Jeff Bezos it so step down as Amazon CEO in Q3 2020, and will be succeeded by current Amazon Web Services head Andy Jassy.
Bezos will move to become the tech giant’s executive chairman, where he intends to focus his “energies and attention” on new products and early initiatives.
Jassy, who has been with Amazon for nearly 24 years, founded AWS, which reported a 28 per cent increase in revenue during Q4 2020.
Jassy’s move to the top job is not a huge surprise according to analyst Alex DeGroote. “Its a logical move,” he tells TVBEurope. “Amazon Web Services equated to 67 per cent of the entire company’s operating profit last quarter, demand has risen for digital transformation during the pandemic.
“Under Jassy, AWS has emerged as a top player in the $100 billion cloud computing industry. It is a key value driver for the company. No other cloud infrastructure vendor, even the mighty Microsoft, is even close in this category. Microsoft stands at around 20 per cent marketshare compared to AWS’s approximately 33 per cent market share.”
Does Jassy’s appointment signal a possible shift in Amazon’s video strategy? The company is very active in the sports rights market, particularly in Europe at the moment. Could Jassy focus more on the technology side of the company due to his background? “It will be very interesting to see how the strategy evolves,” says DeGroote. “At present, Amazon gives Amazon Prime Video for “free” to all its Prime members who happily pay c£100 annually for free shipping. Prime members passively receive Amazon Prime Video, whether they know it or not, as just another ‘goodie’ to keep them shopping. The video service is not the end itself; it functions more like a loss-leader to drive retail. Amazon is well differentiated from Netflix, which must be profitable and self-sustaining. Amazon Prime Video has no such need.
“My gut feel is no material change is likely in terms of rights acquisition. Amazon has such vast resources that it can do anything it wants. However, it is a good corporate citizen and unlikely to blow up the broadcast ecosystem,” he adds.
De Groote says he expects the market’s reaction to the news to be “fairly relaxed”.
“It feels like when Larry Ellison stood down as Oracle CEO in 2014 to take on the exact same executive chairman role. Ellison has remained intimately involved with the company he helped found. It’s reasonable to assume that Bezos will do the same.”