Hello Idiots ✊
If you own 1 share of $AMZN and the price drops 50% in one day, what percentage increase is needed the next day to get you back to even?
Reply with the answer!
On to the news of the day.
If someone forwarded you this email, they’re telling you to sign up. You can do that here:
I f***ing love Amazon, as evidenced by my purchasing history in the chart above.
Besides your mom’s house (burn), Amazon is the only place.
Plus, your mom doesn’t offer 2-day shipping (double burn).
The move brings them +4K movies and +17K shows in intellectual property (IP), plus an established TV and film operation. I smell a ton of remakes and reboots.
The revenues generated from this will be a drop in the bucket for Amazon (sales last Q = +$105B), but this, like Amazon Salon, is a strategic play.
With Amazon Salon, it’s about having a brick-and-mortar location to experiment with new products and technology (i.e. augmented reality [AR]). This gives them the chance to see what works, what doesn’t, and ultimately, how best to scale what does work.
With this move, it’s about Amazon Prime.
Improved streaming content is just another perk that makes Amazon Prime a little bit more attractive to potential customers and adds another reason to keep it for existing customers.
The name of the game here is attracting and retaining eyeballs because those eyeballs lead to memberships, which is where the long-term customer value is at.
I also see the possibility of an entirely new movie theatre experience. What exactly that would look like is anyone’s guess, but I’d bet concessions would get a serious upgrade (possibly lower prices too) and there would be all sorts of AR stuff built into the experience.
Another little twist: earlier this year Amazon acquired the rights to Thursday Night Football for the next 10 years (at $10B per year). I could see them using the theatres to host events centered around that. The big game on the big screen.
And all of this would be available to…Amazon Prime members.
As if buying a film and TV studio that has been around since the silent era wasn’t enough, today they also announced that they were thinking about making a physical retail pharmacy play (they already have the online Amazon Pharmacy).
Because, you know, why the f*** not?
TL;DR: It’s Bezos’ world, we’re just living in it.
That also happened today. Busy day!
CNBC will explain it better than I can, but here’s the Idiot summary:
Amazon prides itself on offering the lowest prices on its website.
To do this, they prohibit third-party sellers from offering their products at lower prices on other websites (even their own).
DC attorney general says this creates an artificially high price floor, meaning you and me end up paying more than we should for stuff.
He sues Amazon.
Amazon says it’s bullshit, that the opposite is true.
Round and round we go.
Thanks for reading! ✊