Jeff Bezos: the garage inventor who set up Amazon

When the Amazon founder strolled on stage in New York last week for the carefully choreographed unveiling of the Kindle Fire, there was no mistaking the subject of his "barbed tribute", says the FT. Steve Jobs was a wizard at using such presentations to stir the masses. "This time, it was Bezos who bewitched the geeks." By the time he'd finished, most in the room were singing from his hymn sheet: convinced that this was the first serious product to challenge the dominance of the iPad.

Outwardly at least, Bezos is very different in style from Jobs, says Businessweek. A married father of four, he's famous for his "explosive" laugh. One former colleague remembers Bezos fondly as "a cutie pie". But, as she observes, he also possesses an other-worldly quality. "Imagine how far humans would get if we didn't have hang ups. Well, that's Jeff. He does not have the usual frailties, which makes him a bit cold, almost robotic."

Perhaps that explains Bezos's support for his secretive, costly Blue Origin space rocket programme, despite endless setbacks. And it may also account for the no-holds-barred tone of his declaration of war against Apple (see below). Bezos's first love was always invention. As a child growing up in Texas, he was a "garage inventor", crafting among other things a solar-powered cooker from an umbrella and tinfoil.

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But after studying computer science at Princeton, he joined the New York hedge fund DE Shaw. The eureka moment that led to the formation of Amazon in 1994 came when "he peered into the maze of connected computers called the World Wide Web and realised that the future of retailing was glowing back at him", says Time. Within weeks, he headed for Seattle (chosen for its technical talent and proximity to national book warehouses), writing a business plan en route.

Following its float in 1997, Amazon swiftly morphed from a website selling books into a network of warehouses dispensing all manner of goods. In 1999, Bezos appeared on the last Time magazine cover of the old century, as the face of the new one. Yet within months, he was being pilloried as "the biggest money loser" on the web, notes Richard L Brandt in One Click. As markets crashed, it became common wisdom that "Amazon.bomb", which lost $1.4bn in 2000, was a goner, likely to be snuffed out as established booksellers and generalist retailers moved online. But Bezos ploughed on, never losing his first-mover advantage. By 2010 Amazon was worth more than $80bn.

In attempting to transform Amazon from an internet retailer to a fully digital content company, Bezos is making his most ambitious move yet, says the FT. "It will take more than one shiny device to crack Apple's hitherto impregnable world. But who, given his record, would bet against him?"

Is this the time to snap up the shares?

"Can Amazon's new Kindle Fire hold a candle to the iPad?" asks Dominic Rushe in The Guardian. Actually, it's not trying to it has a smaller screen and only offers Wi-Fi connectivity. But at $199 it is half the price of the cheapest iPad and offers access to a huge collection of Amazon content, including books, film and music.

"Bezos knows he can't take on Apple head on. Instead, he is doing everything he can to carve out a new space in the tablet market," says Erich Schonfeld on TechCrunch. Price is a big part of his plan to win over the Apple disaffected. "There are two types of companies," wrote Bezos last week. "Those that work hard to charge customers more, and those that work hard to charge customers less. Both approaches can work. We are firmly in the second camp." Amazon's foray is brave, given the failure of products from HP and Sharp to make any inroads into Apple's dominance of the tablet market, says Ian King in The Times. "It is not yet clear that the Fire will spread", but in a market 75% dominated by Apple, the customer can only win.

"Oh yeah?" says John Naughton in The Observer. "The reality is that both Apple and Amazon are aiming at the same thing: locking (in) the consumer." The Kindle Fire comes with only 8GB of memory, so most of the content users access will come from Amazon's Cloud. In the battle of the tech giants, Bezos appears to have the upper hand for now. Apple chief Tim Cook's presentation of the latest iPads this week was widely deemed to have bombed. So is it time to pile into Amazon stock?

You'd be mad to, says Stephen Foley in The Independent. For all its innovative genius, Apple trades on just 14 times current year earnings; Amazon is on a "stratospheric" 107 times indicating it "has never fallen from the dotcom bubble heights". Whoever wins the tablet battle, "Amazon shares will be the losers".