Updated from 9:38 a.m. to include additional analysis on UPS in the ninth paragraph.
NEW YORK (TheStreet) In yesterday's letter to shareholders, Amazon (AMZN) CEO Jeff Bezos touched on a number of initiatives, but perhaps the biggest is the company's plan for faster delivery. Not only is the Internet retailer really serious about providing a better experience for customers, its drone plans are bigger than anyone imagined.
This particular passage from the letter to shareholders was beyond startling, revealing the ambitious scale of Amazon's plans for drones, which were initially revealed just a few months ago:
UPS recently announced it was raising 2014 shipping prices by 4.9% for "UPS Ground, Air and International, and Air Freight rates within and between the U.S., Canada, and Puerto Rico," according to a press release. Similarly, FedEx announced in Sept. 2013 that FedEx Express package and freight rates would go up an average of 3.9%. To curb those costs in part, Amazon recently announced a deal with the United States Postal Service to deliver packages on Sunday. Also See: Amazon's Drones Set to Take Out UPS, FedEx During the 60 Minutes interview, Bezos said the drones can carry packages up to 5 pounds for as much as 10 miles, with the drones originating from Amazon's vast fulfillment centers. If Amazon is already working on the seventh and eighth generation versions of these drones, it's not unreasonable to think that, by the time they roll out to the public, they could carry packages larger than 5 pounds, at a distance of longer than 10 miles. Following the interview in December, UPS also said it was researching drones for delivery. "The commercial use of drones is an interesting technology, and we'll continue to evaluate it. UPS invests more in technology than any other company in the delivery business, and we're always planning for the future," UPS told ABC News in a statement. Call this a pipe dream all you want, but Amazon is spending research and development dollars on building out these drones, so it's obvious the company is serious about this initiative. Whether it succeeds or fails, is anyone's guess, but Bezos and team are building upon a moon shoot, much bigger than anyone, including you or I, imagined. --Written by Chris Ciaccia in New York >Contact by Email. Follow @Chris_Ciaccia
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