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FTC sues Amazon for illegally maintaining monopoly power

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Re: FTC sues Amazon for illegally maintaining monopoly power

#921

Post by hnlmorg »

hellojesus wrote: post #920
hnlmorg wrote: post #917

Earlier quoted context omitted.

I cannot speak for every location, but Amazon isn’t the cheapest in the UK. I would say it is about average. Where Amazon wins is the range of stock and its next day deliveries. Which means most people default to Amazon because it’s quicker and easier than shopping around. But you can definitely get cheaper if you were to shop around. Also by Amazon owning the whole pipeline, from stock to delivery, they can squeeze…

I agree fully, but Amazon is still the "cheapest" when you consider the all in price of cost_of_goods+cost_of_delivery|want_goods_in_fewer_than_two_days. Amazon has the most efficient business, which allows them to survive on lower margins and attract buyers because of the vertically integrated pipeline they've created. Your example of other companies selling the same product at cheaper prices helps to illuminate the…

> I agree fully, but Amazon is still the "cheapest" when you consider the all in price of cost_of_goods+cost_of_delivery|want_goods_in_fewer_than_two_days.

Why say you agree when you only go on to disagree with me?

I've bought plenty of things cheaper on other sites. Delivery included. There have been things that were cheaper on Amazon as well. This is why I said it's about average. But there are so many variables at play here (location, items you're looking to purchase, etc) that it might just be easier to agree to disagree.

> Amazon has the most efficient business, which allows them to survive on lower margins and attract buyers because of the vertically integrated pipeline they've created.

Those vertically integrated pipelines come with significant cost savings though. That's why they do it. And because it saves them $$$, it then also increases their margins.

> Your example of other companies selling the same product at cheaper prices helps to illuminate the fact that there isn't any real impact from the supposed anti-competitive behavior to the consumer. Cheaper prices still exist! Amazon hasn't become the sole provider.

Those two arguments aren't mutually inclusive. Other companies might be offering cheaper prices but making a loss in the hope that loyalty will win customers in the long run. Or other corners might get cut that could ultimately lead to that businesses demise, such as not hiring skilled staff, not following health and safety or other local laws, etc. And even if none of the aforementioned is true, it still doesn't mean that Amazon aren't being anti-competitive.

Also "anti-competitive behaviour" applies to how they block other businesses from competing. You cannot be "anti-competitive to the consumer"

Re: FTC sues Amazon for illegally maintaining monopoly power

#922

Post by TheKarateKid »

jollofricepeas wrote: post #786
iancmceachern wrote: post #713

Earlier quoted context omitted.

>A lot of mom and pop businesses (~$20 million) have been built on Amazon over the past 10 years. Most of us are in the $250k to $5 million dollar range. It's interesting, Amazon also put a lot of mom and pop businesses out of business during this time period as well. The overhead that used to go to local commercial property owners, independent trucking and warehousing companies and such now all goes to Amazon. It's…

Selling anything in America is incredibly difficult even when you make design and or manufacture your own products. Amazon controls the connection to the customer. Walmart/Family Dollar control pricing. Stamps.com controls independent shipping/stamps. Stripe and the major card companies take a chunk of fees for credit card transactions.

eBay controls the consumer reseller market. (FB Marketplace, etc. are designed for local, not national, sales)

Re: FTC sues Amazon for illegally maintaining monopoly power

#923

Post by kortilla »

edgyquant wrote: post #805
kortilla wrote: post #643

Earlier quoted context omitted.

Vertical integration is fine as long as there are competitors at each layer.

No it isn’t. Integrations, both vertical and horizontal, should be discouraged and companies should do one thing and do it well

This view is not held by economists because it’s really inefficient and is bad for both the business and the consumers. It adds pointless friction all over.

Re: FTC sues Amazon for illegally maintaining monopoly power

#924

Post by [deleted] »

BizarroLand wrote: post #898
danielmarkbruce wrote: post #881

Earlier quoted context omitted.

That's pretty circular. To the extent any company, A, relies on company B to operate, A can be destroyed by B, according the definition of "rely". So the logical response wasn't to assume you were being circular. The logical response was to assume you were inferring Amazon is big enough and capable enough to squash any business.

And yet it is obvious in retrospect that I didn't mean entirely independent multi-billion dollar empires, but that is the response everyone went with.

[deleted]

Re: FTC sues Amazon for illegally maintaining monopoly power

#925

Post by danielmarkbruce »

BizarroLand wrote: post #898
danielmarkbruce wrote: post #881

Earlier quoted context omitted.

That's pretty circular. To the extent any company, A, relies on company B to operate, A can be destroyed by B, according the definition of "rely". So the logical response wasn't to assume you were being circular. The logical response was to assume you were inferring Amazon is big enough and capable enough to squash any business.

And yet it is obvious in retrospect that I didn't mean entirely independent multi-billion dollar empires, but that is the response everyone went with.

It clearly wasn't obvious to most given the responses.

Re: FTC sues Amazon for illegally maintaining monopoly power

#926

Post by berniedurfee »

hnlmorg wrote: post #917
hellojesus wrote: post #860

Earlier quoted context omitted.

What? Amazon is offering lower prices to consumers, which is why they're winning business. If other competitors could get their costs as low or lower than Amazon's, then they could enjoy those margins themselves.

I cannot speak for every location, but Amazon isn’t the cheapest in the UK. I would say it is about average. Where Amazon wins is the range of stock and its next day deliveries. Which means most people default to Amazon because it’s quicker and easier than shopping around. But you can definitely get cheaper if you were to shop around. Also by Amazon owning the whole pipeline, from stock to delivery, they can squeeze…

Yeah, that’s really the anti-competitive part. The vertical integration is so incredibly difficult to compete against.

At some point you have no choice but to give them a slice of your revenue and some control of your product, lest your access to customers is severely limited.

Kinda like app stores.

Re: FTC sues Amazon for illegally maintaining monopoly power

#927

Post by thewix »

hellojesus wrote: post #906
thewix wrote: post #880

Earlier quoted context omitted.

Cept the part about Amazon not letting you sell your goods cheaper elsewhere. That keeps the price inflated and is anti-competitive since it squashes competition from other marketplaces, not because their platform is better, mind you, but because they have all the power.

Amazon only controls their market. You play by their rules if you sell with them, and that is totally valid. You can sell your product for any price you want so long as you don't use Amazon or don't undercut them if you choose to use them. That is totally valid. Amazon provides the eyes; they don't want to provide a service for free. Think of all the people that go to best buy to feel a product and then buy it online…

That's the point. They are by far the largest player in the game, and can ( and do) use their size to squash competition. You don't have to use their marketplace but as a small business you don't have many options that can compete.

Hell, they're even extremely anti-competitive with their employees. Their NDAs are very restrictive and have threatened non-senior employees with them, even ones that they let go.

Re: FTC sues Amazon for illegally maintaining monopoly power

#928

Post by BizarroLand »

danielmarkbruce wrote: post #925
BizarroLand wrote: post #898

Earlier quoted context omitted.

And yet it is obvious in retrospect that I didn't mean entirely independent multi-billion dollar empires, but that is the response everyone went with.

It clearly wasn't obvious to most given the responses.

Maybe not to you

Re: FTC sues Amazon for illegally maintaining monopoly power

#929

Post by hrdwdmrbl »

kortilla wrote: post #663
hrdwdmrbl wrote: post #378

Earlier quoted context omitted.

They force sellers to use their payment processor. If you don't, they charge an extra 0.5% markup on top, which basically means that no 3rd party payment processor can be competitive on price. I think you can also measure their power in the same way as Amazon - The % of fees that they capture as a percent of sales volume goes up every year. Slow squeeze.

That’s not a monopoly. Movie theaters also force you to buy their popcorn rather than bringing in your own.

But then by that logic any action by any platform is never illegal. It's their platform, they can do whatever they want. If you don't like, don't use their platform, right? Is that what you're saying? I'm not totally unsympathetic to that POV, but in practice I guess it doesn't seem to be working out so well...

Re: FTC sues Amazon for illegally maintaining monopoly power

#930

Post by downrightmike »

kiney wrote: post #781
ihaveajob wrote: post #82

In my opinion, Amazon needs to be split into at least 4 independent entities: - Online marketplace - Consumer products - Internet infrastructure - Delivery logistics Similar to the three-tier distribution system for beer in most states (a brewer cannot be a wholesaler or a retailer). This makes it easier for smaller players can compete with the big ones on quality at least, if not price or recognition. (Edit: format)

As someone living in germany: We don't have a three tier system. But we have literally thousands of breweries selling better beer at waaay lower prices than in the US. So your three tier systems sucks...

The USA used to have a system like that, we have a long history of brewing, but then we had to go fight the Nazis, so everything was rationed and industrialized. That's why our most popular beers suck.
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