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Originally Posted by emellaich
The interesting thing about Amazon ... their net income last year was 631 Million USD ( Google Finance ). Included in that was the $1 Billion in revenue they made from selling advertising ( WebProNews ). I imagine their advertising was very high profit. Then add in 30% on independently published ebooks. Consider the money they make from Amazon stores where someone else provides the product and they provide a link to the listing. This is almost like more advertising income.
Bottom line, is that it appears that Amazon breaks-even or loses money on most of the stuff they sell. It's almost like they treat low priced stuff as marketing cost to get people to their web site. Once they have the eyeballs there, they make money by steering them to advertisers, affiliated stores, and other similar arrangements. |
Expect that to really change this year or next year at the latest. They made a lot of big investments in 2011 and will continue to do so in 2012. They still make money on everything they sell, and obviously they take the ad revenue. And they will post big numbers soon, once the dust has settled.