A look ahead at 2017

7 things Amazon needs to do in 2017

Amazon is riding high these days—in the cloud, retail, drones, devices, AI and more. But to extend its dominance without alienating customers, it must address a few key issues.

7 things Amazon needs to do in 2017

A look ahead at 2017

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As you may have noticed, 2016 was a very good year for Amazon, pretty much across the board. 

Amazon Web Services’ cloud business soared, growing insanely fast, dwarfing its competitors and generating big profits. On the retail side, Amazon dominated the holiday season, even as it experimented with drone deliveries and other shipping innovations. Known for its online sales, Amazon finally introduced retail stores as well. And the company’s voice-powered assistant, Echo, clearly outshone Apple’s Siri and forced Google to play catchup with Google Home.  As one report noted

Half of all U.S. households are subscribed to the membership program Amazon Prime, half of all online shopping searches start directly on Amazon, and Amazon captures nearly one in every two dollars that Americans spend online. Amazon sells more books, toys, and by next year, apparel and consumer electronics than any retailer online or off, and is investing heavily in its grocery business.

That hot streak is likely to continue for a while, but if Amazon wants 2017—and beyond—to turn out as rosy as 2016, I have some suggestions for how to keep the good times rolling, focused mostly on transparency, openness and fairness:

1. Get some cloud humility

AWS’ success just killed Cisco’s cloud efforts, and Gartner reportedly estimates that Amazon’s cloud business is “several times the size of its next 14 competitors combined.” That’s great, but it also means Amazon must be wary of being deemed a monopoly. I’m sure Jeff Bezos and friends don’t see it that way, given high-profile competitors such as Google and Microsoft—and possibly Oracle. But AWS’ market dominance could persuade regulators to take action, which is the last thing Amazon needs. 

+ Also on Network World: Can any cloud company keep up with Amazon +

2. Retail pricing transparency

Amazon is increasingly competing on service and convenience, not just price. But the company’s constant experimentation with pricing schemes and offers is beginning to create confusion about exactly how good the company’s prices really are. Amazon has the ability, if not the desire, to make its price history transparent, letting buyers see how much others are paying for a given product, in both real time and over time. Heck, Amazon has the smarts and reach to show accurate data on how much the item is selling for elsewhere. That would create a level of customer trust that could only enhance the company’s sales. 

3. Embrace data transparency

The Amazon Echo voice-powered speaker is limited, but useful—more useful than most of its competitors, in fact. But it’s also a little creepy. Tracking every request and purchase is bad enough to raise privacy concerns, but that’s pretty much par for the course for any retailer in the digital age.

The bigger question, though, is whether we are confident Amazon isn’t tracking everything it hears? Whether you’re talking about what you want for dinner or what really happened that night on the lonely country road. How might that information be used? Who could get access to it, either because Amazon sells it or some government agency demands it? When you’re automatically listening to everything we say, it’s important to not just tell us what you’re collecting, but let us see it, edit it and delete if we want to. 

4. Build phones and tablets more like the Echo

As noted above, the Echo is a premium product, ahead of most of its competitors in terms of voice recognition and sound quality. And it doesn’t constantly bombard you with advertising as you use it. Sure, it’s deeply tied to the Amazon ecosystem, but compared to many of Amazon’s other consumer devices, it seems elegant and practically agnostic.

If Amazon wants to be a serious player in the world of smartphones and tablets, it needs to go beyond inexpensive devices subsidized by ads and make world-class devices to compete with Apple and Samsung (but not explode). Being the cheap alternative for people who don’t mind being assaulted by ads is not the long-term answer, and it’s not up to the company’s standards in other areas. 

5. Open up Amazon Prime to more content sources

There is an increasing amount of high-quality content on Amazon Prime, but the current reality is that no single service has all the content people want, which means there’s a real opportunity to make Prime the gateway to other services. Amazon is already starting down that path with available subscriptions to Starz and Showtime, among others, but there’s plenty of opportunity to expand this process.

6. Contribute more to open source.

While Amazon’s tech relies deeply on open-source components, critics have charged that AWS doesn’t contribute much of its work to the open source community. The company may be taking steps to change that with the recent hiring of Zaheda Bhorat to head its open source strategy, not to mention bringing Adrian Cockroft on board in October. Let’s hope the trend continues.

7. Be nicer to its employees. 

Back in 2015, The New York Times famously slammed Amazon’s “bruising” culture. While there’s some evidence things have improved since then, there’s still room for improvement. And there are still disturbing stories about the company’s highly competitive, high-stress working environment. I’m not saying Amazon should abandon the aggressive practices that have helped it lead in many tech categories, but a little compassion can go a long way in attracting the very best workers. 

Many of these recommendations won’t be easy to realize, of course, and Amazon may not choose to pursue any of them. But I hope they do. 

Have other ideas for Amazon? Share them on Twitter #AmazonIdeas

Copyright © 2016 IDG Communications, Inc.

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