Amazon Is Asking Customers To Hand Over Their House Keys

Would you feel comfortable giving Jeff Bezos your house keys? Amazon is hoping that the answer is yes.

The e-commerce behemoth and creator of a global deflation impulse on Wednesday introduced a connected door-lock and security-camera system to let package carriers, guests and dog walkers into your home using an app, WSJ reports. The so-called “Amazon Key” will be available for the bargain price of $25. “This is not an experiment for us,” said Peter Larsen, vice president of delivery technology at Amazon. “We think this is going to be a fundamental way that customers shop with us for years to come."

Of course, one Amazon executive insisted that the key isn’t an experiment: the e-commerce monopolist fully expects this entry process will soon be common features of the homes of Prime customers, giving Amazon direct access to millions of homes. And that’s no accident: The key is essentially Amazon’s coup de grace in its battle to master “the last mile” of delivering packages - a phrase denoting the last leg of a package’s journey as it’s processed, placed on a delivery truck, and spirited to the customer’s door.

As we reported last week, Amazon recently struck a deal with some of the largest landlords in the country to install electronic lockers that delivery people will be able to access for the purposes of dropping off packages. The lockers have a dual purpose: They will help landlords reduce the building staff’s workload (and wages) while also cutting down dramatically on the rate of lost or stolen packages, an area that Amazon has identified as a potentially significant source of cost savings. And, as WSJ points out, in-home delivery is the “next logical step."

As it tinkers with drone delivery and its own delivery service to rival UPS and FedEx, Amazon continues to seek out every competitive advantage it can find as it tries to scale up to take on two entrenched competitors who’ve been pioneers in supply chain logistics. Given the prevalence of smartphones, cutting down on theft appears relatively straightforward.

A consequence of the rise in e-commerce is that “theft is certainly a problem,” said John Haber, who works with retailers on supply-chain issues as chief executive of consultancy Spend Management Experts. Theft is particularly pronounced during the holiday season, when some thieves dubbed “porch pirates” go from door to door stealing gifts.

 

But it remains to be seen whether consumers are ready to open their doors to strangers. Transportation industry experts said that most people are likely to balk at the idea, at least at first.

There is always a risk that customers just might balk at letting complete strangers into their home.

“People have a difficult time letting cleaning people into their house if they haven’t been properly vetted,” said Ivan Hofmann, a former FedEx Corp. executive and transportation-industry consultant. Still, he added, that is how innovation works: “You have to try things that no one else has tried and see what works.”

In the beginning, the Amazon Key system will allow in-home deliveries only from Amazon Logistics, the company’s delivery network. When an Amazon delivery-service provider brings a package to the door, he or she scans the label with a phone before requesting entry to the home.

The system unlocks the door automatically - without a code - and turns on the security camera as the delivery person opens the door and sets the package down inside. After leaving, the delivery person taps the phone again to relock the door.

 

The package recipient gets notifications throughout, including a time-stamped log and the possibility to watch a live video of the delivery or a recording afterward. The recipient can also block the ability to enter the home throughout the process.

…

Customers can also use the app to generate codes for guests to enter and will eventually add access for service providers like dog walkers and maids.

The Amazon Key package includes the new Amazon Cloud Cam security camera and a smart-lock made by partner companies. For now, it is only available to Prime members, something the company said helps add value to the $99 annual subscription fee. The service will initially be available in 37 cities starting Nov. 8.

Customers who’ve purchased Amazon’s Alexa personal assistant or Echo speakers should already be comfortable with installing the company’s devices in their homes, WSJ says. But by introducing Key, Amazon risks angering certain business partners, like smart-doorbell maker Ring and smart-door lock maker August Home Inc., which Swedish lock maker Assa Abloy AB signed an agreement to acquire last week.

However,  if Amazon’s track record is any indication, the company’s limitless tolerance to burn money on any growth idea lends it a crucial competitive advantage that could quickly see Amazon Key become a staple in all American homes, meaning that it’s only a matter of time before this tweet becomes reality.

 

AMAZON, 1998: hello we sell books but online

AMAZON, 2023: please return to your Primehouse for your nightly Primemeal, valued Primecitizen

— KRANG ???? NELSON (@KrangTNelson) June 16, 2017

 

If Amazon Takes Over The World...

Authored by Scott Galloway op-ed via The Wall Street Journal,

Four tech giants - Amazon, Apple, Facebook and Google - have added $2 trillion to their combined market capitalization since the 2007-09 recession, a sum that approaches the GDP of India. The concentrated wealth and power of these companies has alarmed many observers, who see their growth as a threat not just to consumers and other businesses but to American society itself.

After spending most of the past decade researching these companies, I’ve come to the conclusion that our fears are misplaced in focusing on what I call the Four. We should instead be worrying about the One: one firm that will come to dominate search, hardware and cloud computing, that will control a vast network of far-flung businesses, that can ravage entire sectors of the economy simply by announcing its interest in them.

That firm is Amazon. Jeff Bezos has been disciplined and single-minded in his vision of investing in the most enduring consumer wants—price, convenience and selection. Coupled with deft execution, it has made Amazon the most impressive and feared firm in business.

As for the other three, don’t be misled by their current successes. They are falling behind as the One marches ahead.

Google seems to have a commanding market position when it comes to search functions. As European Union regulators pointed out in their recent antitrust finding, Google has an astonishing 90% share in the category in Europe. Its share in the U.S. is 64%. But it’s a very different story in the narrower, and more lucrative, domain of product search. In 2015, more product searches in the U.S. began on Amazon than on search engines, including Google (44% vs. 34%), according to BloomReach. A year later, Amazon’s share grew to 55%. Amazon could reasonably be described as a search engine with a warehouse attached to it.

For years, Apple has been the undisputed king of hardware innovation. But the prize for the most disruptive recent device goes to the hands-free, voice-controlled Amazon Echo speaker and its buttery voice, Alexa. Research firm Gartner predicts that 30% of computing will be screenless by 2020. So far, Apple looks to have blown an early lead in the great voice race: With 700 million iPhones in use world-wide, Apple’s Siri still has the most share in voice overall. But Amazon’s share of voice on home devices—the next frontier—is 70%.

Today’s fastest-growing sector in tech is cloud computing. There are several big players in the field, including old and new tech: IBM , Microsoft , Google. The dominant player again is Amazon, with a business launched originally to support its internal computing needs. According to Synergy Research Group, Amazon’s cloud offering (called Amazon Web Services) enjoys more than 30% of the market, triple the share of the No. 2, Microsoft’s Azure, and will register $16 billion in revenue in 2017. Financial pundits, looking for something negative to say about Amazon’s recent quarterly earnings, highlighted that growth in the company’s cloud business had slowed to 43%. “Slowed to 43%” is not a phrase you read in any other equity analyst’s write-up of a large company in 2017.

Amazon’s consistent outperformance of the other three tech giants is distinct from its continued dominance of old-economy firms. With the acquisition of Whole Foods, Amazon will likely become the fastest-growing online and bricks-and-mortar retailer. The whole grocery sector—with $612 billion in U.S. sales in 2016—has been disrupted overnight by Amazon. In the months between the announcement and closing of Amazon’s acquisition of Whole Foods this year, the largest pure-play grocer, Kroger , lost nearly a third of its market value.

The late business professor C.K. Prahalad of the University of Michigan famously argued that the most successful firms focus not on one market but on one “core competence.” Amazon has proved otherwise. What Amazon has accomplished across industries is unprecedented, even among the most successful businesses. Nike does not have a cloud business; Starbucks is not developing original TV content; Wal-Mart has not filed patents for warehouses in the sky. Amazon has recently been granted patents for a floating warehouse and small drones that can self-assemble into bigger drones capable of transporting larger packages, reflecting the ability, one day, to operate intricate networks of fulfillment by air. Other firms are punished for straying from their familiar areas of strength; Amazon sucks value from sectors in which it has had no previous involvement just by glancing at them.

At New York University’s business school, where I teach, I have for years kept a close watch on which firms are winning the competition for the most talented students. A decade ago, the top recruiter was American Express , with investment banks vying for second position. Now the clear winner is Amazon: 12 students from my most recent class have opted for a life of rain and overrated coffee in the Pacific Northwest.

Why does Amazon’s ascent matter? Aren’t lower prices and greater efficiencies better for everyone? They are, in all the obvious ways, but that’s not a complete picture. Amazon’s seemingly boundless growth forces us to wrestle with difficult questions about the reasons for its dominance.

For one, Amazon, unlike any other firm its size, has changed the basic compact with financial markets.

It has replaced the expectation for profits with a focus on vision and growth, managing its business to break even while investors bid up its stock price.

This radical approach has provided the company with a staggering advantage in free-flowing capital. Google, Facebook, Wal-Mart and most Fortune 500 companies are saddled with expectations of profits. Many firms would be much more innovative if they were given a license to operate without the nuisance of profitability. Amazon has thus had enormous capital on hand to invest in delivery networks, especially the crucial last link for getting goods to the doorsteps of consumers, without having to worry that they don’t yield immediate profits.

Amazon’s strategy of break-even operations also means that it has virtually no profits to tax. Since 2008, Wal-Mart has paid $64 billion in federal income taxes, while Amazon has paid just $1.4 billion. Yet, while paying low taxes, Amazon has added $220 billion in value to the stock held by its shareholders over the past 24 months—equivalent to the entire market capitalization of Wal-Mart.

Something is deeply amiss when a company can ascend to almost a half trillion dollars in market value—becoming the fifth most valuable firm in the world—without paying any meaningful income tax. Does Amazon really owe so little to support public revenue and public needs? If a giant firm pays less than the average 24% in income taxes that the companies of the S&P 500 pay, it logically means that less-successful firms pay more. In this way, Amazon further adds to the winner-take-all tendencies plaguing our economy.

Because Amazon is more efficient than other retailers, it is able to transact the same amount of business with half the employees. If Amazon continues to grow its business by $20 billion a year, the annual toll of lost jobs for merchants, buyers and cashiers will be in the tens of thousands by my calculations. Disruption in the U.S. labor force is nothing new—we have just never dealt with a company that is so ruthless and single-minded about it.

I recently spoke at a conference the day after Jeff Bezos. During his talk, he made the case for a universal guaranteed income for all Americans. It is tempting to admire his progressive values and concern for the public welfare, but there is a dark implication here too. It appears that the most insightful mind in the business world has given up on the notion that our economy, or his firm, can support that pillar of American identity: a well-paying job.

Amazon has brought us many benefits, but we all must recognize that the rise of the One brings with it much more than free two-day delivery. “Alexa, is this a good thing?”

Digital Data Is A Mortal Risk

The tech culture would have you believe that the digital data format has produced untold innovations and advancements for personal development, societal advancement and business innovations. Well, the glass is half full for the kool aide drinkers, but for the mere mortals, who seek out a meaningful life as opposed to a regimented existence, the curse of placing the most intimate data on untold hard drives and shuffled among unknown servers, a loss of simple privacy is the least of the problems.

The horror of keeping the door unlocked to the treasure chest of government and business secrets seems not to faze the computer gurus who pushed for decades that going digital was the holy grail of efficiency and productivity. Encryption was the answer to securing central databases of zeros and ones that store the most desirable information of national security.  

When the mainstream USA Today warns, The hacking of OPM: Is it our cyber 9/11? – The cover-up of a vulnerability of unlimited sharing of data from security breaches should be a substantial alarm call.  

“Although the announcement of the hacking into the computers of the OPM and the stealing of personal data on more than four million present and former federal employees was made in late May, the data breach had been discovered a month earlier and had been going on undiscovered for more than a year. 

An obvious question about this latest data breach is why were the hackers seeking this information and the answer at this time is that we do not know. This type of information could be used for purposes of identity theft for profit, for gathering information to be used by the Chinese government to enhance their spying capabilities or even as part of their ongoing worldwide corporate espionage efforts by which they steal corporate and military secrets, such as the theft of secret plans of our most advanced F-35 Stealth Fighter Jet which was accomplished by hacking into computers at the Pentagon and at Lockheed Martin, the builder of the plane. Evidence of the hacking of the F-35 was leaked to the public by NSA whistleblower Edward Snowden. 

In May of 2014, the Justice Department indicted five Chinese military personnel on charge of hacking into six American companies to steal corporate secrets, however this type of activity has gone on for years. According to security company Mandiant, Chinese hackers have stolen corporate secrets from 115 American companies since 2014 and it is not just the Chinese who do this type of corporate espionage. Russia has also been particularly active in corporate cybercrime. It was estimated by cybersecurity company CrowdStrike that the Russian government has hacked hundreds of companies around the world in order to steal trade secrets and corporate information they can exploit.” 

Now it should be self-evident that spying from friends or foes are normal occurrences in a hostile world. Citing the theft of design, confidential technological and engineering details, obviously should be of concern to all citizens. However, the pattern of hacking and easy access to such information just does not seem to rise to the highest national concern.  

The question that is seldom asked is whether placing such sensitive secrets on networks that can be used by anyone, who can duplicate or pilfer the authorization credentials to login, is a core and systemic issue. 

With all the billions spent on the computer spy game, one would reasonably wonder why keep in a digital format the most important information resources that seem to be the highest objective on the target list for foreign theft.  

Espionage makes use of the most sophisticated methods for penetrating the barriers attempting to protect the information. Remember when the U.S. Embassy in the Soviet capital was penetrated with an eavesdropping device, the response was to communicate using an Etch-a-Sketch toy? Magic Slates don’t blow up, go fast or even scare the dickens out of the bad guys, but the erasable memo pads nonetheless came in handy for two congressional delegates trying to outsmart spies during a mission to Moscow. 

While this example used voice recording, the permanent horde of computerized data is a far more significant gold mine of information. The miracle of the computer revolution has turned into the nightmare of espionage extraction. 

Consider how implausible it would be for a human spy to use a Minox camera from the cold war era to photograph top secret documents that were instantly transferred from the Chinese hack. Back in the “good old days” of low tech, organizations and bureaucracies stored their records on magnate tape drives in-house. Those vast sharing networks in cyberspace did not exist and the only cloud known was the one that carried the rain. 

Today, the storm from relying on some exotic algorithm formula that claims to safely encrypt and secure any database is like placing your faith into the iPhone culture of assured communication. Back doors are the true entry gateway of global digital dissimulation.  

Surrendering safekeeping for the promise of easy sharing, misses the entire purpose of why secrets in any business or government are kept in the custody and stewardship of trustworthy persons, managing systems of formidable barriers that resist theft and broadcasting.  

What lessons were learned from Edward Snowden? For all the scorn dumped on this whistleblower, what was the method of his disclosures? The digital format of the files begs for accessing the data, for whatever motive the expert exhibits.

Even harsh critics of Snowden do not make the case that he was a foreign agent plant. However, just imagine the kind of damage that could be accomplished if an undercover spy had access to the type of databases that a civilian contractor at the NSA was able to transmit. 

Centralizing critical information under firewall barriers has little guarantees that networks are secure. Since the digital format is the new standard, just maybe, going against the grain is the prudent method to keep real secrets, confidential.

Submitting the most important and sensitive to paper and not on computers might well supply a much safer policy than depending on security clearances to protect top secret documents. 

Abandoning the old fashion tax reporting filings for an electronic submission is a formula for opening financial records on all tax payers. Surely, companies should get nervous over certain details that may not be part of public disclosures. And government technocrats should be put on notice that their role in protecting the system may just require their own agencies to be put under the microscope. 

If whistleblowers were the main source of hacks, the risk might be relatively minimal. Conversely, falling under the state sponsored hacking initiative certainly has every aspect of an act of war. Certainly, the prospect for a heated up confirmation is unlikely for no other reason that it is reasonable to conclude that the U.S. is well skilled in its own espionage operations.  

Nonetheless, it should be recognized that transparency is not defined as direct access to every database, both public and private.  

Digital files are well appreciated for library archives, news reports and political debate, but when foreigners attack information platforms that are intended to secure personal disclosures, the outrage should be more intense and the press needs to feature the problem.  

Privacy has become a dirty word for the collectivists who want to dominate individual behavior. Yet, the stuck on stupid crowd continues to voluntarily provide the most intimate details on their lives on every government form or in surveys.

The databases, themselves are the issue. A society that rushes to send “selfies” on the internet, is hardly a culture based upon prudent and protective privacy. 

Accepting the digitalization of all information guarantees that the only security available rests upon non participation in the electronic communication environment. Even dropping out of the computer revolution will not retake your former disclosures.

Files, yes digital format, are so prevalent that only the unborn do not yet have a dossier on file. 

It is one thing for Google, Facebook and Amazon to assemble personal profiles and project future behavior. But it is much worse for governments to target citizens of other countries for accumulating background information of civilians.

Lesson learned. There is no security in cyberspace. 

If the information you want to protect is important, maintain the details in a privately secure paper format. By this definition, banking, employment, medical and educational circumstances are almost impossible to keep private.

As for national security secrets, will you not agree that this is one area where the government should scale back on network access databases that are so vulnerable to foreign infiltration and spying?  

Let the debate be about expanding public disclosure on government policies and programs and keep the personal background data, private. If you believe that Net Neutrality regulations will provide greater security, the opposite will happen.

Soon foreign agents will not have to hack the system. They will just need to plug into the next “Big Brother” data base that the government will assemble.

It Begins: WalMart Warns Truckers It Will No Longer Work With Them If They Move Goods For Amazon

The cold war between America"s two largest retailers just turned hot.

In a note this morning from Deutsche Bank"s freight and logistics analyst Amit Mehrotra, he notes that  the "WMT vs. AMZN battle is heating up" and points to a report by DV Velocity, according to which a well respected transportation industry consultant told attendees of a logistics conference that Walmart (WMT) is telling trucking companies that it will no longer do business with them if they continue moving goods for Amazon (AMZN).

This follows similar reports citing WMT’s “request” for its tech partners to stop using Amazon Web Services.

The news, while suggestive perhaps of Walmart"s growing desperation in its war with the retail juggernaut that is Amazon, has dramatic implications not only for the future of retail (and associated prices) but for one of the most important US industries: trucking, and the number of people it employes.

According to Deutsche, these developments, "are likely to have significant implications for U.S. transportation companies, in our view, as Amazon and Walmart remain two of the largest users of truckload capacity. For reference Walmart represents about 14% of SWFT’s operating revenues and traditional retail accounts for about half of WERN"s total sales (WMT around 4%)."

A map of Amazon"s multiplying fulfuillment centers is shown below.

And, as CNBC reported last week, WalMart warned some tech companies that if they want Wal-Mart"s business, they can"t run applications on Amazon"s cloud platform, Amazon Web Services, some tech companies told The Wall Street Journal. Wal-Mart uses some tech vendors" cloud apps that run on AWS, Wal-Mart spokesman Dan Toporek told the Journal, though he declined to say which apps or how many. But Toporek did acknowledge instances where Wal-Mart is pushing for AWS alternatives, the Journal reported Wednesday. 

Wal-Mart spokesman Toporek told CNBC in an email: "Our vendors have the choice of using any cloud provider that meets their needs and their customers" needs. It shouldn"t be a big surprise that there are cases in which we"d prefer our most sensitive data isn"t sitting on a competitor"s platform." Wal-Mart doesn"t appear to be alone in this push to leave AWS, either.

Other large retailers are reportedly requesting that service providers move away from AWS, the Journal said, citing technology vendors that work with retailers. Adding to the many growing conflicts of interest, Amazon has confirmed a number of retailers it competes with use AWS, for example GameStop.

The battle between Wal-Mart and Amazon is only heating up, after Amazon announced plans last week to acquire brick-and-mortar grocery retailer Whole Foods. With Amazon stepping into Wal-Mart"s turf in grocery, Wal-Mart has been trying to beef up its e-commerce presence.

In light of AMZN"s recent expansion with the purchase of WFM, one can see why WMT is starting to take it much more seriously. Perhaps Amazon"s latest push (and WMT"s lobbying effort) may explain why Trump decided to finally reignite his long-simmering war with AMZN CEO Jeff Bezos, when this morning he tweeted “The #AmazonWashingtonPost, sometimes referred to as the guardian of Amazon not paying internet taxes (which they should) is FAKE NEWS!”

The #AmazonWashingtonPost, sometimes referred to as the guardian of Amazon not paying internet taxes (which they should) is FAKE NEWS!

— Donald J. Trump (@realDonaldTrump) June 28, 2017