Amazon gained a huge perk from its HQ2 contest that's worth far more than any tax break

  • Amazon's contest for the home of its second headquarters has helped the company score valuable data on land use and development across the United States.
  • The proposals that 238 cities submitted to Amazon likely contain details about optimal sites for development, current and future land use and development projects, planned infrastructure investments, and demographic information.
  • "Amazon will put that data to prodigious use in the coming years to expand its empire," says Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a Washington, DC-based think tank.

Amazon's highly publicized hunt for the site of its new headquarters, HQ2, was a brilliant strategy. 

The contest has resulted in cities warring for Amazon's favor with offers of billions of dollars in tax breaks and other generous promises.

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Twitter reacts to Amazon HQ2 rumors
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Twitter reacts to Amazon HQ2 rumors
OH MY GOD THIS WHOLE ODYSSEY DOESNT EVEN END WITH A SECOND HEADQUARTERS BUT JUST TWO ADDITIONAL OFFICES https://t.co/L6wLrwztxf
Gonna be hilarious when half the HQ2 employees work remotely from cities they could afford to buy homes in
If #HQ2 ends up in NYC & DC regions, 3 takeaways: 1. #Amazon picked existing super regions, as expected, highlighti… https://t.co/bSS5AnLawM
So Amazon lied throughout the entire H2 search process, making cities ante up in expectation of a far, far bigger d… https://t.co/quuOPDDDJG
this guy is right "HQ2" was basically an enormous PR stunt to get the best tax breaks possible from local governme… https://t.co/0YPwxFrCDj
Indeed. A shameful charade in which a wealthy corporation conned public officials into giving away public resources… https://t.co/qDNZDTCRZJ
the single most valuable thing to come out of HQ2 is the local journalism across the country about how cities tried… https://t.co/5m2VZ08c2G
Can’t wait to see your faces when @JeffBezos announces Amazon HQ2 will be a vast traveling city on gigantic tank tr… https://t.co/22f11OHwOe
I'd love to know what the 240 cities that applied for HQ2 think about this, especially the other 18 finalists that… https://t.co/2R77llb6oL
Hearing that @amazon is choosing their #HQ2 between the DC area, NYC and Dallas is like Bryce Harper choosing betwe… https://t.co/mBSFCBvcpi
This whole #HQ2 thing is so ridiculous — grotesque how Amazon has manipulated cities https://t.co/28Ijedw8qw
If Amazon is really about to name DC (or the outskirts of DC) as their HQ2, I'm going to vomit. It will be a clear… https://t.co/MMxVme4mz9
If #HQ2 is going to Northern Virginia (DC) as the obvious choice, I think residents of the 200+ other cities who lo… https://t.co/vwS1zPs9x7
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It has also given Amazon something that's potentially far more valuable than any subsidies it may have gleaned from this process: a trove of data. 

"Amazon has a god-like view of what's happening in digital commerce, and now cities have helped give it an inside look at what's happening in terms of land use and development across the US," says Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a Washington, DC-based think tank. "Amazon will put that data to prodigious use in the coming years to expand its empire."

A representative for Amazon did not immediately return Business Insider's request for comment. 

Amazon received proposals from 238 cities vying to be chosen as the home of its second headquarters.

While the information in many of those proposals is sealed from the public or otherwise heavily redacted, it's safe to assume that most contain details about optimal sites for development, current and future land use and development projects, planned infrastructure investments, and demographic information, Mitchell said.

Amazon could use this data to aid in future expansion as it selects sites for new stores, warehouses, data centers, fulfillment centers, and other brick-and-mortar needs.

In some cases, the bids could help Amazon get a leg up over its competitors, because the data they contain might not be publicly available.

"This is an incredibly valuable trove of data that 238 cities spent time compiling and submitting to Amazon," Mitchell said. "At the end of the day, it may well be that the data is the most valuable thing that Amazon has gotten out of this."

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