Amazon’s Business Platform Model

"Amazon" by Canonicalized is licensed under CC BY-SA 2.0
“Amazon” by Canonicalizedis licensed under CC BY-SA 2.0 
The platform can be described as an emerging group of individuals in which interpersonal, economic, and social traffic is extensively conveyed by an international online ecosystem stimulated by information and classified by algorithms. Platforms are categorized into three meso-level of the ecosystem, micro-level of individuals, and macro-level of geopolitics. Thus, the American platform-based ecosystem is characterized by the leading corporation in the technology industry, which encompasses Amazon, Apple, Google, Microsoft, and Facebook. The corporations’ platform services are fundamental in determining the distribution of data flow and their general design(van Dijk et al., 2018). On the other hand, apart from the dominant technology companies, some civil societies and nations are proactive in controlling the platform society. The essay has focused on Amazon’s business platform model. Thus, the company is among the leading digital global retail platforms, entailing its massive network in logistics for the dissemination of physical commodities. Amazon is dominating in the cloud server software and space (Mansell & Steinmueller, 2020). In addition, the firm controls various sectors such as analytics, database management, and telemarketing.

Moreover, collaborative and social media platforms are becoming key players in engaging consumers and society. Further, the platforms such as Amazon have changed the consumer experience and buyer behavior through their online services and interaction with the buyers. As a result, the platform corporation has affected various economic categories (de Kloet et al., 2019). Conversely, previous research postulates that the platform organizations have influenced trade unions and labour laws and undermined the existing enterprises such as transport, hotels, and media industries, which operate with the initiated regulatory framework. Therefore, the essay will discuss Amazon’s business platforms fields of operation, its success, and revenue generation technique before the conclusion.

Amazon’s platform model has various fundamental fields of operation. The information ecosystem’s focal points that dominate the online space in Europe and North America are operated and owned by the global technology giants such as Amazon, which have their headquarters in Seattle, Washington United States West Cost. Amazon and other big tech companies have generated more revenue from the apps and websites consolidated with their fundamental services and the increasing establishment of sectoral platforms. Amazon has strategically invested in the sectoral presence by acquiring whole foods (van Dijk et al., 2018). Additionally, Amazon retail aims at setting its footprint in the grocery and pick-up stores. Consequently, the company has been involved in strategic alliances with various companies around the globe. On the other hand, the corporation has enabled user data compilation throughout the applications and websites ecosystems, stimulating increased profitability. Conversely, various digital disruptors rely on business platforms. Thus, Netflix depends on Amazon’s web services (de Kloet et al., 2019). The multinational corporation has diversified into television production with Game and Amazon Studio. Amazon as the largest online retailer in the US has a substantial online payment system.

“Amazon Prime Video” by stockcatalog is licensed under CC BY 2.0

Amazon operates a platform business model as its core framework for various business components. Some elements like advertising and prime business are interconnected to e-commerce platforms. Thus, prime unit aids Amazon in rewarding its loyal and repeated clients, which improves its business platform. The platformization nature means that the society that embraces the platform could take broader diverse forms (Mohan & Punathambekar, 2019). Concurrently, the AWS element has been vital in enhancing Amazon’s technological infrastructure. The firm has embraced various platform business models in operation, such as Kindle, which is an eReader. Additionally, it aids in the interactions of multi-sided actors with limited cost effect to Amazon but its income on every transaction. Conversely, prime video aids in connecting the media producers with the customers. Amazon exerts the degree of control on prime video over the systematic content. The firm invented Alexa, the most adaptable platform business framework with an extensive proportion of devices configurable through the voice recognition apparatus. Thus, Amazon’s marketplace links 3rd party sellers with consumers.

 The platformization has resulted in the success of Amazon. As a result, different economies and enterprises have been impacted. Nieborg and Poell (2018) argue that platformization is the penetration of digital platforms’ infrastructural, governmental, and economic expansion into the application and websites ecosystems. Amazon has been listed among the top ten most valuable brands in America and China because of its platform business model (de Kloet et al., 2019). The firm has attracted major corporations as its clients. For instance, the Netflix streaming platform has been a notable client of Amazon’s AWS cloud infrastructure. On the other hand, prime video has been among Netflix’s prime content platform’s rivals (Mansell& Steinmueller, 2020). Amazon is a customer-centric firm that has enabled individuals around the globe to utilize other websites and online social networks platforms to trade (John, 2018). Moreover, the corporation’s platform has attracted a broader network of buyers and sellers from different economies to trade. As a result, Amazon has played a vital role in enhancing consumer experiences while shopping online and engaging other buyers and sellers. The platform business model has made it easy for firms to start an online store due to reduced risks of entry barriers. Thus, businesses can depend on Amazon’s AWS cloud services. Furthermore, content creators can successfully monetize their commodities information through schemes such as kindle direct publishing. Concurrently, consumers can utilize authentic content through prime videos.

Amazon has generated more revenue through its platform’s business model. The corporation has experienced increased profitability from the substantial percentage of income generated from a more comprehensive array of products. Therefore, the firm has embraced the platform model to establish a marketplace that buyers and sellers can interact. Thus, Amazon charges an agreed percentage fee from a product’s transaction made by the buyers. The firm earns a fixed and per-unit activity fee, percentage sales, and interests from the marketplace transactions through the Amazon seller scheme. Additionally, it has attracted revenue from its business units such as AWS, advertising, and prime videos (Cusumano, 2017). As a result, the firm has established a diversified business framework. Kindle direct publishing platform has enabled many independent authors to publish products information and e-books. Consequently, Amazon generates an estimate of 30% to 70% royalty fee from the independent authors’ e-books sales. Through Amazon, consumers can purchase the desired products at lower prices and just in time. Sellers can decide not to handle their consignments since Amazon has fulfillment centers. Further, they may find new market opportunities. Therefore, the corporation has increased its revenue from the platform business frame and has generated value for various players in the marketplace.


Platformization has continued to expand into the social sector. The emergence of the sharing economy has raised critical concerns about the platform business model (Scholz, 2016). Most critics argue that companies are not participating in the sharing economy through the platform model, but are conducting their own regular business. And most technology companies are using platforms to enter international markets and attract more consumers. As a result, companies like Amazon have integrated software, hardware, and third-party developer support to effectively build their platform business models. Government agencies have worked with international business platforms to address social issues. Conversely, local regulators are interested in understanding the impact of platforms in the marketplace (van Dijk et al., 2018). Therefore, most online organizations should restructure to meet the needs and mitigate the challenges of the platform society. On the other hand, states and companies should comprehend the dynamics, operations, and social impacts of platforms in a global context. Understanding how platform devices are reshaping the international community is therefore crucial to gain more insight into how individuals are governed. The business models of Amazon platforms play an important role in creating value by enhancing the online exchange of products between buyers and sellers. Finally, these platforms create a broader network of users scalable and accessible resources on request.


Cusumano, M. A. (2017). Amazon and whole foods: follow the strategy (and the money). Communications of the ACM60(10), 24-26.

de Kloet, J., Poell, T., Guohua, Z., & Yiu Fai, C. (2019). The platformization of Chinese society: Infrastructure, governance, and practice. Chinese Journal of Communication: The Platformization of Chinese Society, 12(3), 249-256

John, Nicholas A. (2018) Sharing Economies. In The age of sharing (pp. 69-97). New York: John Wiley & Sons.

van Dijk, J., Poell, T., & de Waal, M. (2018). The platform society. In The platform society as a contested concept (pp. 5-32). Oxford: Oxford University Press.

Nieborg, D. B., & Poell, T. (2018). The platformization of cultural production: Theorizing the contingent cultural commodity. New Media & Society, 20(11), 4275–4292. doi:10. 1177/1461444818769694

Mansell, R., & Steinmueller, W. E. (2020). Advanced introduction to platform economics. Cheltenham, Edward Elgar Publishing.

Mohan, S., & Punathambekar, A. (2019). Localizing YouTube: Language, cultural regions, and digital platforms. International Journal of Cultural Studies, 22(3), 317–333. doi:10. 1177/1367877918794681

Scholz, T. (2016). Uberworked and underpaid: How workers are disrupting the digital economy. New York: John Wiley & Sons.

Editor:Karina Huang

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