Data theft means a real Big Bother

The Daily Telegraph (Sydney) - - News - MATTHEW BENNS

BIG shop­per is watch­ing you.

Ex­perts have warned that Amer­i­can in­ter­net gi­ant Ama­zon is us­ing ar­ti­fi­cial in­tel­li­gence to keep tabs on your ev­ery move.

“Ama­zon is much more than a re­tailer, it is a data min­ing busi­ness,” re­tail ex­pert Brian Walker warned.

The on­line store’s Aus­tralian launch this week was branded a fizzer by shop­pers and mar­ket an­a­lysts who crit­i­cised its poor choice, high prices and slow de­liv­ery.

But Mr Walker said the real busi­ness of Ama­zon was in the data it col­lected from its shop­pers to pre­dict what they were think­ing.

“On a global level it is all around data and build­ing en­cryp­tion to get into the homes and busi­nesses of peo­ple,” he said. “Peo­ple are right to think Ama­zon is a game changer, but it is not be­cause of price. Over time it will use al­go­rithms and ar­ti­fi­cial in­tel­li­gence to pre­dict ex­actly what we want.”

Ama­zon says it has em­ployed more than 1000 peo­ple in Aus­tralia. “But 75 per cent of their em­ploy­ees are com­puter coders,” said Mr Walker, who pointed to Ama­zon’s own re­cruit­ment ads for com­puter en­gi­neers in Aus­tralia.

He said the com­pany boasts about em­ployee num­bers but the re­al­ity in Amer­ica is that it has just dou­bled the num­ber of ro­bots man­ning its ware­house by 55,000.

Dr Shumi Akhtar from the Univer­sity of Syd­ney Busi­ness School said the longterm im­pact of on­line re­tail meant jobs would be lost.

“The US re­tail in­dus­try faces grow­ing prob­lems, with nearly a dozen com­pa­nies pushed into bank­ruptcy al­ready in 2017 ac­cord­ing to (rat­ings agency) Stan­dard & Poor’s,” she said.

“Credit Suiss e es­ti­mates that as many as 8640 stores could close down by the end of 2017. The prob­lem is e-com­merce and ad­vance­ment in dig­i­tal tech­nol­ogy.” How­ever, she said Ama­zon was not com­pet­ing on a level play­ing field. It has based its global head­quar­ters in the Euro­pean tax haven of Lux­em­bourg, where it pays a frac­tion of the tax Aus­tralian com­pa­nies pay at home. She said a re­cent rul­ing by the Euro­pean Union or­der­ing Ama­zon to pay $400 mil­lion in un­paid taxes was a “land­mark court case on how Ama­zon shifted their rev­enue from high-tax coun­tries to low-tax coun­tries by show­ing mas­sive op­er­a­tional ex­penses.” Aus­tralian Tax Com­mis­sioner Chris Jor­dan said the ATO will be launch­ing foren­sic au­dits with other coun­tries to make sure Ama­zon pays its fair share of taxes in Aus­tralia. Ama­zon did not re­spond to re­quests for com­ment.

(Right) re­tail ex­pert Brian Walker.

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