00:00Andy Jassy, the CEO, points to AI as being not the culprit, but the catalyst for these job firings.
00:07Yes, and it's not just AI. It's also the fact that Amazon feels it has overhired, especially during the pandemic, when it seems like there was unlimited demand for Amazon's products.
00:19There has been some rethinking about what the workforce needs to really meet the next era, and it's not going to be the same mix that they had planned for a few years ago.
00:33They're making wide cuts across many of their key departments, whether that's gaming, cloud, and especially in the management layers.
00:42They're trying to reduce bureaucracy and bloat. That has been a key issue for Amazon as they've tried to address the extreme competitive momentum from competitors and try to make decisions a lot faster.
00:58Yeah, and we'll certainly see how this all shakes out. This actually marks the second round of reductions, job reductions in recent years.
01:05How much is that part of Andy Jassy's thrust over at Amazon, his mandate, so to speak?
01:10Yeah, I think that we're seeing this across big tech, that executives are trying to instill this more cutthroat culture, this more competitive culture in the age of AI, and they're really racing to try to bring things to market before others.
01:27And my colleague Matt Day just had a really great piece the other day about the cloud business, how Amazon was the leader, or still is by sheer numbers, the leader in cloud, but has fallen behind on some AI reputational things.
01:44The startups are not going to Amazon's cloud for their AI expansion the way they're going to Google or Microsoft, which have built better reputations.
01:54And part of that is just the slowness at bringing things to market, the decision-making is not as fast as it could be, and Jassy's trying to really fix that.
02:04Yeah, absolutely. We should mention as well, there's some headlines here that Meta's shifting a metaverse executive to AI following job cuts as well.
02:12So this is something that you were just reporting on here, and your byline is on the story.
02:18Can you give us some more context on what's going on there?
02:21Well, it's really interesting in the case of Meta that they have done all of this reshuffling of their AI organization,
02:27and we still haven't seen the clear through line in strategy from Zuckerberg here.
02:32There's going to be so much pressure on this AI, this extremely expensive AI team.
02:36If you remember some of the employees they hired for it from competitors, they paid upwards of $200,000, sorry, $200 million.
02:47They just unheard of salaries for these key people, and then they culled a lot of the rest of the workforce
02:54and are really putting it in the hands of these senior leaders.
03:00But we haven't seen the new model from Meta or what they're doing in this.
03:06So they brought on Vishal Shah.
03:08He's a longtime person at Meta known to execute on the vision, right?
03:15Previously, he was in the metaverse division.
03:17Before that, he was at Instagram.
03:19So he's really kind of become a jack-of-all-trades at Meta, and now he's going to be leading product at AI,
03:25trying to help them execute on what their good ideas may be.
03:31All right.
03:32And very quickly here, of course, we know that Amazon and Meta, two companies we just mentioned,
03:36will be reporting results this week, along with Apple as well.
03:39Apple, it feels like, is very much the also-ran when it comes to AI and at least retaining talent,
03:45if not bringing in new talent.
03:47It just has not been on the cutting edge on AI at all.
03:51No, they've lost so many key employees to Meta.
03:54I think it's upwards of 10 employees to Meta at this point.
03:58And that's in part due to Zuckerberg's aggressive poaching efforts,
04:02but also because they've really lost their way.
04:06Siri and Apple intelligence have not delivered at the level that consumers are expecting
04:11or even that the company was promising.
04:13And so they really have to go back to the drawing board in some cases
04:17and figure out what they're trying to achieve.
04:20They have not been at the forefront the way Google, Meta, Amazon, or Microsoft have been.
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