4 ms·

At risk of sounding idiot and down votes. Can you explain me when was the last time you saw the itemized breakdown of a toy, or a T-Shirt you bought in Target/W

At risk of sounding idiot and down votes. Can you explain me when was the last time you saw the itemized breakdown of a toy, or a T-Shirt you bought in Target/Walmart? Same is true for Nintendo, Sony, and Xbox systems. Why do we think it's fair for Walmart to not show exact breakdown on how much commission they are charging for keeping something on shelf and Google is wrong about it?

rebelos 5y ago
I strongly believe that Nintendo, Sony, & Xbox should also disclose their rake. However, it's also well understood that they take heavy losses on consoles that are made up on game margins. The same cannot be said for Google and Apple. Retailers have substantial costs associated with distributing products and physical shelf space is a scarce resource. There are, by comparison, no limits to the number of apps on Apple and Google's "stores" and we know that the costs of maintaining them are quite low because the respective business units are wildly profitable. The points you raised are the rather beguiling false equivalencies that have been propagated largely by people with a vested interest in preserving this system and averting scrutiny.
- Talanes 5y ago
  Exactly how profitable does a market need to be to require showing margins to the customer? Where are you drawing the threshold?
  - rebelos 5y ago
    Who said anything about a requirement? It suffices to make it illegal to prohibit disclosing the fee. Businesses can decide if they want to do so. The point is that this 'invisible rake' model is being exploited to nullify free market forces in service of obscene profit. Many businesses (not just Apple and Google) have realized they can leverage this to make considerably more money than they otherwise might.
    - Talanes 5y ago
      >I strongly believe that Nintendo, Sony, & Xbox should also disclose their rake. Sorry, between this line and not realizing you were also the GP commenter, I assumed you were suggesting the markets be forced to disclose the rake pro-actively themselves. Making it illegal to prohibit disclosing the fee is great, and at that point I don't even think you need to make the case that the industry is different than others. It's not the same as the cost, but plenty of items have an msrp listed on their packaging. You know if your Arizona Iced Tea is being sold at a higher than usual mark-up because it's not $1. (Disclosure: I live in San Francisco and have no idea whether Arizona is actually still a dollar in other places.)
      - rebelos 5y ago
        Ah my bad for the confusing wording on that. And yes agreed.
clucas 5y ago
The analogy doesn't work. A more apt analogy would be to compare Google and Apple to car manufacturers who charge you a 30% markup on anything you buy from a store you drive to... But the stores have to charge you that automatically, and they're not allowed to tell you that they charged it.
- asciident 5y ago
  Why do you think your analogy is better than the parent post? The parent post makes more sense to me. People to go stores, and the stores charge a markup. In your analogy, the mode of transportation charges the markup, which in the app store case would be the ISP charging a markup.
  - lostmsu 5y ago
    The key is that Wallmart does not prohibit your product from listing its wholesale price on the label. A clause like that should be illegal.
    - thaumasiotes 5y ago
      Listing wholesale prices on the product is vanishingly rare, possibly nonexistent. I wouldn't be surprised if it infuriated retailers to the point that they refused to stock your product. Printing MSRP on the product happens all the time. Arizona Iced Tea is a prominent example.
      - lostmsu 5y ago
        Rarity of example os irrelevant. Producers have no need for that, because IRL stores generally do not have 50% markup on mass produce.
    - simondotau 5y ago
      > Wallmart does not prohibit your product from listing its wholesale price on the label. Are you sure that they don't? I honestly wouldn't be surprised if Walmart does have clear policies around prices of any kind being printed on packaging. And it wouldn't be a stretch to assume that if they have a policy, it would disallow printing of any price which is less than the highest price Walmart intend to charge at retail.

rebelos 5y ago

I strongly believe that Nintendo, Sony, & Xbox should also disclose their rake. However, it's also well understood that they take heavy losses on consoles that are made up on game margins. The same cannot be said for Google and Apple. Retailers have substantial costs associated with distributing products and physical shelf space is a scarce resource. There are, by comparison, no limits to the number of apps on Apple and Google's "stores" and we know that the costs of maintaining them are quite low because the respective business units are wildly profitable. The points you raised are the rather beguiling false equivalencies that have been propagated largely by people with a vested interest in preserving this system and averting scrutiny.

Talanes 5y ago
Exactly how profitable does a market need to be to require showing margins to the customer? Where are you drawing the threshold?
- rebelos 5y ago
  Who said anything about a requirement? It suffices to make it illegal to prohibit disclosing the fee. Businesses can decide if they want to do so. The point is that this 'invisible rake' model is being exploited to nullify free market forces in service of obscene profit. Many businesses (not just Apple and Google) have realized they can leverage this to make considerably more money than they otherwise might.
  - Talanes 5y ago
    >I strongly believe that Nintendo, Sony, & Xbox should also disclose their rake. Sorry, between this line and not realizing you were also the GP commenter, I assumed you were suggesting the markets be forced to disclose the rake pro-actively themselves. Making it illegal to prohibit disclosing the fee is great, and at that point I don't even think you need to make the case that the industry is different than others. It's not the same as the cost, but plenty of items have an msrp listed on their packaging. You know if your Arizona Iced Tea is being sold at a higher than usual mark-up because it's not $1. (Disclosure: I live in San Francisco and have no idea whether Arizona is actually still a dollar in other places.)
    - rebelos 5y ago
      Ah my bad for the confusing wording on that. And yes agreed.

clucas 5y ago

The analogy doesn't work. A more apt analogy would be to compare Google and Apple to car manufacturers who charge you a 30% markup on anything you buy from a store you drive to... But the stores have to charge you that automatically, and they're not allowed to tell you that they charged it.

asciident 5y ago
Why do you think your analogy is better than the parent post? The parent post makes more sense to me. People to go stores, and the stores charge a markup. In your analogy, the mode of transportation charges the markup, which in the app store case would be the ISP charging a markup.
- lostmsu 5y ago
  The key is that Wallmart does not prohibit your product from listing its wholesale price on the label. A clause like that should be illegal.
  - thaumasiotes 5y ago
    Listing wholesale prices on the product is vanishingly rare, possibly nonexistent. I wouldn't be surprised if it infuriated retailers to the point that they refused to stock your product. Printing MSRP on the product happens all the time. Arizona Iced Tea is a prominent example.
    - lostmsu 5y ago
      Rarity of example os irrelevant. Producers have no need for that, because IRL stores generally do not have 50% markup on mass produce.
  - simondotau 5y ago
    > Wallmart does not prohibit your product from listing its wholesale price on the label. Are you sure that they don't? I honestly wouldn't be surprised if Walmart does have clear policies around prices of any kind being printed on packaging. And it wouldn't be a stretch to assume that if they have a policy, it would disallow printing of any price which is less than the highest price Walmart intend to charge at retail.