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The argument is that this is rent-seeking. A mechanism like this allows the company to capture 99% of the value they add compared to their competitors, which is

The argument is that this is rent-seeking. A mechanism like this allows the company to capture 99% of the value they add compared to their competitors, which is obviously not fair.

rmbyrro 5y ago
Rent-seeking involves manipulating public policy to artificially increase profits. This isn't really the case, is it? The point sometimes people miss is that the value of a service varies to each person, business or team. It might be that, for you, in the contexts you were in, they were capturing too much with their price to the point its not advantageous for you to use the service. That's fine, use something else. But it doesn't mean everyone lives the exact same experience as you.
- HWR_14 5y ago
  Rent seeking doesn't require manipulating public policy, manipulating public policy is an effective method of rent seeking. I think vendor lock-in leading to higher prices is an example of rent seeking. The prices are going up not because that cloud provider is doing more/better things, but because of social things built around it
  - rmbyrro 5y ago
    This isn't rent seeking, it's called sales. You may not like it, but it's how the world works and what puts food on our tables. The problem I see with vendor lock-in is when, after you're locked, the service provider exploit this to change their terms (price and/or else) in a disproportionate and unjustifiable way against your initial interests in the service. This never happened with AWS, to my knowledge (please correct if I'm wrong). Everyone knew the price when they subscribed. Little changed afterwards. AWS was able to meet a demand with quality enough products in an acceptable price to whoever decided to buy. This is a commercial transaction. They're tremendously successful at marketing, sales and delivering, and that's OK. They don't have to be ashamed of that, there's nothing immoral or "rent-seeking" here. They're providing a service and selling it honestly, with transparent and predictable prices. Lock-in exploitation happened with GCP at least once, that I know, with App Engine. And their service was doomed after that, as developers reacted against their practice and they weren't able to grow past a tiny fraction of the market.
    - pritambaral 5y ago
      > The problem I see with vendor lock-in is when, after you're locked, the service provider exploit this to change their terms (price and/or else) in a disproportionate and unjustifiable way against your initial interests in the service. > This never happened with AWS, to my knowledge (please correct if I'm wrong). Everyone knew the price when they subscribed. Little changed afterwards. AWS was able to meet a demand with quality enough products in an acceptable price to whoever decided to buy. Vendor lock-in does not require any changes to terms, price, or any part of the service or product provided. In most classically studied cases of vendor lock-in (e.g., Microsoft Windows and Office binary formats, VHS vs. Beta), everyone knew the lack of interoperability when they bought the service/good, and nothing changed afterwards. That didn't stop those cases from becoming "vendor lock-in".
      - rmbyrro 5y ago
        I totally agree that lock-in is there. What I'm disputing is that AWS has exploited it maliciously to screw their customers. More specifically, this statement: > AWS was fucking everyone on egress price and nobody could do anything about it I disagree because AWS has been transparent with their prices since day one. Everyone who subscribed was aware of how much it cost. AWS didn't screw anyone by increasing prices after they were locked-in.
        pritambaral 5y ago
        Good, we're in agreement.
    - HWR_14 5y ago
      > This isn't rent seeking, it's called sales. It's rent seeking when you don't produce new value, you just leverage existing systems to extract value.
      - rmbyrro 5y ago
        Sure, we can certainly agree on that. But can we make it more tangible with an example? Would you argue that AWS, for instance, is a company that produces no new value? One might argue they add value, but their price is too high for the value they add. We'd go back to what I've said before: value perceived by a service is subjective and highly dependent on the context.
  - 8note 5y ago
    "Leading to higher prices" is where the issue lies The prices didn't get higher, they just didn't get lower by as much as they could have. That really describes profit though. While I agree that all profit is rent seeking in some way and thus unfair, it's not very useful for splitting up some practices as bad rent seeking and others as less bad

The argument is that this is rent-seeking. A mechanism like this allows the company to capture 99% of the value they add compared to their competitors, which is obviously not fair.

rmbyrro 5y ago

Rent-seeking involves manipulating public policy to artificially increase profits. This isn't really the case, is it? The point sometimes people miss is that the value of a service varies to each person, business or team. It might be that, for you, in the contexts you were in, they were capturing too much with their price to the point its not advantageous for you to use the service. That's fine, use something else. But it doesn't mean everyone lives the exact same experience as you.

HWR_14 5y ago
Rent seeking doesn't require manipulating public policy, manipulating public policy is an effective method of rent seeking. I think vendor lock-in leading to higher prices is an example of rent seeking. The prices are going up not because that cloud provider is doing more/better things, but because of social things built around it
- rmbyrro 5y ago
  This isn't rent seeking, it's called sales. You may not like it, but it's how the world works and what puts food on our tables. The problem I see with vendor lock-in is when, after you're locked, the service provider exploit this to change their terms (price and/or else) in a disproportionate and unjustifiable way against your initial interests in the service. This never happened with AWS, to my knowledge (please correct if I'm wrong). Everyone knew the price when they subscribed. Little changed afterwards. AWS was able to meet a demand with quality enough products in an acceptable price to whoever decided to buy. This is a commercial transaction. They're tremendously successful at marketing, sales and delivering, and that's OK. They don't have to be ashamed of that, there's nothing immoral or "rent-seeking" here. They're providing a service and selling it honestly, with transparent and predictable prices. Lock-in exploitation happened with GCP at least once, that I know, with App Engine. And their service was doomed after that, as developers reacted against their practice and they weren't able to grow past a tiny fraction of the market.
  - pritambaral 5y ago
    > The problem I see with vendor lock-in is when, after you're locked, the service provider exploit this to change their terms (price and/or else) in a disproportionate and unjustifiable way against your initial interests in the service. > This never happened with AWS, to my knowledge (please correct if I'm wrong). Everyone knew the price when they subscribed. Little changed afterwards. AWS was able to meet a demand with quality enough products in an acceptable price to whoever decided to buy. Vendor lock-in does not require any changes to terms, price, or any part of the service or product provided. In most classically studied cases of vendor lock-in (e.g., Microsoft Windows and Office binary formats, VHS vs. Beta), everyone knew the lack of interoperability when they bought the service/good, and nothing changed afterwards. That didn't stop those cases from becoming "vendor lock-in".
    - rmbyrro 5y ago
      I totally agree that lock-in is there. What I'm disputing is that AWS has exploited it maliciously to screw their customers. More specifically, this statement: > AWS was fucking everyone on egress price and nobody could do anything about it I disagree because AWS has been transparent with their prices since day one. Everyone who subscribed was aware of how much it cost. AWS didn't screw anyone by increasing prices after they were locked-in.
      - pritambaral 5y ago
        Good, we're in agreement.
  - HWR_14 5y ago
    > This isn't rent seeking, it's called sales. It's rent seeking when you don't produce new value, you just leverage existing systems to extract value.
    - rmbyrro 5y ago
      Sure, we can certainly agree on that. But can we make it more tangible with an example? Would you argue that AWS, for instance, is a company that produces no new value? One might argue they add value, but their price is too high for the value they add. We'd go back to what I've said before: value perceived by a service is subjective and highly dependent on the context.
- 8note 5y ago
  "Leading to higher prices" is where the issue lies The prices didn't get higher, they just didn't get lower by as much as they could have. That really describes profit though. While I agree that all profit is rent seeking in some way and thus unfair, it's not very useful for splitting up some practices as bad rent seeking and others as less bad