Amazon has opened its largest campus in the world, and its first outside the United States, in Hyderabad, India.
The Times of India reported today that Amazon has opened its largest campus in the world this week in Hyderabad, India, inaugurating a 1.8 million square foot office facility, built on 3 million square feet of land. The campus, which will employ 15,000 of the company's Indian employees, used more than 2.5 times the amount of steel by weight used to construct the Eiffel Tower and sits on 9.5 acres of land.
"We have eight buildings in Hyderabad with 4 million sq ft of office space," said John Schoettler, Amazon's vice president of Global Real Estate and Facilities, in a conference with reporters. "We are going to be migrating some of the employees out of some of those facilities (to the new campus). So far as of today, we moved around 4,500 to the (new campus). The building can hold - at any given point of time - 15,000 people," he told reporters here.
Competition for the Indian market has been fierce between Amazon, Walmart-owned Flipkart, and China's Alibaba. While Amazon's dominance of the e-commerce industry in North America and Europe is undisputed - 50% of all e-commerce in the US goes through Amazon, with its nearest rival, eBay, pulling in just 6% - achieving such a dominating position in India will be much harder.
According to New York magazine's Jake Swearingen and Stephan Kozub, "In late December , the Indian government announced rules that ban e-commerce sites from offering exclusive sales, heavily restrict the ability to offer discounts, and make it illegal for online retail platforms to sell products from companies that they have more than a 25 percent stake in."
This has significant implications for Amazon and Walmart, who typically purchase large or even controlling stakes in established businesses in the markets they want to enter and who have been able to use their extensive cash reserves to subsidize losses in exchange for establishing market share in new regions of industries. To compete then, India is telling Amazon and Walmart that they have to do it the old-fashioned way by establishing business relationships with customers from the ground up or accept considerably higher costs to doing business in the country.
The building of its first overseas campus in India is certainly helpful in establishing the company's presence, though construction began well before the new law was introduced. The company already has more than 62,000 employees in the country, and the new campus will be used by software developers, product managers, and other related administrative offices.
Amazon has three fulfillment centers in the country, along with two sorting centers and 90 delivery centers. The company has also announced that it will invest $5 billion in India, as well as an additional $500 million investment to expand food and retail services.