Amazon scooped up data from its own sellers to launch competing products • Hacker News Board

Re: Amazon scooped up data from its own sellers to launch competing products

#581

Post by hnick » Fri, Apr 24, 2020, 12:11 AM UTC

aogl wrote: post #551

theturtletalks wrote: post #458

Earlier quoted context omitted.

This is different that Costco selling their own brand vodka or toilet paper because buyers can see those items side by side when shopping. Amazon has their products on the top every time and if 3rd party sellers want to be next to them, they have to pay for ads. Amazon doesn't pay for its own ads so they can effectively hide their competition.

You say Amazon doesn't pay for ads, but by them taking the space of the ads others aren't buying, they're losing ad money, which probably equates back to the value of the ad. ?

Good point, is Amazon only PPC?

I mean, they own the whole platform so click fraud would be easy to get away with but hopefully that's not happening. I'm not sure if anyone has the ability to audit their honesty.

Re: Amazon scooped up data from its own sellers to launch competing products

#582

Post by PaulDavisThe1st » Fri, Apr 24, 2020, 12:17 AM UTC

repiret wrote: post #540

PaulDavisThe1st wrote: post #305

Earlier quoted context omitted.

(1) it's not just about generic products. Amazon uses the same approach to decide what non-generic products it should become a direct seller of, potentially (and normally) negatively impacting 3rd party sellers. (2) HD and Lowes have almost no generic/store brand stuff at all. There are a few exceptions, and they likely do represent fairly profitable sections of their overall business. The main ones I am aware of: li…

(1) You don't think HD and Lowes and Safeway and Walmart and every big retailer doesn't use their sales data to decide which products to try to disintermediate distributors and other middle-men in the supply chain? (2) I'll concede HD and Lowes have a lot of departments without store brands [1], but raise you the local grocery store, which doesn't. [1]: The pattern I see is that the stuff marketed mostly to contracto…

Amazon has done a lot more than you describe. Their marketplace has been a major online venue for retailers not just manufacturers and distributors. Companies (typically small) that focused on small niches (e.g. triathlon equipment). Amazon has siphoned off the best-sellers and high margin items from these sellers, making their businesses somewhere between less profitable and completely unviable.

The model here is not "Safeway and Walmart and every big retailer [ using their sales data]". It's more akin to the flagship store in a mall actually owning the mall, and requiring that all customers check out via their registers. Every other vendor in the mall surrenders all their sales data to the flagship, which it uses to decide how to use its own internal spaces to sell with higher volume and/or profit.

The own-brand stuff that Amazon is doing is dubious, but sure, I agree that many large retailers do it. Most large retailers do not operate 3rd party retail marketplaces, however, where they can siphon sales data from largely unsuspecting 3rd party retailers.

Re: Amazon scooped up data from its own sellers to launch competing products

#583

Post by hnick » Fri, Apr 24, 2020, 12:18 AM UTC

dathinab wrote: post #508

theturtletalks wrote: post #458

Earlier quoted context omitted.

This is different that Costco selling their own brand vodka or toilet paper because buyers can see those items side by side when shopping. Amazon has their products on the top every time and if 3rd party sellers want to be next to them, they have to pay for ads. Amazon doesn't pay for its own ads so they can effectively hide their competition.

I believe amazone should pay for their own advertisement to well themsell and prices should be transparent (amazone has to pay them self what other would have to pay), _because then they would still need to pay tax_ for this. At least in countries where taxes are not very low this could make the situation slightly better. Through not that much better tbh.

Yes this sounds like an antitrust situation to me (I know they are not technically a monopoly but different countries have different takes on these laws so it's worth considering why they exist).

A phone wholesaler with a retail business will be broken up since it is a problem for their other retail customers.

This is quite similar where Amazon is acting as both the provider and a retail customer competing against their other retail (marketplace business) customers, with a number of advantages.

Having them forced to provide services at arm's length, at published costs, with audited public books and no inside information would level the playing field. They probably already account for advertising "spend" internally anyway if they're smart, since as another poster alluded they miss out on PPC when someone clicks on an Amazon product so need to know what it cost them.

Re: Amazon scooped up data from its own sellers to launch competing products

#584

Post by kube-system » Fri, Apr 24, 2020, 12:25 AM UTC

ceejayoz wrote: post #429

kube-system wrote: post #400

Earlier quoted context omitted.

I'm not so sure about that. AWS terms do not assign their customers any rights to any physical computer. And the AWS customer agreement gives Amazon the authority to access your data for certain purposes. I'm not sure I've ever heard of anyone prosecuted under the CFAA for accessing a computer that they physically own and physically control. AWS is a service, not a computer rental.

https://aws.amazon.com/agreement/ > We will not access or use Your Content except as necessary to maintain or provide the Service Offerings, or as necessary to comply with the law or a binding order of a governmental body. The CFAA uses wording like "exceeds authorized access", which Amazon would absolutely be guilty of if they went into your database to spy on your product listings. If they could go after Aaron Swar…

The CFAA doesn't protect "content", though. It protects "protected computers".

In this case, Amazon fully owns, possesses, and operates the "protected computer".

You'd have to successfully argue that Amazon fraudulently accessed their own computer. It might be possible, but I'm guessing it'd be a first.

The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR.

Re: Amazon scooped up data from its own sellers to launch competing products

#585

Post by ceejayoz » Fri, Apr 24, 2020, 12:28 AM UTC

kube-system wrote: post #584

ceejayoz wrote: post #429

Earlier quoted context omitted.

https://aws.amazon.com/agreement/ > We will not access or use Your Content except as necessary to maintain or provide the Service Offerings, or as necessary to comply with the law or a binding order of a governmental body. The CFAA uses wording like "exceeds authorized access", which Amazon would absolutely be guilty of if they went into your database to spy on your product listings. If they could go after Aaron Swar…

The CFAA doesn't protect "content", though. It protects "protected computers". In this case, Amazon fully owns, possesses, and operates the "protected computer". You'd have to successfully argue that Amazon fraudulently accessed their own computer . It might be possible, but I'm guessing it'd be a first. The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR.

The Amazon employee accessing the data would be "exceeding authorized access".

> The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR.

His access was authorized, though. They still threw CFAA at him.

Re: Amazon scooped up data from its own sellers to launch competing products

#586

Post by closetohome » Fri, Apr 24, 2020, 12:31 AM UTC

1propionyl wrote: post #357

closetohome wrote: post #312

Earlier quoted context omitted.

In all seriousness, not giving your own brands prominent placement would be ignoring the benefits of vertical integration, leaving money on the table, and violating your fiduciary duty to stockholders.

> violating your fiduciary duty to stockholders The idea that corporate directors (of whichever kind) have an legal obligation to maximize profits/shareholder value is a myth. Taken directly from Alito's (non-dissenting) opinion in Hobby Lobby: "While it is certainly true that a central objective of for-profit corporations is to make money, modern corporate law does not require for-profit corporations to pursue profi…

This would actually be an interesting test of that decision and the law of Business Judgement, which normally shields corporate directors from micromagement via lawsuit.

I doubt it would pass the threshold of "grossly negligent" that you'd typically need to sue a CEO as a shareholder, but it's certainly different from an otherwise positive action that simply uses company resources - like raising salaries or making charitable donations.

Re: Amazon scooped up data from its own sellers to launch competing products

#587

Post by kube-system » Fri, Apr 24, 2020, 12:32 AM UTC

ceejayoz wrote: post #585

kube-system wrote: post #584

Earlier quoted context omitted.

The CFAA doesn't protect "content", though. It protects "protected computers". In this case, Amazon fully owns, possesses, and operates the "protected computer". You'd have to successfully argue that Amazon fraudulently accessed their own computer . It might be possible, but I'm guessing it'd be a first. The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR.

The Amazon employee accessing the data would be "exceeding authorized access". > The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR. His access was authorized, though. They still threw CFAA at him.

"exceeding authorized access" is not enough to violate the CFAA.

You have to "exceed authorized access to a protected computer"

The CFAA is not a data protection law. It is a computer protection law.

Re: Amazon scooped up data from its own sellers to launch competing products

#588

Post by qaq » Fri, Apr 24, 2020, 12:34 AM UTC

AmericanChopper wrote: post #577

qaq wrote: post #541

Earlier quoted context omitted.

AWS has amazing marketing the truth of the matter is AWS Region has worse downtime than a single top tier DC. Mainly due to nightmarish complexity of their control layer. They had outages that lasted many hours in a row multiple times. You need to carefully separate marketing claims from operational reality and actual track record. When US East has major issues there is not enough spare capacity to spin up everything…

Amazon has some of the best uptime in the world, especially for basic services like EC2, even if you’re only considering the least reliable regions like US East. Their last major event was in 2017. There are few providers in the world that can compete with them in that respect, and there’s nothing that you or I or anybody else could build with 6-10 servers that could come close. If you were planning to try exceed the…

Our AWS monthly spend is deep 7 figures over the last 10 years our colo projects had better uptime than AWS US East. You keep living in the marketing bubble for AWS.

Re: Amazon scooped up data from its own sellers to launch competing products

#589

Post by ceejayoz » Fri, Apr 24, 2020, 12:40 AM UTC

kube-system wrote: post #587

ceejayoz wrote: post #585

Earlier quoted context omitted.

The Amazon employee accessing the data would be "exceeding authorized access". > The difference in Aaron's case is huge: he didn't own the computers that hosted JSTOR. His access was authorized, though. They still threw CFAA at him.

"exceeding authorized access" is not enough to violate the CFAA. You have to "exceed authorized access to a protected computer " The CFAA is not a data protection law. It is a computer protection law.

https://en.wikipedia.org/wiki/Computer_Fraud_and_Abuse_Act

> In practice, any ordinary computer has come under the jurisdiction of the law, including cellphones, due to the interstate nature of most Internet communication.

Re: Amazon scooped up data from its own sellers to launch competing products

#590

Post by ooobit2 » Fri, Apr 24, 2020, 12:50 AM UTC

granzymes wrote: post #559

snowwrestler wrote: post #436

Earlier quoted context omitted.

The difference is that Safeway does not have any other sellers on their shelves. Safeway buys inventory at wholesale and sells it at retail. Everything that is sold in Safeway was intentionally selected by Safeway to be there. If you see a product on a Safeway shelf, the company that makes that product already got paid--by Safeway. If Safeway puts a generic ibuprofen bottle next to a bottle of Advil, that's fine with…

I don't see as big of a distinction between Safeway and Amazon. The demand for pain medication is relatively constant, so if sales of Safeway's generic ibuprofen increase it will come at the expense of Advil because Safeway will start buying fewer units. The harm is one step removed but is still there. I think a better argument would be the scale of the data collected by Amazon vs physical stores. But on the other ha…

Maybe. One distinction I want to argue is placement: Amazon always places the Amazon Choice options at the top of the search and product listings. They also always include them in the "Popular, Editor's Picks, Highest Rated, etc." box that appears in the middle of most pages on the site. This would be like you walking into Safeway for a bag of sugar, and as soon as you turn down the aisle, there's an employee telling you everyone buys the Safeway brand Sugar or an advertisement with three boxes showing Safeway's as the Most Popular option, and two others next to it.

Where this gets real distinct is in delivery: Amazon is currently purging its warehouses of stock from thousands of vendors so it can keep stock of Amazon-brand and big box brand alternatives to those same products. (See: https://www.bloomberg.com/news/articles/2019-05-28/amazon-is...) So, the Safeway equivalent of this would be you going down the sugar aisle and finding exactly 1 or 2 bags of competing brands with a note that says, "Hurry! Almost out!", and each bag has 10lb. anchor attached to it. But there's 100 bags of Safeway sugar, and there's a line of employees offering to carry it through the store for you do you don't hurt your terribly sore shoulders...

How would you feel if a Safeway associate slapped a tracking device on you when you walked in the door, and then didn't tell you they were recording everything you thought while you were working your way through the store? That's how Amazon.com works. Oh, and if Safeway could just look at your other recent thoughts and know you fapped about 20 minutes before you walked in the door? That's also Amazon.