Amazon at 25: With the high street on its knees should we be more wary of this online giant?
- Credit: Archant
Our reporter says she’s not sure she wants to see the web behemoth reach its 50th anniversary....
On Friday, retail giant Amazon blew out the candles on its birthday cake, celebrating 25 years in business. In just a quarter of a century, the company has grown exponentially from its modest beginnings as an online bookseller, operating out of owner Jeff Bezos' garage. Its astronomical rise has changed the face of retail as we know it today, tempting us away from our traditional high street stores with the promise of low prices, fast delivery and one-click ordering.
For some, Amazon represents the ultimate success story - an inspirational tale of one man taking $10,000 and turning it into a trillion dollar empire, catapulting himself to the position of world's richest person in the meantime. For others, though, the e-retailer represents something altogether more negative. Allegations of worker exploitation and mistreatment have dogged the company for many years, with an undercover report by The Mirror detailing constant surveillance, 55-hour work weeks, timed toilet breaks and poor working conditions at an Amazon warehouse in Essex in 2017.
Reports from around the world suggest that these issues aren't unique to the UK, with employees across the US, Spain, Germany and Italy staging walkouts over their working conditions. "We are not robots" was the message that emblazoned placards during November's Black Friday protests.
The retailer has also come under heavy scrutiny for repeatedly paying very little tax. Despite tripling its profits to £72.3m in the UK, its tax bill fell to just £1.7m. Over in the US, meanwhile, Amazon will pay precisely $0 in federal income tax on the $11.2bn in profits that it made in 2018. Like many companies, Amazon manages to escape with paying so little by taking advantage of the tax-breaks available to them across the US, UK and Europe. So, although the company has reduced their tax bills through perfectly legal methods, these figures don't sit well with many tax-paying consumers.
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Taxes aside, it's also hard to ignore the e-retailer's impact on our local high streets. Traditional brick-and-mortar shops are shutting their doors at an alarming rate, with 10,000 stores predicted to close across the UK in 2019 alone. Boarded-up, vacant shops are becoming a feature of high streets across the country, and with the future of retail stalwarts such as Debenhams and House of Frazer hanging in the balance, the future for town centre shopping looks bleak. The high street is in crisis, and there's no doubt that e-commerce is driving this decline. Amazon now accounts for over a third of all UK online purchases, with over 90% of British shoppers using the site. As consumers flock to the online giant for all manner of purchases - gifts, books, clothes, tech gadgets and even food - Amazon is well on its way to achieving its vision of becoming 'the everything store'. And it might just end up being 'the only store'.
Then there's Jeff Bezos himself. Now the world's richest man, Bezos is worth close to $160bn, but has given away just a tiny percentage of his vast wealth. The Amazon boss is still yet to sign up to the Giving Pledge - a campaign to encourage wealthy individuals to donate at least half of their wealth to charitable causes either in their lifetime or in their will. The campaign, which was founded by tech innovator Bill Gates and investor Warren Buffet, now has 204 signatories, including Richard Branson, Michael Bloomberg and Mark Zuckerberg, among others. Bezos' ex-wife Mackenzie has even managed to beat her husband to signing the pledge, committing to giving away at least 50% of her $38bn divorce settlement.
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With all this to consider, an easy and convenient one-click purchase with Amazon suddenly doesn't seem so easy and convenient after all. In just 25 years, the company has come to dominate the retail space - becoming something of an e-commerce monopoly and rapidly expanding into areas as diverse as food shopping, financial services and entertainment. It begs the question: just what might this behemoth be like at 50?