Apple, where cofounder Steve Jobs returned to power in 1998, is up 600 percent since the beginning of 2002. Amazon.com, where Jeff Bezos has reigned as CEO more or less uninterruptedly since the online retailer's founding, tripled its worth. Google, where cofounders Larry Page and Sergey Brin form a troika with hired-hand CEO Eric Schmidt, has also tripled in value since its inital public offering in 2004. These gains remain despite the stock market's punishing fall.

What about Yahoo, eBay, and Microsoft, where founders handed over the company to professional managers? They are all back where they started almost seven years ago. Under former CEO Terry Semel, Yahoo had a brief golden age in 2004, where it outperformed all the other big Internet companies; it ended just as Google began its relentless rise. Meg Whitman overstayed her welcome at eBay, presiding over its stagnation before handing over the CEO job to John Donahoe — like Whitman, also a management consultant by training. Microsoft CEO Steve Ballmer has proven that he's no Bill Gates; the stock has flatlined under his leadership.

Under Yang, the stock has gone down, down, down, interrupted only by the hope that Microsoft might buy the company and in so doing, give its employees the leadership and sense of purpose they so desperately crave. Does that disprove the value of founders? No. Rather, it suggests that by abandoning his company when it was merely a toddler to be reared by strangers, that he was never much of a father figure to begin with.

• Steve Ballmer
• Mitchell Baker
• Jeff Bezos
• Sergey Brin, Larry Page, and Eric Schmidt
• Jeff Clavier
• Paul Graham
• Arianna Huffington
• Joi Ito
• Steve Jobs
• Jonathan Kaplan
• Loic Le Meur
• Jack Ma
• Matt Mullenweg
• Rupert Murdoch
• Craig Newmark
• Gabe Rivera
• Kevin Rose
• Sheryl Sandberg
• Jon Stewart
• Peter Thiel
• Maria Thomas
• Anssi Vanjoki
• Jimmy Wales
• Evan Williams
• Jerry Yang

Finsphere hasn't announced its product plans, but a job listing for an engineeering position suggests it's engaged in some kind of wireless play.

The other company, Aviary, makes Internet-based image-, video-, and music-creation tools. Like Finsphere, it hasn't publicly announced any investors. But check out the team caricatures on their "About" page. Doesn't the fellow in the lower right-hand corner look a bit like Bezos?

Bezos's current investments:

(Photo via Seattle Times)

Limited Brands CEO Leslie Wexner, for example, spent much of his $1.25 million 2007 security allowance toward "protecting" his corporate aircraft, yacht and 22,371-sq. ft. home. "Security has become a convenient excuse for getting shareholders to pick up the cost for the CEO's lifestyle,' corporate watchdog American Federation of State's director of corporate governance and pension investment told the Wall Street Journal. (Illustration by Richard Blakeley)

My question is whether or not the car will be passing through the enclaves of wealth on the east side of Lake Washington like Mercer Island and Medina, where Microsoft chairman Bill Gates has his four-story underground bunker. Still, the homes of Amazon CEO Jeff Bezos, Starbucks CEO Howard Schultz and Clearwire founder Craig McCaw are all within Seattle city limits, so happy Street View hunting! (Photos by Jed Rosenzweig)

The representatives declined to discuss sales numbers of the Kindle, only saying that it's generally first or second on the list of best selling items in the retailer's electronics category. And there was no information about demographics — a critical piece of data to book marketers, where the sheer number and breadth of subject matter in published titles, combined with limited marketing budgets, mean that niche audience appeals are critical.

Publishers receive 35 percent of the list price they set for titles per sale. However, larger publishers who move lots of physical units can probably negotiate better deals, and even get physical books converted to e-book format for free. But the Amazonians declined to comment on specifics due to antitrust concerns — belying their role as price-setter for the entire publishing market in print and otherwise.

Later, I dropped by the Amazon booth to see the Kindle in the wild. There were maybe three or four units on display, each closely held by a spokesperson. Visitors weren't even allowed to handle one of the devices for themselves, presumably for fear they'd walk away with one.

But giving them away might have been a smart move. Nothing sells the Kindle like the Kindle, not even the price cut to $359 from $399 that Amazon CEO Jeff Bezos touted in his speech Friday. A three-figure price point simply won't get the devices into the hands of readers fast enough to make the market for content worthwhile for publishers anytime soon.

• On former White House spokesmonkey Scott McClellan's new book, which won't be back in physical stock until June 9 but is still available on the Kindle for $9.99: "One of the great things about electronic books — they don't go out of stock."
• Regarding reading on a laptop, Bezos asserted, "You certainly can't curl up in bed with one." Actually, our laptop has been our most faithful sleeping partner in years.
• Playing up the Kindle's ability to look up definitions on the fly. "I have discovered my vocabulary is not nearly as good as I thought it was ... I was living in a nice fantasy world where my contextual guesses were accurate."
• Of the 125,000 titles available as both physical books and Kindle e-books, six percent of the sales go to Kindle. Some, including Bezos, buy both a physical copy and an electronic copy — presumably because a Kindle full of books doesn't telegraph just how smart you are.
• Anderson asked by what factor the number of titles available on Kindle would grow by next year in Bezos estimation. "I wouldn't be happy with 20 million. I'm hard to make happy. Bwahahahaha!" (Bezos' laugh is surprisingly deep and loud for such a small man).
• Like Amazon's offering of used copies alongside new copies, it didn't change the amount of original sales, only expanded, suggesting it's not a zero-sum game. "Most people bought as many books as they previously bought, and plus they buy Kindle books."
• Explaining Amazon's strategy of only offering print-on-demand titles printed through BookSurge in its shipping discounts, he said it's because it's cheaper to pack multiple purchases in one box — hence POD books must be printed at Amazon fulfillment centers to qualify.
• Early in the discussion with Bezos, Anderson kept turning the conversation towards his"long tail" theory. Eventually, Bezos caught on, expounding on how Amazon's whole business model was based on niche content availability being a differentiator — shrewdly buttering up Anderson while subtly claiming credit for the idea.

It cites a case pending in New York that would close the loophole, and garner the state $50 million in possible revenue. Instead, Pennsylvania is giving the book-business behemoth — or its customers, rather — a $1,750,000 tax break. And here I wondered how Carnegie Mellon was able to convince Bezos to fly to Pittsburgh for a commencement address.

Whether you want to meet at your local coffee shop, a public park, or your favorite watering hole is up to you. We hope you enjoy meeting your fellow Kindlers.

The sort of resourcefulness, perhaps, that has a writer like Maney plumbing the shelves of juvenile nonfiction for recycled material. The third-world prison bit has also been reported in the New York Post, the U.K.'s Observer, Playboy, and even Wired, which is, like Portfolio, published by Condé Nast.

Like Google, which also claimed to see no dark clouds on the business horizon, Amazon.com made a good, long-term bet. The ongoing shift to e-commerce obscures any short-term business-cycle bumps.

Also, Amazon.com's customers tend to be wealthy, and in America's bifurcated economy, the well-to-do are feeling the pinch less than the poor. (Wal-Mart shoppers choose between gas and groceries; Amazon.com shoppers choose between Starbucks and steak.)

There are other reasons, such as the winner-take-all nature of the Web. Google may have created a theoretical level playing field for online stores. Who needs to go to a one-stop shop when you can just search for what you want to buy? But the reality is that search is a tedious way to buy things online, and going to one store is convenient. That one store, for most people, is Amazon.com, and no one else has come along with a site worth changing that habit for.

The thing that's helping Amazon.com the most, I think, is simply the adoption of broadband. Fast Web connections make it quicker to buy something online than to drive to a store. And the longer someone has been an Internet user, the more likely they are to shop online. For the Facebook generation, it's second nature. Until broadband hits saturation in the U.S. and other markets, Amazon.com will have a powerful growth engine behind it. Bezos may like to talk about all the innovative things Amazon is doing, but the truth is, he can now afford to coast.

The transformation began when Amazon plunged into auctions. Amazon's dotcom-era server-and-database combo was staggering under the complexity. Engineers gambled on a Net-centric idea. Bingo. "We were building these services for ourselves," says [the Amazon employee] who wrote the Amazon Web Services business plan. "They could be valuable to other people." 10,000 new developers are signing up monthly, with the total closing on 400,000. The idea that AWS is about wringing extra bucks out of Amazon's data centers? "That ship sailed."AWS's 2007 revenue: $100 million. Other companies building data centers: Salesforce.com, EMC, IBM, Google. Bezos: "I'd be surprised if no one else does this. It's a really good idea!" Ace up his sleeve: Commodity business prices plunge toward the cost of production. "We've never had 35 or 40 percent margins."

Update: SmugMug's Don McAskill, also an Amazon customer, thinks it's all a big misunderstanding. The short version: Not all gigahertzes are created equal.

Instead, they're entranced by Amazon Web Services. The only notable statistic? That Amazon Web Services consumed more bandwidth than Amazon's own websites. Well, one would hope so, since one of Amazon's chief services is renting out bandwidth.

TechCrunch's Erick Schonfeld acknowledges that "most of the things that tend to interest us here at TechCrunch about Amazon are not yet material to its finances." But that raises the question: Why are they of interest? Amazon likely already enjoys massive discounts on its bandwidth; setting up a system to rent some of it out does not likely improve its cost structure. It does, however, win Amazon priceless PR from gullible bloggers. And it creates uncertainty about what business Amazon is really in — uncertainty which provokes optimism among investors, who can argue Amazon's more than just a bookseller and bid up its shares accordingly. That profit Bezos can take home to the bank.

It means that Diller, who prides himself on spreading his bets, has done a bad job. The company's diversification into all fields of Internet business has proven a weakness rather than a strength — a fact even Diller now recognizes. That's why he's breaking the company up into bits, leaving an IAC that's focused on online content and advertising. The remainder, however, will still be too vulnerable to the U.S. economy.

Bezos, meanwhile, has proved the opposite of Diller. He's made one bet and stuck to it. And while e-commerce is no longer sexy on Sand Hill Road or on Wall Street, it continues to be a growth industry. The longer users have been on the Web, the more they tend to shop online.

His lone divagation from e-commerce — Amazon's panoply of Web services, popular with gullible startups — is an exercise in renting out a computing infrastructure he's built at great expense. It's unlikely to be a better business than e-commerce, but it scores Bezos valuable press at little cost.

Mahaney's stock analysis is not a shocker: The stock market undervalues persistence and overvalues change for change's sake. What's surprising is that so few people have taken this insight to the bank.

SimpleDB lacks some of the most basic features of "relational" databases, the entrenched enterprise products which pay the salaries of those pasty sysadmins who natter on for hours about stored procedures and triggers when you just want them to run a report. As Uncov has smartly observed, SimpleDB is 18 times less efficent than other databases.

But that's not a bug, that's a feature. Amazon has designed a database which transmits data inefficiently, and then charges users by the amount of data transmitted. The MBA who put together this business plan deserves a raise. This isn't a database; it's a Ponzi scheme. One designed to transfer money from venture capitalists to Amazon.

So who's the patsy? Well, startups who have already gotten hooked on Amazon's other cloud-computing services, like S3 (storage) and EC2 (computing). They're a natural target. Amazon helps them get up and running with a proof-of-concept website. Never mind that it won't scale cost-effectively. By the time a real CTO gets hired and figures that out, they'll already have raised $40 million from unwitting venture capitalists. In the meantime, the startuppers get to tell users that their data is safely stored with Amazon, a name consumers trust. Win-win-win.

SimpleDB's perfect for anyone who's not aiming to serve millions of users. In other words, most of the Web 2.0 startups today that won't be around two years from now. If your ambitions are low, your technical skills lower, and your sense of shame lower yet, Jeff Bezos has the database for you.

Amazon has captured 3 percent of the digital download market since its music download store launched to little fanfare in September. The store did force Apple to drop the prices on its DRM-free music to the standard 99 cents, but it's had little impact besides that. Amazon certainly has the name recognition to make a store work, but with iTunes and the iPod so overwhelmingly in control of the music player market, it will be a tough sell to get the average iPod owner to download a song from Amazon, copy it into iTunes and then load it on his iPod. Three steps to get a song versus one step with iTunes? Apple actually licensed Amazon's 1-Click technology for the iTunes Store. Too bad Jeff Bezos has forgotten what he taught Steve Jobs.

Kindle's definition "to ignite" is straightforward enough, but starting fires in the context of books? Fahrenheit 451, maybe, and we're hardly the first to point that out. But there just happens to be a famous quote using kindle and books in the same context that states exactly Bezos's vision ... by the 18th century philosopher and satirist François-Marie Arouet, better known as Voltaire:

The instruction we find in books is like fire. We fetch it from our neighbors, kindle it at home, communicate it to others, and it becomes the property of all.

So why no Voltaire tributes? Either Amazon wanted to avoid associating the only-available-in-America device with the hated French, or Jeff Bezos hoped to keep all of the credit to himself. I'll assume the latter, and blame Bezos for the awkwardly named Kindle.

As the sole reviewer puts it:

This is a rather embarrassing electronic version of Time Magazine. There are NO pictures, no charts, no illustrations. Instead whenever you run into an article that has these in any decent amount, they've inserted an entry telling you to go get a PDF or print version. The salvation here is that their MOBILE web site at least has some images (even if impossibly small) and seems better formatted and organized. It looks and feels like some cheap RSS reader collected this rather than being an electronic version of the magazine. To fix it they should include all major article pictures, along with a full-screen copy of the cover. Time without pictures, is like the Braille-edition of Playboy. No wonder it is just $1.49 a month.

Kindle supporters may be willing to overlook this flaw, but Amazon cannot afford to. Amazon is depending on subscription revenues derived mostly from newspapers, magazines, and blogs to subsidize its free Internet connectivity. If image-rich content, including most magazines, fail to catch on, it could be a serious blow to Amazon's plans to make Kindle profitable.

Of course, all Kindle subscription content comes with a free 14-day trial, so we may soon see the text-heavy Times falling next week as well, since the free Web version is also accessible from the device. (The Journal, whose website still charges for now, may hold out longer.) Can books, a one-time purchase, keep Kindle lit? Jeff Bezos must hope so. The modern day Charles Dickens has yet to make an appearance.

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