Amazon Web Services Could Pay A Steep Price For Amazon’s Retail Arm

by MR Magazine Staff

Several years ago I sat on panel where each member was asked to weigh in on whether or not retailers would utilize a payment program conceived and operated by Amazon. A platform that would presumably provide Amazon with key customer information and data that would otherwise be owned by the retailer or a payment processor such as Visa or Paypal. The consensus was no, that would be insane. And in the years since, Amazon has indeed had trouble getting a Paypal-like payment program off the ground. But Amazon Web Services (AWS) has been something else. In rudimentary terms, AWS are servers that host online operations for a variety of businesses, including Amazon’s own. AWS is a powerhouse business unit for Amazon and by some estimates contributes more than half of Amazon’s profits and is growing fast. AWS brought in $12.2 billion in 2016 and is projected to reap more than $30 billion by 2020. It’s value, according to Canaccord Genuity, is roughly 7.1 times revenue, or $162 billion. But now there’s indication that some companies may be hesitant to utilize these services given Amazon’s role as a competitor, or potential competitor. Read more at Forbes.