7 ms·

"and then doing what the systems tell them is the most profitable." ...so, not predatory pricing then?

deleted 7y ago
[deleted]
microcolonel 7y ago
It seems to me that, by this description, Amazon is admirably fulfilling its legal and fiscal duties, and to a greater degree than I thought before receiving this information.
- warent 7y ago
  Maybe to the shareholders but definitely not to the consumers or the businesses on the platform.
  - microcolonel 7y ago
    > definitely not to the consumers Amazon always ships packages ahead of time, at my leisure, and often cheaper than retail. They always process returns and complaints in my favour, without contest. They reach out to local logistics companies in order to improve delivery, and I can tell by the fact that those companies now have branded vehicles (and much happier and more attentive personnel than UPS!), and better verification processes (they found a logistics provider that actually emails the signature given at the door to you when the delivery is processed) that they've done well out of that. I feel they're serving me very well as a customer, and every ordinary person in my life who isn't competing with Amazon is richer and happier because of Amazon's services. > definitely not ... the businesses on the platform The businesses fulfilling through Amazon would absolutely not have received my business were it not for Amazon; in many cases they do not have the expertise to handle the orders correctly, and I do not trust all of them to process the payments securely to the degree that I trust Amazon to. They have every opportunity to improve their ordering and fulfillment systems, but they choose Amazon because it's where the customers are comfortable already. I dreamt of a logistics integration system much like Amazon Marketplace when I was 16, and every year they make it closer to that dream, I think it's great. I'm willing to accept an argument from concrete evidence that they have somehow deliberately and systematically broken the law in so doing, but I've yet to see it.
    - darpa_escapee 7y ago
      I get free shipping from Walmart.com and AliExpress, the latter of which 90% of electronics on Amazon are sourced from. Walmart offers free 2 day shipping and in-store pickup. AliExpress offers the same items on Amazon without having to give middleman their expensive cut. I don't trust Amazon not to send me fake items or cheap Chinese knockoffs. There is absolutely no quality control on Amazon's end. Amazon has the resources to fight fake reviews, yet fake reviews are still rampant. As a result, I cannot trust Amazon's rating system at all.
      - microcolonel 7y ago
        > Amazon has the resources to fight fake reviews, yet fake reviews are still rampant. As a result, I cannot trust Amazon's rating system at all. While this is true, at least the part about fake reviews being pervasive, the fact is that I don't trust any reviews on a retailer's website anymore, especially those that aren't verified purchases, and the only retail site where I trust verified purchase reviews at all (and not all of those either) is Amazon. > I get free shipping from Walmart.com Yes! walmart.ca is great, very prompt and simple to work with them. > AliExpress, which 90% of electronics on Amazon are sourced from. More like 90% of obscure commodity electronic bits and bobs. But yes, some of these rinky-dink sellers and unrecognized brands do mess up the experience a bit, but imagine ordering directly from their individual weird off the shelf fulfillment sites and hoping your credit cards don't get burned. It's not any better of an experience, and at least with Amazon you generally have recourse outside the seller. > I don't trust Amazon not to send me fake items or cheap Chinese knockoffs I don't trust AliExpress not to send me fake items or cheap knockoffs either, but that doesn't stop me from trying sometimes. At least with Amazon you have recourse in my experience.
        hakfoo 7y ago
        >More like 90% of obscure commodity electronic bits and bobs. I feel like this is a dramatic market development. In the era of brick-and-mortar shops, a lot of those products were only available as branded versions. Think when you had to go in to a store and get a printer cable in 2001, and you were paying $25 for a Belkin cable in a fancy box because it's all they sell. Branding from a consumer perspective is about building a message of "we're the quality one you know and trust" or "we're the cool/desirable one you recognize." It isn't necessary for a lot of these products: they're not sexy and the bar of competence is so low that you're unlikely to be burned. AliExpress and friends have completely reinvented that market by tapping into that sentiment. Their products are unbranded (or as-good-as-unbranded, with a name with no meaning to the buyer) but trade on cheap and good enough. I'm sure a lot of the bits-and-bobs industry is up all night sweating.
  - reaperducer 7y ago
    Maybe to the shareholders Not to this shareholder. If Amazon is playing a dangerous game, then it's risking my money, which is not OK.
    - microcolonel 7y ago
      > If Amazon is playing a dangerous game, then it's risking my money, which is not OK. If you're so sure of that, then why did you buy AMZN? Why have you not sold your AMZN?
lostmyoldone 7y ago
That doesn't follow. If predatory pricing is effective, an algorithm can be taught, or learn to, exploit it if fed with the right data. This, quite obviously, shouldn't change anything regarding the potential legality, as it's entirely self evident that a sufficiently powerful machine learning algorithm will exploit any patterns not expressly forbidden. As always, the responsibility for following the laws, and making sure these extensions of our own agency we call machines also follow the same laws fall on whomever is making the machine act in their stead. One can however be assured that several companies will argue otherwise, argue as if they were simply a victim of some sort. Which might be true in a sense. Victims of their own devices, both figuratively and almost literally at the same time.
- goliatone 7y ago
  “A slightly more grey area arises where, with no human involvement or instruction, a price-setting AI algorithm teaches itself to coordinate with competitors – otherwise referred to as tacit algorithmic collusion. While it is unclear the extent to which current AI technology allows for this tacit coordination, a 2018 University of Bologna study found that if two competitors both employ pricing algorithms, and each gives its software total autonomy to set prices, those two algorithms would reach collusive, price-fixing arrangements more often than not.” [1] https://www.russellmcveagh.com/insights/march-2019/ai-and-price-fixing-collusion-by-machines https://www.russellmcveagh.com/insights/march-2019/ai-and-pr... [2] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3209781 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3209781
  - TheSpiceIsLife 7y ago
    > no human involvement How does it come about that that is that a concept? Does the thought go something like: "We neglected to instruct the algorithm not to collude, and failed to monitor outcomes for collusion, therefore we're not responsible?" > and each gives its software total autonomy to set prices Ah, yep.
    - Nasrudith 7y ago
MereInterest 7y ago
Depends. Did they intentionally go out of their way to teach the model that predatory pricing, despite being profitable, is not allowed?
- chii 7y ago
  why does it matter that the decision came out of an AI model? Predatory pricing is either legal or not (in the eyes of the court, or legislations).
  - MereInterest 7y ago
    We are in agreement on that. The point that I was attempting to make was that an AI model will do exactly what it was trained to do. If a model is trained to maximize profit without consideration for the law, then it will find all the unethical and illegal ways to price goods.
  - deleted 7y ago
    [deleted]
pertsix 7y ago
luckily, predatory pricing does not have to consider intent. see Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209. essentially, all you have to do is prove that there is "dangerous probability" that a monopolist can recoup their losses after all competitors have been priced out.
darpa_escapee 7y ago
Predatory pricing is still predatory if a human does it or if a giant Rube Goldberg machine does it.

deleted 7y ago

[deleted]

It seems to me that, by this description, Amazon is admirably fulfilling its legal and fiscal duties, and to a greater degree than I thought before receiving this information.

warent 7y ago
Maybe to the shareholders but definitely not to the consumers or the businesses on the platform.
- microcolonel 7y ago
  > definitely not to the consumers Amazon always ships packages ahead of time, at my leisure, and often cheaper than retail. They always process returns and complaints in my favour, without contest. They reach out to local logistics companies in order to improve delivery, and I can tell by the fact that those companies now have branded vehicles (and much happier and more attentive personnel than UPS!), and better verification processes (they found a logistics provider that actually emails the signature given at the door to you when the delivery is processed) that they've done well out of that. I feel they're serving me very well as a customer, and every ordinary person in my life who isn't competing with Amazon is richer and happier because of Amazon's services. > definitely not ... the businesses on the platform The businesses fulfilling through Amazon would absolutely not have received my business were it not for Amazon; in many cases they do not have the expertise to handle the orders correctly, and I do not trust all of them to process the payments securely to the degree that I trust Amazon to. They have every opportunity to improve their ordering and fulfillment systems, but they choose Amazon because it's where the customers are comfortable already. I dreamt of a logistics integration system much like Amazon Marketplace when I was 16, and every year they make it closer to that dream, I think it's great. I'm willing to accept an argument from concrete evidence that they have somehow deliberately and systematically broken the law in so doing, but I've yet to see it.
  - darpa_escapee 7y ago
    I get free shipping from Walmart.com and AliExpress, the latter of which 90% of electronics on Amazon are sourced from. Walmart offers free 2 day shipping and in-store pickup. AliExpress offers the same items on Amazon without having to give middleman their expensive cut. I don't trust Amazon not to send me fake items or cheap Chinese knockoffs. There is absolutely no quality control on Amazon's end. Amazon has the resources to fight fake reviews, yet fake reviews are still rampant. As a result, I cannot trust Amazon's rating system at all.
    - microcolonel 7y ago
      > Amazon has the resources to fight fake reviews, yet fake reviews are still rampant. As a result, I cannot trust Amazon's rating system at all. While this is true, at least the part about fake reviews being pervasive, the fact is that I don't trust any reviews on a retailer's website anymore, especially those that aren't verified purchases, and the only retail site where I trust verified purchase reviews at all (and not all of those either) is Amazon. > I get free shipping from Walmart.com Yes! walmart.ca is great, very prompt and simple to work with them. > AliExpress, which 90% of electronics on Amazon are sourced from. More like 90% of obscure commodity electronic bits and bobs. But yes, some of these rinky-dink sellers and unrecognized brands do mess up the experience a bit, but imagine ordering directly from their individual weird off the shelf fulfillment sites and hoping your credit cards don't get burned. It's not any better of an experience, and at least with Amazon you generally have recourse outside the seller. > I don't trust Amazon not to send me fake items or cheap Chinese knockoffs I don't trust AliExpress not to send me fake items or cheap knockoffs either, but that doesn't stop me from trying sometimes. At least with Amazon you have recourse in my experience.
      - hakfoo 7y ago
        >More like 90% of obscure commodity electronic bits and bobs. I feel like this is a dramatic market development. In the era of brick-and-mortar shops, a lot of those products were only available as branded versions. Think when you had to go in to a store and get a printer cable in 2001, and you were paying $25 for a Belkin cable in a fancy box because it's all they sell. Branding from a consumer perspective is about building a message of "we're the quality one you know and trust" or "we're the cool/desirable one you recognize." It isn't necessary for a lot of these products: they're not sexy and the bar of competence is so low that you're unlikely to be burned. AliExpress and friends have completely reinvented that market by tapping into that sentiment. Their products are unbranded (or as-good-as-unbranded, with a name with no meaning to the buyer) but trade on cheap and good enough. I'm sure a lot of the bits-and-bobs industry is up all night sweating.
- reaperducer 7y ago
  Maybe to the shareholders Not to this shareholder. If Amazon is playing a dangerous game, then it's risking my money, which is not OK.
  - microcolonel 7y ago
    > If Amazon is playing a dangerous game, then it's risking my money, which is not OK. If you're so sure of that, then why did you buy AMZN? Why have you not sold your AMZN?

lostmyoldone 7y ago

That doesn't follow. If predatory pricing is effective, an algorithm can be taught, or learn to, exploit it if fed with the right data. This, quite obviously, shouldn't change anything regarding the potential legality, as it's entirely self evident that a sufficiently powerful machine learning algorithm will exploit any patterns not expressly forbidden. As always, the responsibility for following the laws, and making sure these extensions of our own agency we call machines also follow the same laws fall on whomever is making the machine act in their stead. One can however be assured that several companies will argue otherwise, argue as if they were simply a victim of some sort. Which might be true in a sense. Victims of their own devices, both figuratively and almost literally at the same time.

goliatone 7y ago
“A slightly more grey area arises where, with no human involvement or instruction, a price-setting AI algorithm teaches itself to coordinate with competitors – otherwise referred to as tacit algorithmic collusion. While it is unclear the extent to which current AI technology allows for this tacit coordination, a 2018 University of Bologna study found that if two competitors both employ pricing algorithms, and each gives its software total autonomy to set prices, those two algorithms would reach collusive, price-fixing arrangements more often than not.” [1] https://www.russellmcveagh.com/insights/march-2019/ai-and-price-fixing-collusion-by-machines https://www.russellmcveagh.com/insights/march-2019/ai-and-pr... [2] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3209781 https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3209781
- TheSpiceIsLife 7y ago
  > no human involvement How does it come about that that is that a concept? Does the thought go something like: "We neglected to instruct the algorithm not to collude, and failed to monitor outcomes for collusion, therefore we're not responsible?" > and each gives its software total autonomy to set prices Ah, yep.
  - Nasrudith 7y ago

MereInterest 7y ago

Depends. Did they intentionally go out of their way to teach the model that predatory pricing, despite being profitable, is not allowed?

chii 7y ago
why does it matter that the decision came out of an AI model? Predatory pricing is either legal or not (in the eyes of the court, or legislations).
- MereInterest 7y ago
  We are in agreement on that. The point that I was attempting to make was that an AI model will do exactly what it was trained to do. If a model is trained to maximize profit without consideration for the law, then it will find all the unethical and illegal ways to price goods.
- deleted 7y ago
  [deleted]

pertsix 7y ago

luckily, predatory pricing does not have to consider intent. see Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209. essentially, all you have to do is prove that there is "dangerous probability" that a monopolist can recoup their losses after all competitors have been priced out.

darpa_escapee 7y ago

Predatory pricing is still predatory if a human does it or if a giant Rube Goldberg machine does it.