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How would this work in practice though? Eg Amazon. Bezos is a major shareholder. Imagine splitting AWS from the retail arm, which I guess would be a sensible sp

How would this work in practice though? Eg Amazon. Bezos is a major shareholder. Imagine splitting AWS from the retail arm, which I guess would be a sensible split point. If Bezos controls both, then what would really change? I'm not critical to the idea nor supportive - I'm just curious to learn more.

hangonhn 8y ago
That was the case when Standard Oil was broken up and it's not a problem. The retail arm becomes free to get their cloud computing needs from others -- say Azure or Google. Bezos can't force them to get a worse deal at AWS simply because he owns the AWS. A lot of the arguments for breaking up companies come from this. It can make the components more efficient once they're freed from the shackles of being locked in. Likewise, the crappy parts of the big conglomerate can't coast on having a guaranteed customer. This is the whole point of capitalism. Monopolies are the anti-thesis of capitalism.
- jonny_eh 8y ago
  Except the Standard Oil break-up was considered a failure. The new companies all reported back to Rockefeller. https://www.npr.org/sections/money/2019/02/15/695131832/antitrust-1-standard-oil https://www.npr.org/sections/money/2019/02/15/695131832/anti...
  - hangonhn 8y ago
    I don't think it's fair to say the break-up was a failure even if in the near term they still coordinated. In the long term, the oil companies competed with each other. Even if Rockefeller became wealthier, it only adds to the original point: breaking up monopolies unlock value for shareholders and increases efficiency. I highly doubt anyone in the main stream schools of economics would call the Standard Oil breakup a failure. That Rockefeller wasn't punished is immaterial to the breakup itself. The point here isn't to punish Bezos or anyone else. It's about efficiency and fairness. In that sense, that goal was accomplished. No single oil company today wields the power that SO once did. Also, those guys meeting up together at Rockefeller's house to coordinate would likely be illegal today and probably was back then too.
Despegar 8y ago
Did you read her proposal? There would be a structural separation from distribution and first party goods. Just like railroads couldn't own interests in the commodities they were transporting, Amazon couldn't operate a market place and also own private label brands. https://medium.com/@teamwarren/heres-how-we-can-break-up-big-tech-9ad9e0da324c https://medium.com/@teamwarren/heres-how-we-can-break-up-big...
- delfinom 8y ago
  So what about Walmart who does double Amazon in revenue AND has their own private label brands? They have so much retail power they are known to get manufacturers by the balls and make manufacturers accept the cost they want instead.
  - basch 8y ago
    or Costco? $130B in revenue and I dont hear clamor for Costco to be split from Kirkland. By this logic Apple shouldnt be allowed to have Apps in its App store, right? Or are they banned from selling first and third party phone cases in store? CVS shouldnt be allowed its own generic drugs. At what point does this become "companies arent allowed to make/sell their own products if they also resell other companies products." And lets be serious: you want to take away Google's ability to choose the ranking of results? Thats their entire company's purpose. People go to google because they like the order the results come in. If google starts delivering bad results, that opens opportunity for other companies.
    - tokyodude 8y ago
      > Warren's team said that the proposal would also apply to Apple. "They would have to structurally separate -- choosing between, for example, running the App Store or offering their own apps,
  - Despegar 8y ago
    Since multiple people are asking this: it would apply to Walmart and Costco under her proposal because they both have $25B in revenues. This is just the first step in a new conversation about confronting monopoly in America. There hasn't been a bill written yet.

hangonhn 8y ago

That was the case when Standard Oil was broken up and it's not a problem. The retail arm becomes free to get their cloud computing needs from others -- say Azure or Google. Bezos can't force them to get a worse deal at AWS simply because he owns the AWS. A lot of the arguments for breaking up companies come from this. It can make the components more efficient once they're freed from the shackles of being locked in. Likewise, the crappy parts of the big conglomerate can't coast on having a guaranteed customer. This is the whole point of capitalism. Monopolies are the anti-thesis of capitalism.

jonny_eh 8y ago
Except the Standard Oil break-up was considered a failure. The new companies all reported back to Rockefeller. https://www.npr.org/sections/money/2019/02/15/695131832/antitrust-1-standard-oil https://www.npr.org/sections/money/2019/02/15/695131832/anti...
- hangonhn 8y ago
  I don't think it's fair to say the break-up was a failure even if in the near term they still coordinated. In the long term, the oil companies competed with each other. Even if Rockefeller became wealthier, it only adds to the original point: breaking up monopolies unlock value for shareholders and increases efficiency. I highly doubt anyone in the main stream schools of economics would call the Standard Oil breakup a failure. That Rockefeller wasn't punished is immaterial to the breakup itself. The point here isn't to punish Bezos or anyone else. It's about efficiency and fairness. In that sense, that goal was accomplished. No single oil company today wields the power that SO once did. Also, those guys meeting up together at Rockefeller's house to coordinate would likely be illegal today and probably was back then too.

Despegar 8y ago

Did you read her proposal? There would be a structural separation from distribution and first party goods. Just like railroads couldn't own interests in the commodities they were transporting, Amazon couldn't operate a market place and also own private label brands. https://medium.com/@teamwarren/heres-how-we-can-break-up-big-tech-9ad9e0da324c https://medium.com/@teamwarren/heres-how-we-can-break-up-big...

delfinom 8y ago
So what about Walmart who does double Amazon in revenue AND has their own private label brands? They have so much retail power they are known to get manufacturers by the balls and make manufacturers accept the cost they want instead.
- basch 8y ago
  or Costco? $130B in revenue and I dont hear clamor for Costco to be split from Kirkland. By this logic Apple shouldnt be allowed to have Apps in its App store, right? Or are they banned from selling first and third party phone cases in store? CVS shouldnt be allowed its own generic drugs. At what point does this become "companies arent allowed to make/sell their own products if they also resell other companies products." And lets be serious: you want to take away Google's ability to choose the ranking of results? Thats their entire company's purpose. People go to google because they like the order the results come in. If google starts delivering bad results, that opens opportunity for other companies.
  - tokyodude 8y ago
    > Warren's team said that the proposal would also apply to Apple. "They would have to structurally separate -- choosing between, for example, running the App Store or offering their own apps,
- Despegar 8y ago
  Since multiple people are asking this: it would apply to Walmart and Costco under her proposal because they both have $25B in revenues. This is just the first step in a new conversation about confronting monopoly in America. There hasn't been a bill written yet.