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FTC sues Amazon for illegally maintaining monopoly power

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Re: FTC sues Amazon for illegally maintaining monopoly power

#731

Post by deepsun »

berniedurfee wrote: post #579
newsclues wrote: post #487

Earlier quoted context omitted.

"This is the result of commoditizing 'starting a business' to the point of near-worthlessness in the bottom 50%+." Is this not just a market effect of saturating the market with competition because suddenly running a business is comparatively easy (communications technology, platforms and existing logistics and production networks) to any other era. I can probably start a company drop shipping crap on Amazon in a sho…

Very similar to the music industry, where technology has made producing music so easy the market is growing by tens of millions of new songs every year. The slices of pie are getting very thin indeed. Especially when there are only a few pie delivery services to choose from and they take their slice first.

In efficient market every business must have razor-thin margins, otherwise competitors squeeze into it.

Good fat margins are a result of an ineffective market.

Re: FTC sues Amazon for illegally maintaining monopoly power

#732

Post by callalex »

lostapathy wrote: post #694
berniedurfee wrote: post #582

Earlier quoted context omitted.

Why not McMaster Carr or even Digikey? I’m sure Amazon has put a sizable dent in their sales without even really trying. Amazon now has special search tools for buying fasteners that make it easier to find exactly what you need. Prices are cheap, risk is high, but prices are cheap.

> Amazon now has special search tools for buying fasteners that make it easier to find exactly what you need Easier but they are no McMaster, by a long shot.

I have a lot of friends in the manufacturing business that range from self-employed to military-backed conglomerates. None of them use this tool. Are they all Luddite idiots, or is this Amazon search tool, backed by their swiss-cheese supply chain, just not that useful?

Re: FTC sues Amazon for illegally maintaining monopoly power

#733

Post by djtango »

sneak wrote: post #628
notyourwork wrote: post #475

Earlier quoted context omitted.

Is drop shopping the kind of business to fight for supporting? That’s all this is.

Yes. Curation is valuable.

I have done a bit of shopping on Taobao which is basically buy direct from manufacturers and yes, curation is valuable. Both of quality and design.

Re: FTC sues Amazon for illegally maintaining monopoly power

#734

Post by chongli »

omnimus wrote: post #504
notyourwork wrote: post #472

Earlier quoted context omitted.

Ding ding ding. Middlemen get squeezed and are mad about it would be equally fair headline here.

Amazon is also the middlemen.

But Amazon adds real value. They built out a huge logistics and PoS system. They have warehouses everywhere. They have millions of subscribers for Prime which gets people to buy large amounts of stuff on the site.

Any business owner is free to build their own website, set up payments, set up accounts with FedEx and UPS, and rent some warehouse space. That’s a tough row to hoe!

Re: FTC sues Amazon for illegally maintaining monopoly power

#735

Post by hackerlight »

mrraj wrote: post #444
jollofricepeas wrote: post #52

FBA seller here. A lot of mom and pop businesses (~$20 million) have been built on Amazon over the past 10 years. Most of us are in the $250k to $5 million dollar range. The impact of Amazon’s monopoly power is felt big time by us as we’re being squeezed with no place left to go online especially post-iOS change. Our second option used to be the Facebook/Instagram/TikTok to Shopify connection but with that being dead…

From the Bloomberg article : "Chuck Gregorich, who sells fire pits and outdoor furniture, says turning a profit on Amazon is getting harder. One of his popular fire pits costs $200, of which Amazon takes $112 for its commission, warehouse storage, delivery and advertising. That leaves him with $88 to pay the manufacturer, ship the product in from China and cover his overhead." I have a hard time sympathizing here. Th…

> They farm out manufacturing to China and logistics/warehousing to Amazon

You miss the key distinction. The former part of that equation is competitive, the latter part isn't. A guy who sells firepits can't be expected to create a competitor to Amazon. Amazon has complete monopolistic pricing power. Whenever a company is in that position, they will abuse it.

Re: FTC sues Amazon for illegally maintaining monopoly power

#736

Post by hackerlight »

notyourwork wrote: post #472
mrraj wrote: post #444

Earlier quoted context omitted.

From the Bloomberg article : "Chuck Gregorich, who sells fire pits and outdoor furniture, says turning a profit on Amazon is getting harder. One of his popular fire pits costs $200, of which Amazon takes $112 for its commission, warehouse storage, delivery and advertising. That leaves him with $88 to pay the manufacturer, ship the product in from China and cover his overhead." I have a hard time sympathizing here. Th…

Ding ding ding. Middlemen get squeezed and are mad about it would be equally fair headline here.

Ok but that is just one example. If the guy they chose for the example happened to make his own firepits he'd also be getting squeezed.

Re: FTC sues Amazon for illegally maintaining monopoly power

#737

Post by callalex »

billjings wrote: post #645
mrraj wrote: post #444

Earlier quoted context omitted.

From the Bloomberg article : "Chuck Gregorich, who sells fire pits and outdoor furniture, says turning a profit on Amazon is getting harder. One of his popular fire pits costs $200, of which Amazon takes $112 for its commission, warehouse storage, delivery and advertising. That leaves him with $88 to pay the manufacturer, ship the product in from China and cover his overhead." I have a hard time sympathizing here. Th…

You have a hard time sympathizing? Say what you will about their means of getting it, but this person did 100% of the leg work of getting that sale. That sale doesn't exists without them. And Amazon gets the MAJORITY of the revenue cut for that? I sympathize with the idea that China should get more of that, but make no mistake: Amazon's logistics and warehousing were not an option here. They were the cost of doing bu…

I want to understand your perspective so I have a personal question: what is your professional discipline/area of training/educational degree?

Re: FTC sues Amazon for illegally maintaining monopoly power

#738

Post by chongli »

missedthecue wrote: post #720
selcuka wrote: post #661

Earlier quoted context omitted.

That's literally the meaning of being a monopoly: There are no other distribution channels that can compete with Amazon. They are a distribution monopoly.

Most things aren't bought on Amazon, but if you're a middleman droppshipping stuff from China, Amazon is an easy way to get in front of a lot of eyeballs. It's not clear to me why droppshippers deserve special care and treatment by the FTC.

The chair of the FTC is Lina Khan. As a law student, she wrote this article [1] for the Yale Law Journal. It attracted so much attention in the antitrust law community that it led to her becoming the youngest FTC chair in history.

She has literally been building this case against Amazon since she was a student. It’s not just about dropshippers. It’s also about how Amazon uses automated price controls, guided by scraping of competitors, to engage in dumping [2] and predatory pricing [3] to wipe out competing e-commerce sites. Since everything is automated, prices can change in a matter of seconds, so once competitors are destroyed, prices go back up automatically.

[1] https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p...

[2] https://en.wikipedia.org/wiki/Dumping_(pricing_policy)?wprov...

[3] https://en.wikipedia.org/wiki/Predatory_pricing?wprov=sfti1

Re: FTC sues Amazon for illegally maintaining monopoly power

#739

Post by callalex »

TedDoesntTalk wrote: post #453
Avshalom wrote: post #447

Earlier quoted context omitted.

The thing is, it's 2023, we all "know" that every company's product get made in the same factory and there's just a fork at the end of the conveyor where they get different branding slapped on. So the gamble is that UCNN is sourced out of the exact same factory as the product/brand you actually want. It's the the evolution of the Warby Parker model.

Just bought a wood bed frame online. 5 vendors with nearly the exact same frame, all priced within $50 of each other. How does one choose? Does it matter?

It’s a great signal that you are buying from the wrong middleman. Seek out the source for a 50% discount. Usually that source is on AliExpress/Alibaba.

Re: FTC sues Amazon for illegally maintaining monopoly power

#740

Post by jiggawatts »

bminor13 wrote: post #648
fpgaminer wrote: post #483

Earlier quoted context omitted.

At least AWS gives me an invoice each month with a break down of fees. GCP just sends an invoice for the total amount. No detail, no breakdown. And I have never gotten any of GCP's many different pages under their billing system to spit out any numbers that make sense. Pick your poison?

Check out https://cloud.google.com/billing/docs/how-to/export-data-big... - you can configure GCP to spit out pricing data to bigquery, to be queried however you like. (I don't think it produces a volume of data that escapes the free tier, but I'd have to check)

If I remember correctly, they charge for the BigQuery table you use for the detailed export. In other words: there's a charge for seeing detailed charges!

All other clouds provide a detailed cost breakdown report for free.

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