Amazon.com's innovations at a glance

1995 User-generated product reviews: Registered customers play tastemaker.

1997 1-Click shopping:Registered users click on one button when they find an item they want to purchase and bam! Their order is placed and processed. The customer doesn't have to fill out page upon page of shipping and credit card information to buy a book. Personalized recommendations: Amazon.com suggests books that registered users might enjoy, based on their past purchases, customer ratings and other authors they like. User-generated reviews of books.

1999 Wish List: Customers can make lists of all the products they'd like to buy or have other people buy for them. Amazon.com Anywhere: Customers can now shop on Amazon.com using their wireless devices. Purchase Circles: These are lists of the most popular items being purchased by customers in a given zip code.

2001 Look Inside the Book: Shopper can browse pages of books. Instant Order Update: Amazon.com warns customers when they're about to purchase a book they previously bought on Amazon.com so that they don't inadvertently buy a book they don't need.

2002 Web Services: This platform lets website developers incorporate content and features from Amazon.com onto their websites.

2003 Search Inside the Book: Customers can search the text inside books for specific keywords.

2004 A9 Search Engine: Stores registered users' search history and offers search results from different sources including Google and the Internet Movie Database, which is owned by Amazon.com.

2005 Mechanical Turk: Named for the chess-playing robot designed by Wolfgang von Kempelen, the service provides businesses and software engineers with a marketplace of temporary workers to work on projects such as identifying objects in a photo or transcribing audio records. Mechanical Turk application programming interfaces then integrate that work into the customer's business processes and systems.

2006 Elastic Compute Cloud: This Web service gives users access to Amazon.com's computing capacity. Simple Storage Service: This Web services interface can be used to store any amount of data, at any time, from anywhere on the Web, on Amazon.com's data storage infrastructure.

Amazon.com's online prowess a blessing (and a curse) for retailers

Amazon.com is a boon to Internet shoppers around the world. It's brought them convenience, choice, discounted prices and quality service. In so doing, Amazon.com made selling more complicated and competitive for retailers. Every retailer now has to have an e-commerce site, and it has to measure up to the high standards Seybold says Amazon.com has established for usability, personalization, and the rapid fulfillment and delivery of orders. And that's not easy for competitors to match, says Lindsay.

Forrester Research's Johnson notes that Amazon.com changed consumers' expectations of how much product information retailers should give them. The product ratings and reviews, which Amazon.com had on its site first, made consumers more informed, discerning and price sensitive, and that pushed retailers back on their heels. "Many retailers say consumers walked into their stores with a huge amount of knowledge and guessed it came from Amazon," says Johnson. "Their win-all strategy has put every merchant selling online on the defensive."

In reaction, says Seybold, some brick-and-mortar retailers have shot back by integrating their sales channels and letting consumers check local store inventories online, and pick up and return items they purchased online in stores. The seamless cross-channel retail experience that some merchants offer brings convenience to another level with which Amazon.com, with only one channel, can't compete. "The cross-channel experience is the industry's one competitive advantage," says Seybold.