- Amazon’s first-ever employee, Shel Kaphan, is speaking out for the first time – and he’s got major criticisms of the company he helped shepherd into existence.
- Among his criticisms, Kaphan suggested Amazon is “now at the scale” where federal regulators breaking up the company “could potentially make sense.”
- “On one hand I’m proud of what it became,” Kaphan said in the new Frontline documentary, “Amazon Empire: The Rise and Reign of Jeff Bezos.”
- “It also scares me,” he said. “I just feel like it’s important for someone in my situation to at least say what they think about what’s going on.”
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After Jeff and MacKenzie Bezos, Shel Kaphan was employee No. 1 at Amazon.
“I built a substantial part of the early system that allowed them to come into existence,” Kaphan told the BBC in a new documentary. “On the one hand I’m proud of what it became, but it also scares me.”
Building on that criticism in a second interview with PBS’ Frontline, Kaphan said he now believes Amazon is so large that breaking it up shouldn’t be out of the question.
“I think that they’re now at the scale where that could potentially make sense,” he told Frontline’s James Jacoby.
Kaphan’s statements echo calls from lawmakers in the last few years.
Sen. Elizabeth Warren has been at the forefront of a push to break up major tech companies, including Amazon, Facebook, and Google.
“As these companies have grown larger and more powerful, they have used their resources and control over the way we use the Internet to squash small businesses and innovation, and substitute their own financial interests for the broader interests of the American people,” Warren’s campaign proposal says. “To restore the balance of power in our democracy, to promote competition, and to ensure that the next generation of technology innovation is as vibrant as the last, it’s time to break up our biggest tech companies.”
Kaphan agreed with Warren’s assessment in his Frontline interview.
“The characterization of Amazon as being a ruthless competitor is true,” he said, “and under the flag of ‘customer obsession’ they can do a lot of things that might not be good for people who aren’t their customers.”
Beyond operating its wildly popular digital storefront, Amazon.com, the Seattle-based conglomerate also operates a massive cloud data operation (Amazon Web Services), runs a major video production and streaming service (Amazon Prime Video), and produces a variety of popular consumer electronics (Kindle, Ring, etc.) among other ventures (like owning/operating Whole Foods).
Under Warren’s plan, federal regulators would attempt to “break Facebook away from Instagram and WhatsApp, Amazon away from Whole Foods, Google away from Nest, and more,” the Warren campaign wrote in a campaign email.
Though Amazon has expressed support for some forms of federal regulation of its business, such as facial recognition software, representatives have rebuffed calls for the company to be outright broken up.
“We don’t think about it very deeply,” Amazon Web Services CEO Andy Jassy said in the documentary. He then related a Jeff Bezos quote from early on at the company: “I would not go to bed at night fearing your competitors or fearing any external issues,” Bezos reportedly said, according to Jassy. “I would go to bed at night fearing whether you’re doing right by your customers.”
When reached for comment, Amazon representative Maxime Tagay sent Business Insider the following statement: “Amazon’s retail business competes in the worldwide market for retail sales. Our competitors include all the other online and brick and mortar stores that people shop at every day. The retail market we operate in is almost 25 trillion dollars, and Amazon represents less than 1% of global retail and less than 4% of US retail. It also is fiercely competitive and we have retail competitors that are larger than us in every country where we operate.”
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