The Pitfalls of Techno-optimism (and the Ambition of Amazon)

by Steve Wildstrom   |   December 4th, 2013

Photo of Amazon drone (Amazon.com)

Jeff Bezos’ interview with Charlie Rose on 60 Minutes accomplished three things. It told the world that Amazon is a true technology company, not just a giant retailer.  It took attention away from unpleasant subjects, such as working conditions in Amazon’s fulfillment centers or the company’s chronic lack of profits. And it established beyond a doubt that Bezos is the true successor to Steve Jobs as the tech world’s premier visionary and magician.

The interview showed Bezos to be better than Jobs, because Steve could only create his reality distortion field in person. Judging by the sometime rapturous reception given to Bezos’ promise of  drone-driven Amazon Prime Air, he can do it just fine over the airwaves. Although there were some misgivings in the cold light of Monday, most initial responses sounded as though Bezos had made a real announcement of a real product. “Amazon Chief Reveals Drone Delivery System: Unmanned delivery aircraft could be ready within five years” reported the normally sober Time Tech. “Amazon’s Drones for Delivery,” read the headline in an unquestioning Wall Street Journal report. and Bezo biographer Brad Stone, while expressing at least a dose of skepticism, wrote for Bloomberg Businessweek:

The aerial drone is actually the perfect vehicle—not for delivering packages, but for evoking Amazon’s indomitable spirit of innovation. Many customers this holiday season are considering the character of the companies where they spend their hard-earned dollars. Amazon would rather customers consider the new products and inventions coming down the pipeline and not the ramifications of its ever-accelerating, increasingly disruptive business model.”

In fact, the Bezos announcement belongs to the same absurd-but-taken-seriously genre as Udacity founder Sebastian Thurn’s proclamation  that the success of massive open online courses would eliminate the need for all but 10 universities in the world, and the reporting of it mostly without a bit of critical analysis reveals a major failing of tech journalism.

Economic sense. For example, just about no one who wrote about the Amazon idea bothered to consider the economics of drone delivery. Until we have fully autonomous drones, and that is a lot further off than Amazon’s five-year horizon,  each of those cute octocopters is going to need a remote-control pilot. Piloting a drone to deliver on a customer’s front porch (and we have no idea of how Amazon plans to make deliveries to multifamily residences; maybe the drones will be able to open the apartment building door and fly straight to your doorstep) is vastly less efficient and thus far more expensive than a traditional truck route. The number of purchases for which drone delivery could make sense will never be more than minuscule.

Small, cheap drones are a fascinating technology with huge potential. But their most likely use seems to be in a large variety of remote-sensing roles (which themselves could be good or evil), not delivering packages.

The techno-ethusiasm that greeted the Bezos interview  is hardly unique. We have seen the same sort of reaction to 3-D printing, which at least has the advantage of being real and available today. 3-D print is also a very exciting new technology that enables many things once thought impossible. But it has also inspired a vast quantity of tech journalistic nonsense: 3-D printing will replace conventional manufacturing, families will meet all their needs for manufacturing objects with home printers; or, my favorite, we will solve the problem of hunger by printing food. These breathless predictions uniformly ignore the limitations of both technology and economics, not to mention the fact that after 40 years, old-fashioned 2-D printers remain the most unreliable pieces of tech equipment that most of us own.

Interesting experiments. Similarly with the crypto-currency Bitcoin. It’s fascinating experiment in a privately, indeed collectively, issued fiat currency with no government or central bank to stand behind it. But despite a lot of techno-enthusiasm, the chances that Bitcoin will replace the dollar or the Euro, or even become an important medium of exchange, a nil.

I give Jeff Bezos all the credit in the world for the PR coup of 60 Minutes. He launched the holiday shopping season by getting everyone talking about Amazon, in a mostly good way, at the cost of producing a clever video. But it’s time for the tech commentariart to show the ability to do more than parrot outlandish claims.

 

 

 

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.
  • stennans

    You’re focused on whether Amazon’s drones are economically feasible. Meanwhile more and more people are buying more and more stuff from Amazon and their sales curve is starting to look vertical.

    • pk_de_cville

      I think he used the drones as an example of how the ‘tech commentariat’ doesn’t do reality well. Bezos has used them to promote his own RDF.

      But why go gaga over a sci fi PR film, as if Amazon has a chance of making money with it? The target isn’t Amazon, the target is the nonthinking, logic avoiding analysis of new things or fhought fantasies by various media analysts and bloggers.

    • jfutral

      “Why do the things I think I need all require batteries?”

      Joe

    • jumbojimbo

      Amazon is doing well in the USA and Europe but it is no longer the World’s largest e-commerce site. The Alibaba Group, the Chinese e-commerce giant, took that crown and it’s yearly sales are now greater than Amazon and Ebay’s combined! Alibaba reported that the volume of transactions on its two marketplaces, Taobao and Tmall, was around $170 billion in 2012. By 2017 Alibaba’s projected sales are predicted to top $470 billion a year. To put that in perspective Amazon recorded about $90 billion in sales in 2012

    • isitjustme

      But where are the profits.

  • peter

    I agree. When I heard of the idea it struct me as completely impractical. The laziness, lack of common sense and lack of skepticism in the press was breathtaking. Not only is delivery by air very impractical (weight/size restrictions), it is costly, it is hard to get the goods in the hands of the customer (dropping it through the chimney perhaps) and many things (such as books) are much easier to deliver via broadband internet.

    I’m looking forward to next year’s plan in which Bezos announces a joint venture with Santa Claus for off-season package delivery.

    • http://www.tumblr.com/blog/his-divine-shadow His Shadow

      The technorati hipsters blithering about Amazon drones all share a sad common trait. The are terribly let down by technology you can actually buy, but always positively glowing about pie-in-the-sky nonsense that is always “just around the corner”.

      As with dead celebrities that can be imagined to have any trait you want, the Unicorns of future tech are as amazing and wondrous as you can imagine, having none of the pesky faults of things that have to conform to the laws of physics and real world business models.

    • stefnagel

      Mr. Bezos: I just want to say one word to you. Just one word.
      Benjamin: Yes, sir.
      Mr. Bezos: Are you listening?
      Benjamin: Yes, I am.
      Mr. Bezos: Pizza.
      Benjamin: Exactly how do you mean?
      Mr. Bezos: Drone delivered. Hot. Pizza.

  • jfutral

    Down south, we would call those drones “target practice”.

    Joe

    • Bill Smith

      I was thinking the same thing; I love skeet shooting, but when you take out an Amazon drone, there’s a gift inside.

  • Rene Stein

    You just mentioned the real coup. Jeff Bezos got a 15 minute long advertising spot on what used to be, at least, one of the most trusted news magazine shows in the US. At the start of the holiday season to boot. And, he probably did not pay a dime for it. Shame on CBS and 60 minutes for failing their viewers by not reporting on actual news.

    • Bill Smith

      Oh, how the mighty have fallen. One day you’re revealing government scandals and tracking down Bernie Madoff(sp?); the next, you’re doing puff work for corporate concerns.

      • http://www.tumblr.com/blog/his-divine-shadow His Shadow

        Your comment is a near perfect encapsulation of the this issue in particular and the state of journalism in general.

        • Bill Smith

          Thank you, kind sir.

          It’s frightening that we’ve gone from (in the US), three major television news outlets and countless newspapers vying to get the story out to the likes of USA Today. There’s nobody to keep anyone honest; no hard core journalism whatsoever. Folks actually turn to comedy shows like The Colbert Report and The Daily Show for news (seen through the filter of entertainment and the show host’s political bias) or, worse, Twitter (not journalistic because one typically only ‘follows’ others with similar views).

          I personally believe that the failure of journalism in the United States is responsible for the fragmentation of our country’s soul.

  • Bill Smith

    Shall I summarize?

    “Steve Wildstrom calls bull…droppings”

    Wonderful, well done article.

    You’re right, Mr. Wildstrom, nobody has stopped to consider the economic realities. That doesn’t mean they can’t eventually be overcome, but it’s silly that everyone sees what is best described as fantasy research projects as “ready for the world.”

    Great insight!

    • Bill Smith

      Still wish you had an editor, though. What’s a “commentariart”?

      • steve_wildstrom

        The Flash object is the video of the Bezos 60 Minutes interview. That’s the way YouTube gave it. If I have time, I’ll try to substitute an h.264 version.

        Techno-enthusiasm and commentariat are not my invention, though I admit they are non-standard. I think their meaning is clear from context.

        I wish I had an editor too. (I’m actually a pretty good one, but it is amazingly difficult to edit your own writing.) Unfortunately, the economics don;t work, at least at the moment.

        Podcasts: We’re working on it.

        I’ll admit my dives have been a bit shallow of late because of the pressure of other work, but things should be easing up shortly.

        • Bill Smith

          Thanks for taking the time to respond, Mr. Wildstrom. I understand about the Flash object. I simply suspect that a growing portion of the audience here reads TechPinions on mobile devices, some of which don’t do Flash.

          I understand about the economics not supporting an editor as well. For most, it won’t matter. For others (myself included), it makes TechPinions fall into the “uncanny valley.” There’s great work here. The high quality of the writing makes the errors in editing stick out like a sore thumb.

          As for the podcasts and deeper dives, please understand that I greatly enjoy your work, and think you bring so much to the table. There aren’t that many writers with actual talent and experience. Or perhaps it’s that there are so many green writers who think they know everything.

          What can one learn from someone who has a knee jerk reaction and spits out what is, effectively, a long Tweet or blog post? What can’t one learn from an industry veteran who knows and understands the patterns and trends, and can convey knowledge in a manner that entertains as well as informs? Anyone can do research and present it, but it takes wisdom to know what to research, and what’s important to present.

          This is why I, for one, continue to look forward to your work, Steve.

          • steve_wildstrom

            I hate flash as much as anyone, but it is still (who knows why?) YouTube’s favored format and when you get an embed code for a video from a PC browser, you get the Flash version. I’m sure there’s a way around this, but I haven’t figured it out yet.

            (Not only are we expected to be our own editors, but we have to be our own programmers as well.)

          • Bill Smith

            That’s why it would be great for you guys to hire an aspiring intern or something.

            Call me selfish, but it pains me to see great talent doing menial stuff that’s orthogonal to their profession. I’m not suggesting that you toss a cocktail napkin at someone and have them “make it work”, but I’d much rather have you take one of those golden nuggets you’ve been meditating on and release it into the world than spend half an hour or more proof-reading a piece.

            Even if you use the reclaimed time to “veg out” with friends and family, I suspect there would be a bump in both the quality and quantity of output because you would be more relaxed and have more time to let your ideas incubate. I highly doubt that Mario Andretti changes the oil in the family minivan.

            I bet Kirk would say something like “Penny wise; pound foolish.”

          • steve_wildstrom

            Techno-enthusiasm has been fixed. This is the problem with editing your own stuff. I certainly know how to spell enthusiasm, but I read right over the the misspelling both when I wrote the piece and when you pointed it out. Had I not written the article in the first place, I’m sure the error would have jumped right out at me. (And because techno-enthusiasm isn’t a real word, I ignored the spell checker flagging it.)

  • stefnagel

    That Jeff Bezos is a smart guy no doubt. He managed to grab the headlines from Apple’s mauling of the competition in tablets and phones over the weekend. Well done that.

    Horace Dediu at Asymco did a great podcast on Amazon on Sunday, before the 60 Minutes PR piece. Not to be missed. Left me with this thought: When companies start plumping products like Glasses and Maildrones, the flop sweat is perceivable: they are covering up a complete lack of coherent, comprehensive business vision with pure technowampum, trollware, aka smoke and mirrors.

    • TheEternalEmperor

      To be fair, only the tech pressed would have carried any info about Apple’s sales and only if they could present it as a negative. “Apple barely manages to meet demand.” or some such nonsense.

  • Applesince1979

    Here is a blog post where someone went into the practicality of what Amazon proposes

    http://www.anandtech.com/show/7560/thoughts-on-amazon-prime-delivery-drones

  • chano1

    I think you’re missing the point. Anything would be better than the current model for B2C deliveries. It is archaic, no matter how kewl the logistics involved. I’m surprised that it impresses you.

  • Jenk Roy

    This is what’s called a publicity stunt. And you drones, er… journalists fell for it.

    • FalKirk

      Guilty as charged.