Amazon Gets Third Party Started

Remember that Seinfeld episode where George Costanza changes his luck by doing the opposite of what he'd normally do?

CEO Jeff Bezos has apparently made George's philosophy a bedrock principle of Amazon.com's(AMZN Quote - Cramer on AMZN - Stock Picks) management, and it seems to be bringing the company some pretty good luck.

Bezos has made moves that many industry observers considered unwise -- branching away from books and into electronics, and opening up software code to any takers -- and, in doing so, has managed to make Amazon stronger.

Most recently, Bezos did something a lot of companies would consider absolutely crazy: He offered to help competitors by giving them the same technology that powers Amazon's site, the secret sauce that made the company a success.

It's still early, but indications are that the move was far from a mistake; it may have saved Amazon from slow growth and rejuvenated its profit margins.

Amazon facilitates outsider retailers through three different means. The first, and best-known to longtime Amazon customers, is its Marketplace function, which allows more than 600,000 small retailers to offer new and used goods alongside those in Amazon's own inventory.

Similarly, its Merchants@ operation will show the name of a bigger retailer such as CompUSA or RitzCamera.com.

More recently, Amazon has gone after even bigger fish, providing, as Bezos likes to say, "the plumbing for other people to operate their Web sites in a private-label fashion."

Amazon doesn't like to talk too openly about this new program, called Merchant.com (it didn't return repeated calls for this story seeking information about it), but it has dropped a few intriguing nuggets of information during conference calls.

And while Amazon's most recent earnings showed strong revenue and profit growth, helped in good part by Merchant.com, some analysts believe this third-party program could continue to be a driver for the company's growth.

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