4 ms·

The biggest risk is that Amazon will act as a monopoly and jack up the prices of the products once it's destroyed competitors. Honestly, I don't think that's t

The biggest risk is that Amazon will act as a monopoly and jack up the prices of the products once it's destroyed competitors. Honestly, I don't think that's too likely as amazon's business model is built around razor-thin margins.

MichaelBurge 10y ago
A monopoly on pieces of metal shaped a certain way? I feel like both of your sentences are unnecessarily abstract here.
perezdev 10y ago
That's super unlikely to happen. At least with a product like this. Jacking up the price would just encourage other manufacturers to do the same as Amazon: release a cheaper product. What Amazon has done is best for the consumer.
adventured 10y ago
That isn't going to happen. See: Walmart's Great Value brand products. Walmart has used it for a long time to hold consumer prices in check. If Nabisco attempts a large price hike, Walmart deploys their Great Value brand right next to said Nabisco product and undercuts them down to a price they regard as reasonable. Despite Walmart's extreme size and market dominance in traditional retail over the last ~20 years, they've never used - at a wide scope - their Great Value brand as an opportunity jack up prices or destroy competitors.
dragonwriter 10y ago
No, the biggest risk is that Amazon will kill innovation by reducing the expected returns to product development expenditures so that investment in product development is reduced.
- capote 10y ago
  But there's nothing innovative about the original versions of the AmazonBasics products. That's why they're called AmazonBasics. I'll agree with you when we have an AmazonBasics car or smartwatch, which turn will change the entire paradigm and probably won't happen.
  - dragonwriter 10y ago
    If that was true, that wouldn't need to free ride on other peoples product and market development. Yeah, it's not the flashy big-picture innovation that goes into inventing whole new product categories -- but it has a cost and provides values, and if Amazon is swooping in to eat the returns of other firms investments, they destroy the incentive to make the ivestments, and improvements in the product categories at risk will be impaired.

MichaelBurge 10y ago

A monopoly on pieces of metal shaped a certain way? I feel like both of your sentences are unnecessarily abstract here.

perezdev 10y ago

That's super unlikely to happen. At least with a product like this. Jacking up the price would just encourage other manufacturers to do the same as Amazon: release a cheaper product. What Amazon has done is best for the consumer.

adventured 10y ago

That isn't going to happen. See: Walmart's Great Value brand products. Walmart has used it for a long time to hold consumer prices in check. If Nabisco attempts a large price hike, Walmart deploys their Great Value brand right next to said Nabisco product and undercuts them down to a price they regard as reasonable. Despite Walmart's extreme size and market dominance in traditional retail over the last ~20 years, they've never used - at a wide scope - their Great Value brand as an opportunity jack up prices or destroy competitors.

dragonwriter 10y ago

No, the biggest risk is that Amazon will kill innovation by reducing the expected returns to product development expenditures so that investment in product development is reduced.

capote 10y ago
But there's nothing innovative about the original versions of the AmazonBasics products. That's why they're called AmazonBasics. I'll agree with you when we have an AmazonBasics car or smartwatch, which turn will change the entire paradigm and probably won't happen.
- dragonwriter 10y ago
  If that was true, that wouldn't need to free ride on other peoples product and market development. Yeah, it's not the flashy big-picture innovation that goes into inventing whole new product categories -- but it has a cost and provides values, and if Amazon is swooping in to eat the returns of other firms investments, they destroy the incentive to make the ivestments, and improvements in the product categories at risk will be impaired.