Jeff Bezos once called him the most important person ever in the history of Amazon.com.
Now, Amazons very first employee, Shel Kaphan, says a breakup of Amazon could potentially make sense.
In an interview for a new PBS Frontline documentary about Amazon viewed by Recode, which airs February 18, Kaphan said the companys rise to power has him conflicted.
On one hand Im proud of what it became, Kaphan told the documentarys host, James Jacoby. But it also scares me.
I think not all of the effects of the company on the world are the best, he added. And I wish it wasnt so, but I had something to do with bringing it into existence; its partly on me.
Asked if he favors a breakup of the company, which has been advocated by Sen. Elizabeth Warren and some anti-monopoly activists, Kaphan said, I think theyre now at the scale where that could potentially make sense.
Warren wants to separate Amazons retail platform, on which other merchants sell goods, from where Amazon sells its own lines of goods, like AmazonBasics. Her plan is fueled by an argument that Amazon uses data it collects from other merchants in its marketplace to boost its own brands. Other critics have called for Amazon to separate its Amazon Web Services (AWS) cloud computing business from its retail business, based on a belief that Amazon uses profits from AWS to subsidize low prices in its retail business.
When asked for comment on Kaphans remarks, Amazon spokesperson Jack Evans sent a statement: Amazons retail business competes in the worldwide market for retail sales and our competitors include all other online and brick-and-mortar stores that people shop at every day. The retail market we operate in is fiercely competitive, and Amazon represents less than 4% of US retail sales.
Kaphans views, combined with recent comments from Amazons second employee, Paul Davis, highlight how some early employees of tech giants are grappling with their roles in birthing companies that have amassed so much power in society today. Davis told Recode in December that Amazons role as both a retailer and the operator of a retail marketplace on which other merchants sell goods and Amazons access to their data that can be used to compete against them is unfair.
Amazon has defended its data usage in its retail business, saying it only uses aggregate data and not individual seller data. It has also previously said, Amazon only succeeds when sellers succeed and claims to the contrary are wrong. Facebook co-founder Chris Hughes has also called for the breakup of the company he helped form with Mark Zuckerberg.
At the same time, being large or powerful is not illegal on its own. But Congress, the Federal Trade Commission, and the Department of Justice are all engaged in simultaneous investigations of the Big Four tech companies, which includes Amazon, to evaluate whether any of their business practices are anticompetitive or otherwise unlawful.
Kaphan was Jeff Bezoss first hire at Amazon and the architect of the shopping site when it first launched. But Bezos eventually took away his direct reports when naming him the first chief technology officer and, thus, his influence, according to Brad Stones book, The Everything Store. Disappointed with his reduced role, Kaphan left Amazon in 1999, five years after joining.
In the documentary, the host asks Kaphan whether Amazons current state just encapsulates what capitalism is.
Yes, Kaphan answered, theyre doing what the business schools teach people to do. And theyre doing it aggressively and skillfully and with great intelligence. And theyll continue to do that unless theyre constrained by other forces in society.
Later in the film, the CEO of Amazons consumer business, Jeff Wilke, is asked about the current scrutiny of the company. He said he agrees that Amazon deserves scrutiny, like everything thats large in the economy and in society.
Were in a lot of verticals, yes, Wilke added. Theres video and theres commerce, theres [Amazon] Web Services, theres all these things. But in every one of them, we have intense competition. And I do understand why, when youre in a lot of them, it can seem like were everywhere. But if were everywhere, that means were talking about the global economy, not just global retail. Its so vast, were just a speck.
