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The problem never was that they can't be beaten. The problem is that they buy all the competition. Great if you're being bought, not so much if you're a part of

The problem never was that they can't be beaten. The problem is that they buy all the competition. Great if you're being bought, not so much if you're a part of society.

adventured 9y ago
Not everyone can be bought. Walmart is booming massively online right now. They've got $15 billion per year in net income to play with (7x that of Amazon), nearly half a trillion in sales, hilariously more cash flow than Amazon, as well as having 3x the retail sales of Amazon. And with the current version of Amazon on the scene, Walmart is unleashed to behave competitively in a way they haven't been able to in two decades (while Amazon is in the exact opposite position due to emotion / fear of their potential; Amazon will increasingly be watched for anti-competitive abuses). As it stands right now, Amazon has a very serious problem brewing with Walmart's online business. It's the only serious competitive threat Amazon has seen in the last 10-15 years. Instead of seeing contracting sales, Walmart's overall retail business is actually holding its ground; and at that scale, it's an extraordinary thing; their same store sales growth has been positive for 13 straight quarters, even as Amazon has grown vastly larger in the last 3-5 years. Amazon is taking share from other retailers and they're failing to strike a meaningful blow to their biggest retail threat.
- snarf21 9y ago
  Which is why them buying Jet.com just to get Marc Lore was a very reasonable bet. He hates Amazon as well and now has the resources to fight them. Look at all the acquisitions they have made into brands in the last year. It is always great to have three competitors in a space but two is better than one (like Comcast in most markets).
jasode 9y ago
>The problem is that they buy all the competition. But they don't buy all the competition. At least 3 forces prevent that: 1) they have to recognize that the target company _is_ competition. For example, Larry and Sergei tried to sell their young Google company to Excite for $1 million. Excite wasn't interested. They also tried to sell to Yahoo. Yahoo wasn't interested either. (Yahoo became interested much later when Terry Semel was the CEO but by then Google was already worth more than $5 billion.) If you can't see the small company as a threat, you ignore them even if they prostrate themselves before you begging you to buy them. Excite and Yahoo both couldn't see that the little upstart Google was going to make them irrelevant. 2) The competition has to willingly say "yes" to being acquired. Some say "no". A famous example of that is Facebook saying "no" to Yahoo's offer of $1 billion in 2006. Later in 2010, Microsoft and Steve Ballmer also wanted to buy Facebook for $24 billion and again, Mark Z refused. Bill Gates himself refused Ross Perot's early offer of $7 million to buy Microsoft. 3) the competition becomes too expensive to buy. Ebay toyed with the idea of buying Airbnb but the home-lodging company got way too expensive way too fast for Ebay to execute a deal Acquiring _all_ the competition requires identification of threats (that don't look like threats on the surface) and cooperation from the targeted companies and available funds. You don't get always get that combination and that's why Google and Facebook are not subsidiaries of Yahoo.

The problem never was that they can't be beaten. The problem is that they buy all the competition. Great if you're being bought, not so much if you're a part of society.

adventured 9y ago

Not everyone can be bought. Walmart is booming massively online right now. They've got $15 billion per year in net income to play with (7x that of Amazon), nearly half a trillion in sales, hilariously more cash flow than Amazon, as well as having 3x the retail sales of Amazon. And with the current version of Amazon on the scene, Walmart is unleashed to behave competitively in a way they haven't been able to in two decades (while Amazon is in the exact opposite position due to emotion / fear of their potential; Amazon will increasingly be watched for anti-competitive abuses). As it stands right now, Amazon has a very serious problem brewing with Walmart's online business. It's the only serious competitive threat Amazon has seen in the last 10-15 years. Instead of seeing contracting sales, Walmart's overall retail business is actually holding its ground; and at that scale, it's an extraordinary thing; their same store sales growth has been positive for 13 straight quarters, even as Amazon has grown vastly larger in the last 3-5 years. Amazon is taking share from other retailers and they're failing to strike a meaningful blow to their biggest retail threat.

snarf21 9y ago
Which is why them buying Jet.com just to get Marc Lore was a very reasonable bet. He hates Amazon as well and now has the resources to fight them. Look at all the acquisitions they have made into brands in the last year. It is always great to have three competitors in a space but two is better than one (like Comcast in most markets).

jasode 9y ago

>The problem is that they buy all the competition. But they don't buy all the competition. At least 3 forces prevent that: 1) they have to recognize that the target company _is_ competition. For example, Larry and Sergei tried to sell their young Google company to Excite for $1 million. Excite wasn't interested. They also tried to sell to Yahoo. Yahoo wasn't interested either. (Yahoo became interested much later when Terry Semel was the CEO but by then Google was already worth more than $5 billion.) If you can't see the small company as a threat, you ignore them even if they prostrate themselves before you begging you to buy them. Excite and Yahoo both couldn't see that the little upstart Google was going to make them irrelevant. 2) The competition has to willingly say "yes" to being acquired. Some say "no". A famous example of that is Facebook saying "no" to Yahoo's offer of $1 billion in 2006. Later in 2010, Microsoft and Steve Ballmer also wanted to buy Facebook for $24 billion and again, Mark Z refused. Bill Gates himself refused Ross Perot's early offer of $7 million to buy Microsoft. 3) the competition becomes too expensive to buy. Ebay toyed with the idea of buying Airbnb but the home-lodging company got way too expensive way too fast for Ebay to execute a deal Acquiring _all_ the competition requires identification of threats (that don't look like threats on the surface) and cooperation from the targeted companies and available funds. You don't get always get that combination and that's why Google and Facebook are not subsidiaries of Yahoo.