A Business Model and Amazon

In 1980-81 I became head of the the Warner Cable Interactive Services Business. At the time we had a two way system called QUBE which was limited to some video on demand such as boxing events and the like. My task with my team was to develop a two way fully interactive system to sell anything as well as do banking, games etc. Thus the name, TIES, Transaction, Information, Entertainment Services. I have to thank Greg Shapiro for this and he was a brilliant young marketing type on leave from American Express.

From the Plan we noted: 

This plan describes the implementation of a business that uses cable television and interactivity to provide services to the home. The business is called TIES (Transaction, Information , Entertainment Services) and is defined as: providing distribution capability , local marketing and customer support to facilitate the delivery to homes of a bundle of goods and services offerings , and is available to subscribers on demand via enhanced videotex in an entertaining format. 

 Enhanced videotex differs from traditional videotex systems by providing full motion video segments in addition to text and graphic displays. The services offered ( applications ) are in the following areas: 

Banking and Investment Services 
Games and Entertainment 
Travel, Ticketing and Real Estate 
Merchandise/Packaged Goods Shopping 
Information/Education and Electronic Mail
Local Services and Classifieds

TIES builds naturally on the existing Warner Amex role , leverages the Warner Amex cable investment, and readily interfaces with the existing businesses of American Express and WCI. TIES responds to emerging trends i n the marketplace by providing an innovative electronic in-home marketing distribution channel in the marketplace by following: (i) supplier expansion into direct marketing, and (ii) consumer demand for choice and convenience, coupled with consumers' growing acceptance of electronic delivery of transactions , information, and entertainment. The strategy in this new marketing and distribution channel is : (i) to build on local presence,  (ii) to bring together suppliers and packagers into what is termed a local electronic shopping mall, (iii) to ensure consistent and high quality service.

Now the problem was that we saw that the Shopping Mall Operator strategy was better because vendors knew better, we were intermediaries. This is the Ali Baba approach. Amazon took on the role of the store, no shopping mall, they were to be the store. This seems to have stopped. Now more than half of the sales seem to bevia some unknown third party. The goods may be knock offs, the delivery scheduled haphazard, the quality questionable. As the Mall Operator one had the duty to ensure quality. In my most recent experiences this is failing on the Amazon side.

Does this open the door for a new competitor. I believe so. I hope so. I liked to old Amazon, the new Amazon not so much.

It is like Google. All my searches were on Google, now, not so much. As for Facebook, that went the way of my Grad students. I saw its flaws a decade ago or even more. Possibly or possibly not.

Here is the composite video of our first system in 1982. This was displayed on an Atari 800, our home platform of choice, Warner owned it then. The videos were done by Richard Veith a great innovator at the time!

 also

and

Note the paradigm of spatial participation. It is worth noting that this now almost 40 year old construct focused on quality and trust. AMEX was a key driver there. Again one must ask where is Amazon wandering, hopefully not astray.