Amazon’s Top Techie, Werner Vogels, on How Web Services Follows the Retail Playbook

9/29/10Follow @xconomy

Amazon.com doesn’t like being labeled simply as an e-retail company. To understand the trajectory it has taken over 15 years, and where it’s going in the future, one of the company’s senior executives says, you need to look at how it uses technology as a means to serve customers in retail and in business.

“Amazon, at its heart, at its core, is a technology company,” said Werner Vogels, the chief technology officer for the e-commerce giant, during an open house event last night at the company’s new South Lake Union headquarters in Seattle (where Xconomy is putting on a feature event called VC Crossfire on October 28). “We joke that we are a technology company, and that we happen to do retail.”

Essentially, founder Jeff Bezos was fascinated in the early days by how the Internet could make it possible to do things in retailing that couldn’t be done before, Vogels said. A great brick-and-mortar bookstore might have 25,000 or 40,000 books, which seems like a lot, but it’s nothing compared to how many books have been published throughout history. Lots of people like to read, and they like the latest books, but many people also like to dig up obscure titles that you can’t find at even stores with the best selection. “It was a unique proposition, and we needed technology to make that work,” Vogels said.

In the early days of Amazon’s technology history, say 1995 through 2001, “Amazon in essence was a bunch of app servers and databases,” Vogels said. Getting big fast and grabbing market share was more important than “architectural coherence,” Vogels said. There were databases held together with “duct tape and WD40 engineering,” he says.

By the 2000 and 2001 holiday shopping seasons, when Amazon saw big surges in customer demand, the company decided things had to change. “We realized we couldn’t scale any further” on the existing architecture, Vogels said.

The company’s guiding principle was to focus on serving the customer. On the technology side, that meant having infrastructure that was strong enough to scale up to meet huge ups and downs in demand, cheap enough to keep prices low, and reliable enough so that if a tornado hit one of … Next Page »

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  • http://www.xconomy.com/author/ltimmerman/ Luke Timmerman

    Amazon Web Services spokeswoman Tera Randall wrote in to raise a point of clarification. I left this event before the end of the Q&A session, in which a question was raised about whether excess infrastructure capacity surrounding holiday peak demand for Amazon.com drove the development of Amazon Web Services. Here’s what she had to say:

    “It is inaccurate to suggest in any way that AWS was started because of excess capacity Amazon.com had available. AWS was started because we had gained a core competency in running large, scalable infrastructure and realized that many developers and businesses could benefit from this experience. Our goal has always been to enable businesses and developers to use our web services to build sophisticated, scalable applications.”

  • http://www.dailygrommet.com Jules Pieri, CEO Daily Grommet

    Luke,

    Darnit. I liked the mythical excess capacity story way more than the officialspokeswoman version. It seemed real and accurate from my experience in startups. Not even Amazon can anticipate EVERYTHING…I like the idea that even they might be opportunistic and responsive rather than always coldly strategic.