. army veteran with combat stories that he was not at liberty to discuss, Niekerk was in Brazil when the Times article hit, preparing for Amazon’s launch in the country. He had the same protective reaction as many other Amazon employees: the article, he felt, was sensationalized and used negative anecdotes to reach unfair conclusions. “Working at Amazon is like being in an Olympic training camp,” Niekerk told me a few years later. “There are very high standards and a push to get everything done, all the time.” At the same time, he had seen plenty of examples of bad management and could admit that there was something familiar in the Times account. Bezos himself was the architect of Amazon’s culture and skeptical of the unoriginal way that human resources was run at many companies. Other Silicon Valley CEOs had varying levels of disinterest in getting involved in the muck of HR and culture building. Steve Jobs, for example, upon returning full-time to Apple in 1997, had addressed an audience of the company’s human resources employees in Cupertino and bluntly told them, “It seems to me you are all just a bunch of barnacles.” Bezos, on the other hand, dove into the tedious details of HR and tried to formulate mechanisms that would substitute for good intentions. He was a student of organizations, culture, and innovation. Early on, he always wanted to hire the smartest people over the best leaders and told HR execs like Niekerk that it was their responsibility to train them to be good managers. Bezos also advocated for the practice of stack ranking, where employees were rated by their managers on the basis of job performance, with the lowest performers pushed out the door. Niekerk recalled that Bezos had absorbed that practice from Topgrading, by Bradford Smart, who had helped legendary CEO Jack Welch set up a hiring system at General Electric that classified job candidates as A Players, B Players, and C Players. Bezos wanted to apply those principles, not just in recruiting, but inside the company as well. “The greatest pain any leader will feel are the open jobs in their organization,” he once told Niekerk. “That means leaders will be very hesitant to let anyone go.” Bezos suspected that managers couldn’t be counted on to voluntarily embrace the hassle of additional hiring and feared that a tolerance for mediocre performers would spread through the company and erode the “Day 1 mentality.” Stack ranking would force managers to upgrade the talent on their teams. “People thought it was a mean-spirited process and to a certain extent it was,” Niekerk said. “But in the big picture, it kept Amazon fresh and innovative.” But as Amazon expanded, booting the poor performers wasn’t enough. Bezos appeared to believe that an overly comfortable or exceedingly wealthy workforce might also doom Amazon. Did employees still have passion for their jobs? Or were they hanging on for ever-larger compensation rewards, draining the company of energy while awaiting riches and retirement? Bezos eschewed any financial hooks, like steadily increasing stock grants, that might keep people at the company even if they were no longer engaged in their work. The typical compensation package at Amazon reflected these priorities. It featured a standard base salary of around $150,000, a signing bonus, and a grant of stock that vested in 5, 15, 20, and 40 percent portions over each of four years; the combination of salary and stock vesting then comprised an employee’s total compensation target. If employees couldn’t cut it at Amazon and lost their jobs in the first few years, they didn’t get their entire stock grant and wouldn’t receive the remaining portion of their prorated signing bonus. And if Amazon’s share price increased more than 15 percent in a year, the employee’s total annual compensation then exceeded their target, and their annual performance stock grants would reflect that and be correspondingly lower, vest farther out into the future, or could even disappear altogether. That meant that after years of Amazon’s stock price increasing well beyond 15 percent, many employees encountered what they called a total compensation “cliff.” They were making well in excess of their target and saw their stock grants drop precipitously. This was another reason why valued, experienced Amazon executives like Chris Rupp left the company for opportunities elsewhere. (Bezos himself made just under $82,000 a year and received no additional stock-based compensation beyond his large initial ownership stake; his wealth was generated purely by Amazon’s steadily increasing stock price.) Bezos understood that in some quarters, all this might make Amazon an unpopular place to work. But he also felt that the perks factored into those high-profile media surveys of workplace desirability—like lavish compensation, unlimited vacation time, and free meals and massages—had little to do with the passion and purpose employees brought to their jobs. “He once told me, ‘If we ever appear in the “100 best places to work in America,” you’ve screwed this place up,’ ” Niekerk said. (Alas, Amazon would soon become a mainstay of those lists.) Despite the fact that Niekerk was preparing to retire in 2015, Amazon had one more mission for the old soldier. When some 250 Amazon employees sent their horror stories directly to the CEO and to HR after the Times article and Bezos’s email to the company, they were then all forwarded to Niekerk. Over the following four months, he consolidated and reviewed the stories and pulled together a paper, offering ten courses of action the company might take to address the issues that had emerged. For example, he suggested that every leader should be required to take a course called “As Life Happens,” to learn how to sensitively manage an employee whose personal life might be interfering with their work obligations. Niekerk recalled that colleagues who read his paper said that it was among the best analyses they had seen of the cultural challenges that were so obviously plaguing the company at its twentieth anniversary. But before the paper got any further, Amazon’s lawyers killed it. The stories that employees had volunteered and submitted at Bezos’s urging, they asserted, were one-sided and unverified. The recommendations, the lawyers said, were thus “fruit from a poisoned tree.” Niekerk retired from Amazon soon after and his report never made it to the S-team. Nevertheless, after the Times story, Amazon made several changes to its culture that it said (somewhat dubiously) were already underway before the article was published. Even as Bezos was publicly defensive, he seemed to acknowledge privately there were valuable aspects to the critique and that a culture forged to support the maniacal pace of a startup needed to evolve alongside a maturing company with 230,000 employees. For example, the practice of stack ranking, or setting attrition targets for each team, was largely discarded; managers were no longer forced into contentious sessions over whom to fire. Employees were offered the chance to change jobs anytime they wanted, even if they had recently joined the company, so that they could always escape a bad manager. This forced managers to be extra solicitous to their employees. Amazon also instituted an internal appeal process to adjudicate cases when employees were put on performance improvement plans or faced termination. The company added a unique parental leave program that allowed employees to divide their time off into different intervals within a twelve-month period, or to share it with a spouse whose job didn’t offer such a benefit. It also instituted smaller changes, such as allowing new mothers to expense Milk Stork, a service that let them send refrigerated breast milk home when they were traveling for business. After the Times article, one female executive said, “We got a lot more latitude to make human decisions.” The biggest change may have been to Amazon’s decade-old performance review system. The former system had required all of a worker’s peers to write lengthy appraisals and send them to the worker’s direct manager, who then wrapped them all into a single evaluation for a one-on-one conversation with the employee, which tended to culminate in a contentious tangle over the worker’s shortcomings. “We found that when we surveyed Amazonians, 90 percent were more demotivated after their review than before, even if they were the best employees,” said HR chief Beth Galetti, who was asked to “radically simplify” the review process after she took over as head of HR a few months after the Times article was published. In this revamped performance review system, peers and managers were asked to write sixty words describing an employee’s “superpower,” and another sixty to describe a “growth idea” for the year ahead. “It was all about looking forward and being motivational,” Galetti said. Bezos also conceded that the old process had grown too negative, explaining his sudden appreciation for its flaws to a group of large Amazon investors at a private meeting: “Imagine if you sit down with your wife once a year. You tell her all these great things that you love about her, but then at the end you say, ‘Also, you’re just a little bit fat.’ That’s the only thing that’s going to stick with her from that entire conversation!” As Bezos delivered the punch line, he burst into laughter, according to an investor who was at the meeting: “We want to have a performance review system that doesn’t tell our employees that they’re fat.” By the end of 2015, there was little doubt left about Amazon’s ascendance. The company posted its third consecutive quarterly profit, along with 69 percent growth in sales at Andy Jassy’s booming AWS division. Amazon’s market capitalization had doubled in the span of a year and stood at $315 billion. For Steve Ballmer and the other skeptics, it was a year for eating crow. At the same time, Amazon became the fastest company in history to surpass $100 billion in annual sales, meeting a long-standing goal of Bezos and the S-team. In his annual letter to investors the following April, Bezos trumpeted that benchmark and tried to get in the final word in the debate over Amazon’s culture. “You can write down your corporate culture, but when you do so, you’re discovering it, uncovering it—not creating it,” he wrote. “It is created slowly over time by the people and by events—by the stories of past success and failure that become a deep part of the company lore.” The events of 2015 would be added to that already rich history. Over the course of a critical twelve months, the dramatic transformation of Amazon in the eyes of the world was matched in scope only by the makeover in the image of the founder himself. He was now known as a corporate taskmaster who had architected a culture of unquestionable efficiency; the genius inventor behind the Kindle and Alexa, but also a versatile CEO who had authored an enterprise computing platform capable of generating lucrative profits. He continued to be dubious of most media coverage of Amazon; yet at the same time, through a set of unlikely circumstances, Jeff Bezos was about to become known as the voluble defender of a free press. CHAPTER 5 “Democracy Dies in Darkness” Who can say what set Donald J. Trump on a tirade against the Washington Post? It could have been the months of critical coverage of his presidential campaign from the nation’s third largest newspaper. Or perhaps it was the edition of the column “Fact Checker,” published by Glenn Kessler on December 7, 2015. That morning, the reporter scrutinized the Republican’s absurd claim that he had foreseen the threat posed by Osama bin Laden before September 11. “I predicted Osama bin Laden,” Trump had declared on the campaign trail in Knoxville, Tennessee. “I predicted terrorism. I can feel it, like I can feel a good location in real estate.” For this assertion, Kessler assigned Trump the highest grade on his scale of mendacity: “four Pinocchios.” A little after 7 a.m. EST that morning, Trump responded with a fusillade of tweets aimed at Amazon.com, the Post, and the man who owned it: Jeff Bezos. Donald J. Trump @realDonaldTrump The @washingtonpost, which loses a fortune, is owned by @JeffBezos for purposes of keeping taxes down at his no profit company, @amazon. 7:08 AM Donald J. Trump @realDonaldTrump The @washingtonpost loses money (a deduction) and gives owner @JeffBezos power to screw public on low taxation of @Amazon! Big tax shelter 7:18 AM Donald J. Trump @realDonaldTrump If @amazon ever had to pay fair taxes, its stock would crash and it would crumble like a paper bag. The @washingtonpost scam is saving it! 7:22 AM Trump’s claims were as tenuous as his boasts about bin Laden; the Post’s financial results had no impact whatsoever on Amazon’s corporate taxes. Bezos had personally acquired the ailing newspaper in August 2013 for $250 million in cash and tried to keep his two high-profile concerns separate. Now the opportunistic GOP candidate was trampling over Bezos’s careful attempts at compartmentalization. Later that morning, across the country in Seattle, Bezos emailed Jay Carney, his senior vice president for global corporate affairs. The response not only exhibited Bezos’s surprising fondness for emoticons but kicked off a revealing exchange that was forwarded to me a few years later. From: Jeff Bezos To: Jay Carney Subject: Trump trash talk Trump just trash talked Amazon/me/WaPo. Feel like I should have a witty retort. Don’t want to let it go past. Useful opportunity (patriotic duty) to do my part to deflate this guy who would be a scary prez. I’m an inexperienced trash talker but I’m willing to learn. :) Ideas? Also tactically I’m about to be interviewed by some German pubs set up a long time ago and they might ask about it. Carney’s style with the media on articles about Amazon that the company didn’t like (e.g., most of them) was nakedly pugilistic. He had helped to persuade Bezos, who felt that responding to media critics only gave their attacks more oxygen, to allow him to challenge coverage like the New York Times expos? of Amazon’s corporate culture. But when it came to Donald Trump, the politically savvy Carney recognized a cynical game and advised Bezos to stay out of it: From: Jay Carney To: Jeff Bezos re: Subject: Trump trash talk We’ve been discussing and decided to make sure reporters know WaPo and Amazon are not connected. He’s playing to his base of disaffected voters by bashing the press and big business in one tweet. For him politically, it doesn’t matter that he’s got his facts all wrong. Much as I’d love to have you slap him down, I personally think you’d be helping him by trash talking him back. Every fight he gets into gives his campaign more energy. If you get asked about [it] with the Germans, I recommend you say, ‘you know Amazon and the Washington Post are two entirely separate companies. I’m not sure what he’s talking about.’ For years, Bezos would have readily agreed with Carney’s advice and stayed quiet, but now their positions were reversed. Trump’s targets at that point had included his rivals in the GOP primary, high-profile journalists, and major business figures like Barry Diller. Bezos was seemingly eager to join that distinguished club and had a desire to engage Trump, counter his inaccuracies, and defend the newspaper. From: Jeff Bezos To: Jay Carney re: Subject: Trump trash talk This seems like one of those times when I might disregard really good advice! :) Can you guys come up with some good options just so we can look at the specifics. Over the next few hours, Carney brainstormed over email and on the phone with Amazon PR deputies Drew Herdener, Craig Berman, and Ty Rogers. They considered and discarded the idea of proclaiming that Amazon and the Post “are as separate as the two sides of Trump’s hair.” Berman suggested reserving a seat for Trump on a Blue Origin spacecraft, a clever bit of misdirection that drew in a third Bezos company. Carney liked that idea and suggested it to Bezos, who asked that they include his feeling of being “left out” until now of Trump’s unmoored denunciations. Finally, after an afternoon of wrangling over the precise wording and the decision to include a link to a Blue Origin launch video, Ty Rogers responded from Bezos’s Twitter account: Jeff Bezos @JeffBezos Finally trashed by @realDonaldTrump. Will still reserve him a seat on the Blue Origin rocket. NsendDonaldtospace http://bit.ly/1OpyW5N 3:30 PM Inexorably drawn to chaos and conflict, Trump eagerly responded, charging in a television interview that Bezos had acquired the Post for political influence and promising that Amazon was “going to have such problems” if he got elected. He later honed his attempt to delegitimize the newspaper by branding it the NAmazonWashingtonPost. Jeff Bezos had officially entered the political fray. “Why would I even be a candidate to buy the Post? I don’t know anything about the newspaper industry.” With such indifference, expressed to investment bankers representing the Washington Post, Jeff Bezos kicked off one of the more illustrious chapters of his career. The Post would expand and fortify Bezos’s reputation as one of the most successful businesspeople of his generation, an organizational theorist whose management practices could be applied not just inside fast-growing tech companies but outside them as well. The Post was owned by the venerable Graham family and run by Donald Graham, the son of legendary owner Katharine Graham, and for years it had been on shaky financial footing. It remained a local paper serving the D.C. region, with a specialization in national politics, at a time when local advertising was moving to the web and the classified ad business was being vaporized by websites like Craigslist. The financial crisis of 2008 only compounded that decay. Seven straight years of revenue declines tended to “focus the mind,” as Don Graham liked to say. Graham was beloved in the Post newsroom for his first-name familiarity with staff and his zeal for the journalistic mission. But under his cautious eye, the Post had reached an impasse. Graham had reached an agreement in 2005 with Facebook founder Mark Zuckerberg to invest in the budding social network, but then he allowed Zuckerberg to withdraw from the deal and take money at a higher valuation from the Silicon Valley venture capital firm Accel instead. Having forfeited a historic company-enriching windfall, Graham joined Facebook’s board of directors, where for the next few years he listened to Zuckerberg preach that content on the web should be free. When major media organizations like the rival New York Times started adding paywalls in 2011, the Post was late to the trend; its paywall was porous and easily circumvented by readers. By 2013, an atmosphere of melancholic decline had gripped the boxy, mid-century concrete headquarters of the Washington Post Co. at 1150 15th Street NW in downtown Washington. Its once profitable Kaplan educational division had been decimated by a regulatory overhaul of the often scammy for-profit education industry. The newsroom, once more than a thousand journalists strong, had been reduced by waves of layoffs to around six hundred. Morale was low, with deep distrust between the business and editorial divisions. The company didn’t have the resources to invest in national and international news and distribution, or to free itself from the straitjacket of regional news and its deteriorating economics. So Graham agreed to sell the paper. Post executives sought a wealthy, technologically sophisticated individual who cared about the paper’s journalistic mission. Jeff Bezos was at the top of the list, alongside other internet billionaires like eBay founder Pierre Omidyar. Bezos’s initial response to the Post’s investment bankers, and sporadic conversations with Graham, a longtime friend, was cool. Only that July 2013, when Bezos asked Graham to meet privately at the annual Allen and Company conference in Sun Valley, did Graham realize that Bezos had researched the opportunity and was more interested than he had previously let on. In the brief talks that followed, Bezos accepted Graham’s initial $250 million asking price and paid cash. Amazon’s founder acquired the newspaper—not via Amazon but personally. Bezos was the platonic ideal of a Post owner—a leader with boundless resources, a widely known reputation as a digital innovator, and a corona of credibility that seemed to extend to whatever he touched. He expressed a staunch commitment to the paper’s editorial independence and seemed to have little interest in using it to serve any political agenda. When Fred Hiatt, editor of the opinion page, offered to resign that fall, explaining that “it’s entirely legitimate for an owner to have an editorial page that reflects his world view,” Bezos declined the offer. Bezos had a traditionalist’s view of the media business. In his first address to Post employees at the 15th Street building in September, he declared his faith in “the bundle,” the collection of news, culture, and entertainment coverage that makes up a newspaper. He also lamented the rise of so-called aggregators, which summarized other organizations’ work, like the Huffington Post. But he had no compunctions about casting aside the paper’s local ambitions and deprioritizing its print edition in favor of a more ambitious future online. “You have to acknowledge that the physical print business is in structural decline,” he told his new employees. “You have to accept it and move forward. The death knell for any enterprise is to glorify the past, no matter how good it was—especially for an institution like The Washington Post.” Their new owner was ready to break from the disciplines of that past. And when Bezos invited the Post’s management team to spend a weekend with him in Seattle that fall, he wanted its cerebral executive editor, Marty Baron—the former Boston Globe chief who would later be depicted in the movie Spotlight—to be included. “If you are going to change the restaurant, the chef has got to be on board,” he reasoned. Baron joined publisher and CEO Katharine Weymouth, president Steve Hills, and chief information officer Shailesh Prakash on the cross-country trip. On the first night, they had dinner with Bezos at Canlis, an upscale restaurant with majestic views over Lake Union; during the meal, they saw a perfect double rainbow over the lake (the future name of the paper’s magazine-like national edition for tablets: the Rainbow app). The next morning, the group met MacKenzie and the four Bezos children at their twenty-nine-thousand-square-foot home on the shores of Lake Washington. Bezos made everyone pancakes for breakfast (afterward the Post’s leadership team called themselves “the Pancake Group”). During the daylong review of the Post’s editorial and business strategies, Bezos never once looked at his cell phone. If he had other things on his mind, he kept them completely compartmentalized. For the next few years, friends occasionally teased him about the purchase of the Washington Post. “The joke was ‘Jeff, when MacKenzie asked you to pick up a newspaper, she meant just one copy,’ ” said his high school pal, Joshua Weinstein. But interviewers and colleagues always asked the question: Why had he bought, of all things, that anachronistic digital relic, a newspaper? It may have been that with his own fortunes soaring along with Amazon’s, Bezos understood that he could use his resources for things he valued, such as ensuring a strong and independent press. Saving the Post would not only help his friend Don Graham; it would be a significant boon to the American media establishment, as well as a symbolic contribution to the country, and democracy. But his public answer to that question was always much simpler and more earnest: “It’s the most important newspaper in the most important capital city in the Western world. I’d be crazy not to save [it],” Bezos said a few years later in an onstage conversation with Axel Springer CEO Mathias D?pfner. “I’m going to be very happy when I’m eighty that I made that decision.” A year after the purchase, Fred Ryan, a cofounder of the politics news site Politico, asked Bezos the same question while they were having breakfast in the Amazon building Day 1 North. The conversation would lead to Bezos hiring Ryan to replace Weymouth as the company’s chief executive and publisher. Ryan, a former aide to Ronald Reagan, had been invited to Seattle after sending Bezos an unsolicited email expressing admiration for the paper. He later recalled thinking at the time that “sometimes wealthy people have passions and toys or might want to own a publication so they can influence things.” Bezos surprised him with his response. “I remember his answer because he has lived it to this day,” Ryan said. “He said he feels that it is essential to have a strong and independent press for the health of our society and democracy.” If members of the Pancake Group had fanciful notions that Bezos was going to rescue the Post by spending uncontrollably, he quickly dispelled them. In early 2015, they trekked back to Seattle and presented him with a multiyear operating plan that called for the paper to lose more than $100 million over the next four years. Bezos shot it down immediately. “Yeah, I’m not interested in that” is how one participant recalled his understated reaction. After the meeting, Bezos and Fred Ryan sat down and hashed out a plan to run the paper as a disciplined, stand-alone business, not as the hobby of someone with limitless resources. Over the next few years, there would be a quiet, targeted series of layoffs in the company’s print advertising division, which were partially offset by a smaller but louder number of hires of digital media specialists. In addition to wanting the Post to operate within its means, Bezos applied elements of his well-tuned business philosophy to the paper. He preached the wholesale embrace of technology, rapid experimentation, and optimism about the opportunities of the internet instead of despair. “You’ve suffered all the pain of the internet but haven’t yet fully enjoyed its gifts,” Bezos told his new employees. “Distribution is free, and you have a massive audience.” One of his first ideas was to give subscribers of other newspapers free online access to the Post. Some 250 papers, like the Toledo Blade and the Dallas Morning News, signed up for the new Post partnership program. While it didn’t result in a surge of new subscribers, the program, plus Bezos’s patina of digital coolness, generated a fresh wave of buzzy news stories about the Post. Another Bezos principle resulted in a more tangible outcome. The Amazon founder always looked for ways to “weave a rope” of connections between his different business units. Careful not to overtly push, he introduced Post execs to their Amazon counterparts and suggested it would be a good idea for them to talk. In the fall of 2014, Amazon’s Fire tablet owners got a free six-month digital subscription to the Post’s national edition on an app that was preinstalled on the device. A year later, tens of millions of Prime members got the same deal. Between 2014 and 2015, unique visitors to the Post’s websites and apps grew by 56 percent. In October 2015, the Post briefly surpassed the New York Times in unique monthly visitors. Taking an opportunity to strafe a competitor and rally the troops, Bezos declared on CBS This Morning that the Post was “working on becoming the new paper of record.” The paper then took out ads that declared, “Thank you for making The Washington Post America’s New Publication of Record.” Though the advertising staff was being pared back, Bezos did agree to methodical increases in hiring in the newsroom and the technology department. In the two years after the acquisition, Marty Baron added 140 full-time journalists, boosting his staff to around 700—compared to some 1,300 reporters and editors at the Times. The additions came mainly on the national, political, and investigations desks, as well as in business and technology coverage. Resources devoted to regional news, the unprofitable mainstay of the Post’s previous leadership, remained largely flat. Bezos also had a few strange notions about how the journalism process might be streamlined. He wondered aloud whether the paper would need so many editors if it simply hired great writers. Baron responded that if anything, the paper probably needed more editors. Bezos repeated that refrain so often that a few editors took to sending him the raw copy of high-profile journalists. Amazon said Bezos never received or read any such emails, but he eventually came to agree with Baron. Marty Baron recalled Bezos defying his expectations at every turn. For example, he assumed that Bezos would want to personalize the Post’s home page for every reader. But Bezos observed that readers came to the paper in part because they trusted the staff’s editorial judgment. Baron said that Bezos “didn’t try to reinvent the paper; he tried to capture what made it special.” But Bezos did try to reinvent the systems behind the paper, with a flood of Amazon-style rituals. The Pancake Group, which occasionally expanded to include finance and audience development execs, spoke to Bezos every other week on Wednesdays at 1 p.m. EST for an hour. Bezos asked Post managers to “bring me new things”; he wanted to see everything, including changes in pricing and how to expand the paper’s audience and revenue, in the form of six-page Amazon-style narratives, subject to Bezos’s careful reading and detailed questions. It was a Bezos-style repeatable process, or forcing function, designed to push his team to think creatively and innovate. Post execs said that Bezos read every memo beforehand save for once, when he apologized for not getting to it and took the time to read it quietly at the start of the meeting. He also exposed them to a steady stream of Jeffisms: about one-way and two-way doors; how double the experimentation equals twice the innovation; how “data overrules hierarchy” and there are “multiple paths to yes”—an Amazonian notion that an employee with a new idea who gets a negative reaction from one manager should be free to shop it to another, lest a promising concept get smothered in infancy. Bezos had only one conspicuous misstep, at least in the eyes of many current and former Post employees. In late 2014, acting on concerns that he had expressed during his due diligence before the acquisition, he froze the Post’s pension plans, cutting retirement benefits for longtime employees and converting newer employees’ plans to 401(k) retirement accounts with a relatively miserly matching grant from the company. The pension had been on perfectly stable footing, thanks in part to the fund’s stake in Warren Buffett’s Berkshire Hathaway. The changes nevertheless reduced the Post’s obligations toward its longest-serving employees and gave current employees less financial incentive to stay at the paper for their entire careers. Bezos’s scuttling of the pension fund, and a twin hostility to the Washington Post Guild, was in line with how he operated Amazon, as well as his long-standing aversion to unions and to lavishing employees with ostentatious perks. “The only explanation anyone ever got was that he doesn’t believe that a company has any obligation to its workers once they walk out the door,” said one Post writer. (Amazon said this does not accurately represent Bezos’s views.) The move initiated a frosty relationship between Bezos and the guild. During the difficult negotiations every few years, a smattering of employees would protest the changes to their contracts in picket lines outside the Post’s offices. But they remained a vocal minority. Many Post employees were grateful for the paper’s revival and remained card-carrying members of the Church of Bezos. Only Donald Trump, lobbing Twitter grenades from afar, noticed the discord and tried to stir the pot: Donald J. Trump @realDonaldTrump Washington Post employees want to go on strike because Bezos isn’t paying them enough. I think a really long strike would be a great idea. Employees would get more money and we would get rid of Fake News for an extended period of time! Is @WaPo a registered lobbyist? Predictably, Bezos took the most interest in the Post’s products and technology. He forged a partnership with CIO Shailesh Prakash, a graduate of the Indian Institute of Technology in Bombay, and boasted that the newspaper had better engineers than many Silicon Valley startups. He obsessed over shaving milliseconds from the time it took web pages and complex graphics to load. He also asked for customized metrics that could measure the reader’s true interest in stories, and whether an article was truly “riveting.” When Bezos acquired the paper, Prakash had been developing a content system for the Post, called Arc Publishing, to manage functions like online publishing, blogging, podcasting, and advertising. Naturally, Bezos loved the idea of supplying that technology to other papers and encouraged Prakash to license it to broadcasters and any company that needed publishing software. By 2021, Arc powered fourteen hundred websites and was on a path to generating $100 million in annual revenue. Bezos and Prakash’s team also spent eight months developing the magazine-like Rainbow app for tablets. This digital edition of the paper, updated twice daily, had no home page. It presented articles in a magazine-like layout and allowed users to scroll through a series of pages containing two articles each and then zoom into any story that interested them. Prakash described Bezos as “chief product officer” on the app; he recalled that the owner articulated an overarching goal of solving the problem of “cognitive news overload” by allowing readers to hover high above the day’s events, like a glider soaring through the sky. The Post released the app in July 2015 and made it standard on Amazon’s Fire tablet. In Prakash, Bezos had found a kindred spirit. They agreed on everything—almost. When Apple (an Amazon rival) solicited the Post to join a bundle of publications in a new service called Apple News , Prakash and other Pancake Group members saw the gaudy potential of 1.5 billion iPhones and iPads and wrote a six-page memo outlining the pros and cons of joining. But Bezos reasoned that it would undermine the Post’s identically priced subscription offering and argued against it passionately. The Post passed on the opportunity. When the Wall Street Journal tried to poach Prakash to be their CTO in early 2017, Bezos persuaded him to stay—in part by endowing him with a separate role on the advisory board of his private space company, Blue Origin. On the occasional Saturday, Prakash would fly across the country to Kent, Washington, to help the company with its supply chain systems. “The most important thing Jeff has brought is a culture of experimentation,” Prakash said. “None of us feel that if we spend money and screw up some big project that we’re going to have to face an auditing committee. We are not afraid to fail.” Bezos’s imprimatur did more than just allow the Post to take bigger risks. On the advertising side, the mere proximity of the world’s most famous businessperson seemed to cast an effervescent glow. A sales deck developed by the ad team screamed “the Bezos Effect” on its second page, next to a smiling headshot of the bald tech impresario. Post ad executives said that sponsors were drawn to the paper because of Bezos’s involvement, even if the execs did find themselves constantly explaining that no, Amazon did not own the paper. “The story is what helped us more than anything else,” said one business-side executive. “That is part of the magic of Jeff Bezos—that he is Jeff Bezos.” The Post was now a private company, so it no longer released financial information. But between the years 2015 and 2018, according to an executive privy to the numbers, ad revenues jumped from $40 million to $140 million and digital subscribers rose by more than 300 percent, exceeding 1.5 million for the first time. (That number would reach 3 million by the time of Marty Baron’s retirement in January 2021.) While the paper had lost around $10 million in 2015, it made more than $100 million in the three years after that—a remarkable turnaround from the projected losses Bezos had rejected. “I can’t believe how fast this is happening,” he said to the Pancake Group after witnessing the extent of the turnaround. Luck certainly played a role: the chaotic presidency of Donald Trump generated record levels of interest in political news. But Bezos, his management methods, and his deference to the realities of a changing news business had also delivered a blast of strategic clarity to a 140-year-old institution. A year after Bezos acquired the Post, its reporter in Tehran, Jason Rezaian, was imprisoned by the Iranian government and charged with espionage. Rezaian would spend the next eighteen months in jail, held often in solitary confinement in “the city I called home,” according to his 2019 memoir, Prisoner. Initially after his arrest, Post execs thought the detention would amount only to short-term harassment. As weeks stretched to months, they realized the situation was more dangerous and that Rezaian might be tried and executed by the country’s hard-line religious clerics. In the U.S., Rezaian’s family, along with Marty Baron, Fred Ryan, and many other representatives of the Post, reached out to officials at every level of the U.S. government. When foreign leaders visited the capital, Ryan requested private meetings and asked them to exert their influence with the Iranian government on Rezaian’s behalf. From Seattle, Bezos asked for frequent updates and at one point briefly considered running a “Free Jason” advertisement in the 2015 Super Bowl. Later that year, when it appeared that the U.S. government had reached a complex and later controversial financial deal with the Iranian government that included freeing Rezaian and three other prisoners, Bezos wanted to fly over personally and bring him home. So on January 21, 2016, Bezos flew his new $65 million Gulfstream G650ER private jet and met the recovering Rezaian and his family at the U.S. Army’s Landstuhl Medical Center in Germany. He had stocked the plane with streamers, NFreeJason signs, and burritos and beer, since prior to his captivity, Rezaian had told TV host Anthony Bourdain that it was the food he missed the most. They flew to Bangor, Maine, an accessible entry point with little air traffic, where despite Rezaian and his wife having parted with their passports and other identification during the ordeal, an ICE official ushered them in, saying that the Iranians needed to know “you screw with one of us, you screw with all of us.” Bezos then personally shuttled Rezaian and his wife to Florida for a brief respite in Key West. A few days later, they were all back in D.C. having dinner with Post execs, and on January 28, they attended the ceremonial opening of the Post’s gleaming new headquarters on K Street, overlooking historic Franklin Square. The offices were state-of-the-art, with new workstations, and spots for developers and designers, who would now sit alongside journalists, as well as video studios so reporters could easily appear on cable TV. Rezaian spoke emotionally at the opening, and then Bezos, wearing a NFreeJason lapel pin, addressed employees. “Important institutions like the Post have an essence, they have a heart, they have a core—what Marty called a soul,” he said. “And if you wanted that to change, you’d be crazy. That’s part of what this place is. It’s part of what makes it so special.” Bezos had saved the Post. But he was also, in a way, benefiting from the refracted glow of its noble journalistic mission. In 2016, Fortune magazine placed Bezos in the top spot on its list of the world’s 50 Greatest Leaders—above Angela Merkel, Pope Francis, and Tim Cook. The accompanying article spent as much space on the turnaround at the paper as it did on the momentum at Amazon. “We used to joke that Jeff changed retail completely, built a 10,000-year clock, and sent rockets into space. But he wasn’t called the greatest leader in the world until he helped a newspaper company,” a former Post executive told me. Washington, D.C., seemed to appreciate Bezos, and he returned the sentiment. That fall, he paid $23 million for the largest home in the city, the former Textile Museum and an adjoining mansion in the fashionable Kalorama neighborhood; his new neighbors were Barack and Michelle Obama, along with Ivanka Trump, the daughter of his adversary, and her husband, Jared Kushner. Bezos would spend the next three years and $12 million renovating the 27,000-square-foot structure, with its eleven bedrooms and twenty-five bathrooms. He planned to spend more time in the city and use the residence to hold the kind of exalted dinner parties for the rich, powerful, and interesting that were once the hallmark of a previous owner, Katharine Graham. “Now I get it,” Bezos had told Sally Quinn, widow to the Post’s celebrated former editor, Ben Bradlee, at Bradlee’s funeral. The Post wasn’t just a business to be reinvented with Amazonian principles and integrated into its ecosystem of Kindle devices and Prime membership. It was also a mission to be protected and a community where he was welcomed and even revered. And if an enemy of the institution attacked it—like, say, a candidate for the presidency of the U.S.—Bezos was going to throw caution to the wind and respond. During the presidential campaign, Bezos asked the Pancake Group to come up with a unique national branding statement, something that would neatly encapsulate that mission. “If this was a club, would you want to join that club?” Fred Ryan recalled Bezos saying as he described what he wanted in the slogan. “If this was on a T-shirt, would you want to wear it?” Bezos offered a single suggestion—something he had heard in speeches by Watergate reporter Bob Woodward, who had read a version of the phrase long ago in an appellate court decision: “Democracy dies in darkness.” Post execs spent a year trying and failing to come up with something better. They hired outside branding agencies and then fired them in frustration. Finally, they gathered around a table and spent hours brainstorming. They wanted something optimistic and hopeful, but out of hundreds of ideas like “Freedom moves in light,” none were quite as poetic or resonant, particularly after Donald Trump’s shocking victory. So they ended up going with Bezos’s original suggestion, which they later put on a T-shirt and mailed to him. Over the next few years, irritated by the Post’s penetrating coverage of his tumultuous administration, Trump would grow even more vindictive on Twitter toward Bezos and the paper. He threatened Amazon with onerous new regulations and attacked its relationship with the U.S. Postal Service. The paper’s reporting on human rights violations would also antagonize authoritarian governments in other countries around the world, from Russia to the Kingdom of Saudi Arabia. In response, they would try to take out their ire on Amazon and its high-profile CEO. Bezos’s easy compartmentalization of all the swirling concerns from multiple entities in his growing business empire was swiftly proving untenable. Bezos and his unique management practices and optimism about technology had been undeniably good for the newspaper. But in the end, owning the Washington Post would exact more of a toll on Amazon—and on Bezos himself—than he ever could have imagined. CHAPTER 6 Bombing Hollywood As reporters and editors at the Washington Post grappled with the surprising victory of Donald Trump in late 2016, publicists for Amazon’s television and film division were immersed in a much different challenge: how to conduct a buzz-generating campaign for its Oscar-worthy movie, Manchester by the Sea. The publicists were brainstorming when one had the idea of asking the boss himself whether he would consider hosting a party for the film in Los Angeles. They emailed him and later recalled getting an unusually speedy reply: “Yes! Let’s do it at my house.” On Saturday evening, December 3, a cool, cloudless night, celebrities descended on Bezos’s twelve-thousand-square-foot Spanish-style estate in Beverly Hills, which he had purchased nine years earlier for $24 million. An extravagant tentlike structure was erected in the backyard, on a decoratively tiled outdoor patio near the swimming pool. One of the film’s producers, Matt Damon, and its star Casey Affleck held court, while actors, directors, and agents lined up at the well-stocked open bar. Here was a substantial slice of Hollywood’s A-list, invited either because they worked with Amazon’s production arm, Amazon Studios, or were members of the Academy of Motion Picture Arts and Sciences: Michelle Williams (also in the film), Gael Garc?a Bernal, Joseph Gordon-Levitt, Andy Garcia, and Megan Mullally; the directors Joel Coen and Kenneth Lonergan (who directed and wrote Manchester); Hollywood legends Faye Dunaway, Diane Keaton, John Lithgow, and Ben Kingsley; the musicians T Bone Burnett and Beck; Maria Shriver and her daughters; and many more. In the middle of it all was Bezos, wearing a plain charcoal-gray suit with an open-collared white shirt—still, back then, the cautious choice of a reforming technology geek. MacKenzie did not attend. “Jeff is the opposite of me,” she had told Vogue magazine in a rare interview. “He likes to meet people. He’s a very social guy.” Indeed, Bezos was laughing and enjoying himself. The room was full of stars radiating high-powered wattage, but as the host and CEO of the company that had hired the event photographers, attention gravitated toward him. Among the many pictures snapped that evening, one would later be closely scrutinized and reprinted. Bezos was standing with Patrick Whitesell, the powerful executive chairman of entertainment and media agency Endeavor, and his wife, former television news anchor Lauren Sanchez, who stood comfortably between them. Bezos’s minders tried to make sure he spoke to as many guests as possible. At one point, they had to interrupt his conversation with actress Kate Beckinsale and her plus-one, the skier Lindsey Vonn, who wore a striking cream-colored jumpsuit. Intermittently towering over him was his longtime deputy Jeff Blackburn, a six-foot-four-inch former college football player who oversaw Amazon’s streaming video business, Prime Video. Also by Bezos’s side but leaving early was Roy Price, head of Amazon Studios, who sported jeans and a black motorcycle jacket over a white V-neck T-shirt. As an event designed to generate buzz and to amplify Amazon’s presence in Hollywood, the party worked magnificently. Trade publications carried multiple photographs and covered it like a high-society ball of yore. Bezos’s “intent this weekend was clear,” wrote the entertainment columnist Peter Bart in Deadline. “He wants a bigger presence in town for both himself and his company.” Over the next few weeks, Bezos would be ubiquitous in Hollywood. He was the target of a joke in Jimmy Fallon’s opening monologue at the Golden Globes (“He actually arrived yesterday, but there was no one around to sign for him”). That night, he hosted one of the buzziest after-parties of the evening in the Stardust Ballroom of the Beverly Hills Hilton. Casey Affleck collected the Golden Globe for best actor in a dramatic film; the following month, he won the equivalent award at the Oscars, despite a gathering storm of controversy involving past allegations of sexual harassment levied against him by former colleagues. Amazon was now mentioned in the same breath as Netflix, another Hollywood upstart composing a radical future for the entertainment business. But inside Amazon Studios, far away from the glamour, tensions were rising. Independent movies like Manchester by the Sea and niche TV hits like Transparent, about a Jewish family in L.A. navigating issues of gender identity, garnered acclaim and accolades. But they were not the kind of mainstream entertainment that could attract large audiences around the world and nurture other parts of Bezos’s e-commerce empire. So Bezos issued an edict to Roy Price and the already embattled executives at Amazon Studios. It would hover above them like the sword of Damocles and contribute to an unlikely chain of events that would remove the luster from Amazon’s Hollywood effort and temporarily embroil it in controversy: “I want my Game of Thrones.” It had all started, as these things usually do at Amazon, with a counterintuitive decision by Bezos that confounded his colleagues and looked smart only with the passage of time. In late 2010, Amazon was one of several companies selling online access to an identical catalog of movies and TV shows. Customers could spend a few dollars to stream a title once over the internet or they could pay more to “own” it and access it repeatedly. Meanwhile, Netflix had introduced an $8-a-month service totally independent from its original DVD-by-mail program; it allowed subscribers to stream the older TV shows and films in the company’s digital catalog at any time. Even though Netflix’s library generally did not include new releases and the company was not yet producing its own content, its customers, as well as investors, were responding favorably to its push for a less restrictive and more customer-friendly future for home entertainment. Amazon executives had periodically considered acquiring Netflix over the years but always considered the price too high and so never seriously pursued it. Now it seemed like they had missed their chance—the Los Gatos, California, company was evolving into a serious competitor. Characteristically, Bezos was unwilling to cede a significant opportunity to a rival. He asked Bill Carr, the vice president in charge of digital music and video, to come up with a way to compete in the emerging business of subscription video on demand, or SVOD. They met frequently over the course of the next few months, and then one day Bezos presented the answer himself: they would offer a subscription video service for free—to members of Amazon Prime. To Carr and other execs, the idea was perplexing. Prime, originally $79 a year, guaranteed Amazon customers that their purchases would show up in two days without an extra shipping charge. Bezos now wanted to define Prime as something different and less transactional: an all-access entry pass to a library of digital content. “I didn’t get it at first,” Bill Carr said. “But what I had learned at that point of my career is that when Jeff comes up with a novel idea, you listen carefully, ask a lot of questions to get clarification of how to think about it, and then come back to him later with details.” In retrospect, the solution was ingenious. Amazon customers would have balked at paying extra for a service that was inferior to Netflix’s more established offering. Introducing streaming as a “free” benefit—people do tend to gravitate toward free things—could tip some Prime members into rationalizing their annual membership fee, even if they only ordered from the site a few times a year. (Amazon would then raise the price of Prime twice: to $99 in 2014 and $119 in 2018.) These were still lean times for Amazon, so Carr was given what he felt was a considerable budget, of around $30 million, to launch the service, called Prime Video. He had no idea that four years later, Amazon executives would be gathering to consider paying $240 million to license a library of programming from 20th Century Fox, including hit shows like 24. During the meeting, they debated whether Amazon had ever spent that much on anything in its twenty-year history, including the new headquarters they were building a few blocks away from South Lake Union in Seattle’s Denny Triangle neighborhood. They did the deal and didn’t stop there. Amazon licensed the hour-long drama Justified from Sony Pictures, Downton Abbey from PBS, Orphan Black from BBC America, and countless other popular shows. Netflix struck a wide-ranging deal with Disney for its Marvel and Pixar films and animated classics, as well as with ABC for shows like Scandal and The CW for Gossip Girl. In 2014, Amazon had forty thousand titles in its video catalog; Netflix had sixty thousand. Reed Hastings and Netflix stayed ahead of Amazon at every turn. “Netflix drove our strategy a lot,” Carr said. “I’m not ashamed to say we learned from them.” By then, Jeff Wilke had handed over the supervision of digital video to his more artistically inclined peer on the S-team, Jeff Blackburn, the former jock who was now the company’s cerebral and soft-spoken MandA and business development chief. In addition to overseeing the content licensing spree, Blackburn supervised the effort to get the Amazon Prime Video app onto as many set-top boxes, video game consoles, and smart TVs as possible. In late 2015, his team started negotiating with cable giant Comcast to preinstall the service on the new Xfinity X1 cable box, which would end up in tens of millions of U.S. households. But according to several executives who worked on that long-gestating deal, one of Blackburn’s underlings, a temperamental manager named Jim Freeman, became uncomfortable with the look of Prime Video on the Comcast home screen and declared, “Netflix would never do this deal!” The talks died. A few weeks later, Comcast did the deal with Netflix instead, even though Reed Hastings hadn’t made many friends there by calling its proposed 2014 merger with Time Warner Cable anticompetitive. Comcast would end up promoting Netflix in all of its marketing. Amazon had to tuck its tail between its legs, and a few years later reached its own agreement with the cable company. Such duels with Netflix to acquire premium programming and distribution were expensive, exhausting, and in the end, did little to change the competitive balance of power. Both companies had learned a valuable lesson, gleaned a generation ago by premium TV channels like HBO and Showtime: by competing to pay top dollar to license various films and shows, they had enriched the Hollywood studios and other entertainment industry incumbents but ended up with cash-draining services that were difficult to distinguish from each other. If they wanted to attract viewers with truly unique video offerings, it made much more sense to try to create hit TV shows and films themselves. The companies reached this conclusion early in their race to develop streaming video services. At Amazon, Bill Carr dispatched one of his deputies, Roy Price, to set up an outpost in Los Angeles and explore the idea of original programming. Having grown up in Beverly Hills, Price was literally descended from Hollywood royalty. His maternal grandfather, Roy Huggins, was a well-known film and TV writer who in the 1950s was branded a Communist, blacklisted, and forced to testify in front of the House Un-American Activities Committee. He later created hit shows such as The Fugitive and The Rockford Files. Price’s father, Frank Price, was a Tinseltown giant: he ran Columbia Pictures in the late seventies and early eighties and released classics like Gandhi and Ghostbusters in addition to Universal Pictures and overseeing The Breakfast Club, Back to the Future, and the infamous Howard the Duck. The younger Price grew up among celebrities—vacationing in the Bahamas with Sidney Poitier and learning to swim from Lee Majors, star of The Six Million Dollar Man. Price had worked at Disney and McKinsey and Company before joining Amazon in 2004 to create the company’s digital video strategy. For years he advocated for creating shows and films to distinguish Amazon’s video offering. He was, in company parlance, strong on the “think big” leadership principle, capable of elucidating his ideas persuasively in six-page documents. Bezos was also attracted to the idea, but typically, he wanted to rethink the entire Hollywood development process. He looked askew at the “gatekeepers” who used their subjective judgments to decide what people could read or watch—with only a marginal success rate, as evidenced by the many shows with weak concepts that flopped. Bezos proposed an entirely new approach, which he dubbed “the scientific studio.” Anyone would be able to send in a script, not just the L.A. and New York elite; customers and independent judges could evaluate them and their accompanying storyboard illustrations. Their feedback would then produce objective data that Amazon could use to decide what it should actually make. “It was very much a Jeff idea,” Price later said of the original thesis for Amazon Studios. “Instead of a 10 percent hit rate, we would have enough data where we could move it up to 40 percent.” Starting in 2010, Amazon invited anyone to submit screenplays and offered hundreds of thousands in cash prizes for the best scripts. It didn’t work, of course. Accomplished writers stayed away and overall the submissions weren’t very good. It took eight years for Amazon to retire the system (which produced one program for kids: Gortimer Gibbons Life on Normal Street and another pilot, Those Who Can’t, which was made into a series by the WarnerMedia network truTV). But Bezos quietly acknowledged that he would need professionals after all to identify and cultivate promising concepts. In 2012, Price started traveling regularly from Seattle to L.A. and hiring content development executives to oversee development and strategy for comedy and kids’ programs. Back then, Amazon was still avoiding sales tax in California, so the group was set up as an independent subsidiary called the People’s Production Company and forced to carry special business cards and use non-Amazon email addresses. They shared an office with IMDb, the Amazon subsidiary that maintains a popular database of films and TV shows, in Sherman Oaks, above a Fuddruckers restaurant, before later moving to a slightly more upscale but bland office complex in Santa Monica called the Water Garden. That year, Price and Bezos tweaked their original premise. Amazon Studios executives would meet with agents and writers, review scripts, and identify pilot opportunities. But then they would let viewers vote and help influence their decisions on which shows should be extended into full series. In April 2013, two months after Netflix scored an immediate hit by debuting its first show, from the production company Media Rights Capital—the political drama House of Cards—Amazon unveiled its first so-called “pilot season.” Customers could sample fourteen pilots. The political comedy Alpha House (operating in the same vein as HBO’s subsequent, funnier Veep) and a dot-com sendup called Betas (ditto for HBO’s Silicon Valley) were among those that made the cut. But when the seasons premiered later that year, they garnered media attention but gained little traction with viewers. Writers on those shows received positive feedback from Amazon, but later expressed disappointment about the absence of Nielsen ratings for online shows, or any significant promotional support. With deputies overseeing drama, comedy, and kids’ programming, Price honed a unique sensibility for Amazon Studios: it would produce high-quality episodic shows that were more akin to serialized films than stand-alone installments. Taking high-quality indie films as their inspiration, and sensitive to the fact that customers already had lots of TV options, they set out to create TV that was distinctive and sophisticated, and that added to people’s entertainment selection. The programs would offer windows into unfamiliar lifestyles and worlds. They would pursue the kind of programs that the major networks, obsessed with pumping out different versions of mainstream fare like NCIS, would never touch. Amazon “had the brand of a retailer,” Price said. “We had to surprise people and focus on quality.” The approach paid off quickly. Among the pilots that Prime members could sample in early 2014 were Mozart in the Jungle, about hijinks in the fictional New York Symphony; Bosch, about a hardscrabble LAPD detective; and Transparent, featuring a transgender matriarch named Maura Pfefferman. Bezos brought the Amazon Studios team to Seattle that March to discuss which pilots to pick up. The Transparent pilot had garnered a litany of gushing reviews praising it for its daring subject matter and open-ended final scene, but it wasn’t the most watched of the new shows. Bezos nevertheless started the meeting by walking into the conference room and declaring, “Well, I guess we’re going to pick up Transparent.” They did, and the show furnished Amazon Studios with a reputation as a backer of visionary creators and historically overlooked material. In January 2015, Transparent became the first streaming series to win a Golden Globe—both for best musical or comedy TV series, and best actor for Jeffrey Tambor. If Price had entertained the fanciful notion that he would be the public face of this success, it was quickly dashed. Bezos wanted to attend the awards ceremony too. He brought MacKenzie and sat at a table during the Golden Globes with Price; his head of comedy, Joe Lewis; show creator Joey Soloway; and the principal cast. Later, they attended after-parties hosted by HBO and Netflix. With his wife by his side, Bezos basked in the glow of Hollywood adulation. “She always seemed like she was having a good time,” one Amazon Studios exec recalled of the couple at Hollywood events, “while he seemed like he was having a great time.” A few weeks later, Bezos appeared on CBS This Morning with Tambor and Soloway to accept more kudos for Transparent’s win. He said that Amazon had backed the show because it was a remarkable piece of storytelling. “Every time we do something, we don’t want to do me-too,” he said. “We’d like to do some wrinkle on it, some improvement, something that customers have a chance of responding to. Transparent is a perfect example.” Bezos, a film lover, was now excited by the idea of creating original content. It was evolving into another significant long-term bet, alongside Alexa, the Amazon Go stores, the expansions in India and Mexico, and Amazon Web Services. To the surprise of Amazon Studios execs, who often wondered whether the chief of a $100-billion-dollar company didn’t have better things to do, he regularly asked them to come to Seattle to discuss which shows to green-light. “The best part of this pilot is that it’s only a half an hour,” he complained in an early 2015 debate over whether to pick up The New Yorker Presents, a docuseries by the iconic Cond? Nast magazine. Bezos asked trenchant questions but deferred to Price’s judgment even when he disagreed with it. “You can do what you want, but I’d sleep on it if I were you,” he said of the news magazine show. The following week, Price and his head of drama, Morgan Wandell, picked up the dystopian drama The Man in the High Castle, based on the novel by Philip K. Dick, a few other series, as well as the relatively inexpensive The New Yorker Presents. One Amazon Studios executive who was at the meeting said she wondered to herself at the time whether Price was defying a direct order. By then Price was working full-time in L.A. and ingratiating himself in a new Hollywood lifestyle. He had separated from his wife and moved to an apartment downtown. Amazon Studios employees couldn’t help but notice his transformation. Back in Seattle, he had favored sport coats, khakis, and the occasional bow tie. Now in Los Angeles, he slimmed down, started wearing Valentino shoes and a leather jacket, got the logo of the seminal L.A. punk band Black Flag tattooed on his right shoulder, and bought a Dodge Challenger muscle car. “He presented as someone who was going through a midlife crisis,” one employee said. But Amazon was on a roll. Mozart in the Jungle was well reviewed and would make Amazon Studios the first network to win consecutive Golden Globes for Best Comedy in years. Bezos and Price’s strategy was validated—and so Price was empowered to take bigger bets and to move faster. He had hired a friend, Conrad Riggs, a former partner of Survivor producer Mark Burnett, to develop reality TV shows for Amazon. On a trip to London in June 2015, Riggs went to a Who concert with Jeremy Clarkson, the former host of BBC’s reality TV show about cars, Top Gear, who had been ousted from the program for verbally and physically attacking a BBC producer. Riggs observed that Clarkson was a bigger star than even the members of the classic rock band. Amazon then outbid Apple and Netflix to sign him and his cohosts to a three-year, $250 million deal to make a similar show, The Grand Tour. It was one of the largest deals in unscripted television history. Riggs recalled that Bezos approved the expenditure via email in “about 15 seconds.” Roy Price could seemingly do no wrong. The next month, he attended Comic-Con in San Diego, where Amazon was screening the first two episodes of The Man in the High Castle to the annual gathering of sci-fi and fantasy aficionados. For Amazon Studios, the show represented the possibility of tapping the growing audience for big-budget genre fare, and at its first showing at Comic-Con, it got an exuberant reception by fans. Studios executives were exhilarated. That night, Price enjoyed a celebratory dinner with colleagues and the show’s creators, which included numerous champagne toasts. Afterward, Price shared an Uber to an after-party with Amazon colleague Michael Paull and someone he was meeting for the first time: Isa Hackett, the show’s executive producer and the daughter of legendary science fiction author Philip K. Dick. There are several versions of what happened in that car and at the party after, which differ on some of the substantive facts. Everyone agrees, though, that Price, who relished casual and occasionally boundary-pushing banter, had had a few drinks and made several off-color jokes and sexual comments to Hackett, whom he knew was gay and married. Hackett found the remarks to be inexplicably vulgar and inappropriate. Outside the Uber, Price insisted that Hackett take a selfie with him, explaining that if people believed they were dating, it would help promote the show. Hackett was dismayed. Inside the party, she encountered Price again, and he allegedly continued to blurt out graphic sexual remarks. Clueless, Price didn’t realize he had offended Hackett and the next day tried to add her as a friend on Facebook. But she was infuriated. She reported the incident to an executive at Amazon Studios, who referred the matter to Amazon’s legal department. Amazon then contracted with an L.A. firm specializing in workplace misconduct to get to the bottom of the incident. One of its senior investigators started to interview Amazon’s Hollywood employees about their boss. They also talked to Hackett, who told them that she hoped the deplorable incident was a catalyst for significant changes at the studio. The overall picture that emerged was unflattering. Several of Price’s female employees in particular were disapproving, saying he had a pattern of making inappropriate jokes in the workplace. They described some of his off-putting habits—for example, squatting in meetings with his feet tucked underneath him, as well as closing his eyes and rocking back and forth. They also criticized him as a poor manager who delegated most of his responsibilities and seemed to prefer going to meals with celebrities and chronicling them for his Instagram feed. Amazon had an opportunity to quietly remove Price from his position of leadership and avoid a future calamity. But it did not. He had helped conceive and build the studio, which was showing signs of promise. Bezos’s weak-kneed fondness for builders appeared to be shared by others at Amazon, including Jeff Blackburn. Price was also remorseful and wanted to apologize to Hackett, though Amazon’s lawyers asked that he have no further contact with her. They told him to stop drinking at company parties and to get additional training on workplace conduct and how to be a better manager. The company later said in a statement that it “acted appropriately in responding to the incident, including by hiring an outside investigator.” When a female Amazon Studios employee asked a friend in the legal department what had become of the investigation, and why it hadn’t resulted in any obvious disciplinary action, he told her that the company had concluded of the allegations: “That’s not the Roy we know.” Roy Price had kept his job but now faced a more ominous threat: Jeff Bezos was fully attuned to the opportunities and challenges of building a successful film and TV business. And when Amazon’s CEO paid close attention, he generally wanted everything to be bigger, bolder, and more ambitious. The company spent an estimated $3.2 billion on Prime Video in 2016 and nearly $4.5 billion in 2017. Even its usually agreeable board of directors was apprehensive over the growing expenditure and asked pointed questions about it. “Jeff was ahead of us in thinking about the relationship between content and Prime” is how former board member and venture capitalist Bing Gordon put it. Bezos contended that the media business enhanced the appeal and “stickiness” of Amazon Prime, which in turn motivated people to spend more on Amazon. “When we win a Golden Globe, it helps us sell more shoes,” he said on stage at a technology conference in 2016. At least some of his Hollywood employees were dubious of that characterization. They did not consider themselves to be shoe salespeople, although everyone appreciated having the backing of a profitable e-commerce company subsidizing their creative risks. They tracked each show and analyzed how many people watched and then converted from free Prime trial periods or extended their current membership. But there was little evidence of a connection between viewing and purchasing behavior—especially one that justified the enormous outlay on video. Any correlation was also obfuscated by the fact that Prime was growing rapidly on its own. The truth was this: Bezos wanted Amazon to make TV shows and films. He could see that the decades-old way that TV shows and movies were produced and distributed was changing and sought a principal role for Amazon in that future. As in the early days of Alexa, the Go store, and Amazon India, the economic justification might be flimsy today, but opportunities for making money would always present themselves tomorrow. At the time, the company was preparing to introduce Prime Video in 242 countries and to charge for it separately; the project, code-named Magellan, would be Amazon’s introduction to many parts of the world where it didn’t yet operate an online retail business. Video was the introductory product for new markets, as books had once been. But the third season of Transparent, which revolved around the main character’s exploration of gender confirmation surgery, wasn’t the greeting that Bezos had in mind for countries like Kuwait, Nepal, and Belarus. Thus the stage was set for a series of tense meetings between Bezos and the Amazon Studios team during the latter half of 2016 and throughout 2017. It was now utterly pressing that they find a big show akin to HBO’s blockbuster Game of Thrones. But Price was still putting out middling fare like One Mississippi, Good Girls Revolt, and Mad Dogs. He had overseen the acquisition of Manchester by the Sea, which led to awards and the memorable party at Bezos’s L.A. house, but that had also associated Amazon with the accusations of sexual harassment against star Casey Affleck. Price also laid out an astonishing $80 million for Woody Allen’s first TV series, the poorly received Crisis in Six Scenes. (Price was a big Allen fan and had a long-standing relationship with Allen’s longtime agent, John Burnham; colleagues said the series was Price’s “dream project.”) Not only was Price doing business with a filmmaker whose work would later be enveloped in controversy, he was still making prestige American content for awards consideration at precisely the time that Bezos wanted to abruptly change direction and turn Prime Video into a broadly appealing global business. Price understood Bezos’s directive but argued that those kinds of shows took years to develop. In January 2017, he hired an Israel-born TV exec, Sharon Tal Yguado, who had helped distribute the popular zombie series The Walking Dead around the world. The hire, which Price didn’t properly alert colleagues about before it was publicly announced, created another set of internal frictions inside Amazon Studios. Nevertheless, Tal Yguado bonded with Bezos over their love for literary sci-fi sagas like The Culture and Ringworld. Later that year, Tal Yguado would help Amazon secure a reported $250 million deal to acquire the global rights to undeveloped material in J. R. R. Tolkien’s Lord of the Rings books. For Bezos though, the changes were not happening fast enough. In combative meetings, he impatiently demanded his Game of Thrones. Price tried to reason with him. There was not going to be another breakout hit like it—the next one would be something that felt as fresh and daring as HBO’s fantasy blockbuster had. He asked for more time and argued there were promising candidates on the way, like a series based on Tom Clancy’s character Jack Ryan. Bezos also quizzed Price on whether he was sufficiently testing titles and concepts with an online focus group of early viewers that Amazon had built, called the preview tool. Among other things, the tool had helped steer a Billy Bob Thornton show, originally called Trial of the Century, to a winning new title, Goliath. But Price reported that the tool was unreliable—you can’t use the same crowd-sourcing principles to gauge the virtues of story ideas as you can to appraise the value of kitchen appliances on the aisles of an endless virtual store. The development executives often had to move fast to close competitive deals with in-demand TV producers and filmmakers; sometimes they had to bypass the data and just go with their instincts. Price also felt that crowd-sourcing creative concepts was suspect: shows like Seinfeld and Breaking Bad were unpopular at first, after all. Do you trust storytellers, or do you trust data; the ingenuity of artists or the wisdom of the crowd? Bezos had encountered the same questions at the Washington Post, where he had pressed for more ways to measure article popularity but ultimately deferred to the judgment of his newsroom experts. At Amazon, which was his own personal canvas for ruthlessly remaking industries with computer science, experimentation, and copious amounts of data, he was more impatient. He wanted a scientific approach to creative decision-making and to see results quickly. And on that point, Bezos and Roy Price were increasingly not aligned. By early 2017, Amazon had moved into its new thirty-seven-floor tinted-glass office tower, dubbed Day 1, like its previous headquarters a half mile away. Bezos’s old ideas about corporate anonymity were now impractical for a company of Amazon’s prominence. The building was flanked by the first Amazon Go store and bore a giant yellow light sign with the computer science phrase “Hello World” on it, looking out over the park on its eastern side. Bezos’s new office and spread of conference rooms were on the sixth floor—the same as the old building—so he could take the stairs and get in extra exercise. That March, Amazon Studios executives traveled to Seattle to meet him there, amid the busy, clanging construction of another skyscraper across the street and the three interconnected Amazon Spheres—company meeting places that, when finished, would double as nature conservatories. In one of the conference rooms, the frustrated CEO laid into the tepid storytelling of The Man in the High Castle. “The execution is terrible,” he complained. “Why didn’t you guys stop it? Why didn’t you reshoot it?” Bezos continued to reproach Price. “You and I are not aligned,” he said. “There must be a way to test these concepts. You are telling me that we are making $100 million decisions and we don’t have time to evaluate whether they are good decisions? There must be a way for us to see what will work and what won’t, so we don’t have to make all these decisions in a vacuum.” After more debate, Bezos boiled it down: “Look, I know what it takes to make a great show. This should not be that hard. All of these iconic shows have basic things in common.” And off the top of his head, displaying his characteristic ability to shift disciplines multiple times a day, then reduce complex issues down to their most essential essence, he started to reel off the ingredients of epic storytelling: •A heroic protagonist who experiences growth and change •A compelling antagonist •Wish fulfillment (e.g., the protagonist has hidden abilities, such as superpowers or magic) •Moral choices •Diverse worldbuilding (different geographic landscapes) •Urgency to watch next episode (cliffhangers) •Civilizational high stakes (a global threat to humanity like an alien invasion—or a devastating pandemic) •Humor •Betrayal •Positive emotions (love, joy, hope) •Negative emotions (loss, sorrow) •Violence Price helped riff on the list and wrote it all down dutifully. Afterward, Amazon Studios executives had to send Bezos regular updates on the projects in development that included spreadsheets describing how each show had each storytelling element; and if one element was missing, they had to explain why. But Price also told colleagues to keep the checklist from the outside world. Amazon shouldn’t dictate to accomplished auteurs the ingredients of a good story. Good shows should break such rules, not conform to them. Price’s risky decisions seemed to be compounding. He authorized a docuseries on Novak Djokovic, the premier men’s tennis player in the world, which shot hundreds of hours of footage before the Serbian star got injured and withdrew from the project. He also struck a deal with Danish director Nicolas Winding Refn for a violent and plodding crime series, Too Old to Die Young; Matthew Weiner’s meandering show The Romanoffs; and a never-titled work by director David O. Russell that was supposed to star Robert De Niro and Julianne Moore, about a family that ran a winery in upstate New York. The first two shows were canceled after their initial seasons; the last, produced by the Weinstein Company, blew up before production started, amid the explosive revelations of producer Harvey Weinstein’s history of grotesque sexual misconduct. According to several former employees, Weinstein had an amicable relationship with Bezos, Jeff Blackburn, and Roy Price, and traveled frequently to Seattle to help steer Amazon through its early challenges in Hollywood. It was a relationship that later no one was particularly eager to discuss. But Prime Video employees said that at one point, the notorious producer worked with Amazon to develop a service called Prime Movies, which would have given Prime members a certain number of free tickets to see some films in cinemas. The program, which presaged the doomed startup MoviePass, never got off the ground. Price’s deals with Woody Allen and Harvey Weinstein would later reflect poorly on his judgment. He displayed other questionable conduct as well. In 2017, Price got engaged to actress and writer Lila Feinberg and tried to persuade his employees to acquire her idea for a TV series, called 12 Parties. Colleagues pointed out that this was a conflict of interest; so instead it was optioned by the Weinstein Company. They also complained that Price was developing his own script, called Shanghai Snow, featuring stereotypical ethnic characterizations and gratuitous sex and violence, that was received poorly by anyone who read it. Many female employees at Amazon Studios in 2017 continued to be unhappy with their boss or their work environment. One described a conference room at the Amazon Studios office with walls that were covered in portraits of Jeffrey Tambor, Woody Allen, and Kevin Spacey (star of an Amazon film, Elvis and Nixon). All three would fall in the gathering backlash against sexual misconduct, known as NMeToo. The movement was also about to ensnare Roy Price and entangle Amazon in a scandal that its executives thought they had put behind them. That October 2017, a few hundred or so tastemakers, thought leaders, authors, musicians, actors, producers, and their families were whisked by a fleet of private jets from the Van Nuys Airport in L.A. to Santa Barbara. From there, they were taken by another convoy of black sedans to the nearby Four Seasons Resort. The five-star hotel was closed to the public that weekend, as was the Coral Casino Beach and Cabana Club across the street. Counselors greeted each family, with one for every child. Waiting for the guests in their hotel rooms were thousands of dollars of free swag, including premium luggage to transport it all back home. This was Campfire, Amazon’s private retreat for the literati and glitterati. The company started the annual event in 2010 in Santa Fe, New Mexico, as a weekend salon for storytellers and their families. In 2016, when the event grew too big for its original venue, Amazon moved it to Santa Barbara. Bezos liked to call it “the highlight of my year” and seemed to love it when others did the same. The shift to Southern California happened to coincide with the evolution of Amazon’s ambitions from the book business to the broader entertainment world. The weekend, entirely paid for by Amazon, consisted of talks, lavish meals, intimate conversations, and hikes. Bezos was bringing together some of the world’s most interesting people and relished being in their company. He usually sat in the front row of every talk and was the center of much of the attention, with his arms draped over the shoulders of his wife and four kids, laughing louder than anyone. Guests were asked to sign confidentiality agreements and never to mention or discuss Campfire with the press. The guest list that year included Oprah Winfrey, Shonda Rhimes, Bette Midler, Brian Grazer, and Julianne Moore, as well as indie actress and musician Carrie Brownstein, the novelist Michael Cunningham, Post executive editor Marty Baron, and musician Jeff Tweedy. Benjamin Berell Ferencz, the last surviving prosecutor from the Nuremberg trials, gave a talk. Also invited to the festivities were several Amazon Studios executives, including Price, who brought his fianc?e, Lila Feinberg. As Campfire was set to begin, Price stood on perilous ground in the company. The previous month, Hulu and HBO had collected a host of Primetime Emmys while Amazon was shut out. The Wall Street Journal acknowledged this shortfall in a critical story that reported that Amazon Studios had passed on hits like The Handmaid’s Tale and Big Little Lies. The article quoted David E. Kelley, the creator of Lies as well as Goliath, calling the entire operation “a bit of a gong show,” and saying of Amazon, “they are in way over their heads.” But that was the least of Price’s problems. For the past few months, enterprising L.A. journalist Kim Masters had been pursuing the story of Price’s inappropriate comments to Isa Hackett after the 2015 Comic-Con and Amazon’s subsequent internal investigation. Numerous outlets, including the New York Times, BuzzFeed, and the Hollywood Reporter, which hadn’t shied away from other NMeToo reporting, passed on the story. Price had personally hired some of the same attorneys who had represented Harvey Weinstein. But in August, the technology online news site The Information printed a short version of Masters’s piece. Hackett declined to comment, other than calling her encounter with Price a “troubling incident.” By the start of Campfire weekend, NMeToo momentum was building. Ronan Farrow had just published his damning investigation into Harvey Weinstein’s behavior in the New Yorker. (Weinstein had attended and spoke at previous Campfires but was now persona non grata.) On the afternoon before the first day, actress Rose McGowan, a Weinstein victim, started tweeting at @JeffBezos that she had told Roy Price of Weinstein’s crimes and urged Amazon Studios to “stop funding rapists, alleged pedos and sexual harassers.” Price had told her to report the crime to the police. Still, Amazon had done plenty of business with the Weinstein Company and with many other Hollywood figures accused of sexual harassment and other illicit behavior. That was an impeachable fact in a fraught social climate—and a particularly embarrassing one at the start of Amazon’s big weekend. Then the Hollywood Reporter, where Masters was an editor at large, reversed its stance and published her full story. This time, Isa Hackett had gone on the record and confirmed the “shocking and surreal” experience and inappropriate things Price had said to her in the Uber after Comic-Con more than two years before. Amazon Studios executives were required to be at Campfire a day before the event officially started, so Price was in his hotel suite when the story hit; Feinberg, his fianc?e, was downstairs with other Amazon Studios execs and started to cry when she read it on her phone. It was a seminally awkward moment. Price and Feinberg were immediately asked to return to L.A. “It was totally upsetting and humiliating. How could it not be?” Price said later. Other Amazon Studios execs jumped on an emergency conference call with Jeff Blackburn, who told them to stay for the conference. Behind the scenes, Amazon struggled again with what to do. Blackburn placed Price on a temporary leave of absence while revisiting his loyalty to the person who had initiated Amazon’s foray into original content, hiring and managing a team that had won a haul of prestigious awards. Roy Price had carved a path for Jeff Bezos in Hollywood. Leaders “are right, a lot,” according to the hallowed leadership principles. That had been enough for Bezos—until suddenly it wasn’t. There was still no Game of Thrones. Price had also lost the confidence of much of his team; and his social awkwardness and occasional impropriety was off-putting and, in the situation with Hackett, disturbing. Amazon execs had known about that behavior but believed it had been addressed. Could they really support a beleaguered executive in the midst of a widespread cultural reckoning? By Tuesday, Price had agreed to resign. In the middle of all this, Blackburn called Isa Hackett to try to make amends. It was now excruciatingly clear that Amazon management, with its predominantly male S-team, had failed to take her charges seriously enough. With the accumulated exhaustion of trying to privately relay a traumatic experience to Amazon’s investigators and, when that failed, having to go on the record in the media, Hackett was overcome with emotion. She started to cry over the phone: “I tried to tell you. And for so many months you had the opportunity to do something about it! You put me in this position, and it caused a lot of pain for my family and me.” Blackburn listened and agreed to her entreaty that he try to use Amazon’s plentiful resources to address pervasive sexism in Hollywood and corporate America. A few days later, Blackburn was in Santa Monica talking to groups of Amazon Studios employees. Some demanded to know why Price hadn’t been fired in 2015; others wondered if Amazon was firing Price to distract from its affiliations with other NMeToo characters, like Harvey Weinstein. Price’s few defenders believed he had been scapegoated and noted that under his leadership, Amazon had backed more female creators than any other studio. Blackburn, according to several people who were in the meetings, acknowledged that the situation should have been dealt with sooner but said that new information had come to light. The explanation rang hollow to at least some employees. By the end of that week, Blackburn was trying to bring closure to the entire unseemly episode. “Amazon Studios has been in the news recently for the wrong reasons,” he wrote in an internal email to Studios employees. “We should be generating buzz about the terrific programming we are creating for customers and the new shows we are planning for next year.” Price would later seek to apologize publicly and clear his name from Hollywood censure, with little success. “I sincerely apologize for any discomfort caused by my comedy faux pas with Isa Dick Hackett in 2015,” he wrote to me in an email. “I wish Amazon had allowed me to apologize to her then, as I desperately wanted but was not permitted to do…. In any case I truly aspired to nothing but to keep us amused as we all Ubered a few blocks from one party to another.” Price’s fianc?e quickly left him after the scandal, a few weeks before their planned wedding, and he was expelled from the entertainment industry, his name relegated to the same broad category as sex offenders like Weinstein, Les Moonves, and Matt Lauer. Considering what his grandfather had been through a generation before during the infamous witch hunt for Communist sympathizers, Price saw bitter historical parallels. He didn’t expect to hear from Bezos and never did. After all, this was Amazon, where employees were there to produce results, not create personal bonds. After Price was ousted, Amazon installed his deputy, Amazon Studios COO Albert Cheng, in the role on an interim basis, and he started to sweep out many of the original executives, including Joe Lewis, who had helped develop such groundbreaking shows as Transparent and The Marvelous Mrs. Maisel. (Lewis was given a two-year production deal and would produce Fleabag, adding to Amazon’s growing awards tally.) Soon after, Amazon hired NBC executive Jennifer Salke to take over the role permanently and announced plans to finally leave the bland office park in Santa Monica and move into a historic film complex in Culver City—the mansion used in Gone with the Wind. A new regime was taking over Amazon Studios. Ironically, many of the shows that the scandal-plagued old guard put into production, like The Boys and Jack Ryan, would turn out to be global hits. Bezos continued to spend heavily on video. Prime Video consumed $5 billion in 2018 and $7 billion in 2019. There was continued debate over the actual return on this investment, though the objections from Amazon’s board and investors were not quite as loud. As rivals like Walmart and Target caught up to Amazon in their ability to guarantee two-day shipping, free media became a more important part of Prime’s bundle of perks. Amazon’s original shows and films also helped to solidify its position just behind Netflix, and alongside Disney, Apple, Paramount, HBO, and other companies in the race to define the future for home entertainment. Prime Video was yet another of Jeff Bezos’s big bets over a fruitful decade. By pointing the way for his employees over and over, closely monitoring their efforts, and using his own budding fame to magnify their visibility, Bezos had blazed a path into promising new technologies and industries. Alexa, Amazon Go, Amazon India, Prime Video, and the rest could still prove disappointments relative to their massive investments—or they could set up Amazon to reap new potential windfalls. But as a result of Bezos’s immersion in the invention process, he managed other parts of Amazon much less closely—like the buying, selling, stocking, and distribution of products. This was Amazon’s original and largest business, of course. And as the public profile of the company and its impresario continued to rise, the gears of that unrelenting machinery were starting to turn ever faster.