Big Technology Podcast - Will Amazon Be Kinder After Jeff Bezos? A Conversation With Recode's Jason Del Rey

Episode Date: February 10, 2021

Jeff Bezos is headed for the door at Amazon, and because 2021 is the craziest news year on record, we mostly haven’t stopped to consider this seismic story and what it means for the business world.�� Joining us to discuss what Amazon looks like after Bezos is Jason Del Rey, a senior correspondent at Recode and author of a forthcoming book on Amazon’s battle with Walmart. Here's Jason's story on what to expect from incoming CEO Andy Jassy: https://www.vox.com/recode/22264330/amazon-ceo-andy-jassy-jeff-bezos-aws

Hey, Jason, good to see you again. Hey, Alex. Thank you for doing this on such short notice. Of course. Appreciate it. I'm going to read a quick ad and then we'll get into it. The Big Technology podcast is sponsored by MediaOcean. Looking for a job in Big Tech, you might want to take a look at MediaOcean.

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of the tech world and beyond. Well, Jeff Bezos is headed for the door at Amazon, and because it's 2021, the craziest news year on record, we mostly haven't stopped to consider the seismic story and what it means for the business world. Joining us to discuss it is Jason Delray, a senior correspondent at Recode and author of a forthcoming book on Amazon's Battle with Walmart.

He's also the host or the original host of Recode's Land of the Giants podcast, which I will be co-hosting this year and a little bit more on that, in a bit. But for now, Jason, welcome to the show. Hey, Alex. What's going on? So are you deep in book writing life or are you still reporting day to day normally? I'm doing both right now. I'm doing reporting and writing on nights and Sundays and eventually we'll take some time to exclusively focus on the book. But right now I'm trying to do both and be a decent or above average father and husband. So I'm not succeeding at all of them at the same time. Yeah, each one of those is its own situation, but I do appreciate you making the time. So, you know, we've known each other

for a long time. We were, uh, I followed you at ad age. We both reported on ad tech there. I actually remember I was thinking about taking the job. I remember the exact place I was standing when I called you and said, Jason, what do you think about this advertising age place? You have a good experience there. And you're like, the only place I would ever leave for was all things D. Wow. You remain there. And now it's recode. Yeah, it's amazing how I said that lie with a straight faith. No, I was kidding. It was that it was. You were sincere. It was the place to be for me. Yep. Yeah. Absolutely. And so, so and then you moved from covering ad tech to, uh, commerce, a lot of Amazon stuff. And I moved from covering ad tech to the tech giants. And

also was obsessed with Amazon and ended up writing a book always day one title is like the catchphrase of Bezos. So my first question for you, my first real question for you is what's what is the deal with us ad tech guys that are just drawn to be obsessed with Amazon? What do you think is behind it? So just to back up for one sec, I really did want to work at all things the with and for you know carers swisher peter kofkin walt mossberg and um the only job available uh was the commerce gig um because peter very uh i covered digital media as well as ad tech um and peter kofka was covering that well for all things d um but i've grown to become uh probably like an e-commerce and retail nerd um uh just because so much of our life for better or worse

revolves around buying stuff. I mean, that sounds. And Amazon obviously is, and Amazon is obviously expanded in so many ways that they affect us in other ways. And so I feel like I sort of lucked into covering that company at a time in which, you know, it was pre-Alexo when I first started covering the company.

Pre-AWS being something about the work. world knew about because its financial results were public, pre-Bezos transformation in a lot of ways, and they've only become more. He mean before he was jacked? He may have been jacked, but he was not showing it off yet. And so, anyway, I am fascinated by the company and by the space, but it was, I don't think there was any connection between ad tech and commerce for me, at least. please. Oh, it's interesting to hear about your journey. So we're here to talk a little bit about

what Amazon, what the commerce world is going to look like after Jeff Bezos is resigning. How surprised were you when you saw the news? When I took a breath and got inside from shoveling my car out outside, which is where I was when the news broke, not great timing. It was not altogether surprising. I mean, who he chose was definitely not surprising after his other sort of number two, Jeff Wilkie had announced his retirement. Right. And he chose Andy Jassy last year. Yes. Yes. Yes. Yeah. I think frankly looking, I think it might have happened sooner if not for the pandemic. Like I think I think many people both inside and outside of Amazon have made the point that this sort of almost formalizes the way

Bezos was interacting with the company for a couple of years now, which is working on sort of his pet projects, early big swings, but trying to make time for his other rocket building and other, you know, increasingly philanthropic initiatives. So anytime it was going to happen, it was going to feel like a big moment and it is. But when I could digest it for a second, it was not altogether surprising. Why do you think now is the moment that he's leaving? there are a couple of theories one is you know he will maybe he wanted well there's three theories and I think they could have all played a role one is you know he was planning to leave before the pandemic and then felt like he couldn't with everything facing the company and society but his

company and so now hopefully feeling like we're on the back end of the pandemic and with the vaccines rolling out that it would be a fair time to pass the baton I think for sure, like, does he want to be being, you know, does he want to be testifying in front of different congressional communities more or, you know, have to face that? I don't know anyone that wants to do that. Maybe he'll still have to as the founder or executive chairman, but I don't think he wants to spend his time being briefed on that stuff. And I think there's going to be more of that to come. and then some people suggested that the exact timing when he'll transfer you know will be you know Amazon will be sort of from a financial perspective there will be sort of lapping their amazing growth numbers from the pandemic and so he'll stick around a couple more quarters maybe as those growth numbers don't look quite as good as we lap those numbers and so he'll face the you know this is a generous take, but that, you know, he'll take the brunt of, you know, if the growth slows down

before passing it off to Jassy. But I think it's a combination of he has other interests. He's been spending time on the scrutiny. I would imagine he does not want to be the face of it for much longer. And then, and then trusting, I think really trusting that Andy Jassy is the person that can make sure his company stays on track. Yeah, I bet all those elements play a role. And personally, I've been watching like every Bezos presentation over the past couple years. And the thing that surprised me the most was that he kept saying, the most important thing I'm doing is trying to get to space with Blue Origin. And I have to think that, you know, Bezos is a type of guy who tries to, looks at the output that he's getting from the input of effort. And he was trying to maximize the output.

And I think that he's probably at this point, say, my effort will be better spent on the Blue Origin stuff. And, of course, he'll look at the philanthropy and the Washington Post, but it does seem like it's a battle between Bezos and Elon Musk to get to space. Is that your next book? Is that your next book? The billionaire space race? I think it would be a pretty good book, actually. Someone's going to get it. Someone's going to write that. Well, I'm choosing you if you want it. The publishers are listening out there. So, I mean, does this change your book at all? You're going to write about Amazon and Walmart? Yeah, I, you know. Because Wilkie's also,

Jeff Wilkie was the head of worldwide consumer and he's out too. So the two big characters inside Amazon you'd think are now leaving. Yeah. I'm trying not to give away story ideas. But I think there is something to be said for Bezos stepping aside, Wilkie, a guy named Steve Kessel, who headed the Kindle project back in the day. but then more recently all the physical store projects like Amazon Go,

who announced his retirement, Jeff Blackburn, long-time exec who's been on, yeah, it is a new era. And so obviously I'll be looking for changes. As far as my book, I think unlike Brad Stone's book, which is an Amazon-centric book and Bezos book. Right, Bezos is on the cover. I think Brad has some work to do between now and his book publishing in May. Um, I, I, my book's not coming out for a bit after that. And so, um, I'm not super concerned. Um, uh, maybe, maybe I want Jassy to play a bigger role in this book now than I anticipated. But, um, but, uh, that is not high on my stress list. And I have a lot of things on my, my stress list. Oh, yeah. So when I was writing always day one, I had five CEOs, uh, that I was writing about. Yeah. Bezos, Zuckerberg.

Dr. Pachai, Sata, Nadella, and Tim Cook. And I was like, man, I just hope none of them stepped down. And I made it like 10 months before Bezos went, which is nice. Yeah. So I wanted to talk. You had some Jeff Wilkie in there too. Yeah, Wilkie was in. And then Wilkie stuff.

I thought Wilkie was going to be the next person in line. But obviously, Wilkie must have had a premonition or at least some knowledge that it wasn't going to be him. And that's when he decided to leave. Yeah. He obviously stayed, took it over. So I just kind of am curious to hear your perspective on how Amazon as a company changes. And I made this point in my newsletter recently, but the thing that Amazon, and you wrote a great story about what's going to happen to Amazon under Jassie, the thing about Amazon under Bezos is that it had this retail DNA.

And the e-commerce and the retail business is notoriously cutthroat. And every penny matters. and you have to be extremely frugal to beat competitors. And, in fact, frugality is one of Amazon's principles. And Walmart first. And Walmart. Yeah. Okay, we'd talk about that.

So, and this has, it's been like, I think one of the reasons why Amazon's been so cutthroat. It doesn't want to pay any taxes. That doesn't want to pay its employees very much, although it's reformed its way in recent years with some encouragement from Bernie Sanders. and yeah and uh won't you know it's one of those companies doesn't serve employees lunch you know and now jassy's going to come and and he's coming from not the retail but the money printing side of the business yeah one that doesn't naturally have those constraints does that background change the way amazon looks moving forward does it make amazon a kinder culture?

I don't know. I have two sides of the, I can answer both ways and I think it's a complex answer. One side is the guy now running Amazon's retail business, and yes, it's a guy, not surprisingly at Amazon. The guy running the retail business now is Dave Clark, who has run the warehouse network operations for years in sort of a cutthroat fashion,

great Bloomberg profile of him said his nickname used to be the sniper because he would in his early days hide out in an Amazon warehouse to watch workers and maybe fire people on the spot if they weren't doing the right thing. So Clark is running that retail business

and he's a tough guy. The jassy thing I'm interested about coming from AWS and helping to invent that is that you I've talked to Amazon former execs who won't say this publicly but privately will tell me Jason once the last time Amazon has really had a breakthrough invention like you know and they will point out Alexa AWS you know Kindle and like the initial idea for Amazon basically and and what and just say like When, where is that new, like new breakthrough invention lead to a new business?

And you can look at things like hands-free technology in stores and anyway. So my big thing is, will Jassy we to, you know, will his taking over in some way directly we to the next great invention? And, you know, does Amazon even need that? I don't, you know, with all the room to grow in retail, in logistics, in, media intellect said the things they already do well it doesn't really feel like that but there's an argument some former execs would say privately that they are they worried that the company's already you know um uh touching day two which is this idea of like when you stop becoming that

invented inventive scrappy um no hold no hold inspired startup i don't know if i answered your question. Yeah, those are some of the. Yeah. Yeah. Well, I want to know whether it's going to, yeah. Well, first of all, I see there's a worry that it's going to be defend your flagship company, maybe like a Microsoft in the Windows days, versus an Amazon invent, invent,

invent, and don't give a damn about what you've built so far, which has been the mantra under Bezos. But, yeah, the thing is that I wonder about, you know, whether it becomes a nicer company. One of our former guests, Tim Bray, who left Amazon at a protest that they fired some whistleblowers, spoke with you for your story about Andy Jassy. And I was surprised at how positively he reacted. He said, AWS was by a wide margin, the best managed place I've worked, including places I was the CEO. And that was surprising to me. And I want to know whether that's surprising to you. And he had also in his memo that when he left said there's a vein of Texas, are you running through Amazon culture? Do you think what Tim Bray is saying, and that is that vein of toxicity was Jeff Bezos? Well, let me first say, I asked Tim if he would talk to me about

Andy Jassy and did not have any idea what he was going to say. And so, yes, I was surprised just because of the way he went out. Yeah, he lit the place on fire when he was going. Yeah. You know, I asked him about, like, how do we make, how do I, how do I, you know, make sense of you going out the way you did? And then this praise of Jassy. And he basically said, he doesn't think Jassy has had anything to do with the whistleblower firings that he was really upset about. The truth is, Andy Jassie's on the S team at Amazon, you know. And so I don't know that he oversaw those firings. I don't think he did. But I wouldn't be surprised if there was, if there was an impression. team. Correct. Sorry. Yeah. My editor would tell me the same thing. Don't assume. Don't assume people know. So, so I was surprised. I think, I think Bray was talking more about, you know, the DNA that comes from Bezos. I think that is true. I've had people describe Jassy to me as, while there are a lot of similarities in management style and philosophy, that, um, more human, which is, weird thing, a weird way to describe a person, but more human than Jeff Bezos. The word empathetic has been used as well. I think he's a hard charging executive for sure, but I think some people internally have a hope that the place will become, you may have described it as

a nicer place. How that manifests itself externally, I have no idea, but I'm going to be looking for any sort of signs of change. I'll stop there, but those are some of my thoughts on that topic. Yeah, having studied Amazon, I think it's a solid company. I think the biggest weakness that the company has is that it does have a lack of empathy. And you can see it manifest in terms of the way that it will work its workers sometime, or even you referenced this in your story. there was concern about conditions around workers in the beginning of COVID.

And instead of like taking those seriously, they organized a smear campaign against one of their employees and said internally that he wasn't very smart and inarticulate. And so how do you think the company, let's say the company does get more empathetic. I mean, I know we're in speculation territory now. How do you think that might change it and can it make it? I mean, we know they're going to be held. I'll ask the next question about the FTC after this. But how would it more empathetic Amazon be changed from what it is stated? Does it make it stronger?

The answer I want to give is that yes, it would make it stronger. But then I look at all the coverage, all the employee activism and many of it negative, right, shining a negative light on the company. And yet record sales and profits through a different. pandemic and i just you know people will say it's not on consumers to vote with their wallets you know they're just trying to you're just trying to get by day to day um but i i i don't know i don't know that being a more empathetic will make it a more a more popular company i just um i think people i think the service is just so accept has historically been so exceptional and far and away the best in retail that um

people just you know people just make decisions that are best for them when it comes to you know buying stuff um i think i think i think recruitment wise i think um yeah no one wants to be at the center of potential antitrust uh enforcement i i think all of that could help talk on that because we only have a couple of minutes yeah sure on the antitrust stuff um is that a real threat to amazon because they're coming after google and facebook yeah i i think i've talked to i've talked to i've talked to i've talk to people about, does the government have the bandwidth to take on more than two giants? I think separating the cases to DOJ, FTC, and then states, maybe so. I think there's still a real risk Amazon's facing. I've been surprised at how combative they've been with critics over the

last few years from both a communications and public policy side. I just think they had a lot of friends on Capitol Hill a few years ago, and now they go in there and every conversation doesn't start with, oh, I'm an Amazon Prime customer. It starts with an sort of interrogation. And that's what I've learned over the years reporting. And so I just, maybe Jassy will instruct his comms and policy teams to like take a different tact. I'm just, I just will believe it when I see it. And so, yes, I think there's real risk. risk you know i've reported lena con um who sort of i don't know if you want to describe lena but uh wrote this paper yeah lena sort of an antitrust scholar and was the a lawyer on the house

antitrust subcommittee that investigated the tech giants who believes all these companies need to be reined in she's she's in contention for an f tc commissioner spot which would be a very big deal. I think there's real risk and you know, you would think Jassy might not want to sit down before Congress or, you know, other courts and might want to take a different tact, but smart people inside that company think the best way forward is to be somewhat combative and dismissive of some of these complaints. And so I'm just, I'm just, I'm just here to watch the ride. Welcome to the Thunderdome.

It's going to be intense. And they won't easily get past the government on this stuff. I think it's going to be a rocky few years for Amazon. We'll have more to say about it on the show. Lastly, you hosted the first season of Land of the Giants. Great podcast with Recode. I was a fan of it and remain a fan of it. And now I'm going to be hosting this season,

premiering on Tuesday, this upcoming Tuesday, about Google. So I just want to say a quick thank you, Jason, for pioneering the show and to everybody out there. Give it a listen. It's going to be fun. We get everybody from Larry and Sergei's advisor, Terry Winnegrad, to Marissa Meyer and people who've worked on products like Toolbar and Chrome and folks involved in the employee protests. So thank you, Jason, for laying the groundwork on that front. As long as people start with season one about Amazon, I'm happy to help. It's a great. I mean, really, it was a great season. I sourced it in my book. I thought it was great. You got some great access, one and two. Fulfillment Centers and towns that had been impacted by fulfillment centers that had set up shop and left.

So when people are finished with the Google season, then they should go listen to your season. That's fine with me. I'm very excited to start listening to your season. All right. Sounds good. Well, Jason, it was great to reunite. Really nice to see you again. Congrats on all the great work.

And you'll have to come back when you're on your book door. Thanks, Alex, so much. All right. Thanks, everybody for listening. It's been another great week here on the big technology podcast, shorter episode this week. We're doing some experimentation, and so let's see if people like this better or they like it worse. As always, your feedback is appreciated. You can always send it to Big Technology Podcast at gmail.com.

Next week, a special episode. We're going to air it Tuesday to sync up with the launch of Land of the Giants, three mayors on the future of technology in the United States. Mayor Francis Suarez from Miami, Mayor Steve. Adler from Austin. Mayor Satya Road Cohn from Madison, Wisconsin. That'll be a fun one. I'm about to go jump and do that interview. So I hope that you join us and stay tuned. And thanks again for listening. Big thanks to Red Circle for hosting and selling ads. A big thanks to Nate Gawadne for editing this on a short timeline. And thanks again to our guest, Jason Delray. We will see you next week. You're on the big technology podcast.

Thank you. Thank you.