Amazon.com 2011 Annual Report Download - page 11

Content Creators
We serve authors and independent publishers with Kindle Direct Publishing, an online platform that lets
independent authors and publishers choose a 70% royalty option and make their books available in the Kindle
Store. Amazon’s own publishing arm, Amazon Publishing, offers authors another outlet to publish their books.
We also serve authors, musicians, filmmakers and other content creators through CreateSpace, which provides
on-demand publishing and manufacturing for independent content creators, publishers, film studios, and music
labels.
Competition
Our businesses are rapidly evolving and intensely competitive. Our current and potential competitors
include: (1) physical-world retailers, publishers, vendors, distributors, manufacturers, and producers of our
products; (2) other online e-commerce and mobile e-commerce sites, including sites that sell or distribute digital
content; (3) a number of indirect competitors, including media companies, web portals, comparison shopping
websites, and web search engines, either directly or in collaboration with other retailers; (4) companies that
provide e-commerce services, including website development, fulfillment, and customer service; (5) companies
that provide infrastructure web services or other information storage or computing services or products; and
(6) companies that design, manufacture, market, or sell digital media devices. We believe that the principal
competitive factors in our retail businesses include selection, price, and convenience, including fast and reliable
fulfillment. Additional competitive factors for our seller and enterprise services include the quality, speed, and
reliability of our services and tools. Many of our current and potential competitors have greater resources, longer
histories, more customers, and greater brand recognition. They may secure better terms from suppliers, adopt
more aggressive pricing and devote more resources to technology, infrastructure, fulfillment, and marketing.
Other companies also may enter into business combinations or alliances that strengthen their competitive
positions.
Intellectual Property
We regard our trademarks, service marks, copyrights, patents, domain names, trade dress, trade secrets,
proprietary technologies, and similar intellectual property as critical to our success, and we rely on trademark,
copyright and patent law, trade-secret protection, and confidentiality and/or license agreements with our
employees, customers, partners, and others to protect our proprietary rights. We have registered, or applied for
the registration of, a number of U.S. and international domain names, trademarks, service marks, and copyrights.
Additionally, we have filed U.S. and international patent applications covering certain of our proprietary
technology. We have licensed in the past, and expect that we may license in the future, certain of our proprietary
rights to third parties.
Seasonality
Our business is affected by seasonality, which historically has resulted in higher sales volume during our
fourth quarter, which ends December 31. We recognized 36%, 38%, and 39% of our annual revenue during the
fourth quarter of 2011, 2010, and 2009.
Employees
We employed approximately 56,200 full-time and part-time employees at December 31, 2011. However,
employment levels fluctuate due to seasonal factors affecting our business. Additionally, we utilize independent
contractors and temporary personnel to supplement our workforce, particularly on a seasonal basis. Although we
have works councils and statutory employee representation obligations in certain countries, our employees are
not represented by a labor union and we consider our employee relations to be good. Competition for qualified
personnel in our industry has historically been intense, particularly for software engineers, computer scientists,
and other technical staff.
3