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The author is nitpicking. Warren may be wrong about the history of bing and google, but that's not really important. She's 100% right about Amazon, and the auth

by chj 8y ago

The author is nitpicking. Warren may be wrong about the history of bing and google, but that's not really important. She's 100% right about Amazon, and the author conveniently forgot to mention. Most people in tech industry always strive to build monopoly and dominance. In their eyes, Warren's idea is of course insane. But viewing from another point, in order to protect competition and small businesses, her proposal is mostly sound. The concept of "Platform Utility" may seem arbitrary, but actually a very helpful check and balance. The perfect solution is that the platform should be run like an open blockchain, trouble is no one has a clue how to build it yet.

elicash 8y ago
Also, some would argue it's also good to protect democracy from any entity getting too powerful and having too much influence. None of this of course only applies to tech companies.
cm2187 8y ago
Actually amazon is the one that I would say doesn't have a monopoly. It doesn't have a monopoly in the retail space (far from it), nor in the cloud hosting (let alone server hosting) business, nor in online streaming (music/tv). Google on the other hand has close to a monopoly on search (and browsers). Facebook on social medias.
- mschuster91 8y ago
  > It doesn't have a monopoly in the retail space For vendors, the situation looks different - and Amazon certainly does abuse their position towards vendors often enough, e.g. with the AmazonBasics program where they take bestselling stuff, produce it at Amazon scales and then outprice the "competition".
  - replicatorblog 8y ago
    That seems like the weakest part of the argument — Walmart, Kroger, Walgreens, Costco, and every other major retailer has a similar program. All use sales data to determine what sells best and copy it. I did this for a decade, designing store brand medical devices for all the major retailers. There are plenty of legitimate critiques of Amazon. The "private label" one is by far the weakest.
    - mschuster91 8y ago
      The difference between the other major retailers and Amazon is the search. When I go through a physical store I will see everything that they have up for sale and have the choice of buying everything - but on Amazon the sheer amount of products that are showing up in searches is the problem. Hard enough to compete against other vendors for the place on the first two search pages, it's unfair that Amazon gives their own brand an advantage.
      - replicatorblog 8y ago
        With Amazon, I have the ability to list my product, and buy ads pointing people directly to it. With physical retailers, I have to hope I can convince the retailer to stock it, often have to pay up front for shelf space, and then have to continue to pay co-op fees for advertising services of dubious value. Moreover, with Amazon, I know exactly how many units have been sold at any time and have the ability, for a fee, to get feedback from the buyers. With retail, you only get a rough estimate of sales, usually lagging by a quarter, and have no easy way to survey buyers. I'm not saying that Amazon is acting like a great corporate citizen, but having worked with Amazon and most of the major national retailers, I'd take Amazon in a heartbeat.
      - ChrisLomont 8y ago
        Plenty of physical stores do that too - place their brand at eye height, in more places, featured in their ads, etc. Amazon controls a large but minority of pretty much any market their in, until you start making smaller and smaller market definitions to the point of being ludicrous. As such, not being a monopoly, they're perfectly fine to do all this they want.
      - mstolpm 8y ago
        Funny you mention that. Because my experience is different: I often have to wade through shady marketplace offers with hundreds of fake reviews and paid ads. I have to dig deeper or explicitly search for AmazonBasics products to even find the USB cables or tablet stands from Amazon itself. It might be that personalization is in effect here (or some sort criteria), but I sometimes would like to better filter marketplace offers I don't even trust.
  - deleted 8y ago
    [deleted]
  - azeotropic 8y ago
    This is a net benefit to consumers, not something they need to be protected from.
- mtmail 8y ago
  "[Amazon] has captured 43 percent of all internet retail sales in the United States, with half of all online shopping searches starting on Amazon. In 2016, it had over $63 billion in revenue from online sales in the United States — or more than the next 10 top online retailers combined. It controls 74 percent of e-book sales, is the largest seller of clothes online and is set to soon become the biggest apparel retailer in the country." https://www.nytimes.com/2017/06/21/opinion/amazon-whole-foods-jeff-bezos.html https://www.nytimes.com/2017/06/21/opinion/amazon-whole-food...
  - sib 8y ago
    Exactly, so, not a monopoly in ecommerce. And only a single-digit share of commerce. And, of course, there is literally nothing inherently illegal (in the US, at least) about building a monopoly in any case.
    - oflannabhra 8y ago
      I'm not so sure we should be heralding the fact that a single company has not captured all of commerce as a win for competition.
      - scarface74 8y ago
        And it “captured it” because of the incompetence of the previous incumbents in retail - Barnes and Noble, Toys R Us, Tower Records, Walmart, etc. Why should the government punish companies because they were able to disrupt incumbents? Should we also punish Apple because RIM and Palm couldn’t compete?
        cgriswald 8y ago
        You seem to be arguing for a winner-take-all approach to the market. Should future competitors to [monopolistic entity] be punished because [previous competitors] were unable to effectively compete? In any case, I don't think punishment is really an apt metaphor for breaking apart a monopoly.
- mbesto 8y ago
  > Google on the other hand has close to a monopoly on search (and browsers) Which are both free products/services. How do you have a monopoly on a freely provide service? They have a monopoly on the supply (eyeballs) of the digital advertising market.
  - cm2187 8y ago
    They have a monopoly on advertising because they have a monopoly on search, hence traffic, hence knowing what individual people are up to.
- basch 8y ago
  everyone is stuck on the word monopoly. Antitrust law is much larger than just monopolys. and, if you can prove it, predatory pricing is illegal. amazon is absolutely subsidizing a bunch of stuff with profit from elsewhere. if and what and how the government can do something about that is a huge can of worms with wide reaching implications outside the tech industry. IF the government wants to get involved with separating product development from distribution, they should be going after splitting primevideo from aws (like saying movie studios cant own theaters), or trying to prove that netflix is being unfairly charged for resources different than primevideo (price discrimination.) they should go after amazon logistics. amazon is a vertical conglomerate problem not a monopoly problem (if its a problem at all.) whatever amazon is, the law wasnt ready for, but whether amazon is a good or bad thing is more a matter of perspective.
  - scarface74 8y ago
    So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing. Does that mean that HN should also come under scrutiny because it can price HN free? What if I wanted to start a competitor to HN? Should the government make it so there is an environment that makes that easier?
    - basch 8y ago
      predatory pricing is undercutting a competitor to purposely drive them out of business. i dont think hackernews is trying to put other sites out of business, far from it, as a link aggregator its business model is to push eyeball views elsewhere, similar to drudge. https://en.wikipedia.org/wiki/Predatory_pricing https://en.wikipedia.org/wiki/Predatory_pricing http://signalvnoise.com/posts/1407-why-the-drudge-report-is-one-of-the-best-designed-sites-on-the-web http://signalvnoise.com/posts/1407-why-the-drudge-report-is-...
      - scarface74 8y ago
        Everyone here is talking about helping “future competitors”. How can you compete with free?
- root_axis 8y ago
  The typical antitrust concerns around monopolies don't really apply to google (currently). Google hasn't used its position to create barriers to entry for competitors, it is only that google has a reputation for producing a superior product in this domain. I've also heard some argue that google has a monopoly on advertising eyeballs, but this is clearly false (i.e. there are lots of platforms that make a lot of money by selling eyeballs)
  - atq2119 8y ago
    Could it be argued that Google is engaging price dumping by financing the development of its search engine from unrelated revenue? Namely, ads placed on websites other than its search result pages? Just thinking out loud, really.
  - onlyrealcuzzo 8y ago
    Google's monopoly on search is entirely because it is the best search product by far. However, as search becomes increasingly important in our lives, and as past search data becomes more important to ranking algorithms, Google might be at a point where no company ever stands a chance to compete with it. By using Google, you make it better. It's already the best, and it already captures 85%+ of searches. How is anyone ever going to compete? Bing even offered to pay people money to use its search engine for a while, and still it got hardly any traction. I don't think Facebook's and Google's monopolies are too concerning other than the impact they have on online advertising. Google basically made CPC ads 10x more expensive like 10 years ago, and ever since, that's been the price of a click. Facebook having a monopoly on social advertising clearly had no interest in starting a price war with Google to win ad dollars. They compete in separate spaces. They can each charge a premium.
    - root_axis 8y ago
      > Google might be at a point where no company ever stands a chance to compete with it. I'm not sure that this, in and of itself, is a problem. Someone has to be the best, and google's product will still be the best even if you break the company up. It's not as if people will start using bing if search were broken out into a separate company; if anything I'd guess that it might increase market-share as that new company would put all their efforts into making search better rather than on broader initiatives that cut across google as a whole.
- mech422 8y ago
  Amazon is the one that continues to amaze me. People forget the original pitch to investors was _LOSE_ money for 5 years until they either drove competitors out of business, or became the single largest e-commerce provider. I've never understood how this was legal. It seems like the definition of 'anti-competitive' and 'predatory'? If Microsoft gave a free computer with every purchase of windows, and could afford to continue the practice until Apple, Dell, etc. went bankrupt - would that be ok ?
  - root_axis 8y ago
    Sounds ok to me. I think the consumer would be very happy with 200 dollar PCs that were comparable in quality to thousand dollar machines.
    - lswainemoore 8y ago
      Ok...but the point is that after they achieve the monopoly they can jack up the price to well over a thousand dollars without worrying about losing market share.
      - edanm 8y ago
        At which point why would wouldn't a new company form to compete with them? They probably couldn't kill the market forever, and it would be very expensive to try this and fail.
        pas 8y ago
        That'd be the illegal part of being a monopoly. The antitrust laws work by restricting (penalizing) monopolies from abusing their market position/dominance. Basically, it's not a problem if you happen to be the best in computers. But it's a big no-no to try to force resellers into exclusive contracts and so on. (If you continue to just buy up newcomers to the market that's not a problem, after all investors can just keep funding new competitors and you have to waste money.) But of course this is a very difficult problem at the intersection of economics, politics, law and sociology.
- lsiq 8y ago
  I love how people love saying Amazon doesn't have a monopoly in retail when that massive category includes the sale of all consumer (and some producer) goods. Amazon has 70%+ market share in many sectors of retail, such as books. But because it's only a fraction of their business, it seems like nothing.
_red 8y ago
The redefinition of the term 'monopoly' to just be 'large marketshare' is very dangerous. However, as a bit of schadenfreude, its nice to see the leftist big-tech receive the unintended consequences of their beliefs. Sadly, the realities is that they will just hire ex-regulators as 'consultants' to help enshrine their businesses into quasi-state protected monopolies.
- crankylinuxuser 8y ago
  Then use the proper term for the FAANG companies: A criminal conspiracy. And we have laws against conspiracies. RICO act for starters. And collusion is also a crime, no? How many execs have gone to prison for the wage fixing that FAANG was accused of and lost?
  - basch 8y ago
    its called a cartel. are you accusing youtube, facebook, netflix, and amazon of secretly working together to keep other video streaming apps from existing?
almost_usual 8y ago
We’re going to see more and more defensive content come out and it’s only going to help Warren. Strategically she’s positioned herself well, she could easily be the most publicized democratic candidate because of this topic alone.
- Reedx 8y ago
  It's definitely timely and getting a lot of attention. But Andrew Yang could end up making waves here. His approach seems more productive - proposing a VAT on big tech and a "Freedom Dividend".
  - chillacy 8y ago
    I think Yang goes a lot farther than warren in that breaking up tech companies still concentrates wealth in costal tech hubs while a UBI would begin shifting that back to the middle states. It is sort of admitting that tech has “won”, but the power of data at scale is imo fundamentally a part of reality and denying it in the US just means China will develop AI technology faster. Either way I’m glad to see these ideas being discussed more broadly.
- jklinger410 8y ago
  It's a sad state we're in that instead of talking about the most important monopolies, we're only able to talk about the ones with the most brand recognition.
  - deleted 8y ago
    [deleted]
- hosh 8y ago
  Sure, though this article isn't defending the FAANG companies. The author is also concerned, though he is saying the problem is deeper, not well-understood, and Warren's solution as-proposed is simplistic and will not be effective.
scarface74 8y ago
The purpose of government should not be to “protect small businesses” - ie protect business models that can not compete in the market
- chj 8y ago
  Well, I think all businesses grow from small ones. They do need some kind of protection while they are developing.
  - scarface74 8y ago
    So I have this great idea to delivery pet food. Should the government protect me while I grow it?
    - chj 8y ago
      OK, I see that we have different ideas of protection. When you are selling pet food, surely you don't want the delivery company steal your customers, right? Now if government says that delivery company can't sell user data, that's the kind of protection I meant.
      - scarface74 8y ago
        And the government has been great about protecting privacy? The government is one of the biggest proponents of less privacy because of the various “Wars on $X”.
product50 8y ago
You need to get into specifics vs. trying to just provide your general view. The author you are claiming is nitpicking is Ben Thompson - the most prolific tech strategist of our times. And look at your response which offers nothing interesting at all. Do you have any suggestions on how to make these breakups happen given all the nuances and challenges? And please get into details vs. pretending they are not important.
- deleted 8y ago
  [deleted]
hosh 8y ago
The author has written a lot about Amazon, how it gained power, both in that article and in others on that blog. He did not conveniently forget to mention it. The article may seem like nitpicking the history of Bing and Google at the beginning of his article. However, if one were to read through the whole thing, he is showing how Warren is coming from an inadequate frame to make an effective policy. The author analyzes this from the Aggregation Theory he has been working on for years throughout other articles on his blog. The biggest takeaway is that, the FAANG aggregators get their market power because consumers voluntarily use their product. While promoting competition can help a market, the current US standard for antitrust is around consumer welfare, and modern-day aggregators do no meet that standard. The concern here is that developing antitrust policies without addressing these deeper concerns will not solve the problem (dominant companies that grow increasingly more dominant over time), and may end up exacerbating it.
- chj 8y ago
  Warren's Amazon coffee maker argument is pretty convincing, but the author focuses on the history of bing and google, that's a big turn off. Shouldn't the author come from the perspective "Where Warren's Right" if the author's "Aggregation Theory", which I am not familiar with, happens to have the same spirit of Warren's proposal? Is it reasonable that since Warren made a mistake about bing and google, therefore she's inadequate for coming up with a policy? To be honest with you, I didn't read the whole thing. Instead of spending many screens of texts in the beginning to show how Warren's wrong, the author could instead promote his own theory right at the start, then we will have a better idea where he's coming from. Right now, from the structure of his writing, it feels nitpicking.
  - hosh 8y ago
    The author perhaps, should have lead with (paraphrased) "Warren raised this as a discussion, and that is a good thing." He wrote that towards the end. However, according to (what I understand) as the author's frame, there is a fundamental misunderstanding of how the tech companies gained power and market dominance. The nitty gritty details about Bing and Google was meant to demonstrate that. Also keep in mind: this author has been writing a blog related to Aggregation Theory for a long time. Years before Warren had raised this issue to the nation. He had analyzed each of the FAANG companies, including Amazon, in depth. Many of his readers would already be familiar with Aggregation Theory. The key insight here is that the FAANG companies are not like the monopolies of the old. These are probably a better introduction: https://stratechery.com/2016/the-amazon-tax/ https://stratechery.com/2016/the-amazon-tax/ https://stratechery.com/2017/amazons-new-customer/ https://stratechery.com/2017/amazons-new-customer/
RestlessMind 8y ago
> The author is nitpicking You are being charitable to the author. Usually Stratechery articles are decent, but on this one, the author has many ignorant remarks. > Bing Microsoft, if not checked with antitrust investigations, could have shoved Bing (or Live, or MSN Search) down everyone's throat. Just like Google tried to do with Google+. So to credit Warren's point, without antitrust case, we could be living with Bing (or Live or MSN Search). > of course a browser should be bundled with an operating system; a new computer without a browser would be practically useless (for one, how do you install a browser?). Hasn't the author heard of floppy disks or CDs with software, which was the popular way to install softwares in 90's? In fact, without Microsoft's free offering, browsers could have remained a software worth paying for and we wouldn't be living with an almost monoculture. > Google would have emerged with or without antitrust action against Microsoft. I read a wonderful article a while back, which stated that the real effect of antitrust on Microsoft was that every minor decision was heavily scrutinized internally, with lawyers vetting the major decisions, thus dampening the velocity of the company. So it is debatable whether Google could have emerged without the antitrust lawsuit.
- edanm 8y ago
  > Microsoft, if not checked with antitrust investigations, could have shoved Bing (or Live, or MSN Search) down everyone's throat. Just like Google tried to do with Google+. So to credit Warren's point, without antitrust case, we could be living with Bing (or Live or MSN Search). Bing started in 2009. Google was already amazingly dominant at that point. What did the previous antitrust cases have to do with Bing's success or failure?

by chj 8y ago

elicash 8y ago

Also, some would argue it's also good to protect democracy from any entity getting too powerful and having too much influence. None of this of course only applies to tech companies.

cm2187 8y ago

Actually amazon is the one that I would say doesn't have a monopoly. It doesn't have a monopoly in the retail space (far from it), nor in the cloud hosting (let alone server hosting) business, nor in online streaming (music/tv). Google on the other hand has close to a monopoly on search (and browsers). Facebook on social medias.

mschuster91 8y ago
> It doesn't have a monopoly in the retail space For vendors, the situation looks different - and Amazon certainly does abuse their position towards vendors often enough, e.g. with the AmazonBasics program where they take bestselling stuff, produce it at Amazon scales and then outprice the "competition".
- replicatorblog 8y ago
  That seems like the weakest part of the argument — Walmart, Kroger, Walgreens, Costco, and every other major retailer has a similar program. All use sales data to determine what sells best and copy it. I did this for a decade, designing store brand medical devices for all the major retailers. There are plenty of legitimate critiques of Amazon. The "private label" one is by far the weakest.
  - mschuster91 8y ago
    The difference between the other major retailers and Amazon is the search. When I go through a physical store I will see everything that they have up for sale and have the choice of buying everything - but on Amazon the sheer amount of products that are showing up in searches is the problem. Hard enough to compete against other vendors for the place on the first two search pages, it's unfair that Amazon gives their own brand an advantage.
    - replicatorblog 8y ago
      With Amazon, I have the ability to list my product, and buy ads pointing people directly to it. With physical retailers, I have to hope I can convince the retailer to stock it, often have to pay up front for shelf space, and then have to continue to pay co-op fees for advertising services of dubious value. Moreover, with Amazon, I know exactly how many units have been sold at any time and have the ability, for a fee, to get feedback from the buyers. With retail, you only get a rough estimate of sales, usually lagging by a quarter, and have no easy way to survey buyers. I'm not saying that Amazon is acting like a great corporate citizen, but having worked with Amazon and most of the major national retailers, I'd take Amazon in a heartbeat.
    - ChrisLomont 8y ago
      Plenty of physical stores do that too - place their brand at eye height, in more places, featured in their ads, etc. Amazon controls a large but minority of pretty much any market their in, until you start making smaller and smaller market definitions to the point of being ludicrous. As such, not being a monopoly, they're perfectly fine to do all this they want.
    - mstolpm 8y ago
      Funny you mention that. Because my experience is different: I often have to wade through shady marketplace offers with hundreds of fake reviews and paid ads. I have to dig deeper or explicitly search for AmazonBasics products to even find the USB cables or tablet stands from Amazon itself. It might be that personalization is in effect here (or some sort criteria), but I sometimes would like to better filter marketplace offers I don't even trust.
- deleted 8y ago
  [deleted]
- azeotropic 8y ago
  This is a net benefit to consumers, not something they need to be protected from.
mtmail 8y ago
"[Amazon] has captured 43 percent of all internet retail sales in the United States, with half of all online shopping searches starting on Amazon. In 2016, it had over $63 billion in revenue from online sales in the United States — or more than the next 10 top online retailers combined. It controls 74 percent of e-book sales, is the largest seller of clothes online and is set to soon become the biggest apparel retailer in the country." https://www.nytimes.com/2017/06/21/opinion/amazon-whole-foods-jeff-bezos.html https://www.nytimes.com/2017/06/21/opinion/amazon-whole-food...
- sib 8y ago
  Exactly, so, not a monopoly in ecommerce. And only a single-digit share of commerce. And, of course, there is literally nothing inherently illegal (in the US, at least) about building a monopoly in any case.
  - oflannabhra 8y ago
    I'm not so sure we should be heralding the fact that a single company has not captured all of commerce as a win for competition.
    - scarface74 8y ago
      And it “captured it” because of the incompetence of the previous incumbents in retail - Barnes and Noble, Toys R Us, Tower Records, Walmart, etc. Why should the government punish companies because they were able to disrupt incumbents? Should we also punish Apple because RIM and Palm couldn’t compete?
      - cgriswald 8y ago
        You seem to be arguing for a winner-take-all approach to the market. Should future competitors to [monopolistic entity] be punished because [previous competitors] were unable to effectively compete? In any case, I don't think punishment is really an apt metaphor for breaking apart a monopoly.
mbesto 8y ago
> Google on the other hand has close to a monopoly on search (and browsers) Which are both free products/services. How do you have a monopoly on a freely provide service? They have a monopoly on the supply (eyeballs) of the digital advertising market.
- cm2187 8y ago
  They have a monopoly on advertising because they have a monopoly on search, hence traffic, hence knowing what individual people are up to.
basch 8y ago
everyone is stuck on the word monopoly. Antitrust law is much larger than just monopolys. and, if you can prove it, predatory pricing is illegal. amazon is absolutely subsidizing a bunch of stuff with profit from elsewhere. if and what and how the government can do something about that is a huge can of worms with wide reaching implications outside the tech industry. IF the government wants to get involved with separating product development from distribution, they should be going after splitting primevideo from aws (like saying movie studios cant own theaters), or trying to prove that netflix is being unfairly charged for resources different than primevideo (price discrimination.) they should go after amazon logistics. amazon is a vertical conglomerate problem not a monopoly problem (if its a problem at all.) whatever amazon is, the law wasnt ready for, but whether amazon is a good or bad thing is more a matter of perspective.
- scarface74 8y ago
  So since most of the things we use everyday on the Internet is free, that means most products we use are run by companies that are using predator pricing. Does that mean that HN should also come under scrutiny because it can price HN free? What if I wanted to start a competitor to HN? Should the government make it so there is an environment that makes that easier?
  - basch 8y ago
    predatory pricing is undercutting a competitor to purposely drive them out of business. i dont think hackernews is trying to put other sites out of business, far from it, as a link aggregator its business model is to push eyeball views elsewhere, similar to drudge. https://en.wikipedia.org/wiki/Predatory_pricing https://en.wikipedia.org/wiki/Predatory_pricing http://signalvnoise.com/posts/1407-why-the-drudge-report-is-one-of-the-best-designed-sites-on-the-web http://signalvnoise.com/posts/1407-why-the-drudge-report-is-...
    - scarface74 8y ago
      Everyone here is talking about helping “future competitors”. How can you compete with free?
root_axis 8y ago
The typical antitrust concerns around monopolies don't really apply to google (currently). Google hasn't used its position to create barriers to entry for competitors, it is only that google has a reputation for producing a superior product in this domain. I've also heard some argue that google has a monopoly on advertising eyeballs, but this is clearly false (i.e. there are lots of platforms that make a lot of money by selling eyeballs)
- atq2119 8y ago
  Could it be argued that Google is engaging price dumping by financing the development of its search engine from unrelated revenue? Namely, ads placed on websites other than its search result pages? Just thinking out loud, really.
- onlyrealcuzzo 8y ago
  Google's monopoly on search is entirely because it is the best search product by far. However, as search becomes increasingly important in our lives, and as past search data becomes more important to ranking algorithms, Google might be at a point where no company ever stands a chance to compete with it. By using Google, you make it better. It's already the best, and it already captures 85%+ of searches. How is anyone ever going to compete? Bing even offered to pay people money to use its search engine for a while, and still it got hardly any traction. I don't think Facebook's and Google's monopolies are too concerning other than the impact they have on online advertising. Google basically made CPC ads 10x more expensive like 10 years ago, and ever since, that's been the price of a click. Facebook having a monopoly on social advertising clearly had no interest in starting a price war with Google to win ad dollars. They compete in separate spaces. They can each charge a premium.
  - root_axis 8y ago
    > Google might be at a point where no company ever stands a chance to compete with it. I'm not sure that this, in and of itself, is a problem. Someone has to be the best, and google's product will still be the best even if you break the company up. It's not as if people will start using bing if search were broken out into a separate company; if anything I'd guess that it might increase market-share as that new company would put all their efforts into making search better rather than on broader initiatives that cut across google as a whole.
mech422 8y ago
Amazon is the one that continues to amaze me. People forget the original pitch to investors was _LOSE_ money for 5 years until they either drove competitors out of business, or became the single largest e-commerce provider. I've never understood how this was legal. It seems like the definition of 'anti-competitive' and 'predatory'? If Microsoft gave a free computer with every purchase of windows, and could afford to continue the practice until Apple, Dell, etc. went bankrupt - would that be ok ?
- root_axis 8y ago
  Sounds ok to me. I think the consumer would be very happy with 200 dollar PCs that were comparable in quality to thousand dollar machines.
  - lswainemoore 8y ago
    Ok...but the point is that after they achieve the monopoly they can jack up the price to well over a thousand dollars without worrying about losing market share.
    - edanm 8y ago
      At which point why would wouldn't a new company form to compete with them? They probably couldn't kill the market forever, and it would be very expensive to try this and fail.
      - pas 8y ago
        That'd be the illegal part of being a monopoly. The antitrust laws work by restricting (penalizing) monopolies from abusing their market position/dominance. Basically, it's not a problem if you happen to be the best in computers. But it's a big no-no to try to force resellers into exclusive contracts and so on. (If you continue to just buy up newcomers to the market that's not a problem, after all investors can just keep funding new competitors and you have to waste money.) But of course this is a very difficult problem at the intersection of economics, politics, law and sociology.
lsiq 8y ago
I love how people love saying Amazon doesn't have a monopoly in retail when that massive category includes the sale of all consumer (and some producer) goods. Amazon has 70%+ market share in many sectors of retail, such as books. But because it's only a fraction of their business, it seems like nothing.

_red 8y ago

The redefinition of the term 'monopoly' to just be 'large marketshare' is very dangerous. However, as a bit of schadenfreude, its nice to see the leftist big-tech receive the unintended consequences of their beliefs. Sadly, the realities is that they will just hire ex-regulators as 'consultants' to help enshrine their businesses into quasi-state protected monopolies.

crankylinuxuser 8y ago
Then use the proper term for the FAANG companies: A criminal conspiracy. And we have laws against conspiracies. RICO act for starters. And collusion is also a crime, no? How many execs have gone to prison for the wage fixing that FAANG was accused of and lost?
- basch 8y ago
  its called a cartel. are you accusing youtube, facebook, netflix, and amazon of secretly working together to keep other video streaming apps from existing?

almost_usual 8y ago

We’re going to see more and more defensive content come out and it’s only going to help Warren. Strategically she’s positioned herself well, she could easily be the most publicized democratic candidate because of this topic alone.

Reedx 8y ago
It's definitely timely and getting a lot of attention. But Andrew Yang could end up making waves here. His approach seems more productive - proposing a VAT on big tech and a "Freedom Dividend".
- chillacy 8y ago
  I think Yang goes a lot farther than warren in that breaking up tech companies still concentrates wealth in costal tech hubs while a UBI would begin shifting that back to the middle states. It is sort of admitting that tech has “won”, but the power of data at scale is imo fundamentally a part of reality and denying it in the US just means China will develop AI technology faster. Either way I’m glad to see these ideas being discussed more broadly.
jklinger410 8y ago
It's a sad state we're in that instead of talking about the most important monopolies, we're only able to talk about the ones with the most brand recognition.
- deleted 8y ago
  [deleted]
hosh 8y ago
Sure, though this article isn't defending the FAANG companies. The author is also concerned, though he is saying the problem is deeper, not well-understood, and Warren's solution as-proposed is simplistic and will not be effective.

scarface74 8y ago

The purpose of government should not be to “protect small businesses” - ie protect business models that can not compete in the market

chj 8y ago
Well, I think all businesses grow from small ones. They do need some kind of protection while they are developing.
- scarface74 8y ago
  So I have this great idea to delivery pet food. Should the government protect me while I grow it?
  - chj 8y ago
    OK, I see that we have different ideas of protection. When you are selling pet food, surely you don't want the delivery company steal your customers, right? Now if government says that delivery company can't sell user data, that's the kind of protection I meant.
    - scarface74 8y ago
      And the government has been great about protecting privacy? The government is one of the biggest proponents of less privacy because of the various “Wars on $X”.

product50 8y ago

You need to get into specifics vs. trying to just provide your general view. The author you are claiming is nitpicking is Ben Thompson - the most prolific tech strategist of our times. And look at your response which offers nothing interesting at all. Do you have any suggestions on how to make these breakups happen given all the nuances and challenges? And please get into details vs. pretending they are not important.

deleted 8y ago
[deleted]

hosh 8y ago

The author has written a lot about Amazon, how it gained power, both in that article and in others on that blog. He did not conveniently forget to mention it. The article may seem like nitpicking the history of Bing and Google at the beginning of his article. However, if one were to read through the whole thing, he is showing how Warren is coming from an inadequate frame to make an effective policy. The author analyzes this from the Aggregation Theory he has been working on for years throughout other articles on his blog. The biggest takeaway is that, the FAANG aggregators get their market power because consumers voluntarily use their product. While promoting competition can help a market, the current US standard for antitrust is around consumer welfare, and modern-day aggregators do no meet that standard. The concern here is that developing antitrust policies without addressing these deeper concerns will not solve the problem (dominant companies that grow increasingly more dominant over time), and may end up exacerbating it.

chj 8y ago
Warren's Amazon coffee maker argument is pretty convincing, but the author focuses on the history of bing and google, that's a big turn off. Shouldn't the author come from the perspective "Where Warren's Right" if the author's "Aggregation Theory", which I am not familiar with, happens to have the same spirit of Warren's proposal? Is it reasonable that since Warren made a mistake about bing and google, therefore she's inadequate for coming up with a policy? To be honest with you, I didn't read the whole thing. Instead of spending many screens of texts in the beginning to show how Warren's wrong, the author could instead promote his own theory right at the start, then we will have a better idea where he's coming from. Right now, from the structure of his writing, it feels nitpicking.
- hosh 8y ago
  The author perhaps, should have lead with (paraphrased) "Warren raised this as a discussion, and that is a good thing." He wrote that towards the end. However, according to (what I understand) as the author's frame, there is a fundamental misunderstanding of how the tech companies gained power and market dominance. The nitty gritty details about Bing and Google was meant to demonstrate that. Also keep in mind: this author has been writing a blog related to Aggregation Theory for a long time. Years before Warren had raised this issue to the nation. He had analyzed each of the FAANG companies, including Amazon, in depth. Many of his readers would already be familiar with Aggregation Theory. The key insight here is that the FAANG companies are not like the monopolies of the old. These are probably a better introduction: https://stratechery.com/2016/the-amazon-tax/ https://stratechery.com/2016/the-amazon-tax/ https://stratechery.com/2017/amazons-new-customer/ https://stratechery.com/2017/amazons-new-customer/

RestlessMind 8y ago

> The author is nitpicking You are being charitable to the author. Usually Stratechery articles are decent, but on this one, the author has many ignorant remarks. > Bing Microsoft, if not checked with antitrust investigations, could have shoved Bing (or Live, or MSN Search) down everyone's throat. Just like Google tried to do with Google+. So to credit Warren's point, without antitrust case, we could be living with Bing (or Live or MSN Search). > of course a browser should be bundled with an operating system; a new computer without a browser would be practically useless (for one, how do you install a browser?). Hasn't the author heard of floppy disks or CDs with software, which was the popular way to install softwares in 90's? In fact, without Microsoft's free offering, browsers could have remained a software worth paying for and we wouldn't be living with an almost monoculture. > Google would have emerged with or without antitrust action against Microsoft. I read a wonderful article a while back, which stated that the real effect of antitrust on Microsoft was that every minor decision was heavily scrutinized internally, with lawyers vetting the major decisions, thus dampening the velocity of the company. So it is debatable whether Google could have emerged without the antitrust lawsuit.

edanm 8y ago
> Microsoft, if not checked with antitrust investigations, could have shoved Bing (or Live, or MSN Search) down everyone's throat. Just like Google tried to do with Google+. So to credit Warren's point, without antitrust case, we could be living with Bing (or Live or MSN Search). Bing started in 2009. Google was already amazingly dominant at that point. What did the previous antitrust cases have to do with Bing's success or failure?