The Six Five team discusses Amazon Generative AI Summit
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Transcript:
Patrick Moorhead: Amazon made some pretty cool disclosures across, particularly across shopping and logistics. And while it wasn’t related to that, we did have a great interview with AWS CEO, Matt Garman, and while the company tries to say AWS is separate from the rest of Amazon, 100% AWS technologies are being used across Amazon.
Daniel Newman: Yeah, I think we could cover this as kind of like a what’s up with Amazon? What’s up with Amazon and AWS and AI? Maybe I’ll talk a little bit about the announcements. We could chat a minute about the conversation with Matt Garman, I think that to some extent needs to be shared and let people see it. But first of all, maybe something of worth note is just these big companies are the probably best customer zeros on the planet for a lot of this AI technology. And so when you look at Amazon, of course we have the AWS business. What are they building that enables other companies? And of course they have the AWS business and what are they building that can then be deployed for their own Amazon footprint? That’s really interesting. So yesterday they made a bunch of AI disclosures or one is about vision-assisted package retrieval, they’re calling it VAPR.
It’s basically something that they think can reduce a route by 30 minutes and per delivery, they’re going to, I believe, deploy it in a thousand vans to start off. But this is the number one growth challenge is when you’ve gone from two days to Prime to same day, to few hours to minutes, with the exception of these packages dropping out of the sky to get more efficiency. Now we’re down to the point where it’s literally minutes make a difference because they’re trying to get stuff to us so quickly. So they’re working on using AI to basically optimize routes using vision-assistance, and they’re going to deploy that out to about a thousand vehicles this year and try to save on an average about 30 minutes package. Now when you’re doing millions and millions and millions, you got to think about the efficiencies that this gains.
That’s super interesting. And of course, Pat, you and I have been, I think in San Marcos together, we went to one of their fulfillment centers. The amount of technology in these places is astronomical. Now, it’s not the humanoid robots that we’ll talk about later walking around these facilities, but the way they use robots for pick, pack and ship, this stuff is… Like, Amazon, while it does employ like a million people and they have tons of seasonality and you need a lot of people still, they have been on the forefront of investing in technology to basically enable this expedited service. So all of us sit in our couch and when we need something, we just click in, we order it, and then voila, it shows up at our door. There’s a lot of technology in it until right now, these new fulfillment centers, robot driven state-of-the-art AI, new logistics systems, and they’re calling it their advanced fulfillment center and they believe they can take 25% of costs.
So efficiency, as I’ve said, the prune to grow first part of AI, another great example here, how it’s being done in factories. And then of course they talked about their new AI shopping tools. So this is not surprising, and by the way, ties very nicely to Amazon’s ads business. I’ve been sharing a little bit of content about this on my tweeter lately, is it tweeter? Can I call it tweeter? That this is a 40 plus billion dollars business now. Ads are growing, but also being able to use AI to put the right product in front of people and get the best pricing. So Amazon kind of pushed out that they’re using more visual shopping tools, more personalized recommendations, and they are saying that they helped customers save a billion dollars. Now, I don’t know if this exactly becomes the Elon Musk office of government efficiency here for corporations, if they’re saving, the more you buy, the more you save. I think this is the new CEO verdict of save you more, as long as you spend more.
But they’re using tools, implementing their technology, and of course you can be certain this is all built in AWS’s cloud, which takes me quickly to look this week, Patrick and I had the opportunity, which is rare, to sit down with AWS CEO, Matt Garman. This is a really candid conversation, Pat. I think it was great because Matt, let us really ask him the hard questions. As analysts, we have to be the arbitrators of what’s going on in the market. We can’t just accept the talking points. We have to kind of get underneath it a bit. And there was a lot of speculation about Amazon being behind in gen AI, Bedrock coming late, models coming after not having the technology, and then of course growth slowing and not having much comment in any of their recent earnings about AI’s impact.
We hit Matt on all these things-
Patrick Moorhead: That’s right.
Daniel Newman: And then of course, you hit them up on our favorite topic, build the silicon or buy the silicon, and there’s a lot on that one too. Matt gave us some great feedback there. I’m going to leave it a little bit opaque here ’cause I want people to watch the episode, but it was a great conversation and I know you’re going to have some more time with Matt soon. But thanks, Matt. Thanks AWS for making the time and everyone out there look for us to drop that pod. Pat, I’m going to pass this topic back to you.
Patrick Moorhead: Yeah, you pretty much drained this topic, which is fine. That’s why I gave you first-
Daniel Newman: There wasn’t that much there. It wasn’t a big one.
Patrick Moorhead: You pretty much hit everything. But some of the announcements that came out, vision-assisted package retrieval, talking about advanced fulfillment center, technologies, AI shopping tools, again, all delivered by AWS technologies. And one of the things that I think is important is that when you know AWS, first of all, it did not partner with OpenAI at the outset. And I think when it comes to how AWS has historically made its decisions, it’s all about scale. What do we have to create where we can have the ultimate scale? And while I do think that Microsoft got the upper hand on this thing, I do think that it’s a marathon and not necessarily a race, and the big competition is who’s going to get share shift customers? And this is never binary. Everybody uses at least two cloud providers, but it’s more on an application basis. Those new generative AI infused applications, who’s going to get those? And I think time will tell on if there were share shift. Competitions good.
Author Information
Daniel is the CEO of The Futurum Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise.
From the leading edge of AI to global technology policy, Daniel makes the connections between business, people and tech that are required for companies to benefit most from their technology investments. Daniel is a top 5 globally ranked industry analyst and his ideas are regularly cited or shared in television appearances by CNBC, Bloomberg, Wall Street Journal and hundreds of other sites around the world.
A 7x Best-Selling Author including his most recent book “Human/Machine.” Daniel is also a Forbes and MarketWatch (Dow Jones) contributor.
An MBA and Former Graduate Adjunct Faculty, Daniel is an Austin Texas transplant after 40 years in Chicago. His speaking takes him around the world each year as he shares his vision of the role technology will play in our future.
