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The genius here is also that Bezos doesn’t care. As soon as someone makes a cloud offering below what he can provide his retail margins increase.

It’s a race to the bottom and Amazon wins even at the bottom.



Retail is brutally competitive sector and you can't easily increase margins there (unless it is for luxury retail like Apple or Tiffany).


Many prime members use Amazon without really comparing prices.


That's because Amazon is generally competitive. And they offer premium service. If people thought they would have to for that free "premium service" their growth rate would stall.


In my experience Amazon usually seems to be about 15% more expensive for most goods I purchase than the cheapest online retailer (usually Aliexpress).

Taking a 15% margin on all products sounds pretty sweet to me...


aliexpress takes 3-4 weeks to get to you and it's subsidized by US-China postal rates.


Or until you move to someone else's cheaper cloud service.


even in "monopoly" pricing theirs a sweet spot. There's always some kind of alternative.




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