Amazon R&D spending is more than that of all companies and government of France
Amazon’s reported $73B in “technology and content” spending—presented as R&D and said to exceed the R&D of all French companies and the French government—raises questions about what actually counts as research and development. Commenters note that tax incentives in the US, EU, UK and elsewhere strongly encourage firms to classify routine software development and even maintenance as R&D, making cross-country and cross-company comparisons highly misleading. The thread broadens into a critique of how tax policy, accounting rules and market incentives distort innovation metrics while users still experience degraded products, aggressive advertising, and weak regulation of tech giants.
What Amazon’s “R&D” Number Actually Is
- Multiple commenters argue the $73B figure is not pure R&D but Amazon’s “Technology and Content” line from its 10‑K.
- That bucket includes: software and product development, store design and maintenance, content curation, plus AWS infrastructure (servers, networking, data center depreciation, rent, utilities).
- Several note that treating this as directly comparable to other firms’ narrow “R&D” line items is misleading.
How Companies Classify R&D
- Many posters report that in practice “R&D” often means “all non‑operations software work.”
- Examples: any new feature, internal tools, non-client work, even basic implementation or “anything not BAU” is logged as R&D to unlock tax benefits.
- Maintenance vs development is blurred in software; some argue nearly all non-trivial software work can be cast as development.
- Some companies devote serious effort to timesheets and narrative writeups to maximize R&D claims.
Tax Incentives and Gaming (US, EU, UK, Australia, France)
- Various countries offer generous R&D tax credits or rebates; posters from EU/UK/Australia/France describe:
- Broad, often vague criteria like “unknown outcome.”
- Systematic over-claiming and “tax grift,” including pseudo “research centers” where bench time or tutorial-watching is billed as R&D.
- In France and elsewhere, development work is frequently pushed into “research” categories.
- In the US, commenters reference IRS definitions and Section 174, noting:
- R&D classification has specific tax rules.
- New rules forcing capitalization of software development costs may hit startups and tech firms hard.
Validity of Comparing Amazon vs France
- Some doubt Amazon truly accounts for ~11% of all US R&D or more than France’s government and firms combined; suspect apples‑to‑oranges metrics and/or overbroad categorization.
- Others note France’s own R&D numbers may be similarly overstated due to generous tax schemes.
- Comparisons between Amazon’s market cap or size and France’s GDP/employment are called misleading because they mix unlike measures.
Outcomes vs Spending
- Some express frustration that massive “R&D” outlays yield more ads, content, and optimization of search/ads rather than visible breakthroughs (energy, robotics, etc.).
- Amazon’s weak search quality and Alexa’s limitations are cited as anecdotal evidence that high spend does not guarantee user-visible innovation.