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Amazon’s Monopsony Is Not O.K.

nytimes.com

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Re: Amazon’s Monopsony Is Not O.K.

#141

Post by johnm111888 »

pron wrote: post #35
ajross wrote: post #12

I normally love Krugman, but it seems like he skipped a step here. Amazon is squeezing publishers to push prices down, which is bad becuase... why? I mean, the apocalyptic end game here is that publishers are forced out of business entirely and Amazon ends up buying content directly from authors, I guess. That doesn't sound so bad to me, nor like something that's going to "hurt America". Maybe then they might squeeze…

The main point isn't one action or another but, and Krugman says it clearly, that Amazon has too much power. Modern democracies usually strive to prevent concentration of power in few hands, especially if those hands aren't elected. The market, however, does often favor concentration of power, and when that happens, democracies should protect themselves. The US in particular has had a history of businesses gaining to…

I would argue that capitalism does not favor this "concentration of power," in fact quite the opposite. Most industries where there is huge concentration of power (i.e. banks) is largely due to regulation. These new SV companies disrupted other big businesses and will eventually be disrupted by another wave of businesses themselves. A look at the top 10 companies by market cap in 1995 is probably very different than the top 10 currently.

I'm not sure how you site "exploitative practices by big business" then give an example of Uber. Uber is % of cab services? I would not classify them as big business. And while you might have a point with Google and privacy, users are not their customer but rather their product they sell to advertisers. So to argue they use exploitative practices and comparing to Amazon is weak considering the users aren't really a part of the supply chain but rather opt-in voluntarily.

Re: Amazon’s Monopsony Is Not O.K.

#142

Post by wutbrodo »

HelloMcFly wrote: post #129
nikbackm wrote: post #108

Earlier quoted context omitted.

Wouldn't a system like Goodreads be a good start for that?

As a regular Goodreads user, I've found that it definitely hasn't been a good start thus far.

Wow really? My reaction to new social networks (even niche ones) is usually somewhere between apathy and irritation, but back in 2010 I remember being excited about Goodreads because I saw actual value there: it just make the system of book recommendations that I already rely on that much more efficient. It took until 2012 for it to suddenly gain popularity and for me to gain a critical mass of friends whose taste I trust on the service, but I get heaps of value out of it now.

Re: Amazon’s Monopsony Is Not O.K.

#143

Post by WalterBright »

exelius wrote: post #88
ajross wrote: post #12

I normally love Krugman, but it seems like he skipped a step here. Amazon is squeezing publishers to push prices down, which is bad becuase... why? I mean, the apocalyptic end game here is that publishers are forced out of business entirely and Amazon ends up buying content directly from authors, I guess. That doesn't sound so bad to me, nor like something that's going to "hurt America". Maybe then they might squeeze…

Yeah; I agree. He would have a good argument except for the fact that the value of a single piece of content is declining across the board. That is fucking with a lot of established business models, specifically with the publishers. The value of a music album has decreased significantly because anyone can create one in their bedroom with free software and under $1000 worth of equipment. Same with a book - all you nee…

I used to watch crummy shows on TV just because they were on and I was bored. Now, there is so much content available streaming online that there's no reason whatsoever to spend time watching anything less than the best.

Re: Amazon’s Monopsony Is Not O.K.

#144

Post by WalterBright »

k-mcgrady wrote: post #126
Kalium wrote: post #106

Earlier quoted context omitted.

I, for one, am quite happy to be "screwed" by lower prices. Recall that Amazon publishes directly right now. They haven't raised prices unreasonably.

Let me explain further. Take this scenario: - Amazon continues to drops prices. Great for consumers. - They drop prices so low that either publishers reduce how much they pay writers or they go out of business. - Writers then start shifting publishing to Amazon who can give them a bigger piece of the pie. - Publishers die out leaving Amazon as sole publisher + distributor. - NOW they can exploit their power. They can…

Being the internet, it's easy for new competitors to start up, and existing competitors to expand. See oreilly.com, for example.

Re: Amazon’s Monopsony Is Not O.K.

#145

Post by WalterBright »

MarkMc wrote: post #53
onthedole wrote: post #34

Earlier quoted context omitted.

Forbes has a good response piece to Krugman: http://www.forbes.com/sites/timworstall/2014/10/20/paul-krug...

I found the Forbes article unconvincing, especially this bit: > applying the same strictures to Standard Oil would have left that company alone rather than breaking it up. And that’s a conclusion that I’m entirely happy with too. So it would have been fine far Standard Oil to take over the entire US economy as long as it reduced prices far consumers?

As Rockefeller's biography "Titan" points out, Standard Oil's market share declined throughout the period of the anti-trust trial, and Rockefeller was unable to stem the slide.

Re: Amazon’s Monopsony Is Not O.K.

#146

Post by WalterBright »

chc wrote: post #138
mikeash wrote: post #86

Monopolies and monopsonies only matter when they're difficult to overcome because their size gives them an insurmountable competitive advantage. Absent that, they only exist as long as people are happy with them. Amazon is easy to bypass. The major publishers could set up their own online stores tomorrow if they wanted to. Authors could set up their own stores too. There are a ton of viable alternatives.

It seems like you're using a very liberal sense of the word "viable" if "Authors could set up their own stores" is considered a viable alternative to selling on Amazon.

I've bought books from authors who set up their own web sites to sell their own ebooks.

Re: Amazon’s Monopsony Is Not O.K.

#147

Post by jasode »

ender7 wrote: post #139
jasode wrote: post #119

Earlier quoted context omitted.

>When one buyer represents 50-60% of sales, ... One party to the negotiation can walk away; the other cannot. I don't follow the logic here. Your fatalistic assessment assumes Hachette (and other publishers) are paralyzed and cannot adapt . However, the business world isn't static therefore Hachette can walk away. (If not this particular contract renewal because of timing pressure then at least the next one -- if the…

Note that some of these ideas count as collusion and are illegal. See: the Justice Department's successful lawsuit against publishers over their deals with Apple. Unfortunately, the set of solutions {!collusion, practical} is very small. It might be empty.

The illegal collusion with Apple was over coordinated price fixing.

I don't see what would be illegal about book publishers partnering up to create their own online store and making their titles exclusive to that store.

The major record labels jointly own Vevo[1] for youtube content. They also collectively own a big chunk of Spotify.

Pearson Publishing is a competitor of O'Reilly and yet they were partial owners of the O'Reilly online subscription system.[2]

[1]http://en.wikipedia.org/wiki/Vevo

[2]http://www.oreilly.com/pub/pr/3216

Re: Amazon’s Monopsony Is Not O.K.

#148

Post by teslaberry »

krugman cannot be trusted. everything he writes is with the angle of getting a job as federal reserve chair or treasury head.

economics is not a science and his nobel prize is on par with obama's nobel piece prize, given for every piece of the middle east he was about to surge with troops.

Re: Amazon’s Monopsony Is Not O.K.

#149

Post by chc »

WalterBright wrote: post #146
chc wrote: post #138

Earlier quoted context omitted.

It seems like you're using a very liberal sense of the word "viable" if "Authors could set up their own stores" is considered a viable alternative to selling on Amazon.

I've bought books from authors who set up their own web sites to sell their own ebooks.

I'm not sure I see the relevance. Lots of people do lots of different things. Some people juggle geese. Does you having bought books from authors who set up their own websites mean that bespoke websites are a viable alternative to Amazon for the majority of authors?

Re: Amazon’s Monopsony Is Not O.K.

#150

Post by cbd1984 »

johnm111888 wrote: post #141
pron wrote: post #35

Earlier quoted context omitted.

The main point isn't one action or another but, and Krugman says it clearly, that Amazon has too much power. Modern democracies usually strive to prevent concentration of power in few hands, especially if those hands aren't elected. The market, however, does often favor concentration of power, and when that happens, democracies should protect themselves. The US in particular has had a history of businesses gaining to…

I would argue that capitalism does not favor this "concentration of power," in fact quite the opposite. Most industries where there is huge concentration of power (i.e. banks) is largely due to regulation. These new SV companies disrupted other big businesses and will eventually be disrupted by another wave of businesses themselves. A look at the top 10 companies by market cap in 1995 is probably very different than…

> I would argue that capitalism does not favor this "concentration of power," in fact quite the opposite.

That's nice and all, but history says otherwise, with the Gilded Age as the primary example: Monopolies existed in the relative regulatory vacuum, and it took government power to break them up.

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