Underdogs Tend to Innovate, Will T-Mobile USA Do So?

If Cole Brodman, Chief Marketing Officer, T-Mobile USA had his way, mobile service providers would not offer, or need to support, device subsidies. Most mobile executives probably would agree, as the growing wholesale cost of the latest smart phones has begun to impose a big penalty on operating income and profit margins.


Consumers obviously like paying $200 for devices that actually cost $500 to $600 each. But the device subsidies obviously represent a sort of inventory cost for the mobile service providers who are subsidizing the devices. 


T-Mobile USA would prefer to operate the way prepaid mobile service providers do, namely by eschewing subsidies. The downside for consumers is the potentially steep cost of their favored devices. 


Unlike the dominant mobile providers in the U.S. market, T-Mobile does support "bring your own device" plans, where consumers have financial incentives to forego the subsidies.


Underdogs tend to drive innovation in most markets, because they have to. The issue now is what else T-Mobile USA might be able to do in that regard 

Evolution of Social Media in 2012

Social media has come a long way over the last decade. Many forms now co-exist, and each medium seems to have a distinct function. It is irresistible to say the changes are long form to short form, and that is one of the trends. 


But the movement also is toward "sharing" more than "writing," and towards more visually-oriented sharing. There also has been a shift to sharing that has more commercial implications. 


2012 will likely see an acceleration of structured, push button, social curation across the web.  Why?  Because most users don't want to take much effort to produce content, and consuming content in a structured manner (especially photos) is also much faster. 


 

Apple iPad Still Leads, But Kindle Fire Gaining

Though a reasonable person would argue Android-powered devices will someday overtake the Apple iPad in sales volume at the moment it is the 7-inch Amazon tablet that is is the biggest competitor to the iPad, with 16.8 percent of the tablet market and 4.7 million units shipped during the fourth quarter of 2011, followed by Samsung with 5.8 percent of the market according to IDC.


But Apple still had “an increase of 110.5 percent from fourth quarter of 2010 levels.


 Apple also continued to lead the market with 54.7 percent of global market share despite being down from 61.5 percent in the quarter before. 


IDC expects Android to overtake iOS for global market share by 2015. Maybe the "tablet" market someday really will emerge from the "iPad" market. 

Source: IDC

Most Consumer Devices More Like iPods than PCs

Parks Associates says more than 60 percent of U.S. tablet owners use the device weekly to listen to music. That is just one more bit of evidence that tablets are "content consumption" devices.


In fact, both consumer and business content consumption patterns appear to be changing as tablet and e-reader ownership grow fast. In fact, one might argue that tablets and e-readers are being adopted faster than any other consumer electronics or communications products of all time.

The share of adults in the United States who own a tablet of some sort nearly doubled from 10 percent to 19 percent between mid-December 2011 and early January 2012. That’s a doubling of mass market adoption in just 30 days, from a significant base.

The ownership of e-readers also surged from 10 percent to 19 percent over the same time period. Tablet ownership doubled in two months

That is an unprecedented growth rate for any consumer electronics device. Tablet ownership also had been on a strong adoption path earlier in 2011 as well, but doubling in 30 days from a base of 10 percent seems never to have occurred before.

And it appears that strong adoption is occurring both in the consumer and business markets.
Fully 51 percent of IT decision-makers surveyed by IDG say they “always” use their iPad at work (and a further 40 percent say they sometimes use it at work), IDG reports after conducting a survey on tablet use for work. Tablet business use

Though iPads seem to be used for a variety of purposes, content consumption seems to be a dominant business application, though significant percentages of business users also say the tablet displaces some amount of smart phone use as well.

Web browsing, reading and news consumption are the top three usage contexts identified by professionals worldwide.

Whether tablet ownership “revives” the print newspaper and magazine market remains to be seen. But it already is pretty clear that tablets and e-readers are changing the function of “reading.”

The survey suggests that tablet computing is transforming patterns of content consumption. iPad-owning IT and business professionals are rapidly migrating away from newspapers and printed books, toward digital alternatives.

Nearly three quarters of iPad owners say that owning an iPad has reduced the frequency with which they purchase newspapers and books. Whether that helps or harms print content providers remains to be seen.

What is very clear, though, is that tablets and e-readers are being adopted faster than any other personal device, period.Historically, 10 percent adoption historically has been an inflection point: it is the point in an adoption process that represents critical mass, after which adoption accelerates.

You’ll have to click on this chart to view it in more detail, but it is one of the most useful bits of historical evidence you can use to estimate how long it might take an application, service or device to reach 10 percent penetration of U.S. households, for example.

There are some caveats. Not every innovation succeeds. This chart only shows you what happened with the most-popular consumer electronics services and products.

The point is that it can take quite a significant amount of time, between three and 10 years, for a successful and mass-adopted innovation to reach the crucial 10-percent-of-homes threshold, which seems to be the point at which any innovation really begins to accelerate, in terms of adoption.  Consumer adoption patterns

Tablets not only reached that level in a couple of years, they then exploded, doubling from 10 percent to nearly 20 percent, in literally 30 days. That is unheard of.

Also, it appears that Amazon might be winning its bet that if it sold Amazon Kindles almost at cost, it could grow content sales substantially.

RBC Capital analyst Ross Sandler polled 216 Kindle Fire owners and concluded that Kindle Fire tablets are making Amazon more money than was originally expected. Sandler originally had estimated that each Kindle Fire unit would generate about $136 in content purchases over the useful life of the device.Content purchases on Kindle Fire

But Sandler’s most-recent survey of 216 Kindle Fire owners suggests content revenue might be higher than that.

The survey found that roughly 80 percent of users already have purchased ebooks, with 58 percent of respondents buying more than three e-books within the first two months of owning the tablet.

Averaged out, that’s five e-books per quarter, which nets Amazon $15 per Fire owner per quarter, assuming an average selling price of $10 for ebooks. That further implies revenue from e-books of about $60 a year.

About 41 percent of Fire owners also say they have bought at least three apps. This will put another $9 per Fire owner per quarter into Amazon’s coffers, or $36 a year of net revenue (after splitting gross revenue with content owners).

That implies possible gross sales of about $30 a quarter worth of apps, assuming Amazon’s share of revenue is 30 percent.

Those figures suggest annual Kindle Fire revenue of about $96 a year. Over three years, that suggests $288 of revenue for Amazon, even if users do not buy any video or audio products, which seems unlikely.

What Should Apple Do With All its Cash?

Apple is the fastest growing company in the S&P 500. Also, given the size of the company and the pace of it's growth, the S&P 500 would have next to no earnings growth without it.


Many would say Apple also is one of the strongest company growth stories, ever. Of course, Apple also has $100 billion in free cash, and that pile seems to grow with each passing quarter. 


Naturally, there are growing questions about what Apple should do about that cash hoard. Some say Apple should start paying a dividend. Others would say that is the worst thing Apple could do. It is a growth company, not a "value" play. Those characteristics draw different kinds of investors. 


Some would argue Apple has to remain focused on growth. In an uncertain environment, that cash is vital, many would argue. And though Apple has no history of making large acquisitions, it always is possible that Apple eventually will find itself facing growth challenges that require significant cash.


Some of us might argue that content acquisition is one such example. Eventually, somebody will "crack the code" on video streaming, and disrupt the existing video entertainment business. But that is almost certainly going to require ownership, control or at least access to the key sources of programming that represent value for millions of potential customers. 


So far, no contestant with the ability and willingness to disrupt the business has had such access. And money is the key. To be sure, we have been hearing about "interactive," or "on-demand," or  Internet delivery of TV for decades. 


But that's the thing about really-big changes in a technology-based business. They often take time. And it is quite common for an important innovation to build very slowly at first, then reach an inflection point where change is more rapid than most expect, especially given the slow ramp up. 


Some might argue that Apple will need much of that cash to disrupt the TV business, even as it continues to insist it simply is a partner in that business. 

Apple Still Dominates Business Tablet Buying

A ChangeWave survey of 1600 business technology buyers in the United States found that  22 percent expected to be buying tablets during the second quarter of 2012, and 84 percent will be buying Apple iPads. 

Though one never knows what will happen in the future, some competitors might fear the worse, namely that Apple has once again created a hot new product category that it will "own," in terms of market share. 


Since November 2010, iPad share of buying intentions has hovered in the 77 percent to 80 percent range, according to ChangeWave.

Data source: ChangeWave Research

The adage that "there is no tablet market, only an iPad market" is no longer as true as it was a few years ago. But it still might be fair to say there is an iPad market, and then a tablet market. When one supplier has 70 percent market share, it is analogous to the MP3 player market, which wound up being an iPod market, with some other providers. 

In 2011, for example, Apple continued to hold 78 percent of the music player market. That is what "terrifies" other competitors. Apple has more than once showed an ability to dominate a new consumer electronics category. 

The mobile phone market is more complicated, as Apple does not compete in the feature phone category. In the smart phone category, Apple has about 30 percent share, globally. 

More tellingly, Apple seems to be, far and away, the most profitable smart phone manufacturer. Right now, one has to wonder whether Apple has done it again, creating a new category which it dominates. 

PayPal’s Digital Wallet Will Change "Money"

“PayPal is changing," says  Anuj Nayar, PayPal director of communications. "We’re known as an online payments brand but this is all part of PayPal becoming an actual wallet.” And that's arguably understating PayPal's present ambitions, or potential impact. For the moment, PayPal wants to change the payment experience in substantial ways.


Sam Shrauger, Vice President of Global Product and Experience for PayPal, says that the new PayPal will feature flexibility with how you want to pay for an item in a store.


With the new digital wallet, you can buy something in a store, take it home and decide later how you want to pay for it. PayPal will offer a five to seven-day grace period for consumers to change their minds. 


Users might also be able to combine gift card or prepaid card payments with other forms of payment, not all so traditional. PayPal has talked about allowing payment using airline affinity program miles, for example.


PayPal wants to change the user experience of “money,” as customers use “stored value” to buy things in stores. In part, that will entail providing an incrementally-new form of payment, not to be confused with “method of payment.”

You might say “paying by waving a mobile at a terminal” is a new method of payment. But PayPal is looking at something different, namely a different form of payment that could mix sources in new ways and also create a new type of banking relationship.


Highly-successful mobile money systems will demonstrate clear value, for both consumers and retailers, it is clear. What already seems quite clear is that simply adding a new form of payment, namely the ability to link a credit or debit card account to a mobile phone, and then swipe the phone to make a retail payment, has limited incremental value, in most cases.


PayPal’s approach to mobile payments and mobile wallet therefore hinges on changing the payment experience in other ways. Among the more interesting approaches PayPal is taking is the separation of transaction from payment method.


For example, if a consumer wanted to use airline miles, in part, a coupon or gift card, in part, PayPal would create ways for consumers to do that. The retailer would still receive the “cash,” but PayPal might handle all the account management details needed to convert miles into cash, for example.


Many consumers have virtual “funds” used to buy groceries and pay bills. PayPal could enable users to “debit” specific accounts when shopping.

In other cases, when making a major purchase, a consumer might prefer to pay in installments, but not use a credit instrument. PayPal will enable installment payments. The merchant is paid upfront, but PayPal will essentially become the banker, allowing the user to pay over time.

There are other features related to shopping that will become part of the PayPal wallet, such as integrating shopping lists, searching for items and comparing prices. Take it a step further and then imagine an automated way to connect a list with location with availability, prices and then available time on your schedule.

PayPal is not about replacing a card swipe with a phone tap at point of sale. We are reimagining money to free it in its digital form, says Sam Shrauger, PayPal VP.

Intel Developing Web-Based TV Service?

Intel Corp. is developing an Internet-based TV service that it hopes to sell to U.S. consumers, a strategic shift for the chip maker that makes it the latest technology company to look at a foray in the pay-TV business, according to the Wall Street Journal.


Intel's interest in doing so is one more example of a firm deciding it wants to "move up the stack" in terms of end user value. Instead of supplying components to other retailers, Intel would vault up to become a service provider itself. 


Intel's "interest" does not mean it will succeed. As other contestants have found, content licensing, of the sorts of content most people want to pay for, is quite expensive. Intel doesn't appear to have any programming contracts locked up, nor is it even clear most major content owners want to do so.


In a phrase, "virtual" cable operators might lead to equally "virtual" profits. Incumbent cable, satellite and telecommunications companies pay nearly $38 billion each year to license TV channels. And that's just one of the revenue streams content owners reap. The networks also earn about $22.6 billion in advertising as well. 


Nor is it likely a new generation of "virtual" providers would be willing to sponsor "hundreds" of channels. Instead, they likely would focus on a smaller subset of highly-viewed channels. In other words, virtual distributors would represent less demand for network fare, not more, or even "the same amounts" of demand. 

If Intel simply wanted to create one more brand name among providers of "traditional" cable TV, it would have better prospects. Content owners, after all, are used to supplying their content to all sorts of distributors who use the standard subscription TV model.


Streaming, though, raises issues, notably the danger of destroying the older distributor model while a new model is built. Now, even that wouldn't be a big stumbling block if content owners were relatively confident that the new model would generate more revenue than the current model. But few seem to believe that. 


The Intel move is not out of character, in a sense. Intel has for some time believed it must gain a bigger foothold in the video entertainment business. In 2005, for example, Intel invested in Revelations Entertainment, a venture aimed at distributing movies over the Internet on the  same day they open in movie theaters.


Intel also recently invested in StreamPlanet, a company that provides a technology platform for video content owners and distributors to stream and monetize their content, for example. 


Intel Capital’s Digital has invested in a number of firms to drive its "SmartTV initiative." Intel hopes to create an ecosystem that includes home networking silicon, platform software, connected devices, and services. 


Intel is particularly interested in TV platforms operating systems, TV apps, social TV, and various video and content services including gaming, advertising, and audience measurement. 


Intel's recent investments include BlackArrow, Digital Chocolate, Exent Technologies, iControl Networks, Kabam, Kaltura, Transgaming, UIEvolution, Videon Central, Verismo Networks, and YuMe, for example. 

60% of Smart Phone Owners Shop from their Devices

Some 60 percent of smart phone owners used their devices for shopping during the 2011 Christmas and holiday shopping season, according to data from Nielsen. 

Those users are researching products and reviews, comparing prices, finding retail locations, and redeeming coupons. 

Nielsen’s metering of the smart phones of 5,000 U.S. volunteers participating in Nielsen’s mobile research shows that during the 2011 holiday season, the top retail apps and websites combined — Amazon, Best Buy, eBay, Target and Walmart — reached nearly 60 percent of smart phone owners. 

Among the more obvious conclusions is the notion that mobile commerce is beginning to blur the line between "brick and mortar" and "online commerce." It's all just becoming "commerce."

Video of Google Algorithm Change Meeting

If you're the kind of person who has to keep up with Google and search engine optimization, this video is interesting. 


It is an authorized Google release of an actual meeting where engineers considered a change in ranking algorithm. Even relatively subtle changes get intense scrutiny by the ranking teams, Google seems to want to emphasize. 


 The specific change discussed in this video improves spelling suggestions for searches with more than 10 words and it impacts only 0.1 percent of traffic. 


 Every change has a dedicated search quality analyst assigned to study the impact. This analyst is not part of the engineering team building the change, but instead offers a separate opinion on whether the change is good for users. he search team relies heavily on the results of experimental data to make decisions. 


During the meeting, we rely on detailed analyst reports including the results of click evaluations and side-by-side experiments. These reports can sometimes be more than 25 pages long. Launch reports include specific examples to illustrate broader trends in the data. 


Rather than manually change one example, our engineers look for algorithmic ways to improve millions of queries. earch algorithm improvements often rely on and impact many different systems, so engineers with expertise in different areas all need to come together to make the best decision for the user, balancing all the tradeoffs involved (relevance, spam, latency, cost, language impact).

Apple Could Be Huge in Mobile Commerce, But Will It?

Will Apple, though universally considered one of the most-important potential influences in mobie commerce, decide that the mobile commerce experience is big enough to matter, and is conducive to the creation of devices that are the best possible approach to that problem?


It's an important question. For starters, Apple makes products. To be interesting, an unmet need has to lead to the creation of a device that offers a dramatically better experience. 


"Our goals are very simple, to design and make better products," says Sir Jonathan Ive, Apple’s SVP of Industrial Design. "If we can’t make something that is better, we won’t do it." 

Apple's approach therefore requires identification of a mobile commerce problem that can be solved by a product. Also, Apple creates consumer products. That doesn't mean those products are not used by people in their business roles. It's just that Apple doesn't do "industrial" products. 

In many cases, there's a problem which is clear, such as Apple's belief that mobile phones and TVs offer experiences that are terribly sub-optimal. 

In a startling number of cases, though, Apple tackles problem people are not aware of, or for which nobody has articulated a need. That's one reason Apple does not do focus groups or other market research to uncover unmet needs. 

"It’s unfair to ask people" how well they would like a product they have never seen and do not know they need, he argues. 

Tablets are Changing Content Consumption Habits

Consumer and business content consumption patterns appear to be changing as tablet and e-reader ownership grow super fast. In fact, one might argue that tablets and e-readers are being adopted faster than any other consumer electronics or communications products of all time.

The share of adults in the United States who own a tablet of some sort nearly doubled from 10 percent to 19 percent between mid-December 2011 and early January 2012. That’s a doubling of mass market adoption in just 30 days, from a significant base.

The ownership of e-readers also surged from 10 percent to 19 percent over the same time period. Tablet ownership doubled in two months

That is an unprecedented growth rate for any consumer electronics device. Tablet ownership also had been on a strong adoption path earlier in 2011 as well, but doubling in 30 days from a base of 10 percent seems never to have occurred before.

And it appears that strong adoption is occurring both in the consumer and business markets.
Fully 51 percent of IT decision-makers surveyed by IDG say they “always” use their iPad at work (and a further 40 percent say they sometimes use it at work), IDG reports after conducting a survey on tablet use for work. Tablet business use

Though iPads seem to be used for a variety of purposes, content consumption seems to be a dominant business application, though significant percentages of business users also say the tablet displaces some amount of smart phone use as well.

Web browsing, reading and news consumption are the top three usage contexts identified by professionals worldwide.

Whether tablet ownership “revives” the print newspaper and magazine market remains to be seen. But it already is pretty clear that tablets and e-readers are changing the function of “reading.”

The survey suggests that tablet computing is transforming patterns of content consumption. iPad-owning IT and business professionals are rapidly migrating away from newspapers and printed books, toward digital alternatives.

Nearly three quarters of iPad owners say that owning an iPad has reduced the frequency with which they purchase newspapers and books. Whether that helps or harms print content providers remains to be seen.

What is very clear, though, is that tablets and e-readers are being adopted faster than any other personal device, period.Historically, 10 percent adoption of a consumer product has been an inflection point: it is the point in an adoption process that represents critical mass, after which adoption accelerates.There are some caveats. Not every innovation succeeds. This chart only shows you what happened with the most-popular consumer electronics services and products.

The point is that it can take quite a significant amount of time, between three and 10 years, for a successful and mass-adopted innovation to reach the crucial 10-percent-of-homes threshold, which seems to be the point at which any innovation really begins to accelerate, in terms of adoption.Tablets not only reached that level in a couple of years, they then exploded, doubling from 10 percent to nearly 20 percent, in literally 30 days. That is unheard of.

Also, it appears that Amazon might be winning its bet that if it sold Amazon Kindles almost at cost, it could grow content sales substantially.

RBC Capital analyst Ross Sandler polled 216 Kindle Fire owners and concluded that Kindle Fire tablets are making Amazon more money than was originally expected. Sandler originally had estimated that each Kindle Fire unit would generate about $136 in content purchases over the useful life of the device. Content purchases on Kindle Fire

But Sandler’s most-recent survey of 216 Kindle Fire owners suggests content revenue might be higher than that.

The survey found that roughly 80 percent of users already have purchased ebooks, with 58 percent of respondents buying more than three e-books within the first two months of owning the tablet.

Averaged out, that’s five e-books per quarter, which nets Amazon $15 per Fire owner per quarter, assuming an average selling price of $10 for ebooks. That further implies revenue from e-books of about $60 a year.

About 41 percent of Fire owners also say they have bought at least three apps. This will put another $9 per Fire owner per quarter into Amazon’s coffers, or $36 a year of net revenue (after splitting gross revenue with content owners).

That implies possible gross sales of about $30 a quarter worth of apps, assuming Amazon’s share of revenue is 30 percent.

Those figures suggest annual Kindle Fire revenue of about $96 a year. Over three years, that suggests $288 of revenue for Amazon, even if users do not buy any video or audio products, which seems unlikely.

Citi Launches Kindle Fire App for Mobile Banking

Citi is expanding its mobile repertoire with the launch of a Kindle Fire application that lets consumers track, analyze and plan their finances.


The Citibank Kindle Fire app lets consumers access their finances no matter where they are. 


In addition to the new app, Citi has also rolled out two additional mobile banking capabilities, mobile check deposit and Citibank Popmoney.


Through the Mobile Check Deposit feature, consumers can take photos of the front and back of their check and submit it for verification. 


The Popmoney feature lets users send money through the Citi Mobile app to people they have set up as payees on Citibank Online.


There's a broader question bankers themselves, and others in the mobile commerce space, always ask. Namely, what is the return on such investment? The key problem for a bank is that it is not clear whether a bank actually grows its revenue when it invests in the mobile channel. 


It might be a key cost of doing business. There should be some benefits in terms of customer satisfaction, stickiness and churn retention. There could be some operating cost implications. But it remains unclear how big those effects might be, in terms of revenue. 


The problem is akin to the similar issue telecom service providers face when offering voice over Internet Protocol services that displace older voice services. The problem is that incumbents typically have found they cannibalize the older services with the new, investing heavily in return for less revenue. 


Bankers might find something similar is the problem with mobile commerce, banking and payments. Citi Kindle Fire App

What Ails Video on Demand?

According to a new report released by The Diffusion Group (TDG), video-on-demand services provided by PayTV operators should be, but are not, generating significantly higher viewing and advertising revenue. Total VOD use is small, representing only one percent of all U.S. TV viewing.

By some measures, VOD is doing better. Magna Global has estimated that U.S. homes with VOD, a "category that includes both traditional multichannel VOD offerings and over the top services," will hit 70.1 million homes, about 57 percent of all TV homes at the end of 2016.


But note the conflation of traditional VOD and over the top services and apps. Some of us would not classify over-the-stop streaming as VOD, just as time-shifted viewing on a digital video recorder is not VOD, and Netflix streaming is not VOD. 


Still, even availability is not the same thing as "usage." Hundreds of TV channels are available on cable, satellite and telco subscription video services. That doesn't mean those channels are viewed by most people. Much as fixed line voice service is available to most homes, but isn't necessarily purchased by all those homes, so too for-fee or ad-supported VOD is available relatively widely, but isn't used much. 

TDG attributes that failure as a reflection of VOD's inadequate advertising support and awkward program guides that limit availability and viewing of ad-supported video-on-demand content. VOD hampered


Some of us might argue that "inattention" not withstanding VOD never has gotten much traction in the U.S. market and that the problem is lack of interest and demand on the part of consumers.


Service provider lack of attention to ad-supported VOD is the problem, TDG argues.


According to Bill Niemeyer, TDG senior analyst, "operators have failed to take advantage of VOD to build subscriber satisfaction, generate ad revenues, and head off competition from over-the-top (OTT) providers like Netflix." 


Niemeyer estimates in the fourth quarter 2011, Netflix U.S. subscribers watched 80 percent more streaming video hours than were viewed in the same period on all U.S. PayTV VOD.


Some of us might argue that marginal failures to market and support VOD could be an issue. But there is a reason service providers do not market VOD so intensively. VOD simply does not contribute significant revenue for a service provider. 


VOD in recent years has contributed about $2 billion a year worth of revenue for U.S. video entertainment providers. U.S. cable TV companies alone booked about $98 billion in 2011 revenue. That doesn't include the sizable revenue earned by satellite and telco providers as well. 


The point is that VOD, as a service, has been a modest success, though it has had three decades to make its case. 

Amazon Bets on Buying, Reselling iPads to Boost its Own Business

Amazon is among the best marketers in the mobile commerce space, perhaps the boldest. While most other contestants consider near term return on investment, Amazon frequently goes for the long term opportunity, even at short term risk.

Amazon Trade-In, for example, lowest offers a trade-in program  iPad 2s, giving users $236 or more fore units in “good” condition. Apple is selling new iPad 2s for $399.

While other trade-in sites will give sellers cash, Amazon gives customers store credit. In essence, Amazon is simply buying a bit of business. For starters, the reconditioned iPads are in turn sold on Amazon for $360 or more.

By some estimates, Amazon might actually lose $14 after buying, reconditioning and reselling any single iPad. But that isn’t the point. It never is, with Amazon.

Users then buy stuff from Amazon, which begins to earn back that $14 of loss.

There’s a chance, though, that Amazon could get even luckier on you. If you use your trade-in money to buy a device or service that keeps you locked to the company for a long time, Amazon might end up making more money on you over time, especially if the user buys a Kindle, or joins Amazon Prime.

One analysis suggests that after joining Prime, the amount of money that a customer spends at Amazon jumps from $400 per year to $900 per year.