3 ms·

I wonder if there is any good writing on how any potential regulation would play out. Amazon is already a platform, so what about it would actually be changed

I wonder if there is any good writing on how any potential regulation would play out. Amazon is already a platform, so what about it would actually be changed if it was "treated like infrastructure"? Ok, players like Google who have been blackballed could list there, so that's a small win. Would it also mean restricting Amazon business units from seeing data on their platform? I'm not sure that's actually a win for society. Is it forcing Amazon to share this data with competitors? That would be interesting, but starts running into privacy challenges. Is it enforcing some idea of neutrality in ranking items? That seems a very hard thing to regulate well without destroying the utility of search. As part of the EU Anti-trust ruling against Google Shopping, Google has made Shopping into a fully separate (accounting wise) business unit and opened up shopping ad slates for bidding to competing sites, but the sites who instigated that action aren't happy because they are not actually able to monetise those slots as effectively as Google can. These companies are powerful, and maybe regulating based on price is short sited as the article claims, but a long term view should not seek to destroy power for no other reason than it exists.

avar 8y ago
"Treated like infrastructure" is a soft version of completely breaking up the company. I.e. just like your power company can't deny you services on the basis that you compete with them Amazon couldn't deny Google a place on their platform. Other Amazon business units could still buy data from the platform, but they'd need to make that available to external companies too. Nobody's trying to "destroy power for no other reason than it exists". There's plenty of established powerful companies in e.g. the car industry, telecom etc. where the rules of what counts as anti-trust are thoroughly established. Tech companies of this scale are a really young industry, so this is still all being figured out, and it's no surprise given the lack of precedent and their relative power that tech companies are in the spotlight when it comes to regulation.
- wongarsu 8y ago
  If we are talking about Amazon-the-Marketplace and not Amazon-the-Giant-Company I'm not sure I would call that a tech company. Sure, they sell their products using a website, but their core business is sales, warehousing and order fulfillment. It's a fairly traditional business, brought to bigger scale and executed really well. Sure, Technology plays a large part in achieving scale (printed cataloges couldn't fit what they offer), but we don't call Airbus a Tech company either.
  - avar 8y ago
    Perhaps "machine learning company" is a better description. Their primary economic moat is the scale of their established customer base, allowing for product recommendations, trusted reviews etc. > their core business is sales, > warehousing and order fulfillment Are you seriously suggesting that if I had even half a billion dollars and bought a sales agency, a warehouse, and an order fulfillment business that I'd be in any position to compete with Amazon? > We don't call Airbus a Tech > company either. Perhaps we would if there were only 3-5 airlines in the world, and all of them made their own planes (had their own proprietary server technology and top-down tech stacks), and some had de-facto monopolies in certain areas of the world (Kindle for books, YouTube for video). What does being banned from YouTube even mean in this comparison? I have no idea. This is why these new business models are something regulators are still catching up to.
jaggederest 8y ago
Imagine AWS being a seperate business from Amazon. Zero personnel in common, no shared office spaces, selling services to each other on a commercial basis with SLAs and pricing negotiations the same way they do to external customers. Similarly, imagine APS - amazon parcel service, an abstraction layer on package delivery through Fedex UPS USPS courier etc, spun out as a separate endeavor and selling services to all comers the same way they do to internal amazon. And Amazon Logistics, warehousing and fulfillment, sold the same way. Amazon-product-sales is just another client who pays the same price as anyone else. Ditto Amazon product sales vs amazon the website. The website continues much as they are now, organized around selling things to people and doing the recommendations / marketing / discovery bit and taking a cut from everyone. The product sales business becomes a separate stockkeeping and inventory buying company. As you say, Amazon-the-product-sales-business could operate just as easily through catalogs or phone orders or late night infomercials. I'm sure there's at least another half dozen parts of amazon that would be industry leaders in some sub-industry instead of part of the degenerate conglomerate as they are now. It's interesting to think about the places you could draw those lines.
- wongarsu 8y ago
  Many of them could be huge players in their fields, but building a service you can offer to others is a lot more work than building a robust service you can use yourself. I don't quite see the advantage in preventing any vertical integration. It just looks like a way to increase overhead and make everything more expensive in the process.
  - petra 8y ago
    I think Amazon already builds its services as something they can easily serve to others.
  - baq 8y ago
    if amazon can profitably undercut everyone for long enough, it becomes a monopoly, at which point it can be either forcefully split to rescue whatever's left of the market or become a tightly regulated utility; before any of that happens, they'll make a killing when they raise prices. if you care about the market, you don't want to let this happen.
petra 8y ago
Let's look at Amazon's fulfillment platform. Currently every warehouse is strongly coupled to the platform, and the platform is strongly coupled to Amazon's logistics, and Amazon.com , the site. This offer a huge barrier for competition. But what if we've create a platform that is totally independent of Amazon(so that other retailers will use it), a platform that decouples warehouses from itself, so that new warehouses(owned by entrepreneurs) are freely added to that system and free to compete with it's other - maybe under the guide of a benevolent dictator(for example guiding toward optimal places at a specific time)? and the platform, since it's regulated as a utility, is pretty open and runs under fair rules ? At the very least, it's a much more competitive system.
jopsen 8y ago
Another interesting question is if these companies can spot the writing on the wall and make regulation unnecessary.. Facebook, Amazon, Apple, Google all seem to be playing a very long game. So why wouldn't they try to moderate the trading platform on Amazon as fairly as possible. In the long run, that's how they can avoid regulation.

avar 8y ago

"Treated like infrastructure" is a soft version of completely breaking up the company. I.e. just like your power company can't deny you services on the basis that you compete with them Amazon couldn't deny Google a place on their platform. Other Amazon business units could still buy data from the platform, but they'd need to make that available to external companies too. Nobody's trying to "destroy power for no other reason than it exists". There's plenty of established powerful companies in e.g. the car industry, telecom etc. where the rules of what counts as anti-trust are thoroughly established. Tech companies of this scale are a really young industry, so this is still all being figured out, and it's no surprise given the lack of precedent and their relative power that tech companies are in the spotlight when it comes to regulation.

wongarsu 8y ago
If we are talking about Amazon-the-Marketplace and not Amazon-the-Giant-Company I'm not sure I would call that a tech company. Sure, they sell their products using a website, but their core business is sales, warehousing and order fulfillment. It's a fairly traditional business, brought to bigger scale and executed really well. Sure, Technology plays a large part in achieving scale (printed cataloges couldn't fit what they offer), but we don't call Airbus a Tech company either.
- avar 8y ago
  Perhaps "machine learning company" is a better description. Their primary economic moat is the scale of their established customer base, allowing for product recommendations, trusted reviews etc. > their core business is sales, > warehousing and order fulfillment Are you seriously suggesting that if I had even half a billion dollars and bought a sales agency, a warehouse, and an order fulfillment business that I'd be in any position to compete with Amazon? > We don't call Airbus a Tech > company either. Perhaps we would if there were only 3-5 airlines in the world, and all of them made their own planes (had their own proprietary server technology and top-down tech stacks), and some had de-facto monopolies in certain areas of the world (Kindle for books, YouTube for video). What does being banned from YouTube even mean in this comparison? I have no idea. This is why these new business models are something regulators are still catching up to.

jaggederest 8y ago

Imagine AWS being a seperate business from Amazon. Zero personnel in common, no shared office spaces, selling services to each other on a commercial basis with SLAs and pricing negotiations the same way they do to external customers. Similarly, imagine APS - amazon parcel service, an abstraction layer on package delivery through Fedex UPS USPS courier etc, spun out as a separate endeavor and selling services to all comers the same way they do to internal amazon. And Amazon Logistics, warehousing and fulfillment, sold the same way. Amazon-product-sales is just another client who pays the same price as anyone else. Ditto Amazon product sales vs amazon the website. The website continues much as they are now, organized around selling things to people and doing the recommendations / marketing / discovery bit and taking a cut from everyone. The product sales business becomes a separate stockkeeping and inventory buying company. As you say, Amazon-the-product-sales-business could operate just as easily through catalogs or phone orders or late night infomercials. I'm sure there's at least another half dozen parts of amazon that would be industry leaders in some sub-industry instead of part of the degenerate conglomerate as they are now. It's interesting to think about the places you could draw those lines.

wongarsu 8y ago
Many of them could be huge players in their fields, but building a service you can offer to others is a lot more work than building a robust service you can use yourself. I don't quite see the advantage in preventing any vertical integration. It just looks like a way to increase overhead and make everything more expensive in the process.
- petra 8y ago
  I think Amazon already builds its services as something they can easily serve to others.
- baq 8y ago
  if amazon can profitably undercut everyone for long enough, it becomes a monopoly, at which point it can be either forcefully split to rescue whatever's left of the market or become a tightly regulated utility; before any of that happens, they'll make a killing when they raise prices. if you care about the market, you don't want to let this happen.

petra 8y ago

Let's look at Amazon's fulfillment platform. Currently every warehouse is strongly coupled to the platform, and the platform is strongly coupled to Amazon's logistics, and Amazon.com , the site. This offer a huge barrier for competition. But what if we've create a platform that is totally independent of Amazon(so that other retailers will use it), a platform that decouples warehouses from itself, so that new warehouses(owned by entrepreneurs) are freely added to that system and free to compete with it's other - maybe under the guide of a benevolent dictator(for example guiding toward optimal places at a specific time)? and the platform, since it's regulated as a utility, is pretty open and runs under fair rules ? At the very least, it's a much more competitive system.

jopsen 8y ago

Another interesting question is if these companies can spot the writing on the wall and make regulation unnecessary.. Facebook, Amazon, Apple, Google all seem to be playing a very long game. So why wouldn't they try to moderate the trading platform on Amazon as fairly as possible. In the long run, that's how they can avoid regulation.