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Where Warren’s Wrong

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Re: Where Warren’s Wrong

#181

Post by AnthonyMouse »

scarface74 wrote: post #115
basch wrote: post #96

Earlier quoted context omitted.

everyone is stuck on the word monopoly. Antitrust law is much larger than just monopolys. and, if you can prove it, predatory pricing is illegal. amazon is absolutely subsidizing a bunch of stuff with profit from elsewhere. if and what and how the government can do something about that is a huge can of worms with wide reaching implications outside the tech industry. IF the government wants to get involved with separa…

So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing. Does that mean that HN should also come under scrutiny because it can price HN free? What if I wanted to start a competitor to HN? Should the government make it so there is an environment that makes that easier?

> So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing.

Don't forget "if it's free then you're not the customer you're the product" -- which means it's the users who are engaged in predator pricing by not charging for access to their eyeballs.

Of course, the users aren't giving their eyeballs for free, they're trading them for services. And the companies are trading services for eyeballs. There is no money because it's barter, not because there is no exchange of value.

And that's the case with all of this. Because the marginal costs for everything in tech are so low, the "cost" of providing something to the incremental user is negligible and nothing is ever really below cost because the ecosystem benefits to the company are worth more than the incremental cost of providing service to the user.

What creates these conglomerates isn't predatory pricing, it's the network effect. People use Facebook because their friends use it. They buy stuff on Amazon because the sellers are there, and the sellers are there because the buyers are there.

Re: Where Warren’s Wrong

#182

Post by oflannabhra »

It seems like the overwhelming response to this article is that the author is nit-picking.

I'd argue that the main point of the article is to drive to first-principles: How did these giants get so big? What is fundamentally different about tech companies that makes current antitrust legislation ineffective?

Antitrust legislation and enforcement has had several "generations" of philosophy in the United States:

- 1890s-1970s Sherman Antitrust Act targeting American Standard Oil. In this era enforcement focused on how a company practiced its business, with a chief goal being maximal competition.

- 1970s-now After The Antitrust Paradox [1] was published by Robert Bork, enforcement shifted to "consumer welfare," with the chief goal being maximal welfare.

(Planet Money is currently doing a series [2] that covers this)

I believe Ben Thompson is advocating that a new generation of philosophy needs to begin, because "consumer welfare" cannot be directly applied to these companies, their unfair advantages, or how to prevent the next "wave." Indeed, their size is a direct result of their serving "consumer welfare" (ie, consumers choose them because their offerings are best).

Nitpicking or not, I'd prefer the result of the current discussion to result in actionable change, and I believe the points in this article (ie, the "nitpicks" it makes) are required for such a result.

[0] - https://en.wikipedia.org/wiki/United_States_antitrust_law#Th...

[1] - https://en.wikipedia.org/wiki/The_Antitrust_Paradox

[2] - https://www.npr.org/sections/money/2019/02/15/695131832/anti...

Re: Where Warren’s Wrong

#183

Post by scarface74 »

tathougies wrote: post #178
basch wrote: post #122

Earlier quoted context omitted.

predatory pricing is undercutting a competitor to purposely drive them out of business. i dont think hackernews is trying to put other sites out of business, far from it, as a link aggregator its business model is to push eyeball views elsewhere, similar to drudge. https://en.wikipedia.org/wiki/Predatory_pricing http://signalvnoise.com/posts/1407-why-the-drudge-report-is-...

> predatory pricing is undercutting a competitor to purposely drive them out of business. That is the purpose of all competition in a free market -- to achieve as large a market share as possible. In a stable market, this necessarily involves removing business from your competitors.

No the entire purpose is to make a profit. The most profitable company in the US is Apple. They didn’t get there by chasing market share.

Re: Where Warren’s Wrong

#184

Post by SlowRobotAhead »

re-actor wrote: post #64
dnautics wrote: post #19

Earlier quoted context omitted.

It wasn't Microsoft's meddling with the browser that was it's major anticompetitive sin; it was it's control over the bootloader. https://birdhouse.org/beos/byte/30-bootloader/ Yet here we are, and windows is not at all the dominant consumer os, and is not the dominant general purpose os any longer.

Windows still hovers around 90% market share, how is that not dominant?

He's counting mobile which is an "yea O.K." at best when he's also talking about general purpose OS.

Re: Where Warren’s Wrong

#185

Post by SlowRobotAhead »

oflannabhra wrote: post #71
SlowRobotAhead wrote: post #40

Earlier quoted context omitted.

>Yet here we are, and windows is not at all the dominant consumer os, and is not the dominant general purpose os any longer. Are you sure about that?

iOS and Android have far more active devices that Windows 10. As pointed out in the article, Microsoft missed the mobile revolution, and computing has shifted to mobile devices.

And when those users need to sit down at a computer to do actual work... It's by far dominantly a Windows PC.

You can't just take mobile and give it equal representation to PC, servers, workstations, etc. It's it's own thing. Did Windows lose mobile, of course. Do mobile users exclusively use Android or IOS and not use Windows - no.

Re: Where Warren’s Wrong

#186

Post by scarface74 »

jmrobertson wrote: post #171
chillacy wrote: post #159

Earlier quoted context omitted.

And Tesla shouldn’t be a car dealership. But going direct to consumer was the best thing for consumers imo. Why would I want to deal with economically inefficient middlemen? The new laws could create digital versions of car dealerships

To be fair, that's inaccurately reframing the argument. Apple with an Apple store for Apple Apps is the equivalent to what you're saying. Tesla doesn't sell Teslas _and_ BMWs.

So how do you think Anker and the other companies that sell products in the Apple Store online and off would feel if because of Warren Apple said forget it, we will just sell our own products and not worry about all of these crap legislations?

Re: Where Warren’s Wrong

#187

Post by scarface74 »

AnthonyMouse wrote: post #181
scarface74 wrote: post #115

Earlier quoted context omitted.

So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing. Does that mean that HN should also come under scrutiny because it can price HN free? What if I wanted to start a competitor to HN? Should the government make it so there is an environment that makes that easier?

> So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing. Don't forget "if it's free then you're not the customer you're the product" -- which means it's the users who are engaged in predator pricing by not charging for access to their eyeballs. Of course, the users aren't giving their eyeballs for free, they're trading…

I’m well aware of that. I’ve been arguing against government regulation.

Re: Where Warren’s Wrong

#188

Post by Rooster61 »

apcragg wrote: post #130
Rooster61 wrote: post #46

Earlier quoted context omitted.

Your argument is equally misleading. Does the fact that those contributions come from individuals somehow make them less profound? It's exceedingly important to point out who these individuals are associated with employment-wise.

I mean, yeah it makes them less profound. Individual identity is not entirely defined by place of employment. I'd imagine the vast majority of people see their employer as the means to pay bills rather than a political entity whose goals they explicitly support.

> not entirely

No, not entirely, but it absolutely can and does factor into one's decisions in life, including who to contribute to politically.

> I'd imagine the vast majority of people see their employer as the means to pay bills rather than a political entity whose goals they explicitly support.

The vast majority aren't the ones typically contributing to political candidates/PACS. Contributions tend to be from those with wealth, which are inherently not the majority. In this particular case, that wealth is at least in part derived from the employers these employees work for. It's also not coincidence that those higher up in a company, and thus more invested in the company doing well, are the ones getting paid more.

Re: Where Warren’s Wrong

#189

Post by jmrobertson »

jmrobertson wrote: post #171
chillacy wrote: post #159

Earlier quoted context omitted.

And Tesla shouldn’t be a car dealership. But going direct to consumer was the best thing for consumers imo. Why would I want to deal with economically inefficient middlemen? The new laws could create digital versions of car dealerships

To be fair, that's inaccurately reframing the argument. Apple with an Apple store for Apple Apps is the equivalent to what you're saying. Tesla doesn't sell Teslas _and_ BMWs.

I don't disagree with you so not sure your point, see my original point. I'm stating that the Tesla comparison doesn't apply to what Apple's specific situation is, and therefore what policy proposals/considerations apply.

Re: Where Warren’s Wrong

#190

Post by AnthonyMouse »

scarface74 wrote: post #170
cgriswald wrote: post #161

Earlier quoted context omitted.

> Spotify doesn’t pay an “Apple Tax”. You can’t subscribe to Spotify within the App store. Spotfy is an example. Plenty of Apps do pay the "Apple tax." I'd get into the complexity of how the "Apple tax" affects Spotify even though it doesn't pay it, but you seem to have already made up your mind about all this regardless of the facts.

You mean companies have to pay to be a part of a marketplace? Software distributors use to pay retailers 60% of the retail price to be sold in stores. It was 70% to be distributed in online app stores like the ones that Verizon use to run to distribute J2ME apps. And you act as if most revenue from online stores is not coming from in app purchases of consumable goods.

> Software distributors use to pay retailers 60% of the retail price to be sold in stores.

Because retail stores have to provide shelf space with real estate cost, unsold inventory cost, etc. How much is that cost to Apple?

> It was 70% to be distributed in online app stores like the ones that Verizon use to run to distribute J2ME apps.

And it costs 0% to be distributed in a Linux package manager.

Possibly something to do with Verizon having the same sort of app monopoly over its device customers that Apple does.

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