[HN Gopher] Amazon knew seller data was used to boost company sales
___________________________________________________________________
Amazon knew seller data was used to boost company sales
Author : giuliomagnifico
Score : 549 points
Date : 2021-05-03 10:28 UTC (12 hours ago)
(HTM) web link (www.politico.eu)
(TXT) w3m dump (www.politico.eu)
| sumedh wrote:
| Cant Costco, Walmart also do the same thing, why is Amazon being
| singled out here?
| 2OEH8eoCRo0 wrote:
| Difference is that sellers have options because none of these
| are monopolies. It's not abusing your size at that scale and
| thus not antitrust. The same rules don't apply to everyone
| because not everyone owns an entire market.
| wolfretcrap wrote:
| They already do.
|
| And anyone selling through any platform where they've all data
| let it be supermarket chain or e-commerce platform, should
| understand the risk that their data can be used to compete with
| them if you realize risk is not worth pay off, prefer selling
| on own website - it's not hard these days. No I mean, yes it's
| still hard to get eyeballs on your product but to list in
| Amazon, you need to pay Amazon tax.
| sct202 wrote:
| The difference is that Amazon said they don't use third party
| data to boost their own sales.
|
| In traditional retailers like Costco, if you are a product
| maker and supply Costco, you don't own any data from the sale
| of the product--Costco owns that data. In fact, you will have
| to pay for that data from data brokers (Retail Solutions Inc
| for example) if you want it.
| murphy1312 wrote:
| are there no antitrust laws in the US, so that amazon could be
| split into marketplace, own products and aws? Thats what should
| have been done long ago and no need to stop at amazon either.
| namdnay wrote:
| Like every supermarket chain in the world?
| choward wrote:
| What stores are you going to that have third party sellers? A
| better analogy is a mall.
| Moeancurly wrote:
| See: https://en.wikipedia.org/wiki/Slotting_fee
| namdnay wrote:
| I guess the best analogy would be a department store with
| third party stands as well as their own label stuff
| count wrote:
| Nearly every grocery store in the US has third party sellers.
| They pay the store for shelf space, provide their own
| stockers, etc. It's not as different as you'd believe,
| because you've 'heard' of the brand names doing it.
| tstegart wrote:
| Yes, especially common in the bread and chip aisles. Third-
| party stockers come in and replace the inventory. Same with
| soda.
| poidos wrote:
| A good example that I see at my local grocery store all the
| time is Coca-Cola.
| salawat wrote:
| You can't square access to "aggregate sales data" of inventories
| that are not yours with having a policy not to use third-party
| sellers info for personal/internal sales gains. In this case
| Amazon went from being a decent host and service provider to a
| malicious, unfair competitor.
|
| Either they divest themselves from being an active participant in
| their marketplace, or they put out their eyes and sequester
| Third-Party sales and transaction records into a bin to never get
| looked at except for reports to third-party sellers themselves.
| That's about the only way I can see for Amazon to ethically move
| forward.
| fnord77 wrote:
| "we have a policy against this, but we violate it all the time"
| ErikVandeWater wrote:
| Is there a maxim for this?
|
| When a group of people are highly incentivized to do something
| bad, they'll conspire to do something bad. Don't call me a
| conspiracy theorist.
| cblconfederate wrote:
| It's basically Murphy's law
| gdulli wrote:
| Human nature
| mentos wrote:
| Utility maximizing entities
| fmajid wrote:
| "I am shocked, _shocked_ , that gambling is going on in here."
| LatteLazy wrote:
| 2nd sentence in the article:
|
| >"I can't guarantee you that that policy has never been
| violated,"
|
| 4th sentence in the article:
|
| >identifying one case in which an employee used the access to
| improve sales.
|
| So only violated once...
| pixl97 wrote:
| That they are telling us about.
| LatteLazy wrote:
| Not quite. Per a secret audit carried out internally and
| smuggled out.
| kishinmanglani wrote:
| Literally every retailer ever does this. From Macy's to Target to
| Walmart to Shoprite
| libertine wrote:
| Doesn't make it right though.
|
| Every brand must estimate their competitors market shares,
| sales volumes, media spend, and actively track promotional
| activity - while retailers have a massive slice of this
| information, namely Amazon. Not only that they control their
| own "shelves".
|
| In my point of view they shouldn't be allowed to compete if
| they are using competitors data without their consent... and
| that's the catch, it's Amazon data as well, so the only
| solution is: either Amazon is a market place or a retailer.
| bsch wrote:
| I'm a third party seller and I just left Amazon. When you buy a
| book, for example, are you aware that 40% of the sale goes to
| Amazon? Many sellers sell cheap items at a steep loss just to
| keep their sale metrics up. A couple bad reviews, etc. and your
| business is kicked off with little explanation and cold or no way
| to appeal. Third party sellers are not treated well and I'm not
| surprised Amazon steals seller data metrics
| TheCapn wrote:
| >A couple bad reviews, etc. and your business is kicked off
| with little explanation
|
| There's got to be a dark underbelly to Amazon going on at the
| same time. My wife is bored enough that she's taken up a fight
| with Amazon over some bluetooth earbuds she returned. The
| earbuds themselves just simply didn't work; they'd do things
| they're not supposed to and not things they are supposed to so
| she posted a review saying such.
|
| The seller started contacting my wife trying to bribe her to
| change her review to 5 stars. My wife updated the review as
| such saying the seller is trying to coerce her to change her
| review but she won't budge.
|
| Amazon has now removed my wife's review saying she's
| "harassing" the seller despite having emails to prove the
| seller is the one who won't stop contacting her even though
| she's explicitly requested such. So my wife is battling Amazon
| asking them to re-instate the review or give her a real reason
| why it was removed.
|
| It really is to the point where I won't buy from Amazon anymore
| unless I have no other choice. I don't trust a single thing
| about their review system. I don't trust a lot of products
| being unopened/untampered.
| cwkoss wrote:
| Amazon has structured their reviews to enable unethical
| behavior by sellers.
|
| Any review which comments on the seller or seller's behavior
| is removed because the product page is supposed to be a page
| of seller-agnostic reviews of the product. There is a
| separate page of reviews for each seller, but it is buried to
| the point that no-one looks at it.
|
| It makes it leaving reviews about sellers doing unethical
| things like paying for reviews fruitless: either you put it
| on the product and it is removed quickly, or you put it on
| the seller and no one sees it.
| BlueTemplar wrote:
| Yeah, as another perhaps anecdotal example, I've recently
| been forced to buy a book from Amazon because I literally
| couldn't find it anywhere else.
|
| Despite the book being listed as "New", I received a book
| that was not only pretty old, but also had clearly been
| stolen from a library, with stamp marks and everything.
|
| I'm not going to leave this alone, contacting the library and
| exposing this fraud is going to go pretty high on my pile of
| "to do" things...
| sachdevap wrote:
| The 40% in a vacuum does not really complete the picture for
| me. Is it possible to get the same book at a lower price
| somewhere else? If it were the case why would there not be
| other retailers undercutting Amazon?
|
| Maybe I am missing some monopoly related issue here, but I
| would love to know more.
| m1117 wrote:
| News love making their headlines in a way that people get angry.
| zizee wrote:
| Does this practice extend beyond retail? Do AWS product managers
| look at AWS usage data of their customers sass products to decide
| whether it's worth launching a competing service?
| gsibble wrote:
| Usually if the answer could be evil, with Amazon it is. I'm
| sure GCP does the same.
|
| Gotta love how AWS/GCP terminate your https and can read all of
| your api traffic.......
| gok wrote:
| Lots of comments here of the format "every store does this."
|
| No, no other store operates this way. Walmart and Costco do not
| have a little flea market of third party sellers inside their
| stores who run their own logistics. This would be more like
| Amazon being both an anchor tenant and owner of a mall, and
| requiring that every other store within the mall provide all
| their sales information, then rapidly evicting all the successful
| stores and replacing them with knock off stores that they also
| own.
| Black101 wrote:
| > Walmart and Costco do not have a little flea market of third
| party sellers inside their stores
|
| walmart.com does
| gok wrote:
| That is true, I picked a bad example, although Walmart
| Marketplace is a very high touch service which is expressly
| targeting sellers that they don't want to cover themselves.
| citrusybread wrote:
| isn't this effectively how home depot and lowes are run?
| basically everything is on consignment, and they occasionally
| spin up private-label versions of tools to sell?
| darksaints wrote:
| Every single discussion around this revolves around the same
| facile comparison with retailers, and I'm fucking sick of it, so
| I'll lay it out in a top level comment one last time.
|
| These are the following ways in which Amazon is not like a
| (WalMart, Costco, insert retailer of choice):
|
| * Physical retailers do not have access to the same breadth and
| depth of data that Amazon does. For example, retailers have no
| reasonable nor accurate methods of determining which advertising
| methods bring in the most leads. They have no idea how many
| people look at the product without buying it. They have no idea
| who puts in their cart and then lets it sit there for days on
| end. They have no idea who puts an item into their wishlist. They
| have no idea which people look at it, then come back a week later
| and buy it. They have no idea how many competing items, let alone
| which ones, the buyer compared it with before buying. They can't
| calculate conversion rates, nor satisfaction rates. Maybe if
| they're lucky, they can track returns down to the purchaser
| (because they might require a receipt to return), but they likely
| don't know much about who you are or why you're returning it.
|
| * Retailers can't notice you looked at a product without buying
| it, then follow you around to your bank, your barber, your job,
| your home, relentlessly trying to convince you to buy it.
|
| * Retailers can't look at your general preferences across
| thousands of unrelated products, perform machine learning methods
| to determine your likelihood of conversion for different brands
| and products, and then rearrange their shelves specifically for
| you to optimize visibility of their products for maximum
| profitability.
|
| * Perhaps most importantly, retailers always have an incentive to
| sell their inventory. They buy it, they invest labor into
| presenting it, they pay holding costs to keep it in stock, they
| relentlessly optimize within difficult physical constraints to
| provide visibility to its location on the shelves, and they
| advertise its existence to the public. Amazon has none of these
| costs or incentives. If they decide to tank the listing of a
| competing item, they bear no cost in doing so. They are being
| paid for every single cost incurred, and they're making money off
| your stuff in FBA even when it doesn't sell. Even pure
| consignment stores will regularly decline to consign products
| that they don't think they can sell or don't think they can make
| enough money on to cover their costs. Amazon has no such
| incentive.
|
| Does Procter and Gamble hate the fact that Costco can position
| Kirkland Signature right next to their products? Of course they
| do...but they still sell their product. The same can't be said
| for many private sellers of niche products when Amazon launches
| an Amazon Basics competitor. Their listings get tanked, their
| recommendations disappear, their sales effectively drop to zero
| almost overnight, and if they made the bad decision to use FBA,
| they're stuck paying holding costs and eventually shipback or
| disposal costs in order to exit the market.
|
| Amazon is uniquely positioned to take advantage of marketplace
| data in ways that retailers could never feasibly do, and they
| bear no costs (and may even augment their profits) when they put
| their merchants out of business. They absolutely need to have
| their marketplace either shut down or completely separated from
| their retail space by legally regulated means.
| mk89 wrote:
| Well, it's something that is slowly backfiring. It's under the
| eyes of everyone, and not enforcing such policy will only make it
| even worse for Amazon itself that eventually will end up selling
| only non-branded products. Finally it will be only another
| e-commerce like "ebay" used to be, and something else will
| replace it. Just enjoy the ride until you can.
|
| PS: speaking out of experience, I had one time a talk to a
| director from an important online shop (top 3 in the country in
| that specific field) and "this sort of things" was exactly the
| reason why they chose to use MS Azure instead of AWS. Imagine how
| deep it can go. And I totally support that.
|
| PPS: I don't understand the downvote. Please, be specific on why
| you disagree instead of just clicking on random symbols.
| anotha1 wrote:
| Upvoted, but I disagree that it's backfiring.
|
| Backfiring would imply things are changing or getting worse for
| them. And I'm certain that we're not at "peak Amazon."
|
| Worse, Americans especially are becoming numb to top down
| abuses. Not only am I worrying that this is not backfiring, but
| I'm also worried about the precedent we're setting by being so
| tolerant to it.
| sharklazer wrote:
| "Money talks and BS walks"
|
| Consumers may not be fed up with Amazon, but if this is SOP
| then the sellers WILL leave and a competitor with better SOP
| will come in.
|
| Getting f'ed in the arse as a consumer is one thing. Getting
| f'ed in the arse by Jeffy B as a business is another.
|
| It is trust which makes this world go 'round.
| an_opabinia wrote:
| If sellers want their sales information to be private, they
| should make a compelling retail experience they control.
| That is where they obtain real competitive advantage.
| Changing from Amazon to another online retailer - that
| retailer will still analyze third party sales data.
|
| It still isn't clear if it matters. You have little
| perspective or experience on selling easily cloned $10-100
| items (Amazon Basics) anywhere. Most of the margin is made
| at the point of manufacturing, by taking $1 overseas labor
| and selling it for $5. AmazonBasics and the other product
| are both made by the same labor, the same process, so the
| economics of what's really going on are still in
| equilibrium.
|
| But I understand (though not really sympathize with) the
| aspiring middleman trying to buy that $5 product and sell
| on Amazon being mad about doing, essentially, product
| discovery for Amazon. On the other hand nobody is forcing
| them to be middlemen.
|
| You don't have to launder cheap overseas labor at all. If
| the EU commission focused on the economics that mattered -
| the labor arb - the impact will be as large as you're
| anticipating. It's my opinion that the injustice of the
| offshore labor system is of far greater importance than
| some bullshit Amazon versus Some Aspiring EU Tech Company
| battle.
| BlueTemplar wrote:
| The issues with Amazon go further than this :
|
| https://arstechnica.com/tech-policy/2017/08/lawsuit-
| amazon-s...
|
| IMHO these websites should be disallowed to sell their
| own brands. (I wouldn't mind if physical retailers
| wouldn't be allowed to sell their own brands either.)
| ClumsyPilot wrote:
| Great argument, could be used to rebut anything:
|
| If someone wants their mobile phone data and photos to be
| private, they should make a compelling mobile os they
| control.
|
| If someone wants a water supply that is not polluted with
| toxic runoff they should start their own waterworks, lay
| their own pipes, and potentially buy their own lake
| because some pollution is unremovable.
|
| If someone wants not to be discriminated against they
| should start their own country.
| nova22033 wrote:
| _chose to use MS Azure instead of AWS_
|
| The article says someone used data from Amazon(the online
| store), not AWS. You should absolutely use Azure(or GCP) if it
| makes more economic sense for you but migrating from AWS to
| Azure because of this may be an overreaction.
| sfifs wrote:
| It's standard practice for any retailer to not use AWS.
|
| Part of it is why would you want to give any competitive
| knowledge to Amazon with your data or even metadata assuming
| you encrypt data with your own keys (eg. # of users derivable
| from # of distinct home/mobile IP address connections to your
| servers, # of transactions from connections your servers make
| to payment processors etc).
|
| The other part of it is why add to Amazon's profit margin
| when it's well known AWS likely subsidizes retail to a large
| extent.
| alias_neo wrote:
| I'm curious what kind of access Amazon would have to your
| data as a retailer running on AWS.
|
| Not in a technical sense, I'm a software engineer, I
| understand what data _is_ there, but more to the extent of,
| do they go out of their way to identify you, an AWS
| customer as a retail business and use that _retail_ data in
| ways such as described by the original complaint here?
|
| If the answer is anything other than "they definitely
| don't", I'm concerned.
| ghusbands wrote:
| Nobody can know for sure. Whether or not they were
| secretly mining data from AWS servers, they would say
| they don't and nobody on the outside would be able to
| tell. Even if it's unlikely, many people are simply
| choosing not to risk it.
| NovemberWhiskey wrote:
| This is at the level of a conspiracy theory right now,
| and one that doesn't even make any sense.
|
| If it were true that Amazon were taking sneaky peeks at
| data inside AWS related to retailers, and this became
| public, AWS as a business would be done.
|
| The loud banging you'd be hearing would be the door
| closing as the last customer exited, followed by all the
| engineering staff who work on AWS as they see the writing
| on the wall.
|
| Why would Amazon look to achieve some marginal advantage
| in its retail businesses at the risk of a total loss to
| one of its marquee businesses, AWS? It's an idiotic risk.
| jjoonathan wrote:
| > If it were true... and this became public, AWS as a
| business would be done.
|
| Why on earth would you think that? They did worse on
| their storefront, which has a much smaller migration
| burden than AWS, and while a few big brands made a stink
| and pulled out, it didn't even noticeably slow growth.
| NovemberWhiskey wrote:
| ... because it's a colossal breach of trust. AWS has an
| entire staff of people whose job it is to convince
| clients that they can be trusted to be a safe custodian
| of data that includes heavily regulated types of data.
|
| Doing this would blow a huge hole in that.
|
| Do you really think banks are going to stay in AWS if
| this happens? Do you really think Salesforce is going to
| be OK with it? Do you think they'd ever do any US Govt
| business again?
| sfifs wrote:
| > Why would Amazon look to achieve some marginal
| advantage in its retail businesses at the risk of a total
| loss to one of its marquee businesses, AWS? It's an
| idiotic risk.
|
| There's a pretty obvious way to achieve this risk
| mitigation which is by spinning off AWS into a completely
| separate company with separate management accountable to
| a separate board with separately traded shares and not
| sharing any offices, employees or infrastructure with
| Amazon retail.
| OldHand2018 wrote:
| There is no need for a conspiracy theory.
|
| The metadata that is _required_ to produce your monthly
| AWS bill reveals a ton of information about the success
| of your business and what is doing very well for you.
|
| Doing analytics on customer billing is something that
| Amazon has every reason to be doing, and what Amazon does
| with that information can be anticompetitive or not.
| NovemberWhiskey wrote:
| At a certain level of aggregation, metadata is AWS need-
| to-know for capacity planning etc or for account execs to
| understand the needs of their covered clients.
|
| There's definitely room for discussion over when what
| level of granularity is necessary and whether metadata at
| different levels of granularity should be shared with
| product vs. customer facing teams.
|
| That didn't seem to be what the GP comment was about
| though - 'mining data from AWS servers' sounded to me
| like a much more invasive approach to client data.
| ClumsyPilot wrote:
| Its always a conpiracy theory untill it happens, and then
| it becomes obvious all along.
|
| People who predicted the 2008 crash used to get tinfoil
| hats in the mail.
| BlueTemplar wrote:
| I don't see how this would be fundamentally different
| from what Facebook did with WhatsApp data ?
| mdoms wrote:
| > This is at the level of a conspiracy theory right now,
| and one that doesn't even make any sense.
|
| It's a conspiracy theory to believe that a company whose
| policy it is to not access data that is on their own
| platform, who was caught accessing said data, would
| violate such a policy?
| shiftpgdn wrote:
| Yes, of course they do. There was a post on here about a
| year ago from someone in the "Amazon profitability team"
| that involved digging through customers AWS instances to
| see what they could learn or duplicate for Amazon.
| alias_neo wrote:
| I'm more than a little disturbed by that response, can
| you back that bold accusation up with some references?
|
| I _need_ to read more about this (about to begin a
| migration to AWS, not retail though).
| shiftpgdn wrote:
| https://news.ycombinator.com/item?id=19734261
|
| https://www.datacenterdynamics.com/news/ovh-ceo-unlike-
| amazo...
|
| https://sellercentral.amazon.com/forums/t/amazon-
| literally-s...
|
| https://fortune.com/2016/04/20/amazon-copies-merchants/
|
| https://www.theverge.com/tldr/2019/9/19/20874818/amazon-
| allb...
|
| I can't find the most recent set of posts about peering
| into customer's AWS instances to research what they could
| copy but consider that govcloud exists.
| alias_neo wrote:
| Thank you for the effort of posting those. Unfortunately
| they don't really indicate any data being taken from AWS
| specifically, all of the copying behaviour appears to be
| Amazon storefront copy-cat tactics.
|
| As for govcloud, it exists because regulatory
| requirements for running things for gov are more strict
| than your average user/business requires and such cloud
| offerings require certain levels of hardening and
| software security and assurances. I happen to work in the
| space so I understand the need for an alternative
| offering for government requirements. There's really
| nothing nefarious going on there and its more about govs
| not wanting to run alongside regular users. I see nothing
| concrete I could take to my superiors.
| wrboyce wrote:
| Am I missing something or do none of these links even
| mention AWS?
|
| I'm also unsure how the explicit trust from the
| government ("consider that govcloud exists") is somehow
| evidence for their untrustworthiness?
| tasssko wrote:
| Source please?
| ahiknsr wrote:
| > I had one time a talk to a director from an important online
| shop (top 3 in the country in that specific field) and "this
| sort of things" was exactly the reason why they chose to use MS
| Azure instead of AWS. Imagine how deep it can go
|
| This seems to be very common.
| https://www.forbes.com/sites/bobevans1/2018/07/18/walmart-ci...
| nova22033 wrote:
| Amazon is a direct competitor so it makes sense for Walmart
| to not give them more money via AWS.
| freeone3000 wrote:
| Everyone in retail is a direct competitor to Amazon. It
| makes sense for anyone with a physical storefront to avoid
| AWS.
| marvinblum wrote:
| I had the same thought a while ago. I remember when Amazon
| mostly acted as a retailer, and not as a marketplace. Nowadays
| I don't see why I shouldn't buy on ebay or somewhere else, as
| the marketplace approach negates what I liked about it:
| everything from one company, a single parcel, easy refunds. If
| I receive each item from a different retailer anyways, I don't
| see why I should feed the beast.
| vishnugupta wrote:
| AWS and Amazon Retail are two different entities altogether.
| Even their infrastructure are at least logically siloed and my
| educated guess is even physically siloed in some places.
|
| AWS is certified to comply with a bunch of cloud/data
| standards/regulations such as HIPPA, PCI DSS and so on. Even if
| a single evidence is found that AWS is breaching them the
| consequences will be severe.
|
| Also for Amazon as a whole it makes very little business sense
| to lose a AWS customer paying hundreds of millions of dollars a
| year just to gain some marginal advantage in retail space. Note
| that Amazon retail already is operating at the limit when it
| comes to having accurate sales information about its
| competitors. It has crawlers to scrape online data and employs
| hundreds of analysts to build multiple models. And it's been on
| this for close to three decades. So trawling AWS customer data
| is net negative for Amazon. It doesn't take much for
| competitors to move away to Azure of GCP.
|
| So it's in AWS's best interest to be absolutely fool proof
| about not going anywhere near customer data. Dealing with
| business data is a whole lot different ball game compared to
| collecting tracking customer data like Google does. Businesses
| will be unforgiving.
| bopbeepboop wrote:
| Amazon is a customer of AWS, and leases most of their
| infrastructure from their subsidiary.
| [deleted]
| whoknew1122 wrote:
| Amazon != AWS. As someone who has access to customer data in
| AWS, I'm very limited in what information I can access (to the
| point where it actively makes my job in Premium Support harder
| than it would be otherwise). I also have to provide a
| legitimate business reason for access to data.
|
| Not only is there an audit trail for what I do internally, but
| any calls I make to review customer data is published in the
| customer's CloudTrail trail. So the customer can audit when
| their information is accessed.
|
| This report has 0 to do with AWS.
| [deleted]
| JumpCrisscross wrote:
| > _This report has 0 to do with AWS_
|
| Same company, leadership and culture. If you compete with
| Amazon, or could compete, it would be pretty stupid to put
| your jewels on AWS.
| whoknew1122 wrote:
| Different leadership and largely different culture. Or are
| you just making assumptions?
|
| Being on AWS works for Netflix, Disney+, and a lot of other
| streaming services I won't mention. ESPN and Fox Sports
| both use AWS. A lot of incredibly visible companies that
| offer cloud storage white-label S3. Tons of game studios
| use AWS.
|
| A lot of successful companies are pretty stupid I guess.
| But I'm not going to spend my time trying to refute
| conspiracy theories about AWS. You do you boo-boo.
| syops wrote:
| I suggest that your reply would be much better without
| the last paragraph.
| nvr219 wrote:
| hmmm, yes.
| Railsify wrote:
| AWS profits appear in Amazon's annual report, AWS is an
| Amazon business unit. The CEO of AWS reports to the CEO
| of Amazon.
| vishnugupta wrote:
| Interestingly enough Andy Jassy, who is taking over the
| reins from Bezos, is the CEO of AWS.
| Railsify wrote:
| I was not aware of that, interesting indeed.
| alex_anglin wrote:
| On the other hand, it seems to be working out pretty well
| for Netflix.
| Workaccount2 wrote:
| On the other hand Apple competes hard against Samsung, yet
| relies heavily on Samsung to build a large part of it's
| competing products.
|
| Although I admit that this might not be as true anymore as
| it was a few years ago.
| selectodude wrote:
| Samsung is a much looser conglomerate than Amazon.
| Furthermore, their fab division is much larger than their
| handset division. I imagine all parties have weighed the
| pros and cons.
|
| Apple continues to actively steer away from Samsung,
| anyway.
| amelius wrote:
| Probably because Apple has an army of lawyers to protect
| against any problems.
| philistine wrote:
| This.
| anotha1 wrote:
| Given everything mentioned in your comment, I don't see how
| it implies that amazon can't cast a dragnet at some level
| you're not aware of.
| ctvo wrote:
| Let's put it in terms of business. What does Amazon gain
| reading the data of retailers in AWS that they don't
| already have? How much more money would this make them?
|
| How much brand damage and lost of business to AWS (their
| most profitable organization) would they lose if this were
| to leak? The more prevalent their use of this AWS customer
| data, the higher the chance it gets leaked.
|
| Why do you think Amazon, one of the most logical and data
| driven companies, would make such a bad business decision?
| [deleted]
| berkeleyjunk wrote:
| Info about what products sell well? Amazon has a thriving
| white label business and they can use it to decide what
| to make.
| ctvo wrote:
| And we think they need to risk the lost of business of
| breaking into your data on AWS to get this information?
| They somehow have no other way to infer this? How much
| business is this thriving Amazon-made products line? It's
| a fraction of AWS's profits considering retail's overall
| profits.
| anotha1 wrote:
| > They somehow have no other way to infer this?
|
| That's actually the point. So what if they're using
| "anonymous" or other indirect data? If "Amazon.com" might
| be benefiting from AWS data of any kind then it needs to
| be investigated as potentially anti-competitive.
| russh wrote:
| People have done worse for less. It may not be a
| significant fraction of Amazon's income but it could be a
| significant fraction of a sellers income or a significant
| fraction of sales manager's sales.
| tw04 wrote:
| It doesn't have 0 to do with AWS. AWS funds the amazon beast
| they compete against. As a retailer you would have to be
| absolutely insane to feed money to the Amazon mothership via
| AWS so they can continue to fund undercutting you in the
| retail space.
|
| All of that is ignoring the fact that any customer of size
| WILL be sharing details about their go-to-market with their
| AWS account team. Just because a random guy in support can't
| login to their systems doesn't mean their assigned architect
| doesn't know what their process workflow looks like and
| didn't help them design it...
| no_wizard wrote:
| To me the only difference is that AWS biggest client base has
| the money and expertise to go after Amazon in protracted
| legal battles while simultaneously scrubbing AWS from their
| companies.
|
| Most retailers, even big ones, don't have the money or
| expertise to do this like that. Of the few who do (Apple for
| instance) Amazon is keen in making sure that those companies
| are heard and has direct relationships with them, but that's
| few and far between.
|
| That's my take on this
| jollybean wrote:
| I think there are enough retailers with at least some
| money, I think this is mostly an issue of business
| expectations.
|
| If AWS were caught sharing your data, with anyone, for any
| reason, it would be a gigantic mess of a problem. Forget
| 'competing with Amazon on Amazon' - we're talking about
| sensitive data of all kinds in every single line of
| business. It would destroy them.
|
| Selling on Amazon, and then having sneaky Amazon PM's use
| your data against you is bad, but the quasi-same thing
| would exist in other retailers. Best Buy doesn't sell '3rd
| Party' so obviously all of their sales data is theirs, and
| I think that the expectations between '3rd Party' and not
| '3rd Party' Amazon may just be a little bit blurred.
|
| I'm suspicious frankly about the distinction, because
| Amazon may very well believe that that data is theirs to
| look at anyhow.
|
| But AWS has to be a different story, if not, it's going to
| hurt.
| munk-a wrote:
| An interesting thing to note is also that AWS sells pre-
| rolled HIPAA compatible services in a lot of their
| offerings. If AWS accidentally peaked into one of these
| services in an unauthorized manner it'd be a huge legal
| event and, I suspect that part of them working out that
| their services are HIPAA compliant involved being
| extremely transparent on how a number of things around
| those services operate with some department in the
| government.
|
| Those servers, at least, should be free from any of the
| snooping concerns folks have.
| mdoms wrote:
| Ah the AWS employee is here to tell us that AWS employees are
| good, actually.
| ziml77 wrote:
| It does though. That money being paid towards AWS will
| certainly be used to subsidize Amazon's undercutting. A
| retailer paying for AWS is funding their own demise.
| helsinkiandrew wrote:
| > "this sort of things" was exactly the reason why they chose
| to use MS Azure instead of AWS.
|
| Unless I've grossly misread these articles, Amazon were using
| third-party seller data from sales on the Amazon.* websites.
|
| The data was on their (Amazon.com) sales database (who sold how
| much of what, for how much). They weren't accessing (hacking)
| data hosted on AWS (a database hosted for an online shop not
| related to AWS)
|
| Those two things are very different.
|
| EDIT: To put this into perspective. Any store (online and
| offline) that has its own branded products, probably looks at
| sales of the existing non shop branded products and makes an
| own branded version when it looks like it will be successful
| ("Panasonic SD cards are selling well, and look like they have
| good margins so let's bring out our own version"). What Amazon
| is being accused of is using sales data from 3rd party sellers
| on Amazon.*
| wongarsu wrote:
| AWS could easily collect metadata like how your traffic looks
| over time, where it's coming from etc., and use that to
| inform Amazon business decisions. That would go a bit further
| than what's in this article, but it isn't a huge stretch.
| tacker2000 wrote:
| I dont have the source anymore, but ive heard of precisely
| this happening: Amazon employees snooping around the AWS
| setup of some other ecommerce competitors... so yea, its not
| just limited to the amazon seller account data
| erikpukinskis wrote:
| That's why they used the words "this sort of thing" and not
| "this thing".
| downrightmike wrote:
| They literally covered this in the book the everything store by
| Brad Stone. This is their game play. This is how they take over
| categories. Let over people to the sales and testing, then rip
| them off and undercut them.
| varispeed wrote:
| Amazon should be split into separate independent companies -
| logistics, AWS, marketplace and whatever else they do now. We
| need laws that will limit growth of companies to become too big
| to fail and have all the money to buy laws, destroy competition
| and in general do as they please without consequences. It's a
| loophole in capitalism that has to be closed. Big businesses
| should follow the same rules as your mom and pops company. If
| small business often pay over 40% in various taxes, the same
| level of taxes should apply to big companies. Nice start would be
| looking into avoidance schemes big companies use and make them
| pay all they have avoided over the years. Use that money to lower
| the tax for small business and continue until the playing field
| is level.
| ch4s3 wrote:
| > too big to fail
|
| How is Amazon "too big to fail" in your opinion? That phrase "I
| think they're too large", it means that a business is so
| central to the functioning on the broader economy and to
| several other industries that their failure would tank the
| whole economy. Think Boeing or JP Morgan Chase Bank.
|
| > and have all the money to buy laws,
|
| What exact laws has Amazon bought?
| varispeed wrote:
| - Well, imagine what would have happened if AWS closed
| overnight. It would not only affect the economy, but also
| governments that run their infrastructure on AWS.
|
| - What I meant by that is also the money can ensure that new
| laws are not introduced, or investigations not carried out.
| Have you seen reports of Amazon Basics, where they ask
| sellers to hand over their leads and then months later Amazon
| introduces pretty much the same product undercutting the
| seller? I would imagine if that was done by a small company,
| they would have been closed down. Yet when you are big,
| anything goes.
| ch4s3 wrote:
| > Well, imagine what would have happened if AWS closed
| overnight
|
| What are the circumstances under which the switch is
| hypothetically turned off at every AWS data center all at
| once? It just doesn't seem like a realistic scenario. Most
| ways in which Amazon could fail would involve either a
| bankruptcy spinning out aws into one or more holdings, or
| years of decline where people switch off of AWS anyway.
| Sure, if all of those data centers blew up, then yes it
| would be catastrophic for a few months.
|
| > What I meant by that is also the money can ensure that
| new laws are not introduced, or investigations not carried
| out
|
| I see where you're coming from, but it seem a little thin
| and unspecific. The Amazon Basics thing seems like a bad
| example. It's the same model grocery stores, Walmart,
| Lowes, and department stores have used for decades. And no
| one ever really complained before. In some cases Amazon is
| white labeling products from the brands they're now
| competing with. So those companies still capture a lot of
| the revenue.
| kdmdmdmmdmd wrote:
| Too big to fail is when we have explicit admission of fraud
| inside a company and a bunch of people, who are likely
| shareholders, are lining up to excuse them and compare them
| to supermarkets.
| swiley wrote:
| "too big to fail" means that a business has friends in the
| legislature and can keep on acting like the local affluent
| drunk teenager who somehow manages to crash all their parents
| cars without getting a DUI.
|
| If we have businesses that are "too big to fail" then why
| bother having a market economy?
| ch4s3 wrote:
| That's not what people meant in 2008 when the phrase "too
| big to fail" came into the lexicon. The phrase meant that
| there was systemic risk. You're moving the goal posts to
| mean "big companies are behaving badly," which is
| different.
| swiley wrote:
| That's certainly how it was sold but I think even then it
| meant what I said.
| ch4s3 wrote:
| I really didn't though. There was real fear at the time
| that if auto makers went under it would ripple through
| their supply chains and gut the economies of numerous
| states, then leading to a cascading series of state and
| local budgetary crises. How correct that assessment was
| is up for debate.
|
| The fear with banking was that the industry had become so
| consolidated and interleaved that a failure of one mega-
| bank would bring down the whole financial system and
| cause a liquidity crisis that would tank any industry
| that relied on credit for ongoing operations, which is
| most industries.
|
| None of this was about companies' behavior it was about
| how they had become so large that their failure would
| destroy huge segments of the real economy. Arguably
| though, the bailouts are a form of moral hazard that make
| more companies too big to fail.
|
| Its commentary on the system.
| jorgenveisdal wrote:
| I wrote about this a while back: https://medium.com/blue-
| poles/how-amazon-screws-third-party-...
| cblconfederate wrote:
| I am constantly amazed by the level of trust that people give to
| tech companies. how did they earn this
| mschuetz wrote:
| It's just a lack of viable alternatives.
| pas wrote:
| A trustless (eco)systems is usually not efficient. So the cost-
| benefit analysis points to almost-blindly trusting Amazon, reap
| as much of the benefits as you can. And don't be surprised when
| it turns out that Amazon abused/exploited your trust.
| [deleted]
| xmly wrote:
| Why Shopify does not do the same thing?
| judge2020 wrote:
| Shopify.com isn't a marketplace that millions of customers
| directly visit. They make enough money as-is.
| Gasparila wrote:
| Thought exercise because I legitimately struggle with this. Is
| this fundamentally different than Costco using sales data to
| choose which Kirkland products to launch/sell? If so, how? If
| not, then why do we not pursue Costco with the same gusto as
| Amazon? To me this behavior by Amazon seems worse, but I can't
| figure out why.
| baq wrote:
| Two helpful questions I don't know answers to, but I'm quite
| confident that the difference between answers are the crux of
| the matter:
|
| Who are Costco customers?
|
| Who are Amazon customers?
| jquaint wrote:
| I think that most Costco customers also use Amazon. I.e. I
| get my basic bulk items from Costco and my specific items
| from Amazon. Perhaps this is why amazon is trying to get
| these customer with "Subscribe and save" which offers
| discounts for subscriptions on basic items.
|
| Although, I have not seen any real data on this. Just my gut
| read.
| agogdog wrote:
| Lots of good points here, but it's also worth mentioning that
| Amazon accounts for a much larger percentage of overall
| ecommerce sales (almost 50%). No other online marketplace comes
| remotely close.
|
| Individual physical retailers own much less of the market...
| even Walmart is only ~10% or so of retail in the US.
| curryst wrote:
| Amazon is pushing people towards Fulfilled by Amazon. It makes
| sense as a marketplace, providing a more consistent experience.
| However when they compete in that marketplace, it means they're
| charging you to get data to outcompete you (via FBA fees). It
| also means that if they do enter that market, they're double
| dipping. They're taking away your revenue stream for their own
| profit, while simultaneously increasing what they charge you
| because it's harder to get your inventory out of Amazon's
| warehouses via selling it. They can also almost always
| outcompete you, because they don't have to pay the marketplace
| fees (they get the service at cost). They can also use the
| money they make from marketplace fees to undercut you, selling
| their competing product at a loss (but net zero after you pay
| your fees) until you get off the marketplace. Amazon also has a
| perverse incentive to not sell your goods because they don't
| have to pay for them, so they're totally okay if they can
| ensure that no one buys your product.
|
| Costco has to buy the goods they sell. If it's on a shelf,
| Costco wants it to sell. If they don't want something to sell,
| they stop buying it/carrying it. They can't make any money by
| buying a competitor's product and letting it sit in a
| warehouse.
|
| The incentive structure for Amazon is bad for everyone else.
| Their ideal profit scenario is to have warehouses full of other
| companies' stuff that never sells, and to sell an Amazon
| branded alternative to each consumer with demand. Costco's
| ideal profit scenario is to never buy third party products and
| only sell Kirkland goods (assuming demand stays the same).
| Amazon needs to pick one; they're either a marketplace, where
| their ideal profit scenario is to sell literally anything they
| have without preference, or they're a retailer and their ideal
| profit scenario is like Costco.
| notyourwork wrote:
| Disclaimer: I'm not a legal expert, just an engineer with my
| own opinions.
|
| I struggle with it as well because conceptually in my mind this
| is the same as a grocery store using customer buying data to
| inform itself. Grocery chains have been using private label
| brands to compete with name brands for years. Check your cereal
| aisle for the "fruit loops" in the back without a box that are
| ~50% cheaper than the name brand boxed real fruit loops.
|
| I never saw this as wrong growing up. I saw this as the store
| offering a cheaper comparable and consumers were able to chose
| which they want. In fact, the grocery store also controls what
| is on the end cap and what is on top and bottom of each shelf.
|
| I think the landscape is heavily skewed in favor of the
| dominant online retail merchant. This skew and dominance is
| what causes people to claim afoul behavior is going on.
| ClumsyPilot wrote:
| Difference in quantity has a quality all of its own.
|
| There are kinds of behavours that are acceptable for an
| individual or a single groceries store, but if a large
| company adopts it across the country and puts it in the
| policy, then they are beaking the law.
| dathinab wrote:
| Grocery stores select which products they want to sell and
| have limited capacity.
|
| Amazon provides a platform through which "everyone" can sell
| "anything" with no tightly constrained space/slots.
|
| As far as I know Amazon is legally closer to a market place
| where everyone is up their own stand (but they are required
| to look mostly the same) and which happens to also require
| you to use their payment system.
|
| I.e. Amazon is just a proxy while the grocery store legally
| buys and resells the products.
| _up wrote:
| I am not from the US but I think Amazon has much more market
| dominance than Costco. If Amazon had 20% market share nobody
| would mind, but they don't have real competition that comes
| close.
| [deleted]
| ls612 wrote:
| Amazon has less than 20% market share in retail overall.
| Remember their competitors are not just the online sellers
| who are pushing this antitrust angle. It's Walmart and
| Target and grocery chains and CVS and Walgreens and brick
| and mortar department stores and so on.
| jagged-chisel wrote:
| Suppose Costco allowed other vendors to be present and selling
| in their stores. Costco requires these vendors to use Costco's
| checkout systems. Costco then takes the data gleaned from those
| sales to determine which products to compete with and then
| begins aggressively pushing their competing product.
|
| Is this fair to the vendors?
| nerdponx wrote:
| This is an interesting thought experiment. Maybe the
| objection is that Amazon is erroneously considered a neutral
| marketplace, and not a "store". But practically is there a
| difference between these arrangements, other than the
| incidence of who technically is the retailer and who is the
| wholesaler?
|
| I think the real issue is how people shop online versus in
| stores. Online, they see a linear feed of individual products
| and buy whatever is near the top. In a store, they see a
| variety of displays, and it's almost hard _not_ to comparison
| shop even a little bit.
|
| It's much, much easier to be "anti-competitive" on a web
| store than a physical store. Imagine if Costco did what
| Amazon does, deliberately making Kirkland products easier to
| find in the store and look more reputable/trusted compared to
| other brands.
|
| So I don't think the problem is that this particular move by
| Amazon is any more anti-competitive than anything a normal
| store with store brand would do. The problem is that Amazon
| already engages in _other_ anti-competitive activity, so
| pretty much anything they do related to their own store brand
| is distasteful.
| dathinab wrote:
| No in that case Costco would likely get into legal problems.
|
| Actually there had been legal cases with unfair market
| practices in grocery stores between different competing
| products sold there. I think there is currently a ongoing
| case with Oreo.
| chii wrote:
| > To me this behavior by Amazon seems worse
|
| only seems worse because amazon is so big, and so monopolistic,
| that a lot of people hold them to different standards.
|
| It's the same idea that people expect a rich person to pay more
| taxes, or contribute more philothropically.
| ClumsyPilot wrote:
| I know man, this idea that people in power have more
| responsebility that a random homeless person, socialism!
| notyourwork wrote:
| I'd rephrase this:
|
| "only seems worse because amazon is so big, and so
| monopolistic"
|
| as:
|
| "only seems worse because amazon is so big, and so dominant"
|
| I don't think monopolistic is a fair adjective because it has
| an implied legal connotation. Is Amazon a monopoly or just
| the largest e-commerce retailer today?
| selectodude wrote:
| Monopoly isn't the best term either, there's definitely
| other companies that are vertically integrated and are
| single-sources. What they don't do (or try to avoid?) is
| leveraging their position to unfairly complete with other
| companies.
|
| Amazon launching new product lines and boosting them to the
| top of the search results is almost textbook leveraging.
| Having information showing they used their internal data to
| find which products to market is basically icing on the
| cake.
|
| Google has already been dinged for this with their Google
| Apps boosterism on their search results. I can't imagine
| this goes any differently from that.
| BlueTemplar wrote:
| Monopoly does NOT mean being the only seller. According to
| US law, having 50% of the market can be enough.
| dragonwriter wrote:
| > According do US law, having 50% of the market can be
| enough.
|
| Having _much less_ than 50% of a descriptive market can
| be enough, if, e.g., you have pricing power, which
| demonstrates that irrespective of what other players may
| be described as being in the same market, they are not
| actually competing with you.
| notyourwork wrote:
| I DIDN'T claim Amazon is or isn't one.
| nerdponx wrote:
| > It's the same idea that people expect a rich person to pay
| more taxes, or contribute more philothropically.
|
| This has to do with diminishing marginal utility of wealth
| and nothing to do with holding different people to different
| standards.
| rtsil wrote:
| I'm not familiar with Costco. Do their sellers operate their
| own stores inside Costco's premises?
| jquaint wrote:
| I don't think they do. It's similar to a grocery store that
| sells other companies products. Costco is different in that
| they sell products wholesale/bulk.
| jquaint wrote:
| I think its a matter of scale. Say Costco makes a Kirkland
| brand cereal, there are other stores that you can buy cereal at
| and there is competition. For a lot people, all online shopping
| comes from Amazon. Amazon uses this position to their advantage
| in many ways (high quality customer data, branding, etc.). This
| actually disincentives people from making compelling products
| because of the risk that Amazon will just steal the product.
| Tiktaalik wrote:
| I recall hearing on a radio show a while ago about this topic a
| lawyer noting that a difference in these cases is that a
| retailer "takes a risk" in order to get the data, that is that
| they open up their storefront to this supplier, allocate space
| for them, and pay the supplier. The only way they learn that
| the supplier's product could be a success is by selling the
| suppliers product.
|
| In contrast Amazon takes on zero risk. It snoops on the data of
| transactions, and then launches competing products.
| michael1999 wrote:
| Costco is a retailer. Amazon claims to be a neutral 3rd party
| when providing marketplace services to 3rd party sellers.
| Especially when trying to disclaim product liability. They
| tried to have it both ways, and now they'll get neither, and
| deserve it completely.
| [deleted]
| jitendrac wrote:
| Costco launching/selling products with own sales data is one
| thing.
|
| To make it clear, Here you should consider Amazon.com different
| entity than Amazon Seller Account. Now would you sell on
| amazon.com if amazon.com leaks your data to "amazon seller
| account" owner to boost his sales of a similar product, which
| you sell.
|
| Moral thing is, Amazon seller division who deals with product
| directly sold by Amazon, should never have access to the data
| of other sellers.Fullstop.
| [deleted]
| nnain wrote:
| You need to consider whether there's a difference between
| physical mail and Email (esp. Gmail)? And whether Google's
| business model is monopolistic because its 'software' over the
| internet.
| zachware wrote:
| This is a good point. I don't think Amazon's practices are
| structurally different than those historically of Walmart or
| Costco.
|
| Each captured sales data and built private label alternatives
| to key brands on a regular basis. Small differentiator in the
| case of Costco is that they have a practice (though not a
| policy) of offering the leading vendor the opportunity to
| produce the private label before doing it themselves. But
| that's a small detail.
|
| Besides the fact that headlines about this get traction, there
| is a differentiator with Amazon in that they actively market
| themselves as a marketplace for small businesses in the way
| we've come to view Shopify. Costco and Walmart were always very
| clearly retailers...they buy stuff and sell stuff at a margin.
|
| So while I think a lot of the blowup about this is overdone,
| there is a legitimate argument about the difference between how
| Amazon markets itself and what it does. But, frankly, for
| anyone with any level of experience with retailers or, frankly,
| tech platforms, this kind of capture behavior should be
| expected.
| Y-bar wrote:
| I used to stuff shelves at a grocery chain ~20 years ago and
| one difference seldom mentioned is that grocery chains bought
| from the manufacturers. That meant that we as a grocery chain
| were responsible for the sale to consumer, we were not merely a
| marketplace for a bunch of different brands.
|
| So, even if we had our own competing labels for some products,
| the manufacturers would never be left in the cold with unsold
| stock (if for example we chose to drop one brand or run a
| promotion for our own).
| zachware wrote:
| This is generally not how grocery operates today.
|
| Most large grocers: - Sell shelf location
| slots to the highest bidder. - Include a consignment
| clause in their vendor agreements requiring vendors to take
| back spoiled, customer-damaged, and unsold inventory at X
| point or on-demand. - Require merchandisers to keep
| inventory in-stock for as many products as they can get
| vendors to manage (e.g. the coke delivery person is in-store
| several days a week.)
|
| All of this is especially true for shelf stable products and
| beverages.
|
| The modern grocery store is effectively managed like a flea
| market and is allowed to do so because the chains have so
| much leverage.
|
| So while we can take issue with Amazon's practices, we have
| to remember that most of large-scale retail operates in ways
| that if written about to the level of Amazon, we'd also be
| griping about.
| Y-bar wrote:
| Are you maybe describing US practices? Some of these
| practices has been prohibited for a decade in EU and it was
| recently broadened to include agricultural and perishable
| products: https://eur-lex.europa.eu/legal-
| content/EN/TXT/PDF/?uri=CELE...
| zachware wrote:
| Yes, US.
|
| Possibly related is that EU grocery margins are amongst
| the lowest in the world.
| gamblor956 wrote:
| What you have described is false. The major brands do not
| "sell shelf location slots" to the highest bidder (aka
| slotting fees), or require consigment clauses, or require
| merchandisers to keep inventory in-stock, as a general
| practice.
|
| Slotting fees and consignment clauses only apply to new
| products. Slotting fees are used as an alternative to
| consignment; they are basically a discount on the wholesale
| price paid by the store for new products that may not sell
| through. Alternatively, the store may sell the items on
| consignment, in which case it only pays the distributor for
| products actually sold through.
|
| Merchandisers...are employees of the stores (they're
| responsible for internal marketing efforts)...Perhaps you
| meant distributor? Only a few store chains have an in-stock
| requirement (Walmart and Costco), and that is due solely to
| the volume at which they sell-through.
|
| More importantly, and the crucial legal distinction: retail
| stores pay the distributors for the inventory on their
| shelves, except for the 1% offered on consignment (i.e.,
| new products sold on a trial basis), while Amazon _gets
| paid by_ the distributors. That legal distinction is at the
| heart of why what Amazon does is problematic.
|
| (Source: Kroger was a former client.)
| carlps wrote:
| I'm not intimately familiar with either side, but I see it as:
| - Costco buys x amount of product at y price from seller and
| then sells it in its store. - Amazon provides a platform for
| sellers to sell with a cut going back to Amazon.
|
| There is a fundamental difference between being a retailer and
| providing a retail platform.
|
| All Costco would really have access to is how much they've
| bought and how that has performed for them. Meanwhile Amazon is
| providing a platform for companies with a policy that they will
| only use their data to help them, which is what is allegedly
| not happening.
| PoignardAzur wrote:
| _> I 'm not intimately familiar with either side, but I see
| it as: - Costco buys x amount of product at y price from
| seller and then sells it in its store. - Amazon provides a
| platform for sellers to sell with a cut going back to
| Amazon._
|
| This isn't really how it works. Retailers very often have
| arrangements to defer payments until after the product is
| sold.
|
| In fact, in France, retail margins are so thin that
| supermarket chains reportedly make most of their profit by
| selling the inventory, investing the money in short-term
| funds, then paying the suppliers one month later and keeping
| the interest.
| hnburnsy wrote:
| With short term interest rates in the negative in France, I
| wonder what their business model is now...
|
| https://data.oecd.org/interest/short-term-interest-
| rates.htm
| jasallen wrote:
| The difference is between retailer and marketplace. Both Amazon
| and Costco are retailers, and both could use that knowledge to
| decide what products to self-source for better retail margins.
| Either way, still a retailer, but maybe also a manufacturer /
| wholesaler.
|
| But Amazon is also a marketplace. In that role it acts as a
| "rentable retail space". Using the data of the retailers in
| your marketplace to decide what to make/wholesale and then
| retail is another layer.
|
| You could easily argue that it reduces to the same thing. But
| societally we've excepted that the retailer is a full layer in
| the system and gets full access to the data flowing through it.
| The marketplace itself is historically more of a fee-for-use
| type of thing, so its not an ingrained concept for us.
| chaostheory wrote:
| > But Amazon is also a marketplace. In that role it acts as a
| "rentable retail space".
|
| Most brick and mortar retailers also sell space to
| manufacturers. Product positioning in the store and even on
| the shelves isnt solely due to UX
| dehrmann wrote:
| > But Amazon is also a marketplace
|
| Meanwhile, https://news.ycombinator.com/item?id=24174276
|
| "Amazon Liable for Defective Third-Party Products Rules CA
| Appellate Court"
|
| It seems both regulators _and_ Amazon want whether or not it
| 's a marketplace to go both ways whenever it's convenient.
| mdoms wrote:
| There's nothing definitional about "marketplace" that says
| you don't have to bear responsibility for what is bought
| and sold on your marketplace.
| cowpig wrote:
| In an ideal world regulators want to define Amazon as
| whatever best fits with the public's best interest (as
| opposed to what is convenient)
| [deleted]
| IncRnd wrote:
| You're misreading the ruling. The ruling is for state law
| not federal and says the following, "The Appellate Court
| didn't agree with Amazon's stance. It noted that the
| product had been listed on Amazon, was stored in an Amazon
| warehouse, had payment facilitated by Amazon, and shipped
| it out in Amazon packaging, proving it to have a hand in
| getting it to Bolger and thus liable under California law."
| So, this stance will change depending on the product and
| what law is being alleged to have been broken.
| Manuel_D wrote:
| I'm still not understanding the distinction here. Costco and
| Amazon both sell company-brand products, alongside non-
| company products. Costco and Amazon collect and analyze sales
| data from the sale of both company and non-company products.
| Closi wrote:
| > Costco and Amazon collect and analyze sales data from the
| sale of both company and non-company products.
|
| It's similar, although personally I think the relationship
| between the companies is meaningfully different:
|
| Costco purchases product from manufacturers, and may choose
| to source product from other manufacturers (including under
| its own brand name). It uses it's _own_ sales data to make
| this decision.
|
| Amazon acts as a marketplace for other businesses to list
| and sell their own products. These businesses are online
| retailers which use the Amazon platform, and pay Amazon
| fees for this service. Amazon is then using _other
| retailers_ sales data in order to inform it 's own
| business.
|
| The difference is with Costco it is _their own_ sales data,
| while in Amazon it is the sales data of _other retailers_.
| It would be an issue if Walmart had access to Costco 's
| sales data and not visa-versa (this would provide Walmart
| with an unfair competitive advantage). Similarly other
| smaller online retailers do not get access to Amazon's
| sales data, but Amazon get's access to the other retailers
| sales data who use their platform, and will then use this
| to compete with them.
| hirako2000 wrote:
| Amen.
| judge2020 wrote:
| Despite this I don't see how the case is that Amazon is
| being anti competitive while Costco isn't - just because
| they purchase and resell inventory doesn't mean Costco
| (or Walmart or Sams Club etc) doesn't hold the same power
| over their product suppliers that Amazon does to do data
| science on their sales to determine what new products to
| make in-house.
|
| Plus, walmart is now a marketplace as well. This
| overpriced GPU is 'Sold & shipped by Monoprice Inc'. It's
| only a matter of time before Walmart commits the same
| anticompetitive acts as Amazon using Marketplace data.
| https://www.walmart.com/ip/Zotac-NVIDIA-GeForce-
| RTX-3080-Gra...
| fredophile wrote:
| Analyzing their own sales and analyzing other people's
| sales on their platform are two different things. Saying
| that Walmart may also try to do this in the future does
| not make it right or excusable.
| judge2020 wrote:
| How is it different? The same outcomes and potential
| power abuse happens in both situations.
| hansoolo wrote:
| I really think you don't get the point of how Amazon
| marketplace works
| foerbert wrote:
| I think the difference they are getting at is something
| akin to this.
|
| In one situation you run a stall and buy products from
| people to sell at that stall. At some point you use what
| you've learned doing this to sell your own product.
|
| In the other, you don't buy anything from anybody. Instead,
| you rent out a stall for other people to sell things from.
| You then watch the stall and use that information to open
| your own stall.
|
| The first case seems pretty normal to most people, I think.
| The person you were buying from originally doesn't
| inherently get some kind of assurance that you will always
| buy from them in the future. There's no difference to the
| seller if you buy from somebody else, don't sell any of
| that product, or make your own. We just don't expect that
| buying goods from somebody inherently adds any other kind
| of obligation. It's two equal parties making an exchange,
| and nothing more.
|
| The second case, however, I think is not so clear cut. All
| of the sudden you have a lasting relationship between two
| unequal parties. These are the sorts of situations where
| you tend to find more implicit or inherent obligations on
| the participants. It's no longer the guy you sold that
| thing to not buying from you again, it's your landlord
| competing with you.
|
| I'm not trying to pick a side here, so much as I am trying
| to explain why people might not see the two situations as
| identical. And of course there are plenty of real-world
| complications too.
| [deleted]
| NegativeLatency wrote:
| When Costco sells a product they've already bought it (a
| retailer) on the other hand when Amazon sells something
| they're just acting as a middle party for the item in most
| cases.
| mrandish wrote:
| That's often not the case. Retailers like Costco,
| Walmart, Best Buy etc have a wide variety of different
| selling arrangements. I've sold products through all
| three and often did so on terms that gave them full right
| of return for any unsold product as well as significantly
| delayed payment.
|
| This combination basically nets out to be financially the
| same as pure consignment. They won't pay me for my
| product until well _after_ it has sold-thru to an end
| user. Everything that 's unsold comes back to me (and
| they bill me for shipping both ways!) In the meantime,
| all I have is basically an "IOU" promise to someday pay
| IF it eventually sells (and they always drag out the
| payment beyond the already-extended due date).
|
| Also, if I want to be featured in their circular I have
| to "buy" that just like an ad in a magazine except the
| retailer will (usually) DFI (deduct from invoice) the
| "ad" cost, which means they just owe me less (if and when
| the product sells and they actually pay). The same is
| true for getting my product displayed on an end cap or
| with in-store signage.
|
| The big retailers bring in new products to "test" all the
| time and do so at basically no financial risk to
| themselves (other than the opportunity cost of the shelf
| space) while capturing all the sales data.
| soperj wrote:
| >(and they always drag out the payment beyond the
| already-extended due date)
|
| That's pretty much their business model isn't it? Make
| money on investing for the days between product sold and
| payment.
| vkou wrote:
| You can only make a little money on that because interest
| rates are near zero, and investments with non-zero
| returns carry risk.
| Manuel_D wrote:
| I'm not sure how Costco works specifically, but that's
| not the case in all retail. At GameStop, game publishers
| only got paid when their games sold not when they were
| put on the shelves. If there are 100 disk cases put on
| the shelves for Call of Battlefield and none of them
| sold, eventually GameStop would return them and the
| publisher got nothing.
| hammock wrote:
| >When Costco sells a product they've already bought it (a
| retailer)
|
| In practice that's not the case at all. Many if not most
| retailers require suppliers to buy back unsold inventory
| eropple wrote:
| Amazon sells products _and facilitates others ' sales_.
|
| If Amazon carried the entirety of their inventory
| themselves like Costco or like Walmart used to be (before
| the expansion of their own online marketplace), it would be
| a distinctly different situation.
| 8note wrote:
| That doesn't sound aligned with the California case
| yesterday?
| FactolSarin wrote:
| All of Amazon's "we're not actually a monopoly" and "we're
| not responsible for defective products" arguments are based
| on this. They claim they are very much NOT a Costco or
| Walmart.
| cgriswald wrote:
| You have the wrong mental model. Amazon isn't Costco.
| Amazon is a shopping mall that has access to its tenants'
| sales information and also owns an anchor store in the same
| mall.
|
| Costco can determine that Best Brand shoes sell in its
| stores and decide to source shoes themselves and stop
| carrying Best Brand.
|
| Amazon can determine that the Footlocker in their mall is
| making a killing selling Best Brand shoes and either sell
| Best Brand shoes in their anchor store or source their own
| shoes, all at a price that Footlocker can't match. They can
| also advertise those shoes throughout their mall and change
| the layout so customers have to walk past their cheaper
| shoes to get to the Footlocker.
| criddell wrote:
| Maybe Costco is different, but at a lot of stores the
| line is blurrier. You might be able to get your product
| on store shelves, but if you want good placement, you
| basically have to rent that shelf space.
| awillen wrote:
| This explanation doesn't explain the difference to me at
| all. Costco can see that vodka sells well, so they can
| make Kirkland brand vodka. They control the layout of the
| store, so they can change the layout so people see
| Kirkland brand first when they get to the liquor section.
| They know the pricing of other vodkas and which ones sell
| well, so they can source Kirkland vodka at an ideal price
| point.
|
| None of what you've described about Amazon differentiates
| it from Costco at all.
| raisedbyninjas wrote:
| When Costco sells Kirkland brand vodka and Grey Goose,
| all bottles of Grey Goose are sold the same way. Costco
| purchases directly or from a distributor. Grey Goose may
| or may not pay for shelf space, IDK. Purchasing premium
| shelf space is a common practice for other retailers and
| grocers. When Grey Goose is sold on Amazon, either Amazon
| buys it and re-sells it or Grey Goose sells it through a
| marketplace account incurring Amazon's marketplace fees.
| So Amazon can always have two listings for one product, a
| marketplace listing and an Amazon listing. Their Amazon
| listing can always be cheaper.
| mattmcknight wrote:
| They don't have two listings though. They list the prices
| of all sellers in one item, with the lowest price as the
| default.
| 411111111111111 wrote:
| I think the only difference is that Amazon is a digital
| marketplace, so they can and do let their users pioneer
| what gets sold.
|
| Space is at a premium with a physical location, so the
| likelihood of an actual store exploiting that is
| extremely unlikely
| awillen wrote:
| Unlikely? I literally just described an example of Costco
| doing this right now with vodka. That's not a
| hypothetical - Kirkland brand vodka is a real thing.
|
| Your logic is backwards - when space is at a premium,
| making the most profit off each item in that space is
| critical. It makes more sense for Costco to do this than
| it does for Amazon, not less.
| fredophile wrote:
| Store brand products are not new and not the issue. Let's
| pretend that Costco didn't currently sell vodka at all.
| If Costco wants to know if they should start selling
| vodka or bottling their own vodka and selling that they
| don't have access to the sales data from the liquor store
| next door to Costco. Amazon is letting other businesses
| take the risks and using sales data from those businesses
| to outcompete them.
| judge2020 wrote:
| But Costco does sell Vodka and wouldn't have made that
| product if Vodka sold 10% of what it actually sells.
| Because Amazon sells literally everything, is it a crime
| to do what Costco does, just on a bigger scale?
|
| The only end-goal that would actually solve the problem
| fairly is if companies couldn't sell first-party products
| (or products from a partner where they have a vested
| interest in) in their store. If you just take care of the
| one company, you end up with other companies doing the
| same thing in 20 years like how iOS still has a default
| music player when MS got burnt for that with having a
| default browser.
| cycomanic wrote:
| This is not about making a home brand. Amazon can
| literally look at the sells data of e.g. some seller
| which sells Nike Air Jordans (as a stupid example) and go
| and source those themselves and offer them (the exact
| same brand) cheaper than the seller, because they have
| all the sales data. Now how would Cosco do this?
| judge2020 wrote:
| Costco also looks at sales data for competing products
| (within Costco) and chooses to make house brands of those
| products.
|
| It's not like Amazon sees sales data from someone's
| shopify site if people choose to sell on both brand.com
| and amazon.com.
| fredophile wrote:
| I feel like people in this thread are being deliberately
| obtuse. The issue isn't about selling vodka. It isn't
| about selling store brand alternatives to brand name
| products. The issue is where Amazon is getting their data
| from when decided what products to sell and what store
| brand products to make.
|
| When Costco decides to make a store brand alternative
| they are using sales data for things they have sold in
| their store. Amazon is using data for things other people
| have sold. Amazon is not doing what Costco does.
| gamblor956 wrote:
| That's the right way to look at it, missing just one
| crucial detail.
|
| Costco _pays_ for the items that appear on its shelves
| (excepting the <1% of goods that are on a consignment
| basis, usually new trial products). The distributor of
| the store brand and the name brand have already been paid
| for the products (and are usually the same company).
|
| Amazon _gets paid_ by the distributors (aka third party
| sellers) on Amazon.com for handling their sales (even in
| instances where it is not handling fulfillment), while
| _also_ competing against them. That is where the
| anticompetitive concerns arise.
|
| If Amazon just sold stuff through the Amazon.com seller,
| and didn't have third-party sellers, (or if it operated a
| _separate website_ for third party sellers) that would be
| fine.
| Nasrudith wrote:
| Don't most large brick and mortar retailers maintain
| refund for unsold goods agreements in addition to
| defects? Generally only exercised if they are complete
| failures.
|
| Effectively the difference in practice is a matter of
| financing and grain of operation - older retail would
| gain more and give no extra to upfront sales of say
| toliet paper after a demand spike raised prices while
| Amazon would give them a per sale percentage cut.
|
| At what point does own involvement in consignment sales
| models become not fine? If it works at 1% consignment. Is
| it 25%? 50%? 75%? 90%? Or more likely it doesn't exist
| because the whole concept is a fabrication that pays no
| attention to real law and operates in the court of public
| opinion to push their bullshit which wouldn't even need a
| defendant motion before winding up dismissed by a judge
| because they cannot point to any real laws?
| codemac wrote:
| It's simple, Costco actually buys the inventory, and
| resells it. There are more advanced kinds of agreements
| (like buy back X number of coats of you sell less than Y)
| but that's largely how they operate.
|
| Amazon is much more like a digital mall in that they rent
| out their store features for sellers.
|
| However, Amazon would like to be seen by the customer as
| Costco and this causes dissonance between how they treat
| sellers, and how they treat customers.
| awillen wrote:
| Okay, you've described the business models, but so what?
|
| In both cases, they still use the sales data available to
| them to create and sell their own products at the expense
| of third party sellers. In Amazon's case, that means
| diverting customers away from third party listings to
| their own. In Costco's case, that means making fewer
| purchases from third party sellers because the amount of
| shelf space available decreases as Costco puts more of
| its own products out.
|
| The type of sales relationship that they have with third
| party sellers doesn't change the fact that both are using
| sales data to create and sell their own products at the
| expense of those third parties.
| ClumsyPilot wrote:
| >"Okay, you've described the business models, but so
| what?"
|
| That the defining feature mate!
|
| Getting paid an extra to provide premium service to a
| customer is normal in some areas, but it's a crime of you
| hold public office.
| hirako2000 wrote:
| S/he may argue that public officials manage to do it too,
| despite its illegality, hence it's Okay for Amazon to do
| so. For some, whatever Amazon does is okay, there will
| always be some other cases happening elsewhere that in
| some twisted ways are the same. I think most people are
| only ever consumers, and can't escape their subjectivity
| on this matter. They get theit toys delivered within a
| couple of days, the invoice says free delivery, they want
| things to remain that way so what ever Amazon is doing is
| okay (for them, for now)
| cwyers wrote:
| In the Costco model, Costco pays up front for the vodka
| and incurs all the risk if the vodka doesn't sell. In the
| Amazon model, Amazon charges third-party sellers "rent"
| to be on the platform in the form of a cut of all
| transactions, but the third-party sellers still incur all
| risk for inventory that doesn't sell. And then Amazon
| turns around and uses the sales data from the third-party
| sellers to undercut them later on.
| megaman821 wrote:
| I am not sure about Costco, but Best Buy does not
| purchase all the items it sells. For some items it only
| remits a payment to the manufacturer after the item has
| sold. Should they not get to see the sales data?
| nkrisc wrote:
| > relationship that they have with third party sellers
|
| There are no third party sellers at Costco, it's only
| Costco.
| awillen wrote:
| Costco buys products from third party sellers. That is a
| relationship with third party sellers.
| [deleted]
| colejohnson66 wrote:
| Not always true. Usually, Costco/Target/Walmart/etc. pay
| for it before it sells, but it's not always like that.
| "Vendor" products like Frito Lay, Bimbo, etc. are
| _sometimes_ given the ability to just put product on the
| floor at no cost to the retailer. When it sells, the
| retailer will send money to the vendor.
| gamblor956 wrote:
| Consignment sales represent less than 1% of retail sales
| at these stores, and generally only are required for new
| products that the retailer will not purchase in bulk
| before the distributor proves market demand.
|
| Generally, for the sales you have described, the
| consignment sales are paired with marketing efforts by
| the distributor to demonstrate customer interest. If the
| test succeeds, the store will purchase future lots from
| the distributor. If the test does not, the product
| disappears from the shelves and the distributor stops
| selling it.
| dec0dedab0de wrote:
| _In both cases, they still use the sales data available
| to them to create and sell their own products at the
| expense of third party sellers._
|
| Costco doesn't have any third party sellers. Costco is
| the only seller.
| arrosenberg wrote:
| Yes, but the terms of the relationship make Amazon's
| behavior anti-competitive. Costco isn't going to various
| brands and asking them to sell at Costco, they buy
| inventory and resell it at a profit. Amazon has convinced
| a large portion of the retail market to feudalize
| themselves on Amazon's platform, then they are using the
| data accrued to take over the markets of their current
| and former tenants.
| LanceH wrote:
| Costco buys products and resells them. Costco's research
| numbers are paid for entirely by Costco.
|
| Amazon rents space to merchants where those items are sold
| through the site for a fee. Amazon is never on the hook for
| a sale and is basically getting paid to do the market
| research to set up as a competitor.
|
| Yes, Costco does do some referral sales but I can't think
| of anything which has gone on to be a Kirkland product.
| elzbardico wrote:
| Costco buys the products it sells. Then it decides how and
| for how much they will be sold. Their product, paid for.
| That's the difference
| tlogan wrote:
| Majority of big retails also rent majority of their shelves
| to vendors. This is called consignment contract.
|
| So no big difference...
| legutierr wrote:
| This explanation makes the most sense to me, but there is
| something that you are leaving out. Not only is Amazon a
| marketplace, but it is THE marketplace. Amazon has an
| effective monopoly on small-seller logistics and marketplace
| services in the United States (and many other places), soup-
| to-nuts.
|
| If you are anything other than a massive corporation, any
| manufacturer that chooses not to sell through Amazon and
| utilize all or most of its services (marketplace listing,
| payments, warehousing, delivery) will be at a massive cost
| disadvantage and will not be able to compete with other
| sellers that do choose to participate with Amazon.
|
| And more significantly, perhaps, if you don't sell through
| Amazon's marketplace, you are often unable to compete with
| Amazon itself.
| awillen wrote:
| This just isn't really true. It depends on what type of
| product you're selling, but there are a huge number of
| independent ecommerce stores that do extremely well.
|
| I sell dog treat mix (coopersdogtreats.com) - I do much
| better both in terms of margins and overall sales on my own
| website (with traffic coming primarily via paid FB ads)
| than on Amazon.
|
| That's not even including other huge marketplaces like
| walmart.com, Chewy, Etsy, etc.
|
| Amazon doesn't have a monopoly on small-seller logistics -
| I'm about to move all of my logistics over to a 3PL, and
| there are plenty that will cost-effectively work with
| startups (ShipBob, Shipmonk, etc. - just Google "ecommerce
| 3PL" and you'll see what I mean).
|
| How much Amazon plays into your business obviously depends
| on the category, but the idea that it's impossible to
| compete in ecommerce unless you're on Amazon is an easily
| disproven myth.
| legutierr wrote:
| I'm happy to read what you are saying, and stand
| corrected.
|
| I wonder, though. Do you think your experience is
| typical?
|
| Am I wrong to think that your product is more niche and
| premium than the most products that are sold via the
| Amazon marketplace? Do you think that you might get more
| repeat business than most products sold on Amazon?
|
| It's been a while since I've looked into pricing for FB
| ads, but my sense is that a product with more narrow
| margins and less potential for repeat business could find
| it difficult to attract customers via advertising without
| increasing prices beyond what could be found on Amazon
| for competing products.
| awillen wrote:
| I think Amazon's too big and broad to describe any
| experience as typical, but there are certainly
| differences in the type of business.
|
| You are 100% right that my products are niche and
| premium, and that definitely makes a difference. But on
| the other hand, if you're a startup selling a commodity
| product, you're in a bad position for a whole lot of
| reasons other than Amazon.
|
| From an advertising standpoint, you're right - I have the
| advantage of selling a product that has a high repeat
| rate, and that's helpful. On the other hand, my AOV is
| fairly low and my margins are okay but not extraordinary.
|
| I think that the points you're raising here are what
| matter - not Amazon. If you're in a business that is one
| of: high AOV, high margin, subscription/frequent repeat
| customers then you're okay. If you're in a low margin,
| commodity business and you aren't operating at a huge
| scale, you're not in a great spot.
|
| Ultimately, I think the actual value added by Amazon for
| startups is trust - I know that if I order from them,
| your product will arrive on time, and if there's an issue
| it'll get fixed ASAP. All of the other stuff, like two-
| day shipping and customer-friendly return policies, is
| doable off of Amazon. Even trust is achievable in other
| ways, though - my company was featured in an Associated
| Press article that was broadly syndicated, and when I
| slapped "AS SEEN ON USA TODAY, FOX, KTLA AND MORE" on the
| top of every product page and the top of my FB ads, it
| made a huge difference immediately.
|
| And actually now that I've typed that I'll add one more
| thing in Amazon's favor - ease of use. If you don't know
| a lot about ecommerce, it's pretty easy to get set up and
| ship them product. It's also easy to advertise, simply
| because their advertising is much, much simpler than
| Facebook. There's no copy and limited ability to use
| creative outside of your product images, so you don't
| have to constantly test stuff. While my sales on Amazon
| aren't high margin, they're also extremely low effort.
| rossjudson wrote:
| I'm curious about how you would compare Amazon vs your
| own site. Things like Amazon's buyer-friendly return
| policy comes to mind...which clearly come at a cost for
| sellers (and buyers, fairly directly).
| awillen wrote:
| I have a very small number of returns on Amazon, since my
| product can't be used and then returned.
|
| Amazon isn't terrible, but it has two big problems for
| me. First, margins are lower because I'm not only paying
| them a cut of every sale, I'm also paying for Amazon
| advertising. Second, I don't have a relationship with the
| buyer, which is the real killer. I do really well with
| repeat sales via email, and those are where the real
| margin is since I'm not paying to acquire those users
| again. On my site, I can afford to break even (or even
| lose a little money) on the first sale, where I must make
| money on each sale on Amazon.
|
| I will say the one big difference between my product and
| many on Amazon is that it's not something that you seek
| out - very few people are searching for "dog treat mix"
| on Amazon (or Google/Bing/etc.). Amazon does have some
| types of advertising that work well for targeting other
| luxury dog goods, but my volume is going to be limited
| there. Facebook advertising works better for me, because
| I can target people by demographics and explain the
| product in an ad.
|
| To that point, it may be important to be on Amazon if
| you're in a commodity business. On the other hand, it
| sucks to be in a commodity business for so many other
| reasons that I hardly think it's reasonable to pin the
| blame on Amazon for the difficulties there.
|
| The one thing I will say about Amazon vs. Shopify that
| surprised me is that Amazon's support tends to be quite
| competent (at least if you call them - you get nothing
| but canned responses via email), while Shopify's is just
| terrible. They can help with basic issues using the
| software, but when it comes to real problems, like bugs
| in reporting (or more recently in my case, a bug where
| they undercharged a customer), they just say they'll get
| back to you and never do unless you are incredibly
| aggressive about hounding them.
| mountainb wrote:
| What people kind of miss is that outside of FBA it's the
| actual logistics companies that are handling the
| logistics for all merchant fulfilled Amazon sales. The
| normal logistics companies are also handling a ton of the
| work involved with getting goods to FBA. There are lots
| of 3PL solutions that can deliver FBA style performance
| at a lower cost to the seller. There are other advantages
| to not using Amazon as a seller or just using Amazon as
| one additional channel among multiple ones.
| dv_dt wrote:
| I've seen at least one other comment saying this, and not
| that I don't believe you, but can you name several
| companies that do that and come within say 150% of
| Amazon? Last time I really dug into this was years ago
| and nothing was really close then, maybe it's better now?
|
| My other question to comments : > What are the Amazon
| level logistics and delivery service that is available to
| a smaller retailer? I see some nascent choices but they
| really aren't that close.
| awillen wrote:
| I've priced out several and all are within 150%. Shipbob
| is the closest at 10-20% more expensive than FBA, but
| depending on your product it may actually be more cost
| effective. I need them to pick and pack several items,
| since I sell my stuff individually as well as in kits
| (boxes of multiple items, which are vastly more popular
| than people buying individual items), and they include
| most of the cost of building out those kits in their
| shipping fees.
| jtsiskin wrote:
| I think Shopify's massive success means this likely isn't
| this extreme
| Nasrudith wrote:
| That sounds awfully like the Platform vs Publisher
| distinction "logic".
| lsaferite wrote:
| So how do you factor in the recent ruling in California?
|
| > An appeals court in California has ruled that Amazon can be
| held liable for products sold through its marketplace by a
| third-party seller
|
| That seems to obviate the distinction of 'marketplace
| facilitator' vs. 'retailer' for them. That makes them much
| more like Costco with a special relationship with vendors to
| set up vendor-specific sections in their store.
|
| Personally, I've always detested the 3rd-party market in
| Amazon and wouldn't mind seeing it go away.
| hirako2000 wrote:
| Amazon doesn't see it that way, their optimised their
| business as an ad platform + logistic solution. Higher
| margins there than bothering acting as sellers with risky
| margins.
| hirako2000 wrote:
| Amazon doesn't see it that way, their optimised their
| business as an ad platform + logistic solution. Higher
| margins there than bothering acting as sellers with lower
| and not even guaranteed margins.
| gamblor956 wrote:
| The distinction comes down to the legal differences in how they
| operate their sales operations:
|
| Costco is legally a "reseller" that _purchases_ items from
| manufacturers /distributors (at wholesale prices) and "resells"
| them to customers. (Note: only a tiny fraction (<1%) of
| Costco's inventory is sold on a consignment basis, meaning that
| the manufacturer/distributor only gets paid for units actually
| sold on. This arrangement generally only applies to some new
| products being sold on a trial basis.)
|
| Amazon is _also_ a reseller of items sold through the
| Amazon.com seller...but _not_ for items "sold" by third-party
| merchants. The distinction is that for Amazon.com seller sales,
| Amazon has _legally purchased_ the inventory sold, even if the
| payment terms may more closely resemble consignment
| transactions than wholesale transactions.
| [deleted]
| munificent wrote:
| This is a good question. It rests on an implicit assumption
| that we think Amazon's behavior is anti-consumer ("bad") and
| Costco's is not ("good").
|
| But perhaps one way to resolve this dissonance is to consider
| that Costco's behavior is anti-competitive too. They are a
| beloved brand, but that doesn't mean our emotional attachment
| to Kirkland products is an accurate reality-based moral stance.
| xmly wrote:
| It is like Microsoft learns your business through your emails
| and starts the undercutting. Does it sound more serious?
|
| AmazonMarketplace is a software vendor and data should belong
| to sellers only.
| poidos wrote:
| I'm not sure if it's fundamentally different, but maybe you're
| just (like I am) more inclined to perceive Amazon as a "bad"
| company. Costco has a lot of goodwill with the public.
| MengerSponge wrote:
| Imagine if a Costco sales rep offered to swap something in your
| cart with the Kirkland clone, or if they suggested the Kirkland
| product as you reached to grab something else off the shelf.
| notyourwork wrote:
| Are businesses in the business of increasing efficiencies
| (more revenue, more profit, lower costs) or are they in the
| business of doing what is in the best interest of consumers
| or both?
|
| I don't think your example really holds weight. I goto Costco
| because they offer products I want at a price I like. If
| during shopping they were trying to give suggestions to
| better deals I'm not sure as a consumer I get to complain
| about it do I?
| cptskippy wrote:
| I've never had amazon offer to swap anything from my cart.
| tylerrobinson wrote:
| Aren't traditional grocery stores doing the same thing but
| using price, sales, positioning, name, and label imitation?
| When I reach for Quaker Oatmeal Squares, and Wholesome
| Oatmeal Squares Cereal is right next to it, for cheaper, also
| in a blue box?
| dathinab wrote:
| And they have gotten into lethal trouble because of it, I
| think there is a ongoing case against Oreo because they
| abused their market power to affect in shelf positioning in
| a way which likely counts as unfair/illegal abuse of marked
| power.
|
| Most important grocery stores and similar are resellers,
| Amazon is a proxy.
|
| Sure that pretend they sell you things but actually you
| just buy things through them, not from them. (Except their
| own products.)
| nerdponx wrote:
| It's a lot easier to comparison shop. Also you can trust
| that the Quaker on the shelf is real name-brand Quaker. So
| you can look at the store brand prices, packaging, etc. and
| make a reasonably informed and quick decision.
|
| I wouldn't be surprised if Amazon lets the fraud and
| ratings scams go somewhat unchecked so as to make their own
| house brand look "safe" and desirable.
| krumpet wrote:
| Take a quick trip the Costco website and you'll see they use
| the same recommendation tactics. Looking at a bag of Peet's
| brand coffee, I see Kirkland Signature brand coffee sitting
| in the "Similar Product". Just saying...
| bogwog wrote:
| Isn't it sad that all our tech giants are guilty of anti-
| competitive behavior? You know, things that are supposedly
| illegal and should have been stopped by government regulators
| long ago?
|
| It makes me wonder if these American businesses are really so
| different from the likes of Tencent, Huawei, etc and their ties
| to the Chinese government. Everyone knows those companies are
| only as big as they are because of government support. Can you
| really say that isn't the case with Google, Apple, Microsoft,
| Amazon, Facebook, etc?
| droopyEyelids wrote:
| I think the difference is that FAANG's regulatory capture isn't
| an explicit part of how our government works, it's implicit.
| president wrote:
| They are getting there. Don't forget censorship and silencing
| unfavorable political speech.
| ecommerceguy wrote:
| We also use Amazon data to find/develop products to sell. I
| assume all sellers do.
| spaceribs wrote:
| Amazon should be nationalized.
|
| All these 3rd party companies want is a "farmers market", a stall
| to sell their wares. Give them the municipal software
| infrastructure they need to do so and maintain it as a public
| good.
| whalesalad wrote:
| Every time a business gets this successful someone will
| inevitably come out of the woodwork and say "the government now
| needs to own this, there is no other option" - wat?
| amelius wrote:
| Stallman said it too:
|
| https://stallman.org/amazon.html
|
| > We should not allow a company to have a share over around 10%
| of any market. If in a certain field a single dominant company
| is beneficial for society, that means it is a natural monopoly,
| and should be served by a regulated utility.
| rualca wrote:
| > We should not allow a company to have a share over around
| 10% of any market.
|
| If a company was already at said 10% limit and you wanted to
| buy something out of them because to you their offer is by
| far so much better than any of the alternatives, in your
| opinion what should happen?
| dragonwriter wrote:
| If they are offering, you buy it. Regulation would affect
| their legal ability and/or willingness (depending on the
| style of regulation) to make the offer.
|
| For instance, a regulation addressing this could involve a
| tax on gross receipts (not profits) in a defined market
| segment that was 0% at up to 8% share, and 50%x(10 - share
| in %) above that point.
| batty_alex wrote:
| It's not a math equation you run through a computer and get
| a legal result out the other end. Congress (or whatever)
| could use this measurement as a tool to drive
| investigations so you can stomp out anti-competitive
| behavior before it becomes a problem
| rualca wrote:
| > It's not a math equation you run through a computer and
| get a legal result out the other end.
|
| Not really. This has zero to do with math. At all. We
| have a buyer and we have a seller, both the buyer and the
| seller wish to perform a transaction, but then we have a
| regulator which arbitrarily wants to force them not to
| execute said transaction because of reasons.
|
| And my question is terribly simple: to those who want to
| force someone like me from buying what I like from a
| seller I chose but they arbitrarily reject, how exactly
| do they wish to force me from buying what I'd like from
| who I chose to buy from?
|
| No math, no numbers. I'm asking a very simple question:
| what then?
| diab0lic wrote:
| > No math, no numbers. I'm asking a very simple question:
| what then?
|
| The comment you replied to answered your question. The
| transaction goes through, absolutely no additional
| regulation or control comes into play at the transaction
| level.
|
| NOTE: I am not supporting this position, or opposing it.
| I'm just stating what the gp post said.
| rualca wrote:
| > The comment you replied to answered your question.
|
| It really didn't, instead it weaseled out by putting up a
| strawman that pretends to put a loophole in a straight-
| forward and very clear way.
|
| In fact, it's blatantly clear by itself the fact that no
| one proposed a single idea or suggestion about how to
| enforce that mysterious 10%. No explanation was given on
| the impact on customers, and how the sellers would be
| forced to not go beyond that 10%. Why is that? Is the
| idea undefendable?
| boomboomsubban wrote:
| There should be an investigation into why they can make a
| far better offer than their competition. Most answers are
| likely exploitative in some way.
| ch4s3 wrote:
| > Most answers are likely exploitative in some way
|
| On what basis are you making a claim like that? Toyota
| sells roughly as may vehicles in the US a Ford and more
| than the other manufacturers. Their cars are in many ways
| better than their competitors qualitatively and often
| cheaper. Do you think they are exploiting people?
|
| I could keep listing examples of market leaders that
| offer better products that are more aligned with consumer
| preferences, but I'm not sure that's going to convince
| you.
| boomboomsubban wrote:
| >Do you think they are exploiting people?
|
| Yes, part of how they achieved this was by violating
| emissions standards for a decade, something that they've
| been fined for. I'd be willing to wager they engage in
| similar practices too.
|
| >I could keep listing examples of market leaders that
| offer better products that are more aligned with consumer
| preferences,
|
| Their existence alone won't convince me. You need to
| answer why the competition is unable to produce similar
| products at similar prices.
| ch4s3 wrote:
| > violating emissions standards for a decade
|
| This began well after they entered the market and upset
| the dominance of established players.
|
| > You need to answer why the competition is unable to
| produce similar products at similar prices.
|
| The same way some people are better at given task. Many
| older firms are complacent, and operating on an
| understanding of the market as it existed in the past.
| Technology, consumer preferences, commodity prices, and
| other market conditions are constantly changing. If you
| see something you competitors don't you can offer better
| cheaper services. The bigger your competitors are, the
| slower they are to change course.
|
| At bottom, firms are made up of people who are uniquely
| skilled and qualified. Better people in better systems
| will perform better. It can be dead simple sometimes.
| Firms with happier employees are often more productive.
|
| If you don't understand the basics of competitive
| advantage, then of course you think companies can only
| gain an edge by doing something immoral. But this is
| ultimately sophomoric economic thinking.
| boomboomsubban wrote:
| >This began well after they entered the market and upset
| the dominance of established players.
|
| I still find it unlikely that it is an isolated incident,
| but that decade is also when they started to pass the
| mentioned 10%.
|
| >But this is ultimately sophomoric economic thinking.
|
| Your attempt to explain why the competition may be unable
| to compete is "they're just better." Beyond that, you
| just say smaller is better, which is the point of my
| argument.
| TchoBeer wrote:
| I think what OP means is that amazon is using all the
| data they have from their storefront to beat everyone in
| the market, which does seem unfair to me.
| ch4s3 wrote:
| I get that, but it doesn't seem any different from any
| national retailer that sells store brand products along
| side competitors. I'm not even sure how unique this data
| is. Every corporation in America has access to relatively
| detailed data about their competitors' sales. There's a
| time delay, but know what's selling well is really a
| small part of executing on go to market strategies.
| passivate wrote:
| What does that mean - Investigation of what? By whom? and
| on what basis/framework? Can you propose something
| workable?
|
| In any case, there are many reasons a company can offer a
| better deal - they have invested money and developed a
| new product/service that the competition cannot simply
| copy or negotiated a better deal with a supplier, or
| they're simply a better managed company, or about a
| million other things businesses can do to gain leverage
| over competition.
|
| Also, like a closely fought game - the advantage could
| just be temporary. These things are very fluid.
| alfonsodev wrote:
| The price would regulate itself by offer/demand balance and
| you would still be able to buy it if you can afford it.
|
| With no limits, they can actually create artificial lower
| prices that competition can't match, and they become
| exponentially more powerful and dominating.
|
| And sometimes you end up as a customer having less options
| and lower quality.
| rualca wrote:
| > The price would regulate itself by offer/demand balance
| and you would still be able to buy it if you can afford
| it.
|
| No, not really. I shopped around. I picked the best for
| me. I want to buy from that company but it is already at
| your 10% limit.
|
| What then? Can I actually buy what I want?
| alfonsodev wrote:
| if a company is maxing their sells, don't you think they
| will raise the price?, and play at a 9%, so there will be
| always room for new buyers willing to pay the price.
|
| And honestly is hard to debate because it's an vaguely
| defined hypothetical, I guess we are talking about
| situations where the state limits how much you can
| produce. I think is already happening if you think about
| Spanish Olive Oil for example, EU limits how much
| countries can produce, so the price goes up, still
| everyone that can pay for it can buy it, but at a price
| that represents the scarcity of it, otherwise you can
| choose other origin of same product.
|
| I'm really not an expert in these topics, but that's my
| mental model of it, and I'm not even defend it as I'm not
| sure it is the optimal, specially the EU way about
| vegetable production.
| rualca wrote:
| > a company is maxing their sells, don't you think they
| will raise the price?
|
| I said nothing about price. It is irrelevant. I shopped
| for a product and that particular company had exactly
| what I want, and they offer it in a way that makes it the
| absolute best option for my preference. The choice was
| made. The company wants to sell the product, I want to
| buy that product from them, but they hit 10% market
| share. What then? Am I free to buy what I want from who I
| want to buy it from?
| alfonsodev wrote:
| This can happen already to you when products go out of
| stock, because the company doesn't have enough capacity
| to produce, or they underestimate the demand, but after
| the company makes profit and reinvest in the next batch,
| they can adjust the price to balance the demand.
|
| It's not like you are already free to buy whatever you
| want, there are production limitations, and your budget
| limitation.
|
| Right now big companies are allowed to give 100x better
| solutions at fraction of the cost, that makes imposible
| to other companies to compete and your freedom to buy is
| just not real, as many times you'll be obligated to buy
| from the big fish, being the only alternative. In the
| other hand limiting them, they will have to raise the
| prices and then it would make sense that something 100x
| more convenient is also more expensive. Right now we have
| convenience and low cost, but it's at the expense of
| killing smaller business and creating virtual monopolies.
| rualca wrote:
| > This can happen already to you when products go out of
| stock (...)
|
| No, it can't. Your case involves a scenario where no
| transaction is possible because there is no product to
| buy or sell. It has zero to do with my very simple and
| very straight-forward example of a customer wanting to
| buy a product indeed sold and available and on the store
| of a seller who already reached its 10% market share.
|
| My example is very clear, and for some reason all
| proponents of this virtuous 10% market share are either
| unable or unwilling to step up and either think their
| idea through or explain how they expect to implement
| their virtuous idea.
|
| And this is a very simple and straight-forward example: a
| seller has a product I want to buy, I shopped around and
| that seller has the absolute best offer, I want to buy
| the product from that seller, the seller has the product
| on the counter and I have the cash at hand, but the
| seller already hit the 10% market share. What then? Is
| the next step so mysterious that no one can even come
| close to dare explain what they believe should happen?
| alfonsodev wrote:
| You keep asking the same, What then? which leads me to
| think we are parting from very different scenarios.
|
| Perhaps the difference comes from you thinking in a limit
| that applies as per number of products sold, and you
| could find yourself on that situation of "what then?" the
| product being on the shelve but you are unable to buy it.
|
| I'm thinking in a scenario where the limit is on the
| production, similar to what I mention before, the EU
| controlling vegetable productions.
|
| So you don't get to find the product on the shelve if
| it's already gone but you'll find some other brand, the
| ones that are better will be more scarce and more pricy
| as a consequence.
|
| Now, do I want as a consumer that the best things are
| also cheap and available?, yes! of course!
|
| But the question is, is that sustainable? and what
| happens to the market when we have this huge player that
| outcompete everyone else, and dictate the rules, and they
| are in a position to set the quality standards, long term
| we might be free to buy just from them under their own
| rules. Is that freedom?
|
| I'm really not familiar with those proponents of the 10%
| market, I was just talking from my common sense, I don't
| think is crazy to put some limits, and we already have
| some in some industries, for better or worse.
|
| I'm dropping it here, but thanks for sharing your point
| of view, I'll read you if you reply, always learning and
| open to change my opinion.
|
| Cheers!
| pc86 wrote:
| Price dumping is already illegal.
| andrepd wrote:
| Explain Uber then :^)
| bryanrasmussen wrote:
| either that or the market is a really small specialized
| market.
|
| on edit: to forestall anyone suggesting I think Amazon has a
| small market, no, just the Stallman quote doesn't take into
| account that monopoly can arise in a relatively small market
| that people would not consider worth nationalizing.
| flavius29663 wrote:
| true, as I remember from last year's crises, there is only
| one wood mill in the world that does a very specific kind
| of pulp used by 3M to make those notorious masks. I
| wouldn't nationalize that.
| ekianjo wrote:
| RMS is right about many things but not this one. Competition
| naturally leads to few companies capturing a market over a
| long period of time. What's however important is to prevent
| actively regulatory capture of said markets.
| pydry wrote:
| It's a _lack_ of competition that leads to market
| consolidation.
|
| This is a compounding problem as companies that grow big
| enough can just buy then out or predatory price them out -
| like, say, Amazon and diapers.com.
|
| In the end the only way to take down mono/oligopolies out
| is to take them out from a direction they're not expecting
| and that can take 100 years.
| pessimizer wrote:
| That's going to be impossible if alienating one or two
| companies can ruin your career in the industry. And that's
| aside from the fact that regulators will mostly be
| recruited from those couple of companies, looking for jobs
| with those companies when they leave, and starting
| consulting firms and lobbying firms that will be
| contracting with those couple of companies. Those companies
| will also have Congress's ear when regulation is discussed
| because they are donating so much. _They are the experts._
| BlueTemplar wrote:
| Well, obviously, if you have a corrupt government and
| corrupt experts, you won't be able to achieve much... why
| was this downvoted ?
| [deleted]
| beforeolives wrote:
| I don't think that Stallman agreeing adds as much credibility
| to the idea as you might think.
| jedimastert wrote:
| As much I dislike Stallman's outreach "strategies" and
| general public efforts, I'll freely admit he's been right a
| LOT. The problem is that no one will listen to him because
| he's an ass about it. I imagine he thinks himself a modern
| day Cassandra...
| pc86 wrote:
| Even if he is right a lot (not a point I'm conceding by
| any stretch), why pick such an asinine thing as "11%
| market share means we should treat this market as a
| regulated utility?" It's an extremely fringe belief,
| which is saying something given the source.
| alfonsodev wrote:
| I think Stallman has been having a relevant point here[1],
| worth to mention, a philosophical one if you will, which is
| the question: should technology keep progressing as fast as
| possible because is convenient no matter what's price ?
|
| That's the background discussion where I think Stallman has
| a point, I heard this from him years ago regarding Facebook
| and privacy, and that was before all the scandals.
|
| [1] Facebook is surveillance monster feeding on our
| personal data - Richard Stallman
| https://www.youtube.com/watch?v=9c3sv30w158
| jpxw wrote:
| For one, large government software projects are almost always
| disastrous, even in developed countries.
|
| Secondly, that isn't what sellers want. Many sellers use Amazon
| to fulfill their orders. Amazon is far more than just a "market
| stall".
| ClumsyPilot wrote:
| "even in developed countries."
|
| I find that UK and USA governments are worse at IT than
| Russia and Czech Republic. Maybe it's age of the lawmakers,
| or over-reliance on old sustem, I dont know
| rualca wrote:
| > Secondly, that isn't what sellers want. Many sellers use
| Amazon to fulfill their orders. Amazon is far more than just
| a "market stall".
|
| This.
|
| Amazon is basically a huge logistics network. Their business
| is not selling you products, whether from their own generic
| brands, from high-end Veblen goods companies like Apple or
| from cheap chinese dropship artists. Their business is to
| process payment, and get that package delivered to your front
| door. To Amazon, their products is just a way to generate
| output through their logistics network.
| spaceribs wrote:
| Based on the article, the verticality of their business
| seems to indicate they are not merely in logistics...
| ceejayoz wrote:
| > For one, large government software projects are almost
| always disastrous, even in developed countries.
|
| The same tends to be true for large _corporate_ software
| projects.
|
| As a fairly recent example: https://www.theregister.com/2019/
| 04/23/hertz_accenture_lawsu...
| fighterpilot wrote:
| Right, but there's a self-correction here, which is that
| Accenture gets fired if they do a bad job. The govt has a
| monopoly and so there's little self-correction - too many
| layers of indirection between the everyday voter and
| Amazon's outcome.
| ceejayoz wrote:
| Governments get fired fairly regularly.
| fighterpilot wrote:
| Through multiple layers of indirection and obfuscation. A
| democratic vote every 4 years is noisy when it pertains
| to one specific outcome (say, Amazon's performance right
| now) since that vote also contains information for
| numerous unrelated things. Private ownership means a very
| tight feedback loop between performance and governance.
|
| It's basically why collective ownership of complicated
| things has never worked. Except for perhaps the army,
| which costs an absolute fortune.
| ClumsyPilot wrote:
| >"It's basically why collective ownership of complicated
| things has never worked"
|
| Except also the roads, railroads, airports, ports, oil
| pipelines, nuclear weapons and reactors, GPS and weather
| satellites, chunks of the energy grid, NASA, a national
| postal service, social security numbers, and so on
| fighterpilot wrote:
| > NASA
|
| Which proves my point. Look at the innovation that SpaceX
| has created with VTOL rockets. If it was left purely up
| to nationalized bodies this would have _never_ happened
| (or maybe, it would have taken 50-100 years). The
| incentives and desire for economic efficiency just simply
| aren 't there. Government wants flashy one-off wins that
| generate publicity and votes, if it wastes a few billion
| and doesn't scale there isn't any consternation. The
| entire mindset top to bottom is completely inconsistent
| with VTOL rockets.
|
| > roads, railroads, airports, ports, GPS,
|
| The argument for these being nationalized is that these
| are goods that are prone to natural monopoly and some of
| those are largely non-excludable in the case of roads.
|
| None of those arguments apply to Amazon. eBay is a
| substitute for marketplace, Azure is a substitute for
| AWS, etc.
|
| These are also much simpler than Amazon. Could a
| government have created AWS? Could a government create an
| iPhone? It's a rhetorical question because all know that
| the answer is no. Even if they _could_ in terms of
| capability, they won 't because the incentives aren't
| right. And if they tried, they'd do it incredibly
| inefficiently and be outcompeted in am embarrassing
| fashion by a private alternative (e.g. eBay), with the
| difference being subsidized by the taxpayer.
|
| > nuclear weapons
|
| In the case of nukes, the argument is that the government
| has a monopoly on force (which is also why the army
| should be nationalized).
|
| And I already conceded that the army was well-run,
| although at a ridiculous level of cost (which is another
| byproduct of nationalization).
|
| > weather satellites
|
| Built by a private company.
| logicchains wrote:
| >The same tends to be true for large corporate software
| projects.
|
| Yes, but it's not true for Amazon, the topic of
| conversation.
| ceejayoz wrote:
| Isn't the topic of conversation that Amazon's
| _successful_ software projects have had potentially
| _disastrous_ side-effects?
| n0us wrote:
| It would be really interesting to see the USPS in the USA open
| a market like this
| swiley wrote:
| No. As it is I can still go to other sellers if I want to, if
| Amazon were nationalized then you might not have any other
| choice.
| niyikiza wrote:
| Whenever someone suggests that something be nationalized, I ask
| myself "Why not create a public version of it?". If the answer
| is "it cannot compete with the private ones", maybe that's why
| running it privately is necessary.
| josefx wrote:
| Just look at how well this works out for every town trying to
| set up its own broadband when Comcast and others fail to
| invest. Lawsuits raining down for every possible reason,
| shared public resources blocked for months, misinformation
| campaigns to convince people that public broadband is a waste
| of their money and anyone involved in it should be kicked
| from their office.
|
| Its like competing in a five hundred meter sprint if the
| winner of the last twenty races had a shotgun. His time
| sucks, but he doesn't need to actually run as long as nobody
| else makes it to the finishing line.
| guerrilla wrote:
| I agree but there's one practical problem with this: other
| markets (e.g. the EU) need to nationalize or reproduce it too
| or else the US is getting significant geopolitical leverage.
| londons_explore wrote:
| If the US nationalized Amazon, I think you can be pretty sure
| that other countries would also nationalize their local
| Amazon divisions (ie. Amazon FR would become property of the
| french government)
| Nasrudith wrote:
| Why would they repeat the US's mistakes immediately after
| watching it blow up on the US? People have agency and the
| response to a sudden theft by the government for being too
| successful would be to get the hell out of there as the US
| is no longer stable. The other subsidiaries wouldn't
| surrender ownership to a distant bandit government just
| like all of the other times it happened.
|
| Everybody but communists know that Nationalization is a
| goddamned terrible idea doomed to failure - you can see it
| by not being in their political platforms at all. Only
| those with dogmas to consider the action a goal in itself
| advocate for it.
| Workaccount2 wrote:
| Amazon doesn't need to be nationalized, it does need to be
| broken up though. The dividing lines in the organization are so
| clear you could practically tap it with a hammer and it will
| fall apart into nice individual pieces.
| mk89 wrote:
| I disagree. There are more and more services providing
| logistics, delivery, payments, etc. And they are quite
| reliable. Just 2 years ago I was entirely relying on Amazon as
| a good ecommerce. As of 2020/2021, to be honest, there is
| nearly no difference with some individual retailers (which
| don't use a 3rd party platform to sell their goods like Amazon
| or Ebay). Lots of websites have improved, logistics, delivery,
| customer service, payments, ..etc etc. They key, in my opinion,
| was the logistics + delivery. That's what Amazon was
| exceptionally good at. Now that the infrastructure is nearly
| the same for everyone, why would you share your profits with
| Amazon and risk to be out of the business in 1-2 years?
| dv_dt wrote:
| What are the Amazon level logistics and delivery service that
| is available to a smaller retailer? I see some nascent
| choices but they really aren't that close.
| [deleted]
| jonnycomputer wrote:
| Or broken up. Its AWS and its online retail are each
| sufficiently large enough to be anti-competitive on their own.
| mellavora wrote:
| We have that in Luxembourg. Problem is finding the site. You
| have to know it is there.
| Black101 wrote:
| should they also nationalize their cloud services?
| nielsbot wrote:
| sure
| Black101 wrote:
| any data backing that claim?
| ceejayoz wrote:
| An apt comparison - most of the farmers' markets around here
| have been ruined by resellers, too.
|
| No, those Driscoll strawberries in March didn't come from
| upstate New York farms.
| Loughla wrote:
| Seriously, though. Between reselling and 'owner/operator
| businesses' (read: pyramid schemes selling oils, scents,
| candles, and makeup), the local farmer's market is just an
| absolute train wreck anymore.
|
| Local farmers who used to sell at the farmer's market have
| moved to subscription boxes, from what I can tell.
| FridayoLeary wrote:
| >Give them the municipal software infrastructure they need to
| do so and maintain it as a public good.
|
| oof. Amazons actual website is frankly horrible, but i shudder
| to think how terrible it would be if it was run by the
| government. I'm cringing at the thought. There would just be an
| endless stream of news about gross mismanagement, incompetence,
| wasting taxpayers money _ad nuseaum_. No. The only thing that
| could possibly be worse then Amazon in its current format would
| be if it were run as a government enterprise.
|
| And to the whataboutism; "who says Amazon doesn't have those
| problems etc, it's different. I don't have to be bothered so
| much by the internal affairs of a private company. A government
| company otoh, it would just be all over the news.
| LightG wrote:
| It's a catch-22 ... would Amazon be this innovative had it been
| nationalised?
|
| At what point do you nationalise? Is there a next technology
| which will be stifled if it was nationalise?
|
| Does nationalisation sttifle innovation?
|
| I've been wrestling with these questions as I actually don't
| like Amazon for all the reasons that have been well publicised
| ... but their customer service is excellent.
|
| Which sets me against a string of recent bad experiences with
| local suppliers, getting stung, and thinking ... well, if
| Amazon treat me better, why shouldn't I move away from local
| suppliers and stick with the monopoly? Which goes against a lot
| I believe in.
|
| I guess the problem is it's putting a lot of trust in Amazon.
| Which is itself an argument for nationalisation. I don't know.
| 49531 wrote:
| > Does nationalisation stifle innovation?
|
| I would argue that it does not. We have a lot of innovations
| from the last 100 years that have come from state-run
| projects / endeavors.
|
| The more I think about it the more it looks as though private
| ownership stifles innovation if there isn't a direct profit
| motive for it.
| pydry wrote:
| Being a monopoly of any kind stifles innovation.
|
| It's often better for the state to react to private
| monopolies/oligopolies by entering the space and competing
| with a bare bones service. This has worked in banking,
| telecoms, land development, housing, etc. It often works
| better than taking over the monopoly directly. It's one of
| the reasons (IMHO) Singapore has such an effective private
| market.
|
| Often private companies lobby for laws restricting the
| level that they can compete - this is a signal that it's an
| effective tactic.
|
| If USPS were given a mandate and the cash it could
| absolutely build a marketplace that could compete and it
| would probably kick start Amazon into being a better and
| cheaper retailer. Unfortunately it's being whittled down to
| a husk of its former self.
| suprfsat wrote:
| Jeff Bezos will testify in front of congress that he will
| cease to be innovative if required to pay taxes.
| sneak wrote:
| Amazon pays mountains of payroll taxes, as they are one of
| the largest employers in the world.
|
| The "Amazon pays no taxes" meme is a false one.
| spaceribs wrote:
| I think the meme is "Amazon pays no federal taxes on it's
| profits", and that is a correct statement.
| dahfizz wrote:
| Even that is not really true. They paid no federal income
| tax in 2017 and 2018, but have before and since.
|
| I'm no fan of Amazon, but you have to admit there is a
| pretty large distance between "Amazon pays no tax" and
| "Amazon pays billions in tax, but they didn't pay this
| one specific kind of tax a couple years ago".
|
| https://www.cnbc.com/2020/02/04/amazon-had-to-pay-
| federal-in...
| cycomanic wrote:
| This is quite pendandic. When you calculate your tax rate
| do you also include GST(VAT)? Because this is essentially
| the same thing.
| [deleted]
| dahfizz wrote:
| I guess it depends on the context. When I am filing my
| income tax, I am focused on that. But when budgeting or
| discussing tax liability in general, I certainly don't
| forget about the tens of thousands of dollars I pay in
| local, sales, SS, etc taxes.
|
| I would certainly not make the claim "I paid no taxes
| this year" if I managed to skirt only federal income tax.
| spaceribs wrote:
| I think income tax is the most impactful and expensive
| tax we have in the US, it's the one everyone thinks of
| when someone says "doing your taxes".
|
| The fact that Amazon just this year after not paying for
| 2 years had to pay a measly 1.6% in taxes does not really
| negate the argument.
|
| Edit: 4 years -> 2 years
| dahfizz wrote:
| It really feels like you're twisting reality.
|
| Amazon went 2 years without paying _income_ tax, not 4.
|
| Amazon paid $3.5 billion in taxes in 2019 (some of which
| was differed, but still owed). That is over 25% of their
| income that year. Their federal income tax rate came out
| to 1.6%, but its borderline lying to say "they paid a
| measly 1.6% in taxes".
|
| Amazon is an awful company. There is no reason to bend
| the truth to try and show how awful they are. Being
| disingenuous only makes your argument weaker.
| spaceribs wrote:
| I misread the article, and I'll correct the 4 to 2 years
| now.
|
| Income is income though, not sales or payroll which are
| the expected and manageable operating costs of overhead
| and human resources.
|
| If I win the lottery, almost 50% of my winnings go back
| to the state, and I haven't even bought anything with
| those winnings. What's different about Amazon having a
| banner year?
| dahfizz wrote:
| > What's different about Amazon having a banner year?
|
| The big difference is that Amazon is a company.
|
| If Amazon decides to pay out large bonuses or dividends
| with its surplus, that gets taxed at the same rate as
| your lottery winnings. Before that happens, the income is
| Amazon's and not an individual's. There is no reason to
| expect the corporate income tax to behave the same way as
| individual's income tax.
| robertlagrant wrote:
| Because that's how lotteries work in the US. Companies
| don't have to be behemoths to pay no tax on income. They
| just have to post no profits by spending all the money
| they make on opex and capex.
| spaceribs wrote:
| I understand the system, I just want to be clear how
| broken this is.
|
| Both are windfalls, one gets taxed immediately, the other
| gets taxed if they don't use up all their profits
| reinvesting in themselves by the end of the year.
| tick_tock_tick wrote:
| I don't see how you can think this is broken. Think about
| the implications if it wasn't like this. Bankruptcy would
| be rampant and R&D investment would be impossible for
| everyone but the largest companies.
| Nasrudith wrote:
| Well yes, governments tend to like their industrial bases
| growing and are willing to wait for bigger gains over a
| longer time period. That isn't broken it is by design.
| Manuel_D wrote:
| Isn't that also incorrect? It would presumably pay the
| normal corporate tax on it's profits. It's just that
| Amazon reinvests it's revenue and thus has no (or little)
| profit.
| sneak wrote:
| If that were the meme, I wouldn't be trying to dispel it.
| Loughla wrote:
| Isn't it the workers who (whom? I never know) pay the
| payroll tax? That's their money, in exchange for their
| time spent on work, that's not Amazon's money. This
| doesn't make sense to me.
| edoceo wrote:
| in USA it works like: pay is $100. then take home is $80
| because $20 is taken out for various payroll taxes. then
| also the company pays $20 for their portion. employees
| only see the -20 from them, not the +20 from Company on
| wage stubs.
|
| also, if the company has profits there is some tax on
| that (well, my little C-corp did)
|
| (numbers are made up to show process)
| josefx wrote:
| > also, if the company has profits there is some tax on
| that (well, my little C-corp did)
|
| No large US company has any profits, maybe one of their
| child companies in Ireland or the Caribic does. They have
| to beg for billions in government handouts every time
| they want expand their operations, that is how bad they
| have it financially.
| dahfizz wrote:
| In the US, "payroll" taxes are split between employer and
| employee. The biggest items that fall into payroll are
| Social Security and Medicare.
|
| https://www.taxpolicycenter.org/briefing-book/what-are-
| major...
| [deleted]
| tremon wrote:
| Does this imply he sees his ability to evade taxes as his
| only worthwhile innovation?
| 8note wrote:
| I think it implies that amazon can't both spend
| everything that would be profit on innovation while also
| paying the same money on taxes
| Red_Leaves_Flyy wrote:
| Sounds like extortion to me.
| batch12 wrote:
| How so? Whether or not amazon innovates should have no
| bearing on a decision by congress to levy additional
| taxes against them. If amazon decides to become shittier
| as a result, someone else can fill that void.
| missedthecue wrote:
| not sure which party you're talking about here
| nerbert wrote:
| Amazon the marketplace isn't terribly innovative. It's a
| marketplace supported by fantastic logistics, and most of it
| is backed by USPS anyways. There's only so much you can do to
| remove the pains from buyers, sounds like we're there.
| pydry wrote:
| It's pretty amazing to me how unsophisticated the filters
| and search criteria are. There are so many products where
| I'd like to filter or sort on weight (for instance) and it
| simply isn't possible.
|
| Nonetheless as a semi-monopoly you are rarely compelled to
| innovate like a smaller company is.
| b3kart wrote:
| They can do better, no doubt, but it is a problem that
| sounds like it should be easy to solve, but becomes
| really rather tricky at Amazon's scale and with their
| catalogue size, speed of updates to it, and general
| dependency on the quality of data provided by the
| sellers. Try defining good filter values when you have
| thousands of product categories with millions of
| products, many of which have poorly defined attributes,
| while all of this is subject to constant change. Quite a
| task.
| pydry wrote:
| Nothing is trivial at that size but given the immense
| resources and market power at their disposal, I find it
| more convincing that it's just not a priority because
| their market position is already too secure.
|
| I heard similar excuses back in the IE6 heyday for how
| improving the browser was "hard". Realistically 94%
| market share just meant that it wasn't broken from
| Microsoft's perspective.
| tracer4201 wrote:
| > Amazon the marketplace isn't terribly innovative. It's a
| marketplace supported by fantastic logistics
|
| These two statements contradict each other. The thing that
| Amazon does extremely well is logistics and that is core to
| their marketplace, not something else to the side.
|
| Amazon.com in my opinion is a logistics company who happens
| to have a Website that sells products.
|
| Amazon moves an item from point a to point b, and they do
| it fast and efficient enough that people go back to them
| again and again.
|
| Last month, I ordered two pairs of jeans and a t-shirt from
| Eddie Bauer. They arrived in three different packages after
| about 10 days. With Amazon, it would have been 1 package
| that arrives the next morning or the following day.
|
| If Amazon is abusing its position, substantial fines or
| regulations are the right solution in my opinion. I'm
| absolutely not in favor of nationalization. Any kind of
| government run facility, in my experience, is mind mumbling
| horrible at their job. They have no incentive to compete -
| which might eliminate bad behavior but it also makes for a
| terrible customer experience. Nationalizing Amazon is no
| different than just killing the company entirely.
| mschuster91 wrote:
| > It's a marketplace supported by fantastic logistics, and
| most of it is backed by USPS anyways.
|
| Not any more, USPS was only used for shipping anyway.
|
| Amazon has shifted to vertical integration wherever they
| can - they run everything they can, from air freight (with
| https://en.wikipedia.org/wiki/Amazon_Air) over their
| infamous warehouses to last-mile delivery with either in-
| house staff or "contractor" schemes set up to avoid labor
| regulations.
| black_puppydog wrote:
| That last bit is an "innovation" I would (and have, when
| I could) pay many for to avoid. My mailman knows where I
| live, can enter the building with a key and knows my
| door. Amazon contractors keep calling me an hour ahead
| "will I be there?" then can't deliver the parcel to a
| nearby post office when I'm not. Over the last year of
| work-from-home this wasn't much of an issue but when you
| have a regular office job it can take a few days to get
| that parcel.
| nixass wrote:
| > and most of it is backed by USPS anyways
|
| Amazon does not do business in US only
| ClumsyPilot wrote:
| Yes, in UK wr have royal mail, and every other functional
| country has it's equivalent
| smhost wrote:
| "Innovation" refers to practices like staying in the red
| for a decade and bypassing antitrust laws by owning (rather
| than monopolizing) markets.
|
| It has little to do with technological innovation.
| choward wrote:
| Right. I wonder how much competition Amazon has
| eliminated over the years with their shady business
| practices. That competition may have driven innovation
| even further.
| andrepd wrote:
| Precisely. Much of the "innovations" and "efficiencies"
| touted (by Amazon and by many other players) are actually
| not any _material /physical/technical_ improvements, but
| financial games, buying competitors, operating at a loss,
| regulatory evasion, monopolisation, etc.
| smhost wrote:
| I mean, business/financial innovation is a legitimate
| kind of innovation. I'm not harping on Amazon for that. I
| just think that discussions about "loss of innovation"
| smuggle in some irrational fears about loss of technology
| when there are no real reasons to.
| batch12 wrote:
| Why should the federal government steal Amazon? Surely, it is
| possible for the government to build another service. I will
| admit that this is a clever way to kill Amazon. I find the idea
| of a government running my compute infrastructure to be a
| terrifyingly bad idea and would seek out someone else.
|
| Edit: Replaced AWS with Amazon
| syshum wrote:
| Yea I am going to go ahead and say No to that....
|
| Amazon has issues, but "nationalizing" it would not ease those
| issues in fact in most ways it would make them worse.
| spaceribs wrote:
| > Amazon has issues, but "nationalizing" it would not ease
| those issues in fact in most ways it would make them worse.
|
| Change my mind then? What would be worse in that situation?
| passivate wrote:
| You said "X would be great" but didn't explain why, so a
| response like "No, X would be bad" is equally lacking in
| details. Its hard to discuss anything without an underlying
| basis for the conversation. There is no precedent for the
| US government providing services comparable to Amazon at
| comparable cost/benefit.
| spaceribs wrote:
| I explained why, commercial goods and services would have
| a safe sponsored forum to sell their wares without
| worrying about a profit hungry giant measuring their
| success, cloning their business and driving them to
| bankruptcy.
| jpxw wrote:
| When was the last time you used government-run software?
| Was it a good experience?
| jononomo wrote:
| Amtrak is great. I generally like government-run
| services. Have you tried dealing with your local cable
| monopoly? It's a nightmare -- why not get the government
| involved so things work more smoothly and there is more
| competition?
| amalcon wrote:
| Less than a month ago, to sign up for my COVID vaccine.
| Yes, it was a good experience.
| spaceribs wrote:
| Yes actually, I recently signed up for my vaccination
| online via the GoVAX system, was flawless and painless:
| https://massvax.maryland.gov/
|
| I've used plenty of for-profit software that did
| essentially the same thing but which fell flat on it's
| face in terms of UI/UX.
| jfrunyon wrote:
| All the time. Yes. I've also had bad experiences with
| plenty of private companies.
| AbrahamParangi wrote:
| Interop requirements may serve better than direct
| government control.
|
| At the very least, it's worth being clear eyed with respect
| to the quality of government run services.
|
| What would be necessary for the government to run a service
| like Amazon successfully? Is our government today capable
| of doing such a thing? I think the answer is clearly no.
| smhost wrote:
| > What would be necessary for the government to run a
| service like Amazon successfully?
|
| Anti-corruption measures to stop politicians from
| sabotaging those services. E.g., USPS.
| AbrahamParangi wrote:
| Idk if USPS is truly an example of excellence, even if
| they are an example of govt excellence. In 2020 they
| shipped 70 billion packages, of which 90% was spam.
| ClumsyPilot wrote:
| Well 90% of products on amazon are shit too, maybe some
| made with child labour. Are you sure this comparisom will
| be favourable?
| oblio wrote:
| > In 2020 they shipped 70 billion packages, of which 90%
| was spam.
|
| Is that their problem, though? I don't think anyone
| expects the post to police package contents.
| amalcon wrote:
| They do police package contents to a degree, but only for
| actual crimes. Postal spam isn't a crime (and probably
| shouldn't be, as much as I'd like to get rid of the
| spam).
|
| https://en.wikipedia.org/wiki/United_States_Postal_Inspec
| tio...
| shiftpgdn wrote:
| They do police package contents, pretty heavily even.
| They allow spam (presorted bulk mail in post office
| terms) because the spammers have a strong lobby.
| girvo wrote:
| Government run services can be absolutely excellent
| though. It's not a pure truth that government run =
| subpar.
| Kalium wrote:
| You're absolutely right. They can be.
|
| With that critical truth that you've touched on said...
| American civilian resident-facing government services
| tend to be organized and run with all the strong
| incentives being to make it good for everyone _but_ the
| residents. Usually the workforce has a strong union and
| management has their goals, but us users have no strong
| force to exert except distant oversight in the form of
| Congress.
|
| Some organizations escape this. Others do so partially at
| best. Most do not. State DMVs are notorious pits of utter
| misery, and this is generally an honest reflection of
| experience.
|
| You can report a passport lost online, but you have to
| file a DS-11 in _black ink_ at a post office to request a
| new one. This process can be easy or hard unpredictably,
| depending mainly on how nice the postal worker feels that
| day. There are few to no organizational incentives
| towards better customer service.
|
| Why black ink? Because the State Department says so. And
| they don't have to care what you think.
| ClumsyPilot wrote:
| The GPS has like no downtime, same for the enrgy grid and
| the post office.
|
| Not that i see calue in nationalising Amazon, but i thi k
| it would be fine
| rualca wrote:
| > What would be worse in that situation?
|
| It would be by far worse to not have Amazon, or dump their
| market share to shady chinese competitors like ali express.
| ClumsyPilot wrote:
| Aliexpress is Ebay, not amazon. That being said, both
| feature a decent return policy, shitty and invariably
| wrong item description, no ability to properly filter
| goods and fake reviewes.
|
| The only dailight I see between them is the shipoing time
| and language.
| jononomo wrote:
| I completely disagree. Amazon should be nationalized. This
| would make life better for citizens.
| isbvhodnvemrwvn wrote:
| Why?
| anotha1 wrote:
| How does a USPS job compare to the job of an Amazon
| delivery driver?
| ekianjo wrote:
| How often are USPS on time for deliveries vs Amazons
| drivers?
| ceejayoz wrote:
| That varies substantially by region.
|
| In my area, Amazon's logistics is the least likely to be
| on time. I've gotten many free months of Prime from
| delayed packages.
| anotha1 wrote:
| Good point. In my last apartment, Amazon threatened to
| stop delivering to the entire (large) complex because
| their delivery people failed so hard at delivering.
| Packages were left just about everywhere and the Facebook
| group became more like a lost-and-found package site.
| Something that didn't happen at all with USPS.
| ClumsyPilot wrote:
| At face value, you argument amounts to "brutally
| exploiting workers produces better results".
|
| You might be right, but...
| anotha1 wrote:
| As far as I can tell, just as often. No, I don't have the
| same expectations, but that is more than reasonable
| considering Amazon has an easier job (every seller
| already has there product in an Amazon warehouse, as is
| the USPS has an additional processing step).
| ekianjo wrote:
| Products more expensive is better?
| wolfretcrap wrote:
| Amazon is far from only being software atleast in India.
|
| They've such a volume here in India that since Amazon has got
| here, traditional LTL logistics soared in price wayyy higher
|
| Amazon has completely revolutionised logistics here in India,
| you'll have hard time sending a box from point A to point B
| cheaper than what Amazon offers.
|
| We are at a point where Amazon sells things much cheaper
| shipped to your door than a shop near you. (If you don't live
| in a metro city highly likely, the price which Amazon offers,
| local shops simply can't beat them)
|
| And in India something like 60-70% people live in small towns
| and villages, traditional family owned distribution networks
| are failing to compete with Amazon, yes the ones which power
| most of the shops in the town.
|
| I maintain, the traditional family owned distribution networks
| were even more exploitative (screwing over both customers and
| their workers) in India atleast compared to what Amazon offers.
|
| Amazon delivery agent here are guys from low economic class and
| often from villages nearby. I am glad my purchases are helping
| these people survive than the "several property owning
| shopkeeper near me" competing with me in the real estate market
| while simultaneously ripping me off on the price on various
| tools.
|
| Few years ago I was working for such family owned distribution
| networks and I never seen such miseries in life, truckers were
| often not paid at time, often driving trucks which hardly get
| any service (dangerously), the axel could become rocket anytime
| while on road. Amazon has only brought best practises to us,
| they've regular vehicle maintenance schedule, drivers get paid
| on time. Amazon delivery agents are some of the happiest people
| I've met despite working so hard, they are always smiling while
| delivering stuff to me.
|
| The distribution agents were regularly fired without payment
| (it's not completely organized sector so lots of labor operate
| in grey area, where if they don't get paid don't have any legal
| recourse and most likely no one will believe if they ever
| worked for the person they are claiming to have rendered their
| service to. I am glad, the nepotistic and exploitative power
| nexus of family owned distribution networks is dying.
|
| Easy return was never available in India, and you risked
| getting "death stares" from the shopkeeper if you ever returned
| anything to him because of quality issues of the product.
|
| Other than this, most of the times I had seen "young girls"
| walking into market and getting "40% discount" by some thristy
| shopkeeper and they wouldn't do same for a guy ever, atleast
| this form of descrimination is dying with Amazon.
|
| And honestly speaking, if a lot of Amazon executives in
| Bangalore and Gurgaon are getting rich, it's well deserved for
| what they've done for the nation.
|
| I forgot to mention, we've many Amazon competitors but
| primarily Flipkart - well, getting them to replace/return
| anything has been tough for me, maybe because I live in a small
| town, I don't say but I get all my packages in 2 days from
| Amazon (without prime), while Flipkart takes 5 days here
| minimum.
|
| What would I like to see Amazon change?
|
| 1. Make it possible to sell low value items which cost less
| than 200 and aggregate it before it's shipped to customer and
| charge customer shipping on aggregate weight shipped for these
| small combines. Sometimes it's very difficult when you've to
| order small items and pay 150-200 shipping on each item. These
| can be "no return combine", I will not bother returning such
| low value item, so Amazon saves overhead and additional costs.
|
| 2. Please revolutionze hardware space for retail buyers, stuff
| like "steel sheets, MDF, nail, bolts, nuts" - we don't have any
| Homedepot or Lowe's, we really need it and my hope is only on
| Amazon. Other countries like US has Homedepot where u can get
| most of the hardware fittings while this space is seriously
| lagging in India, everyone uses different naming for a spare
| part, etc...we don't even have anything like "McMasterCarr".
| iamAtom wrote:
| So true. Without amazon retail experience is shit in India
| bruhhh wrote:
| of course they knew! They also know about all the FAKE REVIEWS
| that infested Amazon, and they're not doing anything about it
| because it boosts sales. Not only that, but I got banned from
| reviewing on Amazon after I posted a review that the product's
| reviews are probably fake (after checking on fakespot and
| receiving a trashy product).
| annoyingnoob wrote:
| Seems like all big retailers do this. I know that Home Depot's
| HDX brand copies products, and you are more likely to find HDX in
| stock than the products it competes with.
| cowpig wrote:
| Can we just rule that internet marketplaces cannot offer
| competing products on their own platforms?
|
| The fundamental conflicts of interest will always persist
| otherwise.
|
| This is going to sound radical but I think Google Search should
| be broken away from everything else and/or Google products should
| not be accessible via the search page (or allowed to buy ad
| space)
| neolog wrote:
| If you make something and sell it in a store, does that mean
| you're not allowed to sell other people's products in your
| store?
| cowpig wrote:
| A store is bound to a physical location, whereas online
| platforms seem to tend toward monopoly
| idiotsecant wrote:
| Should walmart be able to produce and offer generic versions of
| brand name items on their shelves? Why or why not?
| cowpig wrote:
| I don't think they're similar. There are many stores in my
| neighborhood, but there's only one google, only one app store
| on my phone, and only one Amazon.
|
| I also think the degree to which the platform can exploit
| data related to producers (and consumers) is totally
| different with online marketplaces.
| google234123 wrote:
| One Amazon? There many competing sites on the internet.
| bhupy wrote:
| You're correct that they're probably not similar, but they
| are different in ways that undercuts your original
| argument.
|
| There are almost certainly more than one search engine
| (Bing, DuckDuckGo) and more than one online retail platform
| (Shopify, Walmart.com, eBay). But unlike physical
| businesses, they are literally "just a click away"; whereas
| in the real world, you'd have to schlep to the physical
| location of the competing store. Moreover, the barrier to
| entry to actually spinning up an online retail platform is
| _much much lower_ than spinning up a brick-and-mortar
| location (permits, employed labor per location, rent
| /property costs). Finally, the theoretical reach once you
| spin up an online retail platform is infinite; whereas one
| has to go through all of the aforementioned brick-and-
| mortar barriers for every incremental customer in the
| world...
|
| IMO, the concept of abolishing generic store brands strikes
| me as fundamentally hostile to the poor. The other day I
| was at a Walgreen's picking up some Neosporin ointment, and
| I found the Walgreen's store brand right next to at half
| the price. I'm privileged enough to be able to afford the
| name-brand Neosporin without having to think about it, but
| I fully appreciate that there are a lot of people that are
| grateful that the store brand exists. I'm sure Johnson &
| Johnson would love for the government to prevent Walgreen's
| from selling its cheaper store brand, but I'm skeptical
| that this would be good for anybody except Johnson &
| Johnson.
|
| Likewise, Amazon provides "generic" versions of commodity
| products. Insofar as it's difficult to compete with Amazon,
| it's because it's generally difficult to run sustainable
| businesses solely on the back of commodity products.
| chuii123 wrote:
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| https://mays.tamu.edu/humana-tamu-analytics/wp-content/uploa...
| chuii123 wrote:
| <a href="https://mays.tamu.edu/humana-tamu-analytics/wp-
| content/uploa... rbx</a> <a href="https://mays.tamu.edu/humana-
| tamu-analytics/wp-content/uploa... rbx</a> <a
| href="https://mays.tamu.edu/humana-tamu-analytics/wp-
| content/uploa... rbx</a> <a href="https://mays.tamu.edu/humana-
| tamu-analytics/wp-content/uploa... rbx</a> <a
| href="https://mays.tamu.edu/humana-tamu-analytics/wp-
| content/uploa... rbx</a> <a href="https://mays.tamu.edu/humana-
| tamu-analytics/wp-content/uploa... rbx</a> <a
| href="https://mays.tamu.edu/humana-tamu-analytics/wp-
| content/uploa... rbx</a> <a href="https://mays.tamu.edu/humana-
| tamu-analytics/wp-content/uploa... rbx</a>
| LatteLazy wrote:
| I keep seeing stories like this that prey on readers' ignorance
| to push an unfair agenda.
|
| Retailers using their data as an advantage to improve sales of
| own brand products, at the cost of suppliers, is totally
| standard. It's happening right now in every supermarket (and
| plenty of other places). Pretending otherwise is silly.
|
| Amazon having a policy of not doing that is exemplary. Amazon
| failing to meet that in one case is amazon meeting it in 99.9999%
| of cases.
|
| But people are very quick to see the devil in amazon while others
| (Walmart for instance) are much worse and get a free pass...
| nataz wrote:
| The most interesting part of the HN discussion is not about the
| definition of what Amazon is doing, but the occasional
| misunderstanding of how large brick and mortar retail businesses
| operate at scale (see: buying shelf space/payment dependant on
| sales/etc).
|
| There are lots of folks on here that understand what Amazon is
| doing, less who understand retail businesses mechanisms.
|
| I'm not sure what Amazon is doing is legal (def will vary widely
| between the eu and us markets), but it is another interesting
| example of how doing something at scale can be perceived as
| fundamentally different then when it's done in a smaller way
| (especially as it pertains to privacy).
| jiveturkey wrote:
| You seem to have a limited understanding as well.
|
| Unlike other retailers, who are front and center that they own
| the sales data (some even sell it back to you, the 3p
| merchant), Amazon explicitly states they will not use that data
| (except in aggregate). Bezos' statement that he cannot say for
| sure if the policy has been violated is an admission that it
| has, and is even encouraged. It's very possible and easy in
| fact to enforce a chinese wall around that data. That they have
| chosen not to -- that the data is possibly available _at all_
| -- means that they expect successful PMs to use it on the down
| low.
|
| It's clear they have this policy so as to attract merchants. So
| to turn around and violate it is a pretty severe issue.
|
| Second, Amazon is in a position to actually produce or re-brand
| products under their own very strong brand. Unlike other
| retailers whose store brand is always the discount and less
| desirable option, and generally not taking away sales from the
| premium product.
| cmeacham98 wrote:
| These comparisons to brick&mortar stores are mostly irrelevant.
|
| Amazon told 3rd party sellers it wouldn't use their sales data
| for its own sales (and possibly contractually agreed not to? -
| unsure here), and it now seems that they broke this promise.
|
| How other stores operate doesn't matter. Amazon said it
| wouldn't do this and used that trust to attract sellers and
| grow their platform.
| mjparrott wrote:
| Companies break contracts all the time. The consequences
| range and can include legal action, hurt relationships, lost
| business ... but also could be minor ('business is
| business').
| Gibbon1 wrote:
| There is breaking contracts in minor often mutually agreed
| ways, or because 'can't do it'. Happens all the time.
|
| Stealing your customers sales metrics, yeah that's never
| okay.
| akira2501 wrote:
| > Companies break contracts all the time.
|
| Which is an excellent reason for preventing these types of
| monopolies from forming in the first place. Once you let
| one retailer get so large, they have almost unlimited power
| to act in this way, but the people who they harm have very
| little power in receiving any recompense for it.
|
| > The consequences range
|
| They sure do.. and Amazon is one of the largest companies
| operating today. The range is "off-scale high."
| addicted wrote:
| It's less doing it at "scale" and more doing it as a
| monopoly/monopsony.
|
| Walmart has faced similar questions as well, but as much of a
| monopoly/monopsony as Walmart is, it's far less than what
| Amazon is. Moreso in non US advanced countries that actually
| enforce the anti trust regulations in their laws.
| TameAntelope wrote:
| In what market is Amazon a monopoly?
| dahfizz wrote:
| Being strict about the term, none. But "monopoly" has
| become a colloquialism for "big company (that I don't
| like)".
|
| Amazon has certainly generated enough bad faith and
| operates at a large enough scale to galvanize the anti-
| trust advocates
| kempbellt wrote:
| They are popular, efficient, and usually affordable - if
| not cheaper than many competing outlets, but I do not see
| them as a monopoly by definition.
|
| Amazon has made it more convenient to use their services
| than their competition in many ways, but to my
| understanding, there are alternatives for just about
| everything they offer.
| judge2020 wrote:
| > Moreso in non US advanced countries that actually enforce
| the anti trust regulations in their laws.
|
| I think it's pretty disingenuous to say that the U.S. isn't
| enforcing its antitrust laws, the DOJ certainly opens
| investigations against these conglomerates, they just don't
| take them to court, so there might not be enough info for the
| DOJ to think there's a case. We don't know the full story for
| any of these cases and thus can't become sole arbitrators of
| whether or not something is an antitrust violation.
|
| The problem is probably that the DOJ doesn't like to bring
| cases against people in they they don't have hard evidence
| and a high likelihood to succeed in their prosecution - they
| have an average 92% success rate in the cases they bring
| against defendants[0]. I'm not one to say how to run the DOJ
| but chances are they could find more damning documents via
| court discovery (if they think they have enough of a case to
| get to discovery, at least).
|
| 0: https://www.justice.gov/doj/page/file/1249306/download#pag
| e=... (page 16)
| elliekelly wrote:
| > The problem is probably that the DOJ doesn't like to
| bring cases against people in they they don't have hard
| evidence and a high likelihood to succeed in their
| prosecution
|
| It has nothing to do with a lack of evidence and everything
| to do with not biting the hands that feed the boss's next
| campaign fund.
| lupire wrote:
| The DOJ, SEC, etc have an army of non-politically-
| appointed civil servants.
| elliekelly wrote:
| And yet not a single non-politically-appointed civil
| servant at the DOJ has the actual authority to bring an
| action against a big company like Amazon. When the DOJ
| brings a major antitrust case against a major American
| company there is no chance it didn't get the Attorney
| General's, and probably the President's, sign-off first.
| None. Zero.
| lupire wrote:
| Potayto, potahtoh.
|
| Failed enforcement attempts are as ineffective as non-
| attempted enforcement.
| theturtletalks wrote:
| What's a law with no teeth?
| Nasrudith wrote:
| It has teeth but high standards. It is a bit more like
| Treason charges in the US. Technically a capital crime
| but often not worth trying as the precedents make it a
| high fence to clear. You are better off finding some
| anticompetitive business practice to cease.
|
| But anything about monopoly from the professional liars
| is just a bunch of table pounding as they lack laws and
| facts.
| [deleted]
| sokoloff wrote:
| > as much of a monopoly/monopsony as Walmart is, it's far
| less than what Amazon is.
|
| Walmart retail sales are significantly larger than Amazon's
| retail sales.
|
| For 2019 (chosen to avoid the disparate impact of pandemic),
| Walmart sold $514B while Amazon retail sold only $135B first-
| party and $200B third-party. Given the growth rates, Amazon
| will pass Walmart, but I don't think Walmart has "far less"
| power in retail than Amazon.
| TameAntelope wrote:
| This, and Walmart isn't just going to sit by and let Amazon
| win, why would they? I think folks on the Internet
| generally tend to assume Amazon is inevitable, but I doubt
| that's how Walmart thinks of it.
|
| Walmart and Amazon are both good for one another, and their
| competition helps us, except for when they basically non-
| compete over things like wages.
| sokoloff wrote:
| I agree about the internet/tech user part of that. If you
| asked me to give estimates of their relative size 5 years
| ago, I'd have probably said that Amazon was much bigger
| than Walmart, which would have been entirely wrong, of
| course.
|
| The pandemic was a huge boon for Amazon, but I don't
| think the battle for retail will have a clean, singular
| winner and consumers are endlessly demanding in terms of
| what it will take to remain the winner. Toys-R-Us and
| Sears learned that painful lesson within our adult
| lifetime. They won't be the last.
| ethbr0 wrote:
| From a little bit of retail corporate experience: people
| are used to seeing Amazon roll over competitors with
| under-invested supply chains.
|
| There aren't really any of those left.
|
| Amazon taking on Walmart, Home Depot, or (I assume)
| Target is going to look very different. Because all have
| been shoveling money into their supply chain efficiencies
| for the last 10 years.
| lupire wrote:
| I think mail order and brick&mortar compete in some product
| segments, but are separate in others. For example, perhaps
| split off much of grocery and bulky cheap items as well as
| legally constrained products from WalMart's total (although
| Amazon is making inroads there).
| ethbr0 wrote:
| Walmart has a huge online/mail component too. They
| basically bought and (unlike so many) successfully
| integrated and digested Jet (and now Bonobos) explicitly
| for that.
| castlecrasher2 wrote:
| >but as much of a monopoly/monopsony as Walmart is, it's far
| less than what Amazon is
|
| I don't believe this to be the case. How is Amazon a
| monopoly, given the large number of online retailers that
| continue to be successful?
| jorblumesea wrote:
| I don't think that's a fair comparison. It would be like if
| Amazon owned the entire mall, and would kick out competitors
| and establish their own stores once they become profitable.
|
| Amazon is both a retailer in the sense that they sell products,
| but also owns the entire marketplace as well.
| Tinyyy wrote:
| They don't kick out competitors though, merely open up their
| own stores. To me (the consumer), that seems fine.
| ska wrote:
| To abuse this analogy further - if they also put signs for
| their owns stores in front of the other stores signage, or
| redesign the mall to direct people away from the
| competitors - that seems less fine.
| savanaly wrote:
| What if there's multiple other malls just across the
| street? As is the case in online retail. Even easier than
| crossing the street, to be honest, just click that second
| result in Google instead of the first. Is it so hard to
| admit that Amazon's customers are using them because
| their offering is great and not because of lack of
| alternatives?
| theturtletalks wrote:
| Amazon has always used dark patterns with their 3rd party
| sellers. They even restrict the price sellers can charge
| on products they sell on Amazon and their own website.
| This ensures Amazon will be the lowest price.
|
| In this analogy, that would mean you have a store inside
| the mall and right across the street. Amazon sees you are
| selling products cheaper across the street since rent
| across the street is way cheaper than inside the mall.
| Amazon then says either you charge the same price in the
| mall or you get kicked out. You could call Amazon's bluff
| but most sellers are not risking their seller accounts.
| lupire wrote:
| That's irrelevant to charges of anti-competitive behavior
| reaperducer wrote:
| _It would be like if Amazon owned the entire mall, and would
| kick out competitors and establish their own stores once they
| become profitable._
|
| Just wait. It may happen.
|
| During the pandemic some of the big mall companies bought
| their tenants, either out of bankruptcy, or at crazy cheap
| prices.
|
| At first it looked like the malls were just doing it to keep
| the lights on and the storefronts occupied. Now there's more
| and more people saying the mall companies may try to become
| "Amazon In Real Life."
|
| To me, it sounds like Department Stores 2.0. But it'll be
| interesting to see if it actually happens.
| johnebgd wrote:
| This.
|
| They are also so good at building malls that they own the
| construction company and the supply chain of raw goods for
| the construction efforts (AWS). They use their scale to cut
| costs for construction globally so it doesn't make economic
| sense for others to build without them. Even some of their
| competitors use their construction company to build their
| vision of what a mall looks like. All the while Amazon is
| gaining valuable insights they can steal to use on their own
| malls.
___________________________________________________________________
(page generated 2021-05-03 23:00 UTC)