Why Amazon Needs to Raise the Cost of Prime

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Jan. 30 (Bloomberg) –- Bloomberg’s Brad Stone reports on Amazon’s earnings and where the company sees growth and ways to increase revenue. He speaks to Emily Chang on Bloomberg Television’s “Bloomberg West.” (Source: Bloomberg)


What do you make of the numbers today?

We thought amazon had a good amp -- a good holiday quarter and then this.

Was put in perspective.

They did have a good holiday quarter.

E-commerce in general, 13% to team percent, depending on who you listen to.

It is good overall.

For them, it's a slowdown.

They have been putting down 25%- 30%. they -- spending on supply chain -- the cfo on one of the conference calls said they were considering raising the price of amazon prime.

They are committed to building up the supply chain because they are building for 10 years from now.

Has eaten into profits.

How can they bring -- other than raising amazon prime, are there other inventive ways of bringing the price down?

There talking about eying the postal service or fedex -- would that ever happen?

May be way down the line.

They start running more trucks and they are already doing that with the rollout of amazon fresh.

Maybe there are some ways to lower costs that way but they have to basically grow into this infrastructure.

The more customers they get, the more they buy and spend, the lower those marginal operating costs become.

It is what they are doing.

They are building all this logistics capacity because they think they're going to grow into it over the next 10 to 20 years.

What about them potentially working on a gaming console or live internet tv service or payment system where merchant could check people out on a candle -- on a kindle question our i put credence to all those rumors and many of them we have reported on.

Amazon wants to be everywhere.

They have worked on the set top box for a year.

It's a way to get into the living room and put those amazon video initiatives and its own programming, get that into people's living room.

They face a challenge because so many of these retailers view amazon as any number one.

Unlike ebay and paypal, i think amazon has its work cut out for them.

I want to talk about your story on the cover of bloomberg

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