[part 5 of 5] lol

ability to stumble where we've basically gotten past the point where 70 to 80 percent of the risk was external and where we needed a huge amount of luck to get to where we are now now all we need is a clear consistent vision and the ability to execute on it very very well at high speed and that second piece comes from having large numbers of talented employees with lots of executive bandwidth to help guide them and so you know individuals do not win we're very lucky we have the unarguably the most talented venture capitalists in the United States on our boards a guy named John doar and John is very well the time talks about the fact that teams win individuals don't and we have built a great management team and a great group of people underneath that and if you look at companies like Microsoft that's the main way that they've won - if you look at all their assets that got more than 10 billion dollars in cash in the bank they've got an operating system which is a virtual stranglehold on the industry and I would say all of those things are great but the thing that really makes them such an awesome competitor and the reason that they have the position they have today is because they don't just have Bill Gates they have 40 people at the top of that company who are smart and dedicated and hardworking and if you look down below that sort of incredibly deep executive team they've got more people that are waiting in the wings to take on that kind of responsibility so we're trying to build that kind of team at amazon.com we've got a great start and we do have a thousand entrepreneurs at amazon.com there are lots of my name is Mary long there are a number of discussions eyes going on about the future of the book now that there's the computer I'm wondering what your thoughts are on that and also relatedly I guess what with the growth of the super stores the borders and Barnes and Nobles they've really had an impact on I think on publishing in some ways and with no deals with the publishers what kind of an impact are you heavy on publishing and in books ok great questions well impact I'm terrible first of all terrible multi-part questions so if I forget one of the parts while answering the other I'll you just remind me the impact on publishers is especially Amazon accounts impact is especially positive on small and independent presses the reason is that this extensive catalog the ability to that the internet gives us infinite shelf space so that we can actually merchandize to a worldwide audience titles that otherwise simply could not and cannot get distribution in physical bookstores so that has been a positive impact the second thing has been reduction returns turns out most people don't know this but 38% of all books that get shipped out from serves into the retail distribution channel are eventually returned to the publishers as unsold merchandise that's an incredible statistic and amazon.com returns to publishers less than four percent because of our centralized distribution model your first question what's the future of the book I firmly believe that at some point the vast majority of books will be in electronic form I also believe that's a long way in the future and the thing that holds you know many more than ten years in the future and the reason that that gets held back today is that paper is just the world's best display device it turns out that today with the state of the art in display devices dead trees just make the best display devices they're higher resolution they're portable high contrast and so some day computer displays will catch up with that and then I think electronic books will be extremely successful [Music] hi my name is Wil price I'm just wondering what you're doing to drive consumer behavior or access to technology in terms of growth avenues that's something you're actively trying to work on or as you know the inherent growth in the industry sufficient to cater to - right now well we don't we aren't trying to grow the internet what we target the customers that we target with our advertising and our other promotional activities are already online and they're heavy book buyers so at this stage of the game we're not trying to convince people who aren't online to come online we're also not trying to convince people who don't read to read we will save that for a future more glorious day Hart Rogers you spoke about regret minimization do you have other advice for people contemplating moving into entrepreneurship from the normal track yeah I do I think that I almost have started a company straight out of school and I would say there are many examples of people who've done that successfully some very high-profile examples of people who done that successfully I actually buys people not to do that I almost did it who knows how it would have worked out but I think I've benefited tremendously from working at a couple of best practices companies that were very entrepreneurial and were fairly small at the time that I did it and I did that for about ten years and I believe that the experience of doing that and working with people like David Shaw at Dijon Co were just unbelievably helpful to me in terms of being prepared to do this I think it just dramatically increases your odds and when you're doing things like this the problem with being an entrepreneur and undertaking a business initiative is that companies don't fail quickly if they failed fast that'll be okay because then you could you know you could try 20 times but in fact they take years and years to fail it you know if you look at the failure statistics of startup companies very rare do they fail in the first year - it's usually seven eight nine years so it means that you're dedicating a significant percentage of your life to this thing and you really want to make sure you've optimized you know maximize the odds that you're going to be able to succeed I'm Kitty Lansing I'm curious about what percentage of the books you sell are children's books because I think of children's books as seen as being so dependent on illustrations and how do you ease your way you see getting around that yeah well the direct answer to your question is we don't disclose any breakdowns on sales we're competitors I can't actually tell you what percentage of our sales are children's books but what I can't tell you is that the strategy we've taken with children's books is it turns out with children's books people just want to be parents are mostly shopping for children none we're in friends of parents and so on adults shopping for children and they basically want to be told what to buy so in other things people know because you're buying for yourself you know what you want but when you're buying something for a four-year-old guidance is very much appreciated and that's the way that we merchandise children's books online [Music] John McKinnon I'm curious to know how Amazon's gonna respond to some of the large strategic relationships that Barnes and Noble is building with say America Online or CNN well and really if you look at the large relationships that have been built online all the significant ones are actually build with amazon.com so you know this is one of the one of the advantages of being a first mover we have multi-year exclusive agreements with five of the top six web sites including AOL Barnes Noble has an exclusive agreement with aol's proprietary network we have an exclusive agreement with AOL comm aol.com where we have a permanent homepage banner for example is the single most visited web page on the internet so and you know it literally it's if you if you take the pc meter data which is to where the Nielsen service or the internet and look at the top six web sites we have exclusive multi-year arrangements with all of them vault with all five of the top six the one that's not there it's Microsoft they don't have a relationship with anybody we're gonna bring this to a the formal part of our program to a conclusion although I'm sure mr. Bezos will be glad to chat with people informally for a few moments I want to thank you for coming a long way this afternoon to be with us and it's made this year's a be dick lecture at Lake Forest College a truly memorable experience and we'll be looking for you [Applause]