More interesting... They bought Kiva Systems for $775 million from Mick Mountz, a former Webvan employee who identified warehouse fulfillment as a prohibitive cost in delivering groceries.

http://www.kivasystems.com/about-us-the-kiva-approach/manage...

It's unclear if Amazon has actually started using Kiva, though. Does anyone know? That 60 minutes special didn't show them using it.

Edit: Changed from "the prohibitive cost" to "a prohibitive cost."