Amazon scooped up data from its own sellers to launch competing products • Hacker News Board

Re: Amazon scooped up data from its own sellers to launch competing products

#71

Post by mthoms » Thu, Apr 23, 2020, 3:47 PM UTC

cocktailpeanuts wrote: post #29

Thanks for the enlightening insight, captain obvious. Every single platform company, whether online or offline, does this. Apple does this with their appstore. Microsoft did this with their windows platform. Every retail or grocery store does this by developing their own native brand that blatantly copy existing products but with a bit lower quality and lower price. Is this good or bad? Well this is how the vendors a…

Important line from the article

> a practice at odds with the company’s stated policies...

> .. as stated to congress

(per the comment of user "so_tired" above)

Re: Amazon scooped up data from its own sellers to launch competing products

#72

Post by wpietri » Thu, Apr 23, 2020, 3:48 PM UTC

jacobr1 wrote: post #62

annoyingnoob wrote: post #48

Earlier quoted context omitted.

No, this is not great for the consumer. It lowers the bar for everyone. What I find mostly on Amazon in the past year or so is cheaper imported versions of decent products. The decent products are hard to find or I have to look outside of Amazon. They've pushed out the quality and replaced it with higher profit junk. Its kind of the same thing with Home Depot. I used to be able to buy quality hardware from a local st…

Different problems. One is the regulation of which suppliers can distribute on a platform, deceptive advertising, right-to-repair, and similar consumer protection considerations. The other problem the article and parent comments are describing relates to the distributor/retailer creating or sourcing generic alternatives to the items sold by their existing suppliers and informing their decisions to do so based on the…

What's your evidence that we get better outcomes for consumers?

Re: Amazon scooped up data from its own sellers to launch competing products

#73

Post by Shivetya » Thu, Apr 23, 2020, 3:49 PM UTC

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

Disagree, what I do think we need is any retailer who has their own product lines in store must clearly identify that they are store brands.

Re: Amazon scooped up data from its own sellers to launch competing products

#74

Post by dubcanada » Thu, Apr 23, 2020, 3:50 PM UTC

MichaelApproved wrote: post #49

ses1984 wrote: post #31

Earlier quoted context omitted.

In this case it's shitty to be a supplier but isn't this great for the consumer?

In the short term it creates competition and lower priced products. In the long term, Amazon undercuts suppliers who have to exit the market. That reduces competition and allows Amazon to charge more.

You're focused to much on Amazon. Every company does this just go to your local Walmart, everything is white-label. A law like this would have to be applied to them as well.

Re: Amazon scooped up data from its own sellers to launch competing products

#75

Post by mywittyname » Thu, Apr 23, 2020, 3:50 PM UTC

ThrowawayR2 wrote: post #56

mywittyname wrote: post #45

Earlier quoted context omitted.

Because it amounts to IP theft. It's one thing to see that unbleached toilet paper is selling well, and getting a supplier to sell you a store brand version. But it's completely different to see that a particular office stand is selling very well, determine that it has a 20% margin, and have someone build an identical product which you sell 5% margin. If you look at many Amazon Basics products, they are clear ripoffs…

> " It's one thing to see that unbleached toilet paper is selling well, and getting a supplier to sell you a store brand version. But it's completely different to see that a particular office stand is selling very well, determine that it has a 20% margin, and have someone build an identical product which you sell 5% margin. " Those two sound like the exact same thing to me. There is no real difference. It even happen…

Well, you can patent or trademark designs. And our legal system protects the holder of those patents and trademarks for good reason. Amazon is able to leverage their position in the market to abuse suppliers and get away with illegal behavior because the suppliers lack the resources to fight Amazon.

There's a difference between a clean room design that takes inspiration from a product and an identical copy. I can write and perform a song in the style of The Beatles, but I cannot write and perform "Hey Jude" without paying royalties.

Re: Amazon scooped up data from its own sellers to launch competing products

#76

Post by chairmanwow1 » Thu, Apr 23, 2020, 3:50 PM UTC

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

What really is the issue? That Amazon is leveraging its success to be successful? It's unfair that Amazon is able to see that a product category is doing well so it invests its own money into manufacturing a product to sell through its site?

Do you really think that if Amazon couldn't use the data from its own site that it wouldn't procure it elsewhere? Before any product is developed there is extensive market research done to get an idea of how much money this product could make.

Anyone can and does do this, why should Amazon be punished that its data collection mechanism is cheaper than others?

Re: Amazon scooped up data from its own sellers to launch competing products

#77

Post by jacobr1 » Thu, Apr 23, 2020, 3:50 PM UTC

kregasaurusrex wrote: post #36

Oftentimes this is done to circumvent paying patent license fees- for example if a patented component in a BOM would cost 75 cents per unit from the manufacturer, and the in-house team found a way to perform the equivalent function for 15 cents then it would instantly allow your product to undercut the competition. In Amazon's case, all it takes is a query to find high margin items in which knockoffs can be made and…

Another approach ... they could also identify which products either have wide-supplier diversity for the same thing (commodities) or narrow supplier density with many branded variants (OEM suppliers). In either case, they can go direct to the manufacturer without ANY innovation, slap the label on, and cut out the middle-man/sub-retailer costs. I think Amazon, in particular, has a team analyzing these factors as input into their sourcing (on top of general considerations like margin).

Re: Amazon scooped up data from its own sellers to launch competing products

#78

Post by allemagne » Thu, Apr 23, 2020, 3:50 PM UTC

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

>You're either a platform/retailer or you're a manufacturer. You don't get to be both

Ok, done.

Now what are manufacturers supposed to do when Amazon and Walmart start bullying them some other way? You just made shipping their product directly to the customer against the law.

Re: Amazon scooped up data from its own sellers to launch competing products

#79

Post by stronglikedan » Thu, Apr 23, 2020, 3:51 PM UTC

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

What perverse incentive? Competition?

Re: Amazon scooped up data from its own sellers to launch competing products

#80

Post by sp332 » Thu, Apr 23, 2020, 3:51 PM UTC

AbrahamParangi wrote: post #61

MichaelApproved wrote: post #25

The solution isn't hoping the free market would solve this with a competing platform. The solution is to create regulations & laws that prevent this behavior. You're either a platform/retailer or you're a manufacturer. You don't get to be both because we see the perverse incentive that happens when it's allowed.

It’s regulation like this that causes industry monopolies by raising the complexity of entering the space. Outside of dealing with negative externalities, regulation is a poor-man’s trust busting anyway.

The alternative to introducing this regulation is not going to a system with no regulation, it's continuing with the current framework where Amazon is actively driving competition out of the market. Opposing this regulation without an actual alternative is just defending the status quo.