Amazon Business In China Will Stop Business, Cross-Border Electricity Providers And Cloud Computing And Other Businesses Remain To Be Tested

In view of the aftermath of the part of China's e-commerce service in July 18th, the reporter learned from the internal sources of Amazon China that the adjustment involves two ways, including internal operations and service personnel. One is to quit, get N+5's compensation, and two is to pfer to other business departments such as Amazon's global store.

In April 25th, we verified the above information to the relevant persons in Amazon China. The other side did not respond to specific details, only saying that "we have issued an official statement before this", and then issued a statement by the public relations media: "since 2014, Amazon China has continued to focus and force cross-border Internet shopping, creating a unique cross-border business mode centered on" Amazon sea outsourcing "and" Prime member services ".

In order to deepen this strategic pformation...

We will continue to invest and vigorously promote the steady development of business in China, including the Amazon sea outsourcing, global stores, Kindle and cloud computing.

Adjustment and rehabilitation

In April 17th, it was announced that "Amazon will announce its withdrawal from China within this week". "Amazon will only retain two businesses in China in the future, one is Kindle, the other two is cross border ants, and other businesses will be completely abolished."

To be exact, it should be "Amazon's main business provider will quit China."

Since then, our reporter was informed at the first time that at 11 a.m. on April 18th, the meeting was convened by the staff of various departments in the Amazon China region. In the brief meeting, the company thanked all the staff for their hard work and contributions, and announced the news of the company's business adjustment and layoffs.

In April 18th, Amazon China confirmed the key information in three aspects to the media through a public statement. The first is "we will stop providing seller services to the third party sellers on Amazon China website" in July 18, 2019. Second, we will continue to invest and vigorously promote the steady development of various businesses, including the Amazon sea outsourcing, global stores, Kindle and Amazon cloud computing. Third, we will work closely with all sellers to complete the follow-up handover so as to ensure that we continue to provide users with quality shopping experience.

At present, we can see 16 categories of amazon.cn stores, including Kindle stores, Amazon sea outsourcing, books and so on.

In addition to the first two categories, other categories may be part of the adjustment.

Amazon China's internal sources revealed that Amazon will retain some resources such as warehouses and logistics involved in the adjustment.

Amazon China's internal information source also told reporters that the adjustment in the Amazon mainly involved in the operation of amazon.cn, service personnel around the website and so on, "not many people," because (originally) there was no market share in China, and few people.

The adjustment involves the internal staff, one option is to leave the N+5 compensation, one is pferred to the global open shop and other departments.

For the reasons for this adjustment, Amazon China did not mention in a public statement.

Perhaps, as Amazon's internal information sources say, "(because) there was no share in the Chinese station."

Amazon entered China for the first time in 2004. The first few years can be said to be one of the main players in the Chinese electricity market. Data show that Amazon's share in the Chinese electricity supplier market was 15.4% in 2008.

But with the growth of China's e-commerce power, such as Alibaba and Jingdong, Amazon's situation in China's electricity supplier market is deteriorating. Public data show that Amazon's share in the Chinese electricity market in 2014 and 2016 dropped to 2.1% and 1.3% respectively.

EMarketer, the market research firm, said in its latest report that at present, Amazon has only 0.7% of the electricity supplier market in China, and the Chinese electricity supplier market has been dominated by Alibaba and Jingdong.

At present, the most concentrated interpretation of Amazon in China is the "chicken ribs".

Wei Wuhui, a school of media and communication at Shanghai Jiao Tong University, believes that the fact that Amazon is in China is attributable to "acclimatization", "too long a decision-making chain" and "rigid mechanism".

"Amazon is too weak in China, rather than too strong."

Wei Wuhui said.

The whole line is suppressed

Amason has previously focused on the layout of China's offshore purchases, global stores, Kindle and cloud computing.

For example, in the field of offshore outsourcing, Amazon has opened up its bonded warehouses with Amazon's US station, British station, Japan station, German station and Amazon in Hongkong, China. That is to say, Chinese users can directly buy products from Amazon's US station, British station, Japan station, German station and Hongkong bonded warehouse, and enjoy their logistics resources.

In addition, the "black Friday" overseas shopping festival promotion campaign in November has been held for five consecutive years in China. It is known as the largest online shopping festival besides China's "double 11".

The performance of Amazon sea outsourcing can be described as "no effort", but what is the market effect?

AI media consulting "2018-2019 China cross border Electricity Market Research Report" shows that in 2018, in China's cross-border electricity supplier market, NetEase koala took the first place in the market share of 27.1%, and Tmall international and sea hoarding market followed by 24% and 13.2% respectively.

Tmall international and sea hoard belong to Alibaba and Jingdong respectively.

That is to say, Amazon also faces fierce competition from Chinese counterparts such as NetEase, Alibaba and Jingdong.

According to AI media advisory "2018-2019 China cross-border Electricity Market Research Report", and even in the top five of the market share of the list of electronic business platform, also did not see the Amazon sea outsourcing figure.

AWS (Amazon cloud service) is not only Amazon's fastest growing business segment in recent years, but also the most profitable business of Amazon.

In the global cloud computing market, Amazon AWS is also riding the dust.

At present, the mainstream research institutions such as Gartner and IDC in the global enterprise market haven't released the research report in 2018. But according to the 2017 global share market share analysis report of public cloud IaaS, Amazon AWS, Microsoft Azure, Ali cloud, Gu Geyun, IBM share the world's top five by 54.1%, 8.7%, 3.7%, 2.8% and 1.6% respectively.

Amazon AWS is far ahead.

But in the Asia Pacific market, according to the latest report of Bloomberg quoted Gartner research data, Ali cloud's current market share has reached 19.6%, surpassing the sum of Amazon AWS and Microsoft Azure.

Specific to the Chinese market, in order to meet regulatory policy requirements, Amazon AWS and Microsoft Azure have landed in China through the cooperation with aura new network (18.180, 0.52, 2.94%) and century interconnection. However, according to IDC's ranking of China's cloud computing market share in 2018, Ali cloud, Tencent cloud, China Telecom Tianyi cloud, Jin Shanyun, Amazon AWS respectively ranked 45.5%, 10.3%, 7.6%, 6.5% and 5.4% in the first five.

It is especially noteworthy that, according to IDC's Research Report on China's cloud computing market in the first half of 2018, Ali cloud, Tencent cloud, Tianyi cloud, AWS and Jinshan cloud ranked the top five by 43%, 11.2%, 7.4%, 6.9% and 4.5% respectively.

Thus, after the second half of 2018, Amazon AWS's market share and ranking in China have declined.

Compared with Amazon AWS in the global market, in the Chinese market, Amazon AWS can be said to face both the strong suppression of Ali cloud, Tencent cloud and Tianyi cloud, as well as the rapid pursuit of Jinshan cloud, Baidu cloud, HUAWEI cloud and other manufacturers, and the days are not easy.

Kindle e-book business is one of the most distinctive businesses in Amazon.

Since its entry into the Chinese market in 2013, it has been popular for a long time to read and immerse itself in newspapers.

But Kindle e-book is not without competitors in China. Hanwang ebook reader has been popular all the time. Palm reading iReader iReader A6 ebook reader has also attracted the attention of the market.

In addition, e-book reader is only a niche market. According to the Research Report of China Commercial Industry Research Institute, the market size of e-book readers in China in 2017 and 2018 was 3 billion 700 million yuan and 4 billion 200 million yuan respectively.

This compares with Amazon's revenue of over $230 billion in 2018 and net profit of $10 billion, which is unlikely to become a support for Amazon's future business growth.