free html hit counter Amazon's HQ2 Isn't a Headquarters. So What Is It? - John Battelle's Search Blog

Amazon’s HQ2 Isn’t a Headquarters. So What Is It?

By - September 28, 2017

Crossposted from NewCo Shift.

Everyone’s favorite parlor game is “where will Amazon go?” Better to ask: Why does Amazon needs a second headquarters in the first place?

It’s the future! Rendering of Amazon’s new Seattle HQ. The first and original one. 

Why does Amazon want a new headquarters? Peruse the company’s RFP, and the company is frustratingly vague on the question. “Due to the successful growth of the Company,” Amazon says of itself in the royal third person, “it now requires a second corporate headquarters in North America.”

It requires”?

Is this a request for bulk discounts on toner ink? Did Jeff Bezos outsource this momentous and extremely public communication to his purchasing department? Is there really no more room in Seattle?

So…Why? Why is Amazon doing this? If I were one of the hundreds of Mayors and local civic boosters huddling in meeting rooms around North America, that would be my first — and pretty much my only question. After all, if you don’t know why Amazon is looking for a “second headquarters,” then your response to their RFP is going to end up pretty rudderless. If Amazon’s true reason for another HQ boils down to, say, Latin American expansion, then Chicago, Toronto, and Philly should pretty much pack in in, no?

While the RFP is comprehensive in requirements (transportation networks, nearby international airports, sustainable office space, etc.), it nevertheless demonstrates a stunning lack of vision — the very vision that once defined “startups” like Amazon. The current accepted mythology about our fabled tech companies, those lions of our present economic theatre, is that they are fonts of vision — driven not just by profit, but by outsized missions to change the world, and to make it better. So what mission, exactly, will this new headquarter actually be charged with? Can anyone answer that? Absent any serious data, the default becomes “to expand Amazon.” And what, exactly, might that mean?

Amazon’s lists of current and projected businesses include e-commerce (its core), entertainment, home automation, cloud services, white label products, logistics and delivery, and any number of adjacent businesses yet to be scaled. It also harbors serious international expansion plans (one would presume). Any and all of these businesses might inform the “why” of its Bachelor-like RFP. But nowhere in the RFP does the company deliver a clue as to whether these factors play into its decision.

I have a theory about why Amazon issued such a vision-free RFP — and why the world responded with a parlor game instead of a serious inquiry as to the motivations of “the most valuable company in the world.” And that theory comes down to this: Amazon needs a place to put workers that are secondary but necessary — back office service, lower level engineering talent, accounting, compliance, administrative support. It will move those support positions to the city that has the cheapest cost per seat, and consolidate its “high value” workers in Seattle, where such talent is already significantly concentrated.

Put another way, “HQ2” isn’t a headquarters at all. But calling it one insures a lot more attention, a lot more concessions, and a lot more positive PR. Maybe Amazon doesn’t have an answer to the question, and is hoping its call for proposals will deliver it a fresh new vision for the future. But I doubt it.

I’d love to be wrong, but absent any other vision the most likely reasoning behind this beauty pageant boils down to money. It may sound like the cynical logic of a rapacious capitalist — but more often than not, that’s what usually drives business in the first place.

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