Published On: Thu, Nov 8th, 2018

Amazon’s “second headquarters” may be no such thing

NOT FOR the first time, The Onion, a satirical website, got it right. “‘You are all inside Amazon’s second headquarters,’ Jeff Bezos announces to horrified Americans as massive dome envelops nation.” That headline captured both the American e-commerce goliath’s endless expansion in recent years and the stratospheric level of hype around its quest to find a second headquarters.

Fourteen months ago Mr Bezos, Amazon’s boss, announced that he was looking for a city in North America in which to invest over $ 5bn building a campus that would create 50,000 high-quality jobs. The firm vowed that this new location, “HQ2”, would be no mere satellite, but a “full equal” to its Seattle campus.

A beauty pageant among cities ensued. Over 200 made proposals; in January, 20 were chosen as finalists. Chicago reportedly offered $ 2bn in incentives ranging from tax breaks to subsidies for worker training. Andrew Cuomo, re-elected New York’s governor this week, promised to change his name to Amazon Cuomo “if that’s what it takes”.

It now appears that Amazon played cities like so many fiddles. According to multiple reports this week (Amazon has not confirmed its plans), it intends to split its investment between two bases. One is Long Island City (LIC) in New York City’s Queens and the other is likely to be Crystal City, a part of Virginia next to Washington, DC. Amazon does lots of work for the federal government, so being close should help. And a base in LIC, just across the East River from Manhattan, means it would be able to tap the latter’s big tech and media workforce.

Workers in the two locations focused on the effect on their commute. Adding even 25,000 workers would further choke the subway system, complains an employee at an education-tech firm in LIC. If logistics are a priority for Amazon, Dallas may still be a contender given its central location in North America.

Critics of Amazon accuse it of a bait-and-switch; cities were promised a true headquarters on a par with Seattle, but if the split of HQ2 is confirmed, it will create much smaller offices. Another objection is that the firm will have collected a boatload of local data it can use in future business decisions. Yet the winners are unlikely to complain, and cities would probably have surrendered their data even for a biggish Amazon satellite office. The dome is taking over.

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The Economist: Business

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Amazon’s “second headquarters” may be no such thing