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In what sector is Amazon a monopoly. Retail? Walmart is much larger and Amazon's share of the market is too small to be a monopoly. Ecommerce? Even in ecommerce

In what sector is Amazon a monopoly. Retail? Walmart is much larger and Amazon's share of the market is too small to be a monopoly. Ecommerce? Even in ecommerce, Amazon's share is <50%. Fun fact, Tesla has a 60% of electric car market in the US (https://electrek.co/2020/02/04/tesla-electric-car-sales-us-market-share/ https://electrek.co/2020/02/04/tesla-electric-car-sales-us-m...). Does that mean Tesla is a monopoly, and should be broken up?

libertine 6y ago
Honestly this came to me after I've read your reply, and I think you're onto something: Is the 50% market share really necessary to claim who's a monopoly? Maybe it's time to re evaluate the definition of monopoly.
- enitihas 6y ago
  Sure, let's give politicians a stick to break businesses arbitrarily, since we don't like objective criterias. Got a problem with some CEO, cry monopoly and break it up.
  - libertine 6y ago
    I didn't say we shouldn't have criterias. I said that the "50% market share" seems to have flaws. Why not look at market caps? Well, the last monopoly was broken in 1982, isn't odd that since then no other monopoly has ever existed? You currently have monopolies that serve political agendas, that's a better stick I guess.
    - enitihas 6y ago
      What does monopoly have to do with market cap? Market cap is an abstract concept on how much the market values something, and doesn't have much concrete stuff to be based on. Market cap goes way up during bubbles. If companies were to be broken for profits, there are so many companies ahead of Amazon. >Well, the last monopoly was broken in 1982, isn't odd that since then no other monopoly has ever existed? Many monopolies have existed, like Microsoft for the most famous example. But there is no industry in which Amazon is a monopoly. Unless we were playing a witch hunt where we had to create a monopoly by thin air, I don't know what makes Amazon qualify as one.
      - libertine 6y ago
        >What does monopoly have to do with market cap? Well my point is that 50% of a 100 million USD market is different from 50% of 1 trillion USD market. On the later you don't that much market share to pull your weight on the market. >If companies were to be broken for profits, there are so many companies ahead of Amazon. That wouldn't work, specially with the gymnastics that's done. >But there is no industry in which Amazon is a monopoly. Not even AWS?
        enitihas 6y ago
        How is AWS a monopoly? There are several competitors, two with similar market cap as Amazon and likely more cash in the bank. AWS neither builds on any pre existing monopoly, not is being used to push another product. Contrast this with Azure, which greatly benefited from the Windows and Office monopoly. I am pretty sure the Windows, AD, Office monopoly is the prime reason Azure is where it is today.
- ksec 6y ago
  It is not a clear cut 50%, but it is about options. There are plenty of alternative for books, ebooks etc. In a monopoly, a single seller controls or dominates the supply of goods and services. The term you may be looking for is monopsony. In a monopsony, a single buyer controls or dominates the demand for goods and services.
  - libertine 6y ago
    But isn't all dependent on the frame? Amazon owns the monopoly of the ebooks for the KPF (Kindle Package Format), but it's not the monopoly of ebooks market. Google has the monopoly of search, but doesn't have the monopoly of advertising.
ngokevin 6y ago
One issue is they run a marketplace platform where they also sell and push their own products on that platform. People sell products on the platform, Amazon gathers data, and eventually undercuts them out. They can exploit their 50% market share on top of control of the platform to make it almost impossible to compete in many product areas. Not a monopoly perhaps in the definition, but extremely suffocating.
- enitihas 6y ago
  So like every other big retailer? Like Walmart, Costco and many others?
  - heromal 6y ago
    The problem for these people seems to be that Amazon does it far more effectively than other retailers, which isn't really a "break them up now!" kind of argument lol.
- ksec 6y ago
  It is only in Silicon Valley and tech circle this manage to blow up as a big deal. When literally every single Retailer has been acting the same with their private labels for decades. The game has been exactly the same whether it is online or offline. You are simply swapping form Nationwide Stores to Nationwide Logistics.
somethoughts 6y ago
I think the most likely business unit that would be considered a monopoly is its IAAS business unit called AWS which has a very high profit margin. Ecommerce and E-books/books are probably the runner ups. With those two business units, Amazon can then subsidize short term loss making business strategies and M&A that focus on gaining an eventually obtaining a monopoly advantage such as grocery, general brick and mortar retail, shipping and logistics, tablets, etc. The other companies in technology focus on PAAS, self driving cars and VR, etc. and haven't used their profit margins to extend into the real world thus far.
nailer 6y ago
Read the parent tweet.

libertine 6y ago

Honestly this came to me after I've read your reply, and I think you're onto something: Is the 50% market share really necessary to claim who's a monopoly? Maybe it's time to re evaluate the definition of monopoly.

enitihas 6y ago
Sure, let's give politicians a stick to break businesses arbitrarily, since we don't like objective criterias. Got a problem with some CEO, cry monopoly and break it up.
- libertine 6y ago
  I didn't say we shouldn't have criterias. I said that the "50% market share" seems to have flaws. Why not look at market caps? Well, the last monopoly was broken in 1982, isn't odd that since then no other monopoly has ever existed? You currently have monopolies that serve political agendas, that's a better stick I guess.
  - enitihas 6y ago
    What does monopoly have to do with market cap? Market cap is an abstract concept on how much the market values something, and doesn't have much concrete stuff to be based on. Market cap goes way up during bubbles. If companies were to be broken for profits, there are so many companies ahead of Amazon. >Well, the last monopoly was broken in 1982, isn't odd that since then no other monopoly has ever existed? Many monopolies have existed, like Microsoft for the most famous example. But there is no industry in which Amazon is a monopoly. Unless we were playing a witch hunt where we had to create a monopoly by thin air, I don't know what makes Amazon qualify as one.
    - libertine 6y ago
      >What does monopoly have to do with market cap? Well my point is that 50% of a 100 million USD market is different from 50% of 1 trillion USD market. On the later you don't that much market share to pull your weight on the market. >If companies were to be broken for profits, there are so many companies ahead of Amazon. That wouldn't work, specially with the gymnastics that's done. >But there is no industry in which Amazon is a monopoly. Not even AWS?
      - enitihas 6y ago
        How is AWS a monopoly? There are several competitors, two with similar market cap as Amazon and likely more cash in the bank. AWS neither builds on any pre existing monopoly, not is being used to push another product. Contrast this with Azure, which greatly benefited from the Windows and Office monopoly. I am pretty sure the Windows, AD, Office monopoly is the prime reason Azure is where it is today.
ksec 6y ago
It is not a clear cut 50%, but it is about options. There are plenty of alternative for books, ebooks etc. In a monopoly, a single seller controls or dominates the supply of goods and services. The term you may be looking for is monopsony. In a monopsony, a single buyer controls or dominates the demand for goods and services.
- libertine 6y ago
  But isn't all dependent on the frame? Amazon owns the monopoly of the ebooks for the KPF (Kindle Package Format), but it's not the monopoly of ebooks market. Google has the monopoly of search, but doesn't have the monopoly of advertising.

ngokevin 6y ago

One issue is they run a marketplace platform where they also sell and push their own products on that platform. People sell products on the platform, Amazon gathers data, and eventually undercuts them out. They can exploit their 50% market share on top of control of the platform to make it almost impossible to compete in many product areas. Not a monopoly perhaps in the definition, but extremely suffocating.

enitihas 6y ago
So like every other big retailer? Like Walmart, Costco and many others?
- heromal 6y ago
  The problem for these people seems to be that Amazon does it far more effectively than other retailers, which isn't really a "break them up now!" kind of argument lol.
ksec 6y ago
It is only in Silicon Valley and tech circle this manage to blow up as a big deal. When literally every single Retailer has been acting the same with their private labels for decades. The game has been exactly the same whether it is online or offline. You are simply swapping form Nationwide Stores to Nationwide Logistics.

somethoughts 6y ago

I think the most likely business unit that would be considered a monopoly is its IAAS business unit called AWS which has a very high profit margin. Ecommerce and E-books/books are probably the runner ups. With those two business units, Amazon can then subsidize short term loss making business strategies and M&A that focus on gaining an eventually obtaining a monopoly advantage such as grocery, general brick and mortar retail, shipping and logistics, tablets, etc. The other companies in technology focus on PAAS, self driving cars and VR, etc. and haven't used their profit margins to extend into the real world thus far.

nailer 6y ago

Read the parent tweet.