Amazon’s machine vs Apple’s machine

From Benedict Evans’ Amazon is a machine to make a machine, and the machine it makes is more Amazon:

When you look at large manufacturing companies, it becomes very clear that the machine that makes the machine is just as important as the machine itself. There’s a lot of work in the iPhone, but there’s also a lot of work in the machine that can manufacture over 200m iPhones in a year. Equally, there’s a lot of work in a Tesla Model 3, but Tesla has yet to build a machine that can manufacture Model 3s efficiently, reliable, quickly and at quality at the scale of the incumbent car industry.

More than any of the other big tech platform companies, Amazon is a machine that makes the machine… Amazon is hundreds of small, decentralized, atomized teams sitting on top of standardised common internal systems. If Amazon decides that it’s going to do (say) shoes in Germany, it hires half a dozen people from very different backgrounds, maybe with none of them having anything to do with shoes or ecommerce, and it gives them those platforms, with internal transparency of the metrics of every other team, and of course, other people (and Jeff) have internal transparency to their metrics. These are the famous ‘two pizza teams’…

Amazon, then, is a machine to make a machine – it is a machine to make more Amazon. The opposite extreme might be Apple, which rather than radical decentralization looks more like an ASIC, with everything carefully structured and everyone in their box, which allows Apple to create certain kinds of new product with huge efficiency but makes it pretty hard to add new product lines indefinitely. Steve Jobs was fond of talking about saying ‘no’ to new projects – that’s not a very relevant virtue to Amazon.

My take: A good way to understand a difference that sometimes defies understanding.


  1. David Emery said:

    Is there a risk of ‘Peak Amazon’ – where markets are fully saturated by Amazon (and its clones? I heard a piece about how eBay is working to counter Amazon by promoting small businesses.)

    March 12, 2018
  2. Richard Wanderman said:

    When the Amazon machine got laid over Whole Foods, at least some Whole Foods employees rejected it, made them feel like automatons (crying).

    I can see the machine working well at the level of supply chain, but not at the level of retail unless people are taken out of the equation (Amazon Go). Maybe that’s the future, but if Whole Foods is the future there are issues.

    March 12, 2018
  3. Ken Cheng said:

    I think the picture says it all. No wonder Amazon has half a million workers. They’re all warehouse zombies, soon to be replaced by robots.

    March 12, 2018
  4. Gianfranco Pedron said:

    Great comments above with a common thread. Along with the article from Benedict Evans they all speak to the dehumanizing effect of the Amazon “paradigm” ( I hate that word, I use it with disdain and only because I believe it fits the situation perfectly.)

    The Amazon machine building more Amazon machines where, as Benedict Evans describes, humans with no particular knowledge of an industry get dropped into a template, an algorithm (a meat grinder of sorts) where the machine feeds off the human bits it is not capable of providing itself … yet, is a scary prospect.

    March 12, 2018

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