Name: Exclusive: Amazon CEO Andy Jassy on Jeff Bezos's leadership, and the future he’s imagining for AI and health care
Uploaded: 2024-01-19
Duration: 17 min 31 s
Description: Jassy spoke in an interview with Fortune CEO Alan Murray at the World Economic Forum in Davos.

Jassy spoke in an interview with Fortune CEO Alan Murray at the World Economic Forum in Davos.

Exclusive: Amazon CEO Andy Jassy on Jeff Bezos's leadership, and the future he’s imagining for AI and health care

Tech

Amazon CEO Andy Jassy on Jeff Bezos's leadership

I think needs no introduction. You guys have heard of Amazon? Uh, 1.5 million people, $1.5 trillion in market cap. But I learned something really interesting tonight for the first time that you almost came to work for Fortune. You wanna, you wanna share that story? Well, II, I had, uh, first of all, it's great to be here with all of you. Uh, I had, I was telling Allen that I, I thought you were gonna talk about the beef tornadoes. I was hoping we are tornadoes. Um, I know I almost, uh, in, in between my first job and going to graduate school. Uh, when I was applying, I had this recruiter call me about Fortune Magazine and I had a lot of friends I've worked with before who were there. I had a lot of respect for time inc I got the offer and I almost did the job instead of going to business school and then I decided to go to graduate. So it's like Fortune Amazon. Fortune Amazon. It was business school. Yeah, you made a good decision. This is luck. Luck. You got it. Right. II, I wanna start by asking you the question that everybody in this room is gonna be asked to address tonight because this is where we really get value out of this dinner. Look at the year ahead, what do you see is the single biggest opportunity facing business and the single biggest risk facing business? Well, and of course, everything we think we know today may be different three months from now. So take this with a grain of salt. I would say that uh to me, I think the opportunity and risk is pretty similar in that there is this um wildly transformative disruptive technology in general of A I that you can't get through any conversation without talking about. And I think people as they, you know, people were on this March pre pandemic to modernize their technology. You know, it it's part of, you know, I I used to manage this aws business, our cloud computing business and people were on this March to, to modernize their technology to be able to have a lower cost structure and, and have better developer productivity and to innovate at a faster clip. And then the pandemic happened and then we had this economy where everyone, you know, most enterprises tried to figure out how they could save money in any way they could ours included. And as you know, a lot of the low hanging fruit and cost optimization has attenuated over the last, you know, several months and we're back to starting to invest. I just see companies really battling with the prioritization between, are they better off um continuing with that modernization of their technology platform or should they spend all their new engineering resources on generative A I? And in my opinion, uh you have to think and then again, it's prior organization, everyone will decide differently. I think you have to think about it in a balanced way because to me, if you don't set basically, if you don't have your, your technology Infrastructure foundation, right, you are gonna have a hard time being successful with generative A I and uh and, and, and actually it's such a sure win to be able to modernize your technology and move to the cloud. That to me, it is a very predictable payback. Uh And yet, at the same time, I think you would be foolish not to figure out how to use generative A I successfully, I think everyone is trying to figure out how to be successful in a cost effective and high ro I way. And so I think that to me, the, a lot of companies will end up deciding to take the sure successful way of modernizing their technology platform and setting their foundation, right? And then picking at least one or two generative A I uh initiatives where they can learn how to run it, they can learn how to be successful, they can figure out what you gotta do to get the right ro I and the right customer experience for business, but it's gotta be a balance in my opinion. Do you think, uh Davos is overdone the A I thing a bit? I, I mean, I don't think Davos is unique to that, you know, I, I think, I think it, it is, it is so exciting and people, you know, and it, it's, it's really, it has the chance to transform virtually every customer experience. I mean, we're building 60 ish applications right now. Well, that's, yeah, let me ask you about that because yes, every conversation for the last four days has been about A I and particularly generative A I. But when you talk to people about it, they generally talk about open A I and Microsoft, maybe they talk about Goo Google, maybe they bring in meta but they don't talk about Amazon. I mean, do you feel like you've like Miss Miss or been behind the parade a little bit on this or why? Why are we not hearing Amazon in the, in the same sense? I don't know who you're talking to. Al I'm not our customer. Uh You know, I, I think that um you know, most of the conversation, in my opinion on generative A I so far has really been at the application layer. So things like Chat GP T which is by the way, a really remarkable application, but the way that we think about A I, is it has three layers of the uh stack and all three are massive and we're investing very heavily in all three. But you know, at the bottom layer, if you're gonna build your own large language models, you're gonna have to train the models. And the key to training is is compute. And the key to the compute is the chip in the in in, in the compute. And to date, there's really been one GP U chip provider. And yeah, it's hard. Many of you probably know it's hard to get capacity right now. And people are wondering, you know what the cost structure is really gonna be like. And so, you know, about five years ago, we invested in building our own custom A I chips and we have a chip that we've built for training called trainum and one that we built for inference called inferential. And we're on the second version of those chips and they're gonna be meaningfully more price performance than what you see elsewhere. And so, you know, when you get into, I think customers who build models are starting to figure out that the cost equation is maybe a little bit different than they thought. And then the dirty little secret if you have a generative A I apps in production of scale, like we do in a bunch of areas like Alexa is that almost all the cost ends up being in the inference, you know, you train, take Alexa, you train periodically, but we have billions of predictions or inferences coming, you know, every day. And so people are gonna really care about that price performance. So that bottom layer is, is, is an area I think people are gonna care about. And then at that middle layer, it's really for companies that don't wanna build their own large language models, they wanna use somebody else's and customize it with their own data. And you know, we build a service called Bero there that does just that it basically takes our own large language models and then anthropic and um metas with Gamma two and cohere and stability A I and you know, it takes whatever large language models you think you wanna use, you can customize it with your own data, not leak it back into the general model and they have the same security and access control and features that you run in the platform. And that also like what you're learning when you actually when you talk to companies or if you have your own experience building general A I apps, you realize that it's not gonna be one model to rule the world, it's gonna be lots of different models that are better at different things. And then, you know, to try to get the, the quality that you need for your customers and your reputation at the cost structure and the latency you need for the customer experience, it's actually not simple. And so one of the attractive parts of something like bedrock is you can move between models and between sizes of models to experiment and find the right uh e experience. And you know, and then there's that top layer which are the applications and you know, there's, there's chat GP T I think another really compelling application in the early days is a coding companion. And you know, we, we launched this thing called months ago called Q that it, it writes code for you. It debugs the code test the code, it does transformation some old versions of job and the new versions and it goes through your data repositories and let you answer questions. So all three layers of those stacks of that stack is important and we're making big investments in all those areas. And I, I think it's still quite early days but you, you feel comfortable with where you are. I look it is so early this like three steps into a marathon. But our customers really like what we're building. Well, let me ask you in my house and many of our houses, uh the first time we started talking to the furniture was Alexa, as you mentioned. So, so what, what, what, what is uh how does Alexa fit in to this process? Well, you know, Alexa, like a number of different areas inside our company is, is one of the many businesses that is building a significant large language model. And you know, Alexa has um you know, you've used Alexa for lots of different things, but we're building a much more expansive large language model that is aimed to fulfill our broader vision, which has always been the vision for Alexa, which is to be, you know, the world's best personal assistant. Uh So I wanna talk to, you've been in this shop for two years now, right? 2.5 2.5. OK. So how would you, so you, you, you've learned a lot, you've experienced a lot. How would you say your leadership style is different than your predecessor? You can do this, Andy. Come on. Well, I mean, look, you know, that's a trick question. But, but um you know, the, uh the, the look I grew up at Amazon, you know, I've been in Amazon for 26.5 years and I've done so many different jobs there and I've been lucky enough to work closely with Jeff. I work directly for Jeff for 20 years. So I, you know, I, I feel like I learned from somebody who's, you know, arguably the most unusual business leader of our era. So, um you know, I'm lucky that way. But II, I do think that every era of business leadership, I think everybody knows this in this room is different. You know, when I started the job, uh nobody really, you know, predicted that the pandemic would last that long and Omicron would come and the war, you know, in Ukraine would come and the inflation, I mean, you know, there, there's lots of things that happen throughout and you have to just keep adjusting and that's what we tried to do as a team. But when you now you have 2.5 years to look back, how is it different? Granted anybody in the job would have changed. But how do you think the leadership at Amazon is different than it? Well, I don't, you know, we have a very um yeah, we have a set of leadership principles. There's 16 leadership principles that we, you know, carefully have crafted and Recraft over the years. I think the leadership principles are, are quite consistent. I think the leaders are, are, are very consistent culturally. It's just we have different, we have some different folks leading the businesses at this point. Yeah. Yeah. Can, can we, uh I, I could keep trying but you probably don't want me to, you gotta decide how long you wanna go on. Ok, let's see. Where can we go from there? Uh um uh 11 of the things that has come up in a number of conversations over the course of the last week is with everyone imagining these incredible options for using A I. There is a question about where does the, where does the compute power and where does the electricity come from to run all these massive applications? Uh Amazon has been early and strong on sustainability. But how does this explosion in interest in uh complicated massive compute power make you think about sustainability? Well, you know, I think we all, I, I've been in the fortune dinner. This is maybe my third or fourth year and we always talk about how important the environment is and how critical it is. And like a lot of, you know, we have this thing called the Climate Pledge where we've, you know, pledged to be uh carbon zero by 2040. And for a company like ours, it's different than most technology companies. We'll, we'll be, we're already, well, over 90% renewable energy now will be 100% in 2025. But to get all the way there when you have to ship as many products as we do with as many trucks and, you know, the packaging and all the buildings, it's quite difficult. And I, I think uh it's interesting what's happened with power, I think with that, a lot of the municipalities around the world underestimated how much power was required. In fact, several of them told us they just took our estimates and cut them by third. They just didn't believe them. And that was during the pandemic. And that was before, you know, generative A I came about and generative, you know, generative A I and these large language models are so power hungry that it's just we, it's been an explosion in demand and there is not enough energy right now. And so we're going to have the dual challenge as a group to find a lot more energy to satisfy what people want to do and what we can get done for society which generate A I, but we've got to do it in a renewable way in, in, in a, in a carbon neutral or a zero way. It can't be going back to coal. So that, that will require a lot of development. We'll have to be part of that. So what's the next big thing to come from Amazon? I mean, is it health? You made this uh investment in one medical, what's the, what's the thing that excites you? That could be a uh a fourth pillar for Amazon? Well, there, there are so many things that I'm excited about. This is a hard, this is not a soup question. Uh You know, I, I think that uh I'm very bullish on what we're doing with, with prime video. Uh You know, I think the, the combination of the customer experience, the content we build ourselves. Um you know, the, the sports that we have and then all of our third party uh media partners who are part of our channels program. It, we're trying to build the place is the best selection of streaming video. And I think that customers, you know, the, the growth that we've had there, the growth and engagement, the growth in customers. We have a marketplace there. I'm very bullish about that business and how it's progressing. I also think, um, you know, there's still 400 to 500 million households around the world that don't have broadband connectivity. And so they can't do the things we take for granted. They can't, they can't do education online, they can't do their jobs online, they can't uh watch entertainment, they can't buy. And so I, I, you know, we're, we're pursuing the school Earth orbit satellite that we call Ker, that we think will have a real meaningful impact on a lot of people around the world, particularly in rural areas. But I also think will be, it's a big capital investment investment, but I think it will help a lot of people and it will be a good business as well. When will you start to roll that out? We, um, we'll start to roll it out this year. You know, we did, um, our first two big end to end, um, test satellites in October that really performed very well. So there's a lot of demand for that. Um, there's demand on the government and the enterprise side and, and consumers are excited about it too. Health care. There are a lot of people curious about where you're going in health care. You know, I, I feel like when, you know, uh, when my parents tell me that they didn't have color TV, you know, I just kind of roll my eyes do I like my kids, you know, roll their eyes when uh I said we didn't have the internet when I was growing up or, or mobile phones. But I think that my kids, kids will not believe what the health care experience was for us. Like the fact that if you want to go see a doctor, you gotta make an appointment three or four weeks out, you got to drive 20 minutes and park. You have to wait in the waiting room for 15 minutes. Then they put you in a, in an exam room, you can wait 10 minutes for the doctor. Doctor sees you for 10 minutes and you drive 20 minutes to the pharmacy. I mean that, that experience is just kind of nutty and, and that that will completely go away with the way the future of healthcare is. So one medical is a different way of doing primary care. It has an amazing digital interface, you can chat with doctors, you can do video conferences, you make, you can make appointments same day or next day. You can get into specialist, same day or next day. All the reservations are are integrated. And then if you whatever pharmaceutical needs you have, they're connected to Amazon Pharmacy and into a bunch of others that you just get sent to your house within a day. So it's a very different experience. And you know, pharmacy for us was not a big extension. We've been asked by customers for so long to do that. And that business has grown really quickly and I think will be big as well. But we're really trying to get at changing the, the core health care experience starting in the US, which I think has not been a happy place for a lot of people. Uh, we're just about out of time here, but you've got this massive anti trust case against you from the F DC. I mean, anything to that, I'm trying to make it easy for you. Well, what I would say to that is uh I, I am aware of it and um here I'll ask you another question. Have you watched the video of Bill Gates being deposed in the 19 nineties in his anti trust case? No, I haven't, you haven't, you should. Ok. Yeah, I would strongly recommend I just say, uh you know, I think all I can say about that is I think that I think they're wrong on the, on the facts and the law and I think that will be borne out over time. And I think in general, we, we have to be careful in, in Western countries. Um you know, not to, not to kill innovation and not, you know, there's, there's a lot of consolidation in various industries and if, if we only, you know, have strong regulations in, in the in western countries, you'll leave the playing field open in other spots. You don't mean to Is there anything that I haven't asked you that I should have? Not that I'm aware of. If I knew a tornado beef tornado, you're gonna find out in just a minute. Go ahead and take your seat. Thank you for doing this. It was great talking to you.