Reading between the lines of Amazon’s HQ2

Perhaps no one in Seattle watches the Northwest tech industry closer than GeekWire’s Todd Bishop. As he watched Amazon announce its plans for a second headquarters outside of Seattle, he noticed something between the lines.

“I think this is a wake-up call for the leaders of Seattle to step back and say, ‘OK, are we going to be the kind of place that lets these big companies get away? Or are we going to be the kind of place that creates the infrastructure, the housing, the transportation that these companies need? And the rest of the community needs,” Bishop told KIRO Radio’s Ron and Don. “And I do think that Amazon was, in part, sending a message. There’s a lot more to it, but that is one of the things that they are doing.”

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As of Tuesday, Amazon has said that it has no “front-runners” for cities to expand into and that all the cities they have heard from across the nation are being considered equally.

One of those cities is reportedly Tacoma, just south of Seattle. Bothell and Everett have also been mentioned. They all boast much of the requirements Amazon has asked for: near an international airport; near major highways; access to mass transit. Not to mention the many empty properties ripe for development throughout Tacoma.

Washington’s Governor Jay Inslee has even reached out to the company to “better understand” its needs for HQ2.

But there is actually much more to Amazon’s HQ2 announcement than the mere requirements it posted, according to Bishop.

Amazon: Between the lines

Amazon is a major contributor to the region’s growth, drawing thousands of new workers to the area and boosting the economy. There are some, however, who have argued that Seattle’s relationship with tech companies could be more fragile than many believe.

Windermere economist Matthew Gardner used Amazon as an example of how a big company could leave if Seattle couldn’t reign in the rising cost of living — which contributes to how much companies have to pay employees. That’s a considerable cost of doing business in town.

Former Microsoft CEO Steve Ballmer also had similar warnings of an “unfavorable business climate” in Seattle, noting the recent efforts to establish an income tax on the city’s top earners. Councilmember Kshama Sawant has been vocally opposed to that argument.

Amid this back-and-forth, Amazon announced that it is seeking a city equal to Seattle to build a $5 billion second headquarters in North America. Amazon is asking for cities to bid on the plan.

Bishop notes in a recent column that Amazon doesn’t have to ask for such bids, and the announcement is partly a “publicity stunt.” It knows exactly which cities can provide what it needs. Therefore, the announcement wasn’t just about putting the word out. It was about showing Seattle leaders that it can take its business elsewhere.

“I certainly think that’s the subtext, yes,” Bishop said. “If you read through, one of the points in their FAQ – frequently asked questions – that caught my attention was a quote about why they are doing this. Essentially, they said they are looking for a community that will welcome and work with them. To me, the implication of that was they are not getting that in Seattle.”