According to a new report, Amazon has plans to launch a new delivery service, first with its third-party merchants, then expanding nationally across the USA. And executives at companies FedEx and UPS are no doubt waking up to frantic phone calls about what their industry might look like in five years.
The new delivery service will reportedly be called Shipping With Amazon, or SWA, according to the Wall Street Journal—not to be confused with Southwest Airlines, the first hit when you google “SWA” today. The SWA branding is already being used in over three dozen US cities on a much smaller scale.
But SWA wouldn’t just be for Amazon packages in the long term. The vision, as it’s hinted at in the WSJ, is to compete with FedEx, UPS and even the US Postal Service for shipping anything anywhere, even if it’s not an Amazon product.
The Wall Street Journal report only mentions unnamed sources, and Amazon has yet to respond to Gizmodo’s request for comment. But rumours in the world of Amazon have a funny way of coming true in some fashion, even when the company strongly denies them at first. But so far, the statements from Amazon have been generic non-denials about its plans to roll out a new far-reaching delivery service.
“We’re always innovating and experimenting on behalf of customers and the businesses that sell and grow on Amazon to create faster lower-cost delivery choices,” an Amazon spokesperson told the WSJ in a statement.
Will its new delivery service work out? That depends on who you ask on the long line of people who have to touch a product before it makes its way to your door. Gizmodo’s own Bryan Menegus reported last year about just how hard the “last mile” is for Amazon, especially when it comes to the toll it takes on workers. But Amazon clearly believes that it’s the king of innovation and will no doubt meet the challenge in a world of stuffy old delivery services like FedEx.
Amazon is America’s most dominant online retailer. But with its recent acquisition of Whole Foods, it clearly has larger plans to dominate the world of things like food, medicine, and deliveries. The company even announced recently that it was going to set up its own health care services for employees. The so-called “Everything Store” of Amazon is looking to be your Everything Service.
The whole thing is reminiscent of that scene in the 2007 movie There Will Be Blood where Daniel Plainview sits with his son in California looking out at the ocean talking about how he’s going to build an oil pipeline. Why? It’s all about avoiding shipping costs, because shipping costs are for chumps.
“If there’s anything here... we take it to the sea,” Plainview, played by Daniel Day Lewis, says. “We can go into town and see a map, but what we do, we take a pipeline from here to Port Hueneme or Santa Paula and we make a deal with Union Oil. This is what we do and we don’t need the railroads and the shipping costs anymore, you see?”
“Then we’re making money, we’re making the real money, we’re not just throwing it away on shipping costs.”
So what will the delivery business look like in five years? If Amazon’s past behaviour is any guide, they’ll put everyone from FedEx to UPS out of business and then jack up prices as quickly as possible once it becomes a monopoly. Only time will tell, of course. [Wall Street Journal]