Amazon's Jeff Bezos ends 2017 as the world's richest person, worth $99 billion, despite Donald Trump

Jeff Bezos is ending the year as the world's richest person, and despite Trump's numerous attacks - the latest was on US Postal Service pricing - he appears to have a good chance of maintaining his position.
Written by Jack Schofield, Contributor
Five richest people 2017

The five richest people in the world at the end of 2017, according to the Bloomberg Billionaires Index

Amazon founder and CEO Jeff Bezos will end 2017 as the world's richest person, probably with a net worth of $99 billion. That makes him around $33bn richer than he was last year.

Since the valuation is based on Amazon's share price, the number is likely to change, and stock prices can go down as well as up. However, he's now comfortably ahead of Microsoft's Bill Gates ($91.8bn) and his best buddy Warren Buffett ($85.3bn), from Berkshire Hathaway.

Bezos briefly overtook Gates to become the world's richest person for a few hours at the end of July. But as I noted at the time, "it's reasonably safe to predict that Gates will finally hand over the poisoned chalice to his fellow Seattle billionaire." This is based on two propositions: Amazon's continued success, and Gates giving money away. (He's given away more than $35bn so far.)

On November 26, Bezos became only the second person to have a net worth of more than $100bn. Gates was the first to make it in April 1999, when Microsoft's stock was inflated along with the dotcom bubble. Bezos did it as a result of record online sales on Black Friday.

Of course, 2017 was a boom year for technology stocks, and while Amazon did better than Microsoft (below), both companies beat the main indexes: DowJones, Nasdaq and the S&P500. How much further the bull market will run remains to be seen.

Unlike Gates and Buffett, Bezos is also under fire from former reality TV star and failed casino operator Donald Trump.

Bezon tweets at Trump

So far, most of Trump's jibes have been so nonsensical that Bezos could simply ignore them, though he did once respond on Twitter with an offer to shoot Trump into space. (Bezos has his own rocket company, Blue Origin, and wants to run a delivery service to the moon.)

Trump's latest attack, tweeted on Friday, was more interesting. He wrote: "Why is the United States Post Office, which is losing many billions of dollars a year, while charging Amazon and others so little to deliver their packages, making Amazon richer and the Post Office dumber and poorer?"

The very idea that Amazon's customers might have to pay a little more (maybe another $1.40) for USPS deliveries nudged Amazon's shares down by about 1.4 percent over the day. However, that compares with a 58 percent increase over the full year.

The USPS has many problems, but its future depends on increasing deliveries of packages to compensate for declining deliveries of first class mail. That makes Amazon one of the USPS's most important customers, and it has to compete for that business against FedEx and UPS, among others.

In the meantime, Amazon is rapidly growing its own distribution network, for several reasons. First, it wants to get closer to customers who value one- or two-hour, same-day and next-day deliveries. Second, it must be close to customers to provide fresh food deliveries (Amazon Pantry, Whole Foods). Third, it has to be close to customers to exploit drone deliveries, unlikely as this may sound at the moment.

Amazon has already bought thousands of its own truck trailers to speed up deliveries. In the long term, it could turn from a customer into a competitor for USPS, FedEx and UPS. I expect that the USPS knows this much better than Trump. (See: Amazon's instant gratification service aims to disrupt delivery)

Whether Amazon's - and therefore Bezos's - progress can be derailed by any of its competitors is another matter. It has become a successful hardware supplier with Kindles, tablets, video streamers and other devices. It has become a successful supplier of streaming movies and music, and it is moving into video production to compete with Netflix. It is a leading player in the intelligent speaker market with Amazon Echo. It is developing new services such as Amazon Fresh and Amazon Wardrobe, which lets customers order a bunch of clothes and return the ones they don't like. It has plenty of opportunities to expand in the advertising market to compete with Google and Facebook. Its AWS cloud service continues to be a huge - and very profitable - success. And finally, the company still has vast untapped markets outside the leading OECD countries, including China and India.

While the future is unpredictable, it certainly looks as though Bezos's prospects are better than Trump's.


Amazon's share price outpaced Microsoft's during 2017, according to Yahoo Finance.

Image: ZDNet screen grab from Yahoo Finance

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