Amazon’s Monopsony Is Not O.K. • Hacker News Board

Re: Amazon’s Monopsony Is Not O.K.

#181

Post by exelius » Mon, Oct 20, 2014, 9:09 PM UTC

WalterBright wrote: post #143

exelius wrote: post #88

Earlier quoted context omitted.

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.

Well, most of the stuff online is pretty crummy too. But it's at least crummy stuff you've never seen as opposed to reruns.

Re: Amazon’s Monopsony Is Not O.K.

#182

Post by exelius » Mon, Oct 20, 2014, 9:14 PM UTC

jasode wrote: post #147

ender7 wrote: post #139

Earlier quoted context omitted.

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 t…

Joint ventures almost never pan out; especially for content. Once you create a joint venture, none of the partners have full control. That means decisions need to be made by consensus. It's hard to have consensus on a regular basis with one of your competitors. Do it too much and it's anticompetitive; don't do it enough and you'll never get anything dine.

If your company is relying on a joint venture to save its future, you should probably update your resume...

Re: Amazon’s Monopsony Is Not O.K.

#183

Post by WalterBright » Mon, Oct 20, 2014, 9:18 PM UTC

pron wrote: post #180

WalterBright wrote: post #140

Earlier quoted context omitted.

I read Rockefeller's biography "Titan" and could not find a single instance in it where Standard Oil's large market share "seriously hurt" the public. S.O. was a serious force in reducing the price of kerosene to the public - by 70%.

Did you skip the part where he (and his ilk) enslaved a large portion of the country in all but name? Or the part where the people begged government to help curb the robber barons, and Teddy Roosevelt wrestled power away from them?

> he (and his ilk) enslaved a large portion of the country

I read the book, and would be most interested in a cite for this.

> the people begged government to help curb the robber barons,

True, but that's not a statement the public was seriously harmed.

> Teddy Roosevelt wrestled power away from them

True, but also not a statement that the public was seriously harmed.

It's possible that "Titan" is a whitewash, but it has 4.5 stars on Amazon and appears to be well regarded.

Re: Amazon’s Monopsony Is Not O.K.

#184

Post by johnm111888 » Mon, Oct 20, 2014, 9:18 PM UTC

cbd1984 wrote: post #150

johnm111888 wrote: post #141

Earlier quoted context omitted.

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.

Referencing the time period in which the economy grew at its fastest rate in history in regards to GDP and real wages? Gilded Age transformed US into the economic superpower that it is today -- regulatory vacuum helped this. Government corruption and high tariffs helped prevent competition and helped establish the monopolies it later set out to break up. RRs benefitted from the creation of the interstate commerce commission

Re: Amazon’s Monopsony Is Not O.K.

#185

Post by WalterBright » Mon, Oct 20, 2014, 9:26 PM UTC

chc wrote: post #169

WalterBright wrote: post #163

Earlier quoted context omitted.

Of course they are viable. The ones I bought from were set up because the author didn't want to deal with Amazon. It's never been easier for an author who wants to sell his own books to do so. It also isn't hard for like-minded authors to pool their resources and set up their own sales site.

Maybe this is true, but I hope you'll forgive me if I do not take your totally unsubstantiated word for it. Is there actually a good reason I should believe this is viable? Because I have seen no evidence of that whatsoever and a lot of evidence to the contrary (chiefly, the paucity of authors succeeding using this supposedly viable option when compared to other avenues).

Few authors sell enough books to make a living at it, and this is true whether they sell through publishers, Amazon, or on their own.

As with any business, how well they do with their own site is strongly dependent on:

1. the quality of the book

2. the promotion and marketing

3. customer service

4. price

None of this is trivial, but it is certainly doable. Small businesses thrive (and fail) all over the internet, selling books is hardly any different.

And, of course, the 100% failure rate happens only when you quit before you start.

Re: Amazon’s Monopsony Is Not O.K.

#186

Post by WalterBright » Mon, Oct 20, 2014, 9:38 PM UTC

michaelq wrote: post #137

WalterBright wrote: post #133

Earlier quoted context omitted.

Note that O'Reilly books have their own site, and seem to do rather well.

O'Reilly is a specialized technical book publisher. Hatchette, on the other hand, is an undifferentiated conglomerate (one of the big 5 publishing companies). The types of people who would start their book search at O'Reilly are fairly well defined. That isn't the case with Hatchette. People on HatchetteStore.com are less likely to browse and more likely to search, and the second they fail to find a book they were lo…

HBO seems to compete rather well against Netflix, despite Netflix having orders of magnitude more selection.

Re: Amazon’s Monopsony Is Not O.K.

#187

Post by josu » Mon, Oct 20, 2014, 9:43 PM UTC

Tyrannosaurs wrote: post #179

josu wrote: post #110

Earlier quoted context omitted.

In the academic world Krugman-the-journalist has never had that much reputation. It was Krugman-the-academic the one who won the Nobel Memorial Prize. You can check out some of Krugman-the-journalist's most notorious contradictions here: http://wiki.mises.org/wiki/Paul_Krugman#Contradictions

Clearly we don't expect his journalism to have the same level of rigour as his academic work. That's a very different thing to any suggestion he might be part of an orchestrated PR move by Hachette which was the original implication.

You are completely right, sorry about that.

Re: Amazon’s Monopsony Is Not O.K.

#188

Post by pron » Mon, Oct 20, 2014, 10:09 PM UTC

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…

You're looking purely at the market caps and revenues, while the economy is also a function of employment and political influence. Heavily regulated segments might have fewer players (at first), but those are regulated and their power is curtailed. And like another commenter said, unregulated markets (and historical examples are aplenty, especially in the US), quickly see consolidation and concentration of power in the hands of a few corporations (even if they happen to be nominal competitors), and little regulation means their power (which is not the same as their revenue or market cap) can grow unhindered.

In as much as SV companies "disrupt" old industries, they usually consolidate power. Uber may not be big yet, but it's bigger than any single taxi company, and it wants to be a lot bigger still. How Uber transfers risk to its workers and pretends its nothing but a "marketplace" has the potential to change work relations and job security. It's just that Amazon's business practices look more similar to the ones we know from the gilded age, while what Google and Uber do is new, but not any less exploitative.

Opting-in and choice has little relevance here. A modern democracy must ensure that no unelected entity (and even elected bodies have checks and balances) gains too much control over people's lives even if people seem to want it.

Re: Amazon’s Monopsony Is Not O.K.

#189

Post by icelancer » Mon, Oct 20, 2014, 10:13 PM UTC

Shamanmuni wrote: post #160

icelancer wrote: post #121

Earlier quoted context omitted.

>In the case of books, you'd see that by cuts in editing, by authors shortening the amount of time that they spend writing a book, and through authors dropping out and leaving the field to less talented writers with fewer alternative income sources. I just spent $10,000 editing and producing my latest book that's going to be self-published. Comparing the royalties I'll get with self-publish (not using CreateSpace BTW…

It's not just a matter of how much money the writer will get. And even when talking about that, you assume that any published book will sell, and that's not true. When you publish through a publishing house, they assume the financial risk. I hope you get back your $10.000 (and much more), but it surely is not a given, most books don't sell much. It's the same situation we have with startups and VC's, the publisher ca…

>When you publish through a publishing house, they assume the financial risk.

Of what? The cost of the books? Because advances have gone basically to zero. I was offered none.

As far as your other questions: Books won't sell unless you curate an audience prior to writing it. And if you do that, the need for a publisher disappears quickly.

Re: Amazon’s Monopsony Is Not O.K.

#190

Post by jasode » Mon, Oct 20, 2014, 10:18 PM UTC

WalterBright wrote: post #186

michaelq wrote: post #137

Earlier quoted context omitted.

O'Reilly is a specialized technical book publisher. Hatchette, on the other hand, is an undifferentiated conglomerate (one of the big 5 publishing companies). The types of people who would start their book search at O'Reilly are fairly well defined. That isn't the case with Hatchette. People on HatchetteStore.com are less likely to browse and more likely to search, and the second they fail to find a book they were lo…

HBO seems to compete rather well against Netflix, despite Netflix having orders of magnitude more selection.

Indeed, HBO's plans for direct subscribers[1] may be part of their strategy to be less dependent on the cable providers. When contracts expire and are up for renegotiation, HBO will have more leverage with Time Warner, Comcast. I think channels such as ESPN and HBO already do have quite a bit of leverage with cable providers but having their own direct link to consumers would give them even more.

To relate back to amazon, I'm guessing Jeff Bezos has to buy old HBO content at a loss to fill out the selections for Amazon Prime Video. That way, the $99 membership fee looks like a good value. Could amazon put a price squeeze on HBO? It doesn't look like it. Amazon needs HBO content more than HBO needs Amazon.

20 years ago, HBO didn't have these type of business options. If HBO didn't like Comcast terms, it would be unrealistic for HBO to start digging streets and laying new video cables to a million residential homes. With the internet, they don't have to. I'm not convinced that book publishers have no chess moves left to use.

[1]http://deadline.com/2014/10/richard-plepler-time-warner-inve...