In the wake of increased scrutiny from regulators and consumers around Big Tech companies, Amazon and Google have come under pressure to explain their respective price increases and how they arrived at their respective financial results.
This article is designed to help individuals understand the financials of both Amazon and Google, including their total revenue figures, sales growth, net income growth, cash flow metrics, and other factors influencing the company’s profitability. In addition, I will explore various strategies behind their business models and decision-making process.
At the end of this article I hope readers gain a better understanding of the financial decisions made by Amazon and Google and an appreciation for the strategies used by two tech giants to achieve success in a competitive landscape.
Tell us more about all this money; Amazon and Google: Nope
Amazon has responded to the call from the public to give more detailed information about the vast amount of money they collect from customers and other sources. Their response? A resounding ‘Nope’.
Amazon is standing firm on their stance to not divulge specific details about their finances, leaving customers and the public wondering how much money they are collecting.
Amazon’s Statement
Amazon has recently released a statement in response to an inquiry from the U.S. Senate related to its financial dealings, specifically regarding potential profits generated by the company’s innovative products, services, and technologies. In its statement, Amazon discussed how its products and services are a significant source of revenue for the company and how invested research and development pays off in various ways.
In addition to noting the development of new technologies like Alexa, Amazon Web Services, and Prime Video, Amazon stated that more than one million employees receive competitive benefit packages. These benefits often include career coaching programs, generous parental leave policies, and access to onsite medical clinics for health care needs. The Statement also explained how investments in engineering continue to bolster innovation, leading to Amazon being at the forefront of providing customers with innovative solutions such as drone delivery systems.
Millions of people rely on Amazon’s e-commerce business for their day-to-day purchases, whether retail goods or food items, through Amazon Fresh or Prime Now programs. These investments into agriculture help many farmers who supply food items while using data analytics allows Amazon to better meet customer demands while providing cost savings along the way — enabling them to lower prices for their customers.
Finally, Web Services is another big area of investment for Amazon — it provides cloud computing data centres for both public companies as well as small businesses that need help launching their products or getting customers onboard with new features faster than ever before possible due to innovation improvements through machine learning technology as well as other cutting edge advancements such as natural language processing (NLP). This continuous effort by Amazon shows that it continues to provide new value through technology while delivering back savings which contribute significantly towards our economic growth.
Amazon’s Actions
Amazon has been vocal in its response to the letter received by Amazon, Apple, Alphabet (Google’s parent company), and Facebook earlier this week. Since the letter, Amazon has announced it will invest significantly in competition law, public interest technology and public policy.
Specifically, Amazon has committed $1 Million to fund legal scholarship activities at universities nationwide in cooperation with outside experts. The funding will support research on current debates surrounding antitrust law, exploring how competition can function effectively in the digital economy. The scholarship program intends to generate new insights into existing antitrust theories and proposed changes to them while providing educational opportunities for generations of lawyers, economists and legal academics.
Moreover, Amazon will put another $10 Million toward developing a “Public Interest Technology” initiative to advance technology that serves business interests and public interest causes such as reducing healthcare costs and climate change effects. The initiative will bring together university students from across disciplines including computer science, economics and law to carry out projects advancing areas like machine learning algorithms for health care research or other big data studies that advance our understanding of critical policy questions.
Based on these efforts, Amazon is clearly pressing ahead with an independent effort to address some of the concerns raised by lawmakers about competition issues within its markets. This proactive approach may demonstrate Amazon’s good faith effort at least for now when it comes to antitrust regulators’ assessment of its impacts on market competition and consumer welfare.
Google’s Response
Google has held that there is no money to tell people about. In response to ‘tell us more about all this money’ queries, Google has remained tight-lipped and has refused to comment.
In their statement, Google has clarified that they will not provide any further details about the money. However, the search giant has remained mostly silent on the matter, choosing to remain silent on the issue of ‘tell us more about all this money’.
Google’s Statement
In response to Amazon’s statement on their existing investments, Google issued the following statement:
“Google’s investments in emerging technologies are few and far between. So instead, we make very targeted investments in what we consider the most promising technologies with large potential long-term impact. We aim to identify, support and help scale transformational technology platforms that we believe can have significant positive global impact.”
Google is committed to building out its current innovative portfolio while continuing to invest in promising research fields. As part of our commitment, we ensure these investments are done with a commitment to transparency with our stakeholders and partners. In addition, we recognize that these endeavours take time and investment to become meaningful drivers for real transformation.
Google’s Actions
Google has taken numerous steps to respond to the massive amounts of information that has come to light regarding its relationship with Amazon and the immense amount of money it has been spending. To start, Google created a board of directors in 2019 that spearheaded an investigation into Amazon’s use of its customer data and possible agreements between Amazon and Google that would have given the latter an unfair competitive advantage.
Moreover, Google mandated additional safeguards at its level, including a multi-layer review process for transactions over 500 million dollars. The company also increased its transparency on handling customer data and provides greater access to government agencies when necessary. In addition, Google set up an internal conflict-of-interest committee to address potential issues before they arise and conduct complete reviews whenever conflicts are identified.
Finally, Google formed a Corporate Compliance team responsible for developing solutions for eliminating bad practices to protect customers from fraudulent activities and inappropriate conduct.
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