How Amazon is destroying media companies

Amazon is destroying media companies.  The destruction goes from the biggest television companies, movie companies to the local newspaper in tiny communities.

How and why are they doing it?

The Amazon Battle Plan for destroying media companies:

1. Cut off their revenue streams

2. Use its 105 million list of Prime Members to offer advertisers better response rates

3.  Give advertisers access to the 55% of all online shopping searches that begin on Amazon.com

4. Sell products like Alexa, smart homes, and security system at incredibly Low Prices in order to take control over the future of shopping – i.e. voice-based search and AI driven “suggestions” for home and entertainment

Amazon can afford to invest in destroying media companies because it is the most successful company in the world, run by Jeff Bezos, the richest person in the world.  We all know Amazon as the online e-commerce site that controls over 50% of everything that is bought and sold online.  It may seem a bit like a “tinfoil hat” conspiracy to think about Amazon as the big bad media company.

Why would Amazon want to destroy media companies? 

Amazon’s Hidden Strategy:  Amazon wants to destroy media companies because it has a hidden strategy a to become the largest global media/commenications company.

Guess what?  It already is.  Amazon is the world’s biggest communication’s company:  “Amazon has movies, TV stations, cable streaming, music, and direct communication with over 105 US households and will soon bypass ALL of cable television.  Not one cable channel but ALL of them together. Staggering concept.   But wait!  They also own the Washington Post and they just bought MSG Cable Network.”

Amazon isn’t some big bad company that is taking over media through deception or fraud – Amazon is taking media and communications because its executive leadership is smarter than the executives running most media companies.  The major exception would be Disney, whose leadership is outstanding.

What makes Amazon’s executives so smart is they are focused on reality and facts.  When Bezos runs a meeting everyone is handed a 3-6 page type analysis of the problem to be discussed.

Everything STOPS.  Everyone in the meeting spends the next 30 minutes reading.  The meeting is then run with everyone, literally and figuratively, on the same page.  Most media companies aren’t run that way.

Fox Business News reports that Amazon has become so powerful it is “Stealing Market Share From Facebook and Google and is a threat to all traditional media companies.”  Fox News continues, It wasn’t that long ago that all the talk in the digital advertising market was centered on the duopoly of Facebook (NASDAQ: FB) and Google, a division of Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG).  In late 2017, Digital Content Next reported the pair would account for about 63% of online advertising in the U.S. last year, with Google nabbing 42% and Facebook garnering 21%. Even more telling, Brian Wieser of Pivotal Research Group estimated that the two companies accounted for 90% of the growth in the U.S. digital ads industry in 2017.”

So here is how those focused Amazon executives are destroying media companies – they RECOGNIZE and RESPOND in REAL-TIME to TRENDS & FACTS.

Before we detail out how Amazon is destroying media and communications companies it is important to look at its PRIMARY ADVANTAGE.  Amazon uses its e-commerce division to attract shoppers.

  • Amazon has over 105 million Prime Members105 million Prime Members, 55% of all product searches, and its growing grocery and fast food stores to offer shoppers AMAZING DEALS.  Amazon doesn’t care about losing money – they want to grow their LIST of shoppers.
  • Shoppers have changed.  Instead of looking at ads, 90% of shoppers begin the buying process by using their smart phones to search.  Guess what, 55% of all product searches begin on Amazon.
  • Data. Amazon has better data than Google, Facebook, and ALL other media and communications companies. Googgle and Facebook’s data is about views and clicks – Amazon’s data is about PURCHASE.  Advertisers want to know about who’s buying what.  Local and national media companies don’t have the data.
  • Voice-Based Search.  Amazon, with its 35 million Alexa voice assistants, already controls this communications channel.  Amazon is so far ahead of the voice trend in terms of advertising revenues that media companies don’t stand a chance.
  • Smart Home.  From speakers to thermostats Amazon is communicating with consumers.  Advertisers want targeted ads – Amazon is so targeted they know what music you listen to, how cool you keep your home, and when you are home.
  • Cloud computing.   Amazon is streaming EVERYTHING – music, movies, books, and podcasts. Ditto on Better Data.

THE CONSEQUENCES OF AMAZON DESTROYING MEDIA COMPANIES:

As more media companies go out of business because of Amazon – Amazon gains greater control of what news Americans receive.  With or without political bias, Amazon will homogenize the news.  American democracy is based on many different points of view.  If Amazon wins – there will be the Amazon point of view.

The Google monopoly will destroy Local Media


Ryan Cooper of The Week states it clearly Google is dangerous monopoly, “Google is a monopoly — and it’s crushing the internet.”  Cooper supports what I have been pointing out for the past two years.   The publication, Editor and Publisher, warns that it is  Time for publishers to wake up.   Even the staid New York Times reports that Google and Facebooks control digital advertising is destroying local media.  At the time of the article their share was 85% it has now grown to 92% of all digital advertising.  Google is destroying local media by capturing its revenue base.  It is NOT going to get better unless local media is willing to fight back in unconventional ways.

Monopolies are great companies that become so large that they become predatory.  Google is just that – a predatory monopoly.

Where I differ from other thinkers is where to point the blame.  Google is destroying the revenue base of local media companies.  In this Google is wrong but logical.  It is the actions of local media companies that is illogical.  They have tried appeasement with Google.  They have failed to optimize their advantages of local and responsive.  They refuse to address the absolutely ineffective results they deliver to advertisers.

Their failures are best summarized by a failure of leadership.  Leaders see reality and take decisive action. Sammy Papert, an enlightened expert on all things media, wrote in this month’s Wormhole about this failure of leadership.

Three Papert quotes from his leadership article:
1.     “And, let’s be 100% clear – there’s often a huge chasm between someone who is higher up in the organizational structure and a leader!”
2.     “There’s a frightful dearth of leadership and it’s worrisome.”
3.     “In my experience, about 50% of bosses aren’t in the right role.  HALF!”

The consequences of the failure of leadership is the continued downward spiral of local media.  The unintended consequences of this failure is a direct threat to democracy and free speech.  Most people have no idea how the globalist at Google distort the news and search results all with minor tweaks to algorithms.