Jeff Bezos is a Genius

This is a bit of a turn from our normal discussions on how to help get your local small business found online by your customers, but what Amazon.com CEO Jeff Bezos did this week, really needs to be discussed.  At just 49 years of age, Bezos has established and built one of the most recognizable brands in today’s marketplace.  With a net worth of over $28 billion, Bezos is a pioneer in the ecommerce industry.   Amazon.com was created by Bezos in 1994, in where else but the garage of his home, and has now grown to a $61 billion enterprise (2012)

While his work in building an ecommerce giant is truly impressive, what I personally find to be the most intriguing is his recent announcement of Prime Air, a delivery service from Amazon that will guarantee delivery within 30 minutes, of products weighing under 5 pounds by autonomous drone.  Bezos announced his idea on CBS News  60 Minutes  on December 1, 2013, the night before ‘cyber-Monday’ the busiest online shopping day of the year.  He demonstrated his idea by displaying a pair of advanced, private drones adorned with the Prime Air Amazon logo, in a corporate board room.  It was also accompanied by a YouTube video demonstrating the delivery of a small package from an Amazon fulfillment center to a customer’s front door without any human intervention.  The entire investment in this idea was probably less than $100,000 to purchase the two units and create the video (below).

And what did he get for his relatively small investment?

• More than 3 days of global news coverage around the world by every major and minor news organization imaginable.  To purchase that amount of broadcast coverage would cost most businesses millions of dollars, it cost Amazon nothing.
• In less than a week, the YouTube video has received more than 12.5 million views and has been shared widely on social media and email around the world.

What makes this amazing?

And what makes this entire announcement even more amazing to me is that the concept that is being announced and shared globally is, at best, years away from implementation.  It’s really nothing more than an idea with a couple of cool props and a nice little 1:20 minute video to go along with it.  Some of the reasons I feel this way:

• The US Federal Aviation Administration (FAA) which regulates the airspace in the US is at least 1-2 years away from developing laws that cover the use of autonomous (self-governing) drones.  Bezos has no idea if the new laws would even allow his idea to fly…….pun intended.
• The technology is not there and probably won’t be for years.  While the US military has developed very advanced autonomous drones, they tend to operate at high altitudes in military operating zones with little other traffic or obstacles around them.  An autonomous drone that needs to operate at a low level, in a built up urban area with large numbers of potential obstacles is years from development.  Simple things like power lines, vehicles, trees, and moving people all create obstacles that a drone would have to identify and figure out a way around before this idea could even work.  Even determining where it is safe to land will be a challenge for a drone at this time.
• It would have an incredibly limited ability to reach customers. Since the drone must operate out of a Amazon fulfillment center, that carries the product you want and must be within about 20 minutes flying time of your house, it will be available to very, very few customers.  Unless Amazon builds many, many more fulfillment centers, this service would only be available to a small customer base.
• It would be incredibly expensive to provide this service.  While the use of a drone does not have a lot of direct operating costs associated with it (fuel, maintenance, software, etc.) it can still only carry one 5 pound package at a time within an extremely small delivery area.  A UPS or FedEx delivery truck carrying hundreds of packages to a much, much larger delivery area will still be a much more cost effective means of delivering packages.

This is not to say that the technology may not ever be developed, as recent advancements show us that almost anything is possible, I just don’t believe that the idea Bezos presented on 60 minutes is a near term solution for Amazon or any other ecommerce company for many years to come.  Though I would love to be proved wrong.