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Maybe I’m alone in this, but I feel like if you’re going to break up a company with antitrust regulation you should at least be able to point to a way they’re a

Maybe I’m alone in this, but I feel like if you’re going to break up a company with antitrust regulation you should at least be able to point to a way they’re abusing their power or are making a worse experience for customers. The article goes as far as to admit that Amazon is currently not doing anything wrong. Should we really seek to regulate away hard-earned (and valuable!) advantages because they make it possible to abuse the position? Surely we should wait until they’re actually abusing it? As an aside, I can’t think of any advantage Amazon has that wouldn’t open up opportunities for a competitor should they start to abuse them. That’s the goal of capitalism, in a sense; you have to be great or people just go elsewhere. Seems odd to fight against that.

cmurf 9y ago
I do not think it is good public policy to wait until companies are abusing their power before something is done about their size; that suggests the problem is not size, but behaviors which should already be illegal if they're wrong regardless of size. Are they a natural monopoly? If so they should be regulated as a monopoly. If they aren't a natural monopoly, then why is the market not more competitive; and why is it wrong for policy to create a competitive environment? And isn't there an opportunity cost in every case, even if you don't know what it is? What businesses aren't being created because of Amazon's sheer weight? Many of these questions are asked and answered (not entirely satisfactorily in some cases) in the case of Standard Oil.
- wpasc 9y ago
  Taxpayer dollars and regulators' attention are rival commodities. There are plenty of monopolistic/oligopolistic companies and industries that merit examination and reform much, much earlier than Amazon because they currently are exploiting their market position (Chicken companies, Monsanto, etc.) If no mono-/oligopolies existed that were abusing their power, then maybe our government could talk regulation Amazon, but still you'd have to make a strong case. I think it's a tough sell to have an inefficient entity that does not have to compete in a corporate survival sense (the government) tell a very efficient entity that has seen many similar "monopolies" fall (e.g. microsoft) to act differently.
  - ianai 9y ago
    By definition, if a company has significant market power then they are not delivering the services/goods society wants from their market. Because they are able to set price they are setting output below optimum. This leaves demand unmet. But the worst part is it creates wasted goods. Ie they wind up making units that they won’t sell or hoarding resources that then may not be used by anyone. Market power leads to inefficiency and that’s supposed to be what free economy does better than the other resource allocation systems.
jsloss 9y ago
You make a great point. An interesting question is, are anti-trust laws in their current form, adequate for the networked era? When organizations are able to use their network effects to decrease competition in markets (FB / Amazon / Google) does that create a negative outcome despite clearly delivering a better product for customers in the short run. It's clear that network effects and big bank accounts decrease innovation and competition, and it's hard to think that won't have long term negative effects. Just think, is starting a social network a smart thing to do today if your only option is being bought by Facebook, or having them integrate your innovations into one of their services? That being said, innovation thrives on constraints, and there is no indication that these companies wont fall prey to new technology and user demands. It just seems less likely given the powerful position they are all in.
- austenallred 9y ago
  > It's clear that network effects and big bank accounts decrease innovation and competition Network effects almost by definition often create a better user experience. For example, Facebook has a network effect in that all your friends are there. The reason that’s so powerful is you actually want to join a network where your friends are. It seems like it hinders competition, but it only does so because it’s a much better user experience. Very different than, say, Standard Oil where an entire natural resource and distribution line is owned by one company to the extent that it’s literally impossible to compete, then they start screwing you because they can.
  - FeepingCreature 9y ago
    If social networks weren't walled gardens but had interoperability, it wouldn't matter where your friends were. Regulation could enforce this, improving user experience while curtailing potential for corporate abuse.
    - scarface74 9y ago
      So now you want the government where hardly any of the lawmakers know anything about technology to regulate it?
reconbot 9y ago
Sure lets trust a for profit cooperation. Their motives could be anything really? I think destroying competition is something wrong. "Trust us completely forever while we ruin your ability to function without us" isn't something anyone should everyone should have to do. The tax breaks offered to them for their new headquarters (that could "pay for themselves" in 10-20 years and will bring "lots of jobs") are insane, and they don't come close to completely controlling all the markets they operate in. I shudder to imagine what they'll look like when they do. But are they abusing anything now? Lets look into their lobbying, their warehouse temporary workers, their deals with the USPS, and what it's like to be one of their delivery drivers. It sucks to work for Amazon. I know when trying to bring "Amazon Fresh" to NYC, they failed because the only terms they'd offer truck drivers were crazy high risk and low pay and NYC is a big enough market they could collectively resist. That's not going to last forever. I'm not against innovation, I'm not against your margin being my opportunity, I'm against living in an Amazon controlled world.
- austenallred 9y ago
  You’re not “trusting” them, you’re just not going against them because they have the potential to do something. Those are quite different. I could murder someone quite easily. Do you put me in jail just in case? On top of that, I can’t see any power Amazon has that doesn’t evaporate as soon as it’s abused. They have competition from every angle. The only reason they win is because they’re better.
  - robert_foss 9y ago
    How can a corporation whose raison d'être is profits be trusted with being in a monopolistic situation? Sure Amazons power will evaporate as soon as it's abused just like Intels, Microsofts and Dow Chemicals. History tells us this isn't the case.
    - scarface74 9y ago
      How can a government that has effectively unlimited power be trusted?
xg15 9y ago
> Should we really seek to regulate away hard-earned (and valuable!) advantages because they make it possible to abuse the position? "Regulate away" is a nice expression. It implies that "regulate" is the same as "take away", which I believe is a false assumption. No one wants to take away their success - however, if you already have powers approaching monopoly, society should absolutely remind you of the responsibilities that come with those powers - and if necessary force you to obey those responsibilities. Nothing else is what regulation is doing. > Surely we should wait until they’re actually abusing it? You don't wait with the fireproofing until the house is already burning either. > As an aside, I can’t think of any advantage Amazon has that wouldn’t open up opportunities for a competitor should they start to abuse them. It would take a long time until a competitor is actually there that could practically provide the same services. During that time, the damage is done.
vonnik 9y ago
The article seems to be focused on Amazon's retail operations, but there may be a stronger case to be made against AWS. While AWS makes it easy to store and process data, it is essentially distributing open-source software. You could argue that AWS is a more successful open-source company than Red Hat, or at least, it is poised to become so. And AWS mostly distributes OSS while others bear the cost of developing it. I've spoken with executives at both Red Hat and Cloudera who say that, while they are experiencing growth on the public cloud, AWS gives very little energy back to open-source. In fact, they say AWS is killing infrastructure software, and it's doing whatever it can to move into apps. That's a much more serious charge than complaining about the societal effects of mom-and-pop shops dying, because in this case, AWS is using a platform they dominate to extend their power into new products and lines of business. Much as Microsoft used Windows to dominate word-processing and other apps, and as Google used search to dominate things like product search. Given that the repercussions of AWS killing innovation in infrastructure software could have a huge effect on the evolution of tech and business in the U.S., I think this is an issue to be taken seriously.
- austenallred 9y ago
  So regulate AWS because it’s not building enough open source software? How do you determine what the proper amount of open source for AWS to contribute to? Why should they be required to contribute to open source? Does their existence prohibit others from doing so?
  - vonnik 9y ago
    Actually, I'm suggesting that their behavior dominating new business lines for software applications be examined. It's not only infrastructure, although infrastructure is where they started out. They shouldn't be required to do anything, certainly not contribute to open-source. But they are in a position, or will be soon, to abuse antitrust laws by leveraging their dominance of the public cloud. Should that be regulated? Yes. The laws exist and just need to be enforced.
    - deleted 9y ago
      [deleted]
bduerst 9y ago
> at least be able to point to a way they’re abusing their power or are making a worse experience for customers Didn't Amazon ban products from Apple and Google, that competed with their own, from their online store? Isn't this still the case even though they said last year they would eventually allow them again? If you tell Alexa, "buy me a chromecast", it orders you an Amazon fire stick instead.
- scarface74 9y ago
  They banned products that didn’t support Amazon Video. You could always buy Roku boxes. Would Apple sell third party products in their store that only supported Android or Windows? Can you buy an Alexa powered device at an Apple Store? Does Microsoft sell PS4 or Nintendo games at their store?
  - ComputerGuru 9y ago
    Straw man argument. Apple doesn’t have a “general” marketplace that lets you sell almost anything under the sun. Neither is being a marketplace central to their business.
- kylemh 9y ago
  Google Products: https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Daps&field-keywords=chromecast https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3... Apple Products: https://www.amazon.com/Apple-iPhone-GSM-Unlocked-32GB/dp/B01N9YOF3R/ref=sr_1_1?s=wireless&ie=UTF8&qid=1518899586&sr=1-1&keywords=apple+iphone+7 https://www.amazon.com/Apple-iPhone-GSM-Unlocked-32GB/dp/B01... https://www.neowin.net/news/amazon-extends-olive-branch-towards-google-plans-to-stock-chromecast https://www.neowin.net/news/amazon-extends-olive-branch-towa... > If you tell Alexa, "buy me a chromecast", it orders you an Amazon fire stick instead. Need a source on that.
  - bduerst 9y ago
    The Apple iPhone isn't a competing product. Apple TV: https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Dmobile&field-keywords=apple+TV https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3... Those also aren't chromecasts showing in those search results that you linked to...
the_cat_kittles 9y ago
no way man. without making any claims about amazon's specific case, i think its pretty convincing that when everyone sees one company becoming a huge monopoly of something crucial to everyone, we are right to worry, and act. you would really let a single company buy up the entire national water supply? no! hell no!
amelius 9y ago
> Should we really seek to regulate away hard-earned (and valuable!) advantages Could somebody list those advantages (excluding AWS)? And how much better are those advantages than the existing alternatives?
JohnnyHero 9y ago
The authors argument is stolen straight off the pages of Atlas Shrugged. A classic example of the liberal mind thought to tear down those who aspire and achieve great things. Ayn Rand's warnings continue to be amazingly prescient. Amazon earned it's place in our hearts and the market will decide when it's lost sight of what is important. the examples of this abound with the headstones of once dominant corporations. The authors mindset is the way for America to become a feckless copy of European countries and economies.
konschubert 9y ago
> Should we really seek to regulate away hard-earned (and valuable!) advantages because they make it possible to abuse the position? The article argues the case that yes, we should.
deleted 9y ago
[deleted]
Nelson69 9y ago
I agree with you. Amazon, like Walmart, is sort of in this grey zone for me. They smell and feel a little funny. Both are relentless in their customer focus, they drive prices down, they both continue to add more and more services and offerings that seem to be what consumers want and might even be good. There isn't any particular thing I can point to and say with any definitive backing that they are doing and it's bad. I like small indie stores, but Walmart and Amazon beat them on prices and win the market; that's capitalism. Truthfully, I don't see either of them really doing stuff that is bad for the market, they're just better than the competition. Worse, if you go to a small town after a Walmart is built (are there many of these left?) it seems like the locals are almost in a hurry to put the local businesses out of their misery, the Walmart parking lot will be full. It's more of just a concern about the immense power these businesses have and an innate distrust I have of giving that much power to a business. There will be an Amazon backlash, there are already lot's of people that at least claim to not shop at Walmart for various reason, I expect the same will come true with Amazon. Not sure it will amount to much but it's coming. Nobody has made a move to break up Walmart, it's hard to say that anyone will for Amazon.
appleflaxen 9y ago
Overall, I think your point is excellent. But what about selling books at a loss to make it up on higher-margin items, which contributed to putting bookstores of all sizes (mom and pop up to B&N) on the road to bankruptcy? That example is sufficient for me.
bsder 9y ago
> Maybe I’m alone in this, but I feel like if you’re going to break up a company with antitrust regulation you should at least be able to point to a way they’re abusing their power or are making a worse experience for customers. How about selling shitty eclipse glasses that hurt peoples eyes and making it impossible to order the real ones? How about combining counterfeit and genuine products in the same SKU to make it impossible to order the real ones? How about the fact that Amazon are not held liable for selling counterfeit products period? If WalMart attempted to sell a counterfeit product on their website they'd have a class action against them yesterday. Are those not "worse experience" for consumers?
hotdox 9y ago
It is stated many times, present monopolies does not price custmers more. They just pay their workers less in terms of money or benefits.

cmurf 9y ago

I do not think it is good public policy to wait until companies are abusing their power before something is done about their size; that suggests the problem is not size, but behaviors which should already be illegal if they're wrong regardless of size. Are they a natural monopoly? If so they should be regulated as a monopoly. If they aren't a natural monopoly, then why is the market not more competitive; and why is it wrong for policy to create a competitive environment? And isn't there an opportunity cost in every case, even if you don't know what it is? What businesses aren't being created because of Amazon's sheer weight? Many of these questions are asked and answered (not entirely satisfactorily in some cases) in the case of Standard Oil.

wpasc 9y ago
Taxpayer dollars and regulators' attention are rival commodities. There are plenty of monopolistic/oligopolistic companies and industries that merit examination and reform much, much earlier than Amazon because they currently are exploiting their market position (Chicken companies, Monsanto, etc.) If no mono-/oligopolies existed that were abusing their power, then maybe our government could talk regulation Amazon, but still you'd have to make a strong case. I think it's a tough sell to have an inefficient entity that does not have to compete in a corporate survival sense (the government) tell a very efficient entity that has seen many similar "monopolies" fall (e.g. microsoft) to act differently.
- ianai 9y ago
  By definition, if a company has significant market power then they are not delivering the services/goods society wants from their market. Because they are able to set price they are setting output below optimum. This leaves demand unmet. But the worst part is it creates wasted goods. Ie they wind up making units that they won’t sell or hoarding resources that then may not be used by anyone. Market power leads to inefficiency and that’s supposed to be what free economy does better than the other resource allocation systems.

jsloss 9y ago

You make a great point. An interesting question is, are anti-trust laws in their current form, adequate for the networked era? When organizations are able to use their network effects to decrease competition in markets (FB / Amazon / Google) does that create a negative outcome despite clearly delivering a better product for customers in the short run. It's clear that network effects and big bank accounts decrease innovation and competition, and it's hard to think that won't have long term negative effects. Just think, is starting a social network a smart thing to do today if your only option is being bought by Facebook, or having them integrate your innovations into one of their services? That being said, innovation thrives on constraints, and there is no indication that these companies wont fall prey to new technology and user demands. It just seems less likely given the powerful position they are all in.

austenallred 9y ago
> It's clear that network effects and big bank accounts decrease innovation and competition Network effects almost by definition often create a better user experience. For example, Facebook has a network effect in that all your friends are there. The reason that’s so powerful is you actually want to join a network where your friends are. It seems like it hinders competition, but it only does so because it’s a much better user experience. Very different than, say, Standard Oil where an entire natural resource and distribution line is owned by one company to the extent that it’s literally impossible to compete, then they start screwing you because they can.
- FeepingCreature 9y ago
  If social networks weren't walled gardens but had interoperability, it wouldn't matter where your friends were. Regulation could enforce this, improving user experience while curtailing potential for corporate abuse.
  - scarface74 9y ago
    So now you want the government where hardly any of the lawmakers know anything about technology to regulate it?

reconbot 9y ago

Sure lets trust a for profit cooperation. Their motives could be anything really? I think destroying competition is something wrong. "Trust us completely forever while we ruin your ability to function without us" isn't something anyone should everyone should have to do. The tax breaks offered to them for their new headquarters (that could "pay for themselves" in 10-20 years and will bring "lots of jobs") are insane, and they don't come close to completely controlling all the markets they operate in. I shudder to imagine what they'll look like when they do. But are they abusing anything now? Lets look into their lobbying, their warehouse temporary workers, their deals with the USPS, and what it's like to be one of their delivery drivers. It sucks to work for Amazon. I know when trying to bring "Amazon Fresh" to NYC, they failed because the only terms they'd offer truck drivers were crazy high risk and low pay and NYC is a big enough market they could collectively resist. That's not going to last forever. I'm not against innovation, I'm not against your margin being my opportunity, I'm against living in an Amazon controlled world.

austenallred 9y ago
You’re not “trusting” them, you’re just not going against them because they have the potential to do something. Those are quite different. I could murder someone quite easily. Do you put me in jail just in case? On top of that, I can’t see any power Amazon has that doesn’t evaporate as soon as it’s abused. They have competition from every angle. The only reason they win is because they’re better.
- robert_foss 9y ago
  How can a corporation whose raison d'être is profits be trusted with being in a monopolistic situation? Sure Amazons power will evaporate as soon as it's abused just like Intels, Microsofts and Dow Chemicals. History tells us this isn't the case.
  - scarface74 9y ago
    How can a government that has effectively unlimited power be trusted?

xg15 9y ago

> Should we really seek to regulate away hard-earned (and valuable!) advantages because they make it possible to abuse the position? "Regulate away" is a nice expression. It implies that "regulate" is the same as "take away", which I believe is a false assumption. No one wants to take away their success - however, if you already have powers approaching monopoly, society should absolutely remind you of the responsibilities that come with those powers - and if necessary force you to obey those responsibilities. Nothing else is what regulation is doing. > Surely we should wait until they’re actually abusing it? You don't wait with the fireproofing until the house is already burning either. > As an aside, I can’t think of any advantage Amazon has that wouldn’t open up opportunities for a competitor should they start to abuse them. It would take a long time until a competitor is actually there that could practically provide the same services. During that time, the damage is done.

vonnik 9y ago

The article seems to be focused on Amazon's retail operations, but there may be a stronger case to be made against AWS. While AWS makes it easy to store and process data, it is essentially distributing open-source software. You could argue that AWS is a more successful open-source company than Red Hat, or at least, it is poised to become so. And AWS mostly distributes OSS while others bear the cost of developing it. I've spoken with executives at both Red Hat and Cloudera who say that, while they are experiencing growth on the public cloud, AWS gives very little energy back to open-source. In fact, they say AWS is killing infrastructure software, and it's doing whatever it can to move into apps. That's a much more serious charge than complaining about the societal effects of mom-and-pop shops dying, because in this case, AWS is using a platform they dominate to extend their power into new products and lines of business. Much as Microsoft used Windows to dominate word-processing and other apps, and as Google used search to dominate things like product search. Given that the repercussions of AWS killing innovation in infrastructure software could have a huge effect on the evolution of tech and business in the U.S., I think this is an issue to be taken seriously.

austenallred 9y ago
So regulate AWS because it’s not building enough open source software? How do you determine what the proper amount of open source for AWS to contribute to? Why should they be required to contribute to open source? Does their existence prohibit others from doing so?
- vonnik 9y ago
  Actually, I'm suggesting that their behavior dominating new business lines for software applications be examined. It's not only infrastructure, although infrastructure is where they started out. They shouldn't be required to do anything, certainly not contribute to open-source. But they are in a position, or will be soon, to abuse antitrust laws by leveraging their dominance of the public cloud. Should that be regulated? Yes. The laws exist and just need to be enforced.
  - deleted 9y ago
    [deleted]

bduerst 9y ago

> at least be able to point to a way they’re abusing their power or are making a worse experience for customers Didn't Amazon ban products from Apple and Google, that competed with their own, from their online store? Isn't this still the case even though they said last year they would eventually allow them again? If you tell Alexa, "buy me a chromecast", it orders you an Amazon fire stick instead.

scarface74 9y ago
They banned products that didn’t support Amazon Video. You could always buy Roku boxes. Would Apple sell third party products in their store that only supported Android or Windows? Can you buy an Alexa powered device at an Apple Store? Does Microsoft sell PS4 or Nintendo games at their store?
- ComputerGuru 9y ago
  Straw man argument. Apple doesn’t have a “general” marketplace that lets you sell almost anything under the sun. Neither is being a marketplace central to their business.
kylemh 9y ago
Google Products: https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Daps&field-keywords=chromecast https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3... Apple Products: https://www.amazon.com/Apple-iPhone-GSM-Unlocked-32GB/dp/B01N9YOF3R/ref=sr_1_1?s=wireless&ie=UTF8&qid=1518899586&sr=1-1&keywords=apple+iphone+7 https://www.amazon.com/Apple-iPhone-GSM-Unlocked-32GB/dp/B01... https://www.neowin.net/news/amazon-extends-olive-branch-towards-google-plans-to-stock-chromecast https://www.neowin.net/news/amazon-extends-olive-branch-towa... > If you tell Alexa, "buy me a chromecast", it orders you an Amazon fire stick instead. Need a source on that.
- bduerst 9y ago
  The Apple iPhone isn't a competing product. Apple TV: https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3Dmobile&field-keywords=apple+TV https://www.amazon.com/s/ref=nb_sb_noss_2?url=search-alias%3... Those also aren't chromecasts showing in those search results that you linked to...

the_cat_kittles 9y ago

no way man. without making any claims about amazon's specific case, i think its pretty convincing that when everyone sees one company becoming a huge monopoly of something crucial to everyone, we are right to worry, and act. you would really let a single company buy up the entire national water supply? no! hell no!

amelius 9y ago

> Should we really seek to regulate away hard-earned (and valuable!) advantages Could somebody list those advantages (excluding AWS)? And how much better are those advantages than the existing alternatives?

JohnnyHero 9y ago

The authors argument is stolen straight off the pages of Atlas Shrugged. A classic example of the liberal mind thought to tear down those who aspire and achieve great things. Ayn Rand's warnings continue to be amazingly prescient. Amazon earned it's place in our hearts and the market will decide when it's lost sight of what is important. the examples of this abound with the headstones of once dominant corporations. The authors mindset is the way for America to become a feckless copy of European countries and economies.

konschubert 9y ago

> Should we really seek to regulate away hard-earned (and valuable!) advantages because they make it possible to abuse the position? The article argues the case that yes, we should.

deleted 9y ago

[deleted]

Nelson69 9y ago

I agree with you. Amazon, like Walmart, is sort of in this grey zone for me. They smell and feel a little funny. Both are relentless in their customer focus, they drive prices down, they both continue to add more and more services and offerings that seem to be what consumers want and might even be good. There isn't any particular thing I can point to and say with any definitive backing that they are doing and it's bad. I like small indie stores, but Walmart and Amazon beat them on prices and win the market; that's capitalism. Truthfully, I don't see either of them really doing stuff that is bad for the market, they're just better than the competition. Worse, if you go to a small town after a Walmart is built (are there many of these left?) it seems like the locals are almost in a hurry to put the local businesses out of their misery, the Walmart parking lot will be full. It's more of just a concern about the immense power these businesses have and an innate distrust I have of giving that much power to a business. There will be an Amazon backlash, there are already lot's of people that at least claim to not shop at Walmart for various reason, I expect the same will come true with Amazon. Not sure it will amount to much but it's coming. Nobody has made a move to break up Walmart, it's hard to say that anyone will for Amazon.

appleflaxen 9y ago

Overall, I think your point is excellent. But what about selling books at a loss to make it up on higher-margin items, which contributed to putting bookstores of all sizes (mom and pop up to B&N) on the road to bankruptcy? That example is sufficient for me.

bsder 9y ago

> Maybe I’m alone in this, but I feel like if you’re going to break up a company with antitrust regulation you should at least be able to point to a way they’re abusing their power or are making a worse experience for customers. How about selling shitty eclipse glasses that hurt peoples eyes and making it impossible to order the real ones? How about combining counterfeit and genuine products in the same SKU to make it impossible to order the real ones? How about the fact that Amazon are not held liable for selling counterfeit products period? If WalMart attempted to sell a counterfeit product on their website they'd have a class action against them yesterday. Are those not "worse experience" for consumers?

hotdox 9y ago

It is stated many times, present monopolies does not price custmers more. They just pay their workers less in terms of money or benefits.