Amazon.com Inc plans to expand its video production arm and move into a historic studio near Hollywood, the company said on Monday, signaling its entertainment ambitions remain high after a management shakeup earlier this month.
The world’s largest online retailer said in a news release that it would start moving into the Culver Studios, where “Gone with the Wind” was filmed, at the end of the year. The space will allow it to expand its headcount beyond the more than 700 employees working in its current Santa Monica, California, office.
Video streaming has been a major reason people subscribe to the Amazon Prime benefits club, whose members tend to buy more from the company.
Amazon Studios chief Roy Price resigned this month, and other top executives left the unit afterward.
Some have criticized Amazon for making shows that do not appeal to a broad-enough audience.
The company is nonetheless committed to original content. Analysts estimate Amazon will have spent $4.5 billion on video in 2017, and the company said last week that it would budget more for next year.
Amazon did not respond to requests for comment on how many people it would hire for the studio. It said in the news release that it would have space to add creative, technical, legal and marketing jobs.
The new studio in Culver City, California, is owned by an affiliate of Hackman Capital Partners.
The company was founded as a result of what Amazon founder Jeff Bezos called his “regret minimization framework,” which described his efforts to fend off any regrets for not participating sooner in the Internet business boom during that time. In 1994, Bezos left his employment as vice-president of D. E. Shaw & Co., a Wall Street firm, and moved to Seattle, Washington. He began to work on a business plan for what would eventually become Amazon.com.
On July 5, 1994, Bezos incorporated the company as Cadabra, Inc. Bezos changed the name to Amazon.com, Inc. a few months later, after a lawyer misheard its original name as “cadaver”. In September 1994, Bezos purchased the URL Relentless.com and briefly considered naming his online store Relentless, but friends told him the name sounded a bit sinister. The domain is still owned by Bezos and still redirects to the retailer. The company went online as Amazon.com in 1995.
Bezos selected the name Amazon by looking through the dictionary; he settled on “Amazon” because it was a place that was “exotic and different”, just as he had envisioned for his Internet enterprise. The Amazon River, he noted, was the biggest river in the world, and he planned to make his store the biggest in the world. Bezos placed a premium on his head start in building a brand and told a reporter, “There’s nothing about our model that can’t be copied over time. But you know, McDonald’s got copied. And it still built a huge, multibillion-dollar company. A lot of it comes down to the brand name. Brand names are more important online than they are in the physical world.” Additionally, a name beginning with “A” was preferential due to the probability it would occur at the top of any list that was alphabetized
After reading a report about the future of the Internet that projected annual Web commerce growth at 2,300%, Bezos created a list of 20 products that could be marketed online. He narrowed the list to what he felt were the five most promising products, which included: compact discs, computer hardware, computer software, videos, and books. Bezos finally decided that his new business would sell books online, due to the large worldwide demand for literature, the low price points for books, along with the huge number of titles available in print. Amazon was founded in the garage of Bezos’ home in Bellevue, Washington.
The company began as an online bookstore, which was an idea spurred off with a discussion with John Ingram of Ingram Book (now called Ingram Content Group), along with Keyur Patel who still holds a stake in Amazon. Amazon was able to access books at wholesale from Ingram. In the first two months of business, Amazon sold to all 50 states and over 45 countries. Within two months, Amazon’s sales were up to $20,000/week. While the largest brick and mortar bookstores and mail order catalogs might offer 200,000 titles, an online bookstore could “carry” several times more, since it would have a practically unlimited virtual (not actual) warehouse: those of the actual product makers/suppliers.
Amazon was incorporated in 1994 in Washington State. In July 1995, the company began service and sold its first book on Amazon.com: Douglas Hofstadter’s Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought . In October 1995, the company announced itself to the public. In 1996, it was reincorporated in Delaware. Amazon issued its initial public offering of stock on May 15, 1997, trading under the NASDAQ stock exchange symbol AMZN, at a price of US$18.00 per share ($1.50 after three stock splits in the late 1990s).
Barnes & Noble sued Amazon on May 12, 1997, alleging that Amazon’s claim to be “the world’s largest bookstore” was false because it “…isn’t a bookstore at all. It’s a book broker.” The suit was later settled out of court and Amazon continued to make the same claim. Walmart sued Amazon on October 16, 1998, alleging that Amazon had stolen Walmart’s trade secrets by hiring former Walmart executives. Although this suit was also settled out of court, it caused Amazon to implement internal restrictions and the reassignment of the former Walmart executives.
Since June 19, 2000, Amazon’s logotype has featured a curved arrow leading from A to Z, representing that the company carries every product from A to Z, with the arrow shaped like a smile.
Amazon’s initial business plan was unusual; it did not expect to make a profit for four to five years. This “slow” growth caused stockholders to complain that the company was not reaching profitability fast enough to justify their investment or even survive in the long-term. When the dot-com bubble burst at the start of the 21st century and destroyed many e-companies in the process, Amazon survived and grew on past the tech crash to become a huge player in online sales. The company finally turned its first profit in the fourth quarter of 2001: $5 million (i.e., 1¢ per share), on revenues of more than $1 billion. This profit margin, though extremely modest, proved to skeptics that Bezos’ unconventional business model could succeed In 1999, Time magazine named Bezos the Person of the Year when it recognized the company’s success in popularizing online shopping.
In 2011, Amazon had 30,000 full-time employees in the USA, and by the end of 2016, it had 180,000 employees. The company employs 306,800 people worldwide in full and part-time jobs.
On October 11, 2016, Amazon announced plans to build convenience stores and develop curbside pickup locations for food. In December 2016, the Amazon Go store was opened to Amazon employees in Seattle. The store uses a variety of sensors and automatically charges a shopper’s Amazon account as they walk out of the store, eliminating the need for checkout lines. The store is planned to open for the general public in early 2017.