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The FTC sues to break up Amazon over an economy-wide “hidden tax”

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Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#21

Post by endisneigh »

thelastgallon wrote: post #17

An excerpt from: https://pluralistic.net/2023/04/25/greedflation/ Amazon binds its sellers over to something called Most Favored Nation status. That means that sellers can't offer their goods more cheaply than they do on Amazon – even if it costs them (lots) less to sell in Target or direct from their websites. This means that every time a seller adds a dollar to their Amazon sale price, they have to add a dollar to…

I don't see the problem with this. They don't have to sell on Amazon to begin with. Amazon obviously wants their customers to have the best price available. Sellers can just go off Amazon if they don't like it. If sellers end up raising the price on other platforms as a result of this rule, then that says more about them than Amazon.

Demanding the lowest price does not harm consumers. Overstock, Wayfair, Walmart and others do the same thing. The result is the lowest price for a given product on all sites. This is unquestionably good for consumers.

If the price is higher then the fault is simply that of the seller for raising it. All e-commerce sites want the lowest price for their customers. Of course, people don't see nuance and just see BigCompany bad.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#22

Post by abirch »

endisneigh wrote: post #12

It seems the government's main issue is that they have problems with companies being large. If that's the issue they should lobby congress to simply enforce some maximum size/impact a company has. My opinion on this is that e-commerce is extremely competitive and consumers are already highly motivated to pay the least amount of money. If it were cheaper for consumers to go elsewhere they would, and sellers would foll…

I agree with you. I quit using Amazon late last year and it's pretty easy to change to different vendors. Hopefully more consumers do this so that vendors don't have to use the Amazon price everywhere else on the internet.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#23

Post by BarryMilo »

endisneigh wrote: post #12

It seems the government's main issue is that they have problems with companies being large. If that's the issue they should lobby congress to simply enforce some maximum size/impact a company has. My opinion on this is that e-commerce is extremely competitive and consumers are already highly motivated to pay the least amount of money. If it were cheaper for consumers to go elsewhere they would, and sellers would foll…

That's a very naive view of the free market. What has been happening is Amazon consolidated the market, creating artificial barriers to entry as they do so (e.g. any and all exclusivity deals). This was always their plan, and they operated in the red for a very long time to get there. Hardly fair competition.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#24

Post by endisneigh »

BarryMilo wrote: post #23
endisneigh wrote: post #12

It seems the government's main issue is that they have problems with companies being large. If that's the issue they should lobby congress to simply enforce some maximum size/impact a company has. My opinion on this is that e-commerce is extremely competitive and consumers are already highly motivated to pay the least amount of money. If it were cheaper for consumers to go elsewhere they would, and sellers would foll…

That's a very naive view of the free market. What has been happening is Amazon consolidated the market, creating artificial barriers to entry as they do so (e.g. any and all exclusivity deals). This was always their plan, and they operated in the red for a very long time to get there. Hardly fair competition.

What's the barrier to entry? It's hardly a requirement to sell on Amazon. It's extremely straightforward to sell stuff on the internet these days.

Sellers are just complaining that they can't access Amazon's audience and do as they want. Luckily there's eBay, Shopify, Wix, etc. etc.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#26

Post by mjsweet »

endisneigh wrote: post #21
thelastgallon wrote: post #17

An excerpt from: https://pluralistic.net/2023/04/25/greedflation/ Amazon binds its sellers over to something called Most Favored Nation status. That means that sellers can't offer their goods more cheaply than they do on Amazon – even if it costs them (lots) less to sell in Target or direct from their websites. This means that every time a seller adds a dollar to their Amazon sale price, they have to add a dollar to…

I don't see the problem with this. They don't have to sell on Amazon to begin with. Amazon obviously wants their customers to have the best price available. Sellers can just go off Amazon if they don't like it. If sellers end up raising the price on other platforms as a result of this rule, then that says more about them than Amazon. Demanding the lowest price does not harm consumers. Overstock, Wayfair, Walmart and…

From what I understand, it’s not that simple. Sellers need the sheer volume of Amazon to compete. There is also the risk of Amazon duplicating their product and continuing to sell it on their platform… or their competitors filling the void.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#27

Post by endisneigh »

mjsweet wrote: post #26
endisneigh wrote: post #21

Earlier quoted context omitted.

I don't see the problem with this. They don't have to sell on Amazon to begin with. Amazon obviously wants their customers to have the best price available. Sellers can just go off Amazon if they don't like it. If sellers end up raising the price on other platforms as a result of this rule, then that says more about them than Amazon. Demanding the lowest price does not harm consumers. Overstock, Wayfair, Walmart and…

From what I understand, it’s not that simple. Sellers need the sheer volume of Amazon to compete. There is also the risk of Amazon duplicating their product and continuing to sell it on their platform… or their competitors filling the void.

So what? That's how e-commerce works. Why should Amazon be obligated to fill their store with higher priced items compared to their competitors? No one is going to visit a store where every item could be purchased cheaper somewhere else. This is exactly why price match is a thing, because they don't want their costumers soliciting different stores to begin with.

The move that Amazon's price be no higher than offered elsewhere is the most pro-consumer move possible. Hilarious people are complaining about it. Any second-order effects of this are on the actual seller, not Amazon.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#28

Post by icegreentea2 »

endisneigh wrote: post #12

It seems the government's main issue is that they have problems with companies being large. If that's the issue they should lobby congress to simply enforce some maximum size/impact a company has. My opinion on this is that e-commerce is extremely competitive and consumers are already highly motivated to pay the least amount of money. If it were cheaper for consumers to go elsewhere they would, and sellers would foll…

I think you're right that the government does have 'limit the size of companies' as a motivation, but I don't think that's their main motivation.

For one thing, how would you even right and enforce a law on maximum size/impact of a company? How would this even politically get through? There's already enough push-back against enforcing laws like "don't form cartels". The pushback on maximum size/impact of a company would be even more intense.

In any case, as the article states, "Today, Amazon tells sellers that if it detects a lower price for their products on any other online store, they will be punished, which is to say, their ability to get their products onto a place on the Amazon website where customers click will go away.". In other words, e-commerce is not extremely competitive.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#29

Post by philipov »

endisneigh wrote: post #19
elashri wrote: post #8

Earlier quoted context omitted.

> The only reason I keep it is for the video service which I'm guessing is the same for a lot of people. Which will start having ads unless you pay a fee for the ad-free experience starting next year [1] [1] https://www.npr.org/2023/09/22/1201028854/amazon-prime-video...

A more charitable take is that Amazon is raising the price (for the nth time) of prime, and introducing a small discount if you put up with ads.

Amazon doesn't need charity; they can afford to pay.

Re: The FTC sues to break up Amazon over an economy-wide “hidden tax”

#30

Post by temporallobe »

elashri wrote: post #8
koalaman wrote: post #6

This has been pretty obvious for a while. Whenever I do product searches on Amazon the prime eligible results are more expensive by exactly the shipping costs of the non prime vendors. The only reason I keep it is for the video service which I'm guessing is the same for a lot of people.

> The only reason I keep it is for the video service which I'm guessing is the same for a lot of people. Which will start having ads unless you pay a fee for the ad-free experience starting next year [1] [1] https://www.npr.org/2023/09/22/1201028854/amazon-prime-video...

Tangentially related, even in YouTube Premium you can still see ads if the content creator embeds ads as part of their content. This seems like double-dipping to me and I am seeing more and more of this.
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