[HN Gopher] Congress is going to throw the kitchen sink at big tech
___________________________________________________________________
Congress is going to throw the kitchen sink at big tech
Author : kantrowitz
Score : 158 points
Date : 2021-06-11 14:33 UTC (8 hours ago)
(HTM) web link (bigtechnology.substack.com)
(TXT) w3m dump (bigtechnology.substack.com)
| vonsydov wrote:
| 600 billion? Wtf is that number? It could be pegged to something.
| weezin wrote:
| Tech has been a huge deflationary pressure since the 90s. I
| believe that heavy regulation in this space can cause a scary
| amount of inflation given the monetary policy that was used to
| combat this deflation.
| justinclift wrote:
| Sounds like good news to me. :)
| motohagiography wrote:
| Reminds me of what Machiavelli said about coming to power using
| mercenaries and auxilieries the way the current crop of
| politicians have used tech today: "Captains of mercenaries are
| either able men or they are not. If they are, you cannot trust
| them, since they will always seek their own aggrandizement,
| either by overthrowing you who are their master, or by the
| overthrow of others contrary to your desire."
|
| What did these companies _think_ would happen if they became
| partisan mercenaries? Future reference: always back underdogs or
| nobody at all because when they win you still have some leverage.
| The platforms just made themselves disposable stepping stones and
| now they are being disposed of. I 'm untroubled by it because it
| was staggeringly naive on their part to compromise themselves,
| and we need fresh platforms anyway, but they really walked right
| into that one.
| tootahe45 wrote:
| > Congress is going to throw the kitchen sink at big tech
|
| Didn't America just elect a big-tech puppet govt or did i miss
| something.
| h2odragon wrote:
| Good reporting! Congress is made of people, the process of
| lawmaking is just group text editing, and they _answer their
| phones._ If you think any of these ideas are good ones and would
| make good law; call your Congresspipples and _tell them so_.
|
| Otherwise the only people they hear from are the sleazy lobbyists
| speaking paid words, and the silly beltway denizens who wouldn't
| know the real world if it shat on their desk.
| beastman82 wrote:
| Unless the real world shits on their desk with a large campaign
| contribution they still won't care.
| wizzwizz4 wrote:
| Funnily enough, _some_ politicians care about their jobs.
| hamilyon2 wrote:
| Can anyone please explain to me, what the covered platform means?
| Will duckduckgo become covered platform? Microsoft?
| TheBlight wrote:
| Counter-point: They've never hit them with any fine/punishment so
| they probably won't throw "the kitchen sink" at them now.
| ojbyrne wrote:
| And right below this story there's a link to how Amazon got
| provisions that would have affected them removed from a bill that
| actually passed the Senate[1].
|
| Discussing 5 separate bills sponsored by Democrats in the house
| like they might actually go anywhere seems ludicrous.
|
| 1.https://www.washingtonpost.com/technology/2021/06/09/amazon-...
| FridayoLeary wrote:
| They won't.
| mycologos wrote:
| I mean, maybe, but this comment is useless without some
| elaboration.
| fhrow4484 wrote:
| > Jeff Bezos, this one's for you. This provision aims at Amazon's
| practice of using data it collects from third-party merchants to
| enhance its own private label offerings. If it passes, the
| practice would be blatantly illegal.
|
| Would it equally apply to physical stores like Safeway, Kroger,
| Costco's private labels like "Private Selection", "Simple Truth",
| "Kirkland", ...
|
| What makes Amazon different in this regard? Is Amazon doing it
| differently? (Like go out on their own instead of partnering with
| the product company to produce "Amazon" branded version of
| theirs)
| schnable wrote:
| They don't operate a marketplace for third party merchants.
| lotsofpulp wrote:
| Walmart and Target do.
| 2OEH8eoCRo0 wrote:
| This tired take is in every single thread.
| billjings wrote:
| "What makes Amazon different in this regard? Is Amazon doing it
| differently?"
|
| Nothing, and they aren't. Except they're maybe the biggest.
|
| The intellectual foundation of this new movement isn't
| specifically anti big tech. It's anti all kinds of
| anticompetitive business practices, many of which have had huge
| negative effects outside of tech. Grocery stores are one of
| them, but one can point to any area of the economy and find
| businesses engaging in what is currently standard practice that
| the new movement is seeking to outlaw, or in many cases just
| restore the teeth to laws that have been ignored for years, or
| just so narrowly interpreted that they're meaningless.
| dantheman wrote:
| These aren't anti-competitive, they increase competition. The
| help the consumer get better prices.
| timmytokyo wrote:
| Until they push the competition out, and then there is no
| more downward pressure on prices.
| raverbashing wrote:
| Until they become the monopoly and are free to hike prices
| dantheman wrote:
| Unless the monopoly is granted/enforced by the government
| this has literally never happened.
| Supermancho wrote:
| >> Until they become the monopoly and are free to hike
| prices
|
| > Unless the monopoly is granted/enforced by the
| government this has literally never happened.
|
| It happens often enough. So often, you can find stories
| about it all over...if you looked.
|
| https://www.nytimes.com/2021/05/25/business/amazon-dc-
| lawsui...
|
| https://www.theverge.com/2020/9/11/21431962/public-
| citizen-a...
|
| https://www.wsj.com/articles/googles-secret-project-
| bernanke...
|
| etc. It's a matter of them getting caught and when,
| because nothing lasts forever, even for the tech robber
| barons.
| billjings wrote:
| Then you disagree with the folks advancing these policies!
| :) Their perspective is that Amazon, Kroger, Wal-Mart, and
| a whole host of other businesses (including things as
| seemingly boring as cheerleading supply companies) are
| engaging in anticompetitive practices that cause a variety
| of harms.
|
| Depending on which case you look at, they allege different
| harms. In some cases they allege harm to suppliers or to
| employees, but in others they make the case for anti-
| consumer harm.
|
| Hopefully folks won't continue to downvote me. Whether you
| agree with these folks or not (and I'm not trying to make
| their case for them here), that is what their position is.
| It is wise to understand them, even if we don't agree with
| them.
| virtue3 wrote:
| I see it the other way; What's the point of designing
| something that is affordable and usable by everyone if
| Amazon is just going to rip off the design and market
| theirs over me?
|
| Whats the point in making a budget ketchup brand if Safeway
| has their own? I can't compete with their margins there
| especially with that level of competition.
|
| I give a bit of a pass here to kirkland stuff cuz it never
| feels like a race to the bottom nor do I feel like costco
| just advertises the hell out of it over other goods.
| lotsofpulp wrote:
| Patents and trademarks exist to give designers the
| ability to reap profits from their creations. If you are
| not able to patent your design, then either the patent
| system is not working or whatever was designed or
| trademarked is not very valuable.
| Aissen wrote:
| The only difference is this:
|
| > 'covered platforms' (companies that have a half-million
| monthly U.S. users and more than $600 billion in market cap)
|
| There are only 8 companies in the world that match the market
| cap. Probably 6 if you add "users": Apple, Microsoft, Amazon,
| Google, Facebook, and probably Tencent.
| chomp wrote:
| Seems like they set a high market cap to carve out head room
| for Walmart.
| bogota wrote:
| Sounds like this would be easily defeated by spinning amazon
| out into different companies? Maybe that is a good end result
| though.
| ben_w wrote:
| Especially as Amazon is _already_ many companies, in many
| different jurisdictions, and covering different product and
| service categories:
| https://opencorporates.com/corporate_groupings/Amazon
| tedunangst wrote:
| Spinning off AWS, which is pretty independent, might be
| enough.
| ethbr0 wrote:
| I haven't looked at any formal studies of the net effects
| of the Bell breakup, but I'd be hard-pressed to say they
| were net negative.
|
| Especially with a relatively light "break-up, then allow to
| recombine as market evolution renders their previous
| monopoly moot" long-term approach.
| ab_testing wrote:
| 600B seems like a totally arbitrary made up number to target
| Amazon but leave out Walmart (which is close to 400B). Looks
| like Walmart lobbying dollars are bearing fruit.
| [deleted]
| pontus wrote:
| I've had the same thought about Google promoting its own
| products over competitor's in search results. Isn't that the
| same as Whole Foods putting a stack of their 365 brand cereals
| at the front of the store?
| paulpauper wrote:
| i don't see what the big deal is about google promoting its
| own products on the results page. All that means is one less
| slot for wikipedia/pinterest/amazon/ebay/nytimes or some
| other big site.
| crazygringo wrote:
| It's the monopoly aspect.
|
| Amazon is a quasi-monopoly for _sellers_ in the sense that many
| sellers can _only_ be profitable selling on Amazon, they have
| no choice.
|
| If Amazon has data on their entire customer base, clones their
| product and puts them out of business, you can view that as
| monopoly abuse of power.
|
| On the other hand, Ruffles sells their potato chips to hundreds
| if not thousands of national grocery store chains.
|
| If some stores sell their own potato chips as well, those are
| just blips. Stores don't have insight into Ruffles' sales
| nationwide across all chains.
| graeme wrote:
| There are basically three large grocery chains in the US,
| plus Target and Walmart.
|
| The e commerce market isn't so different. Amazon has a 40%
| share. Walmart is a big player, then Shopify et al enable
| lots of DTC companies.
|
| Amazon is only a monopoly if you redefine the relevant market
| to be "Amazon"
|
| https://en.m.wikipedia.org/wiki/List_of_supermarket_chains_i.
| ..
| bingidingi wrote:
| I believe Amazon is more like 50%+ now, and to compared to
| brick & mortar... Wal-Mart is considered huge and still
| only ~10% of the market.
|
| There are more than 3 grocery chains in your link, I think
| you may have overlooked the regional chains listed below.
| crazygringo wrote:
| But as you can see from the gigantic list on that page,
| _most_ grocery stores _don 't_ belong to those top 3.
|
| I live in NYC, for example, and I don't know a single
| grocery store here that belongs to a national chain or even
| a regional one -- they're _all_ local. (With the sole
| exception of Target, but that surely doesn 't make up even
| 1% of grocery sales here.)
|
| So the ecommerce market is entirely different. There's no
| grocery store equivalent of Amazon's 40% share. And people
| can easily visit different grocery stores, but Prime
| members tend to shop mostly exclusively on Amazon for the
| obvious reasons, so it's locked-in in a very unique way.
| rootusrootus wrote:
| > What makes Amazon different in this regard?
|
| Safeway/Kroger/Costco do not have direct third-party merchants,
| do they? They are just resellers. This is fundamentally
| different from what Amazon is doing.
| klodolph wrote:
| If you think that a supermarket buys products wholesale and
| then puts them on shelves for customers to buy, you don't
| understand how supermarkets work.
| rootusrootus wrote:
| > you don't understand how supermarkets work.
|
| Agreed ;-). That's why I hang out on HN, hoping to gain
| some insight and knowledge.
|
| The customer->FBA->merchant relationship is much clearer
| than in any supermarket I've been in. Maybe I'm really
| buying from a third party and the supermarket is just
| acting as the fulfillment center and payment processor, but
| it is well hidden. I'd love to know more about how the
| business end works.
| elliekelly wrote:
| Grocery stores are retailers in the traditional sense
| rather than a consignment shop or marketplace like
| Amazon. I think the person you're replying to is alluding
| to "slotting fees" for new products and perhaps the more
| controversial "pay to stay" fees which are far more
| secretive and, from my understanding, are more of a grey
| area. Technically I believe the "fee" is considered a
| type of advertising expense:
| https://home.kpmg/content/dam/kpmg/pdf/2015/04/revenue-
| leafl...
| wyldfire wrote:
| Those fees might be an interesting factor but who bears
| the inventory carrying cost is what I suspect GP means.
| For FBA, it's not Amazon. It wouldn't surprise me if big
| vendors like coke/Pepsi who stock the shelves also own
| the inventory.
| shkkmo wrote:
| I'd love to read a good article talking about how inventory
| acquisition and management works at divergent super market
| chains... I suspect a lot of the interesting details are
| considered trade secrets though.
| xyzzyz wrote:
| They all have their own store brands.
| rootusrootus wrote:
| Sure, but if they are the actual customers of their
| suppliers, it doesn't seem like what Amazon does. I don't
| walk into Kroger and buy Doritos from Frito-Lay with Kroger
| just doing the fulfillment and payment processing, do I?
| I'm actually buying product that Kroger owns.
|
| At least this is how I understand it. I am 100% open to
| being schooled in how it actually plays out. I'm just a
| software guy, but I like to learn.
| jsolson wrote:
| If you're curious, The Secret Life of Groceries is a good
| (and interesting) read.
|
| One tl; dr thing is that the supermarkets are a
| _supplier_ to both end customers and those with products
| to sell. They supply shelf space and customer reach, in
| the very literal sense that companies bid for things like
| endcap placement (the end of the aisle being better than
| being in the aisle, since everyone making an orbit
| through, say, the deli section will pass your goods).
| rootusrootus wrote:
| Thanks! That is an interesting aspect. I had not
| considered that it could be a two-way relationship,
| rather than the store just buying what they want to sell
| and putting it on the shelf.
|
| I guess it seems a little obvious in retrospect that
| there must be a bit of that going on, I've long noticed
| that some suppliers have a _lot_ of responsibility in the
| store beyond delivering product. Like the beer guy pretty
| much runs the entire beer aisle. And it 's one of the big
| names supplying _all_ the beer, not just their own.
|
| I've seen similar action in some stores by the soft drink
| vendors and even the bread vendor. Non-store employees on
| the floor putting stock directly on the shelf.
| newsclues wrote:
| Grocery retail is much more complicated.
|
| They may charge shelf space rent.
| akiselev wrote:
| They take on the vast majority of the inventory risk, which
| is the fundamental detail everyone seems to miss. They
| _own_ what they sell.
|
| The complications come from trying to manage that risk -
| manufacturers who have better products or marketing can
| afford to pay for prime shelf space which also means it'll
| move faster.
| minsc__and__boo wrote:
| This has been the model traditionally but retailers have
| been shifting to renting shelf/floor space to wholesalers
| and manufacturers. You may see certain fully-branded end
| caps in grocery stores, or kiosks in Best Buy, for
| example.
|
| It's still not the same as signing up to creating your
| own store on Amazon though.
| dave5104 wrote:
| I don't believe this is true in all cases. Maybe for some
| products, but at least other commenters here are
| confirming that some manufacturers refund the grocer for
| any unsold product. (So, Safeway only pays for the
| inventory that gets sold.) Seems risk-free for grocers on
| the products they have those sorts of deals with.
| akiselev wrote:
| Yep they do that too but it's not risk free for physical
| stores because they take up shelf space. Anything that
| isn't moving off storefront shelves isn't making them
| _any_ revenue - unlike Amazon they can 't present every
| product through a paginated digital catalog while
| charging for warehouse storage.
| dantheman wrote:
| You don't think page space matters? How many people go
| page 30 of results?
| akiselev wrote:
| Page space doesn't matter, at all. Anyone can produce
| more Amazon searches in 5 minutes than there are shelves
| in a retail store. Amazon makes money no matter which
| page you buy it from _AND_ they charge all the merchants
| on page 30 for storing their goods in the Amazon
| warehouses _on top of_ any commission. That 's the exact
| opposite of inventory risk, that's an inventory gold
| mine. Retail stores can only sell stuff that is physical
| within arms reach of a customer.
|
| We're talking about retail vs Amazon, not retail vs
| Alibaba reseller #39146527.
| rdtwo wrote:
| And also at the end of the day they take on liability for
| the products they sell. If amazon was liable for its 3rd
| party garage it wouldn't be a problem
| legitster wrote:
| I worked for Frito Lay as a salesperson and yes perhaps only
| 20% - 40% of grocery store inventory is maintained by the
| store staff. The rest was space that we were allocated to
| sell our stuff.
|
| Stores would pay for the inventory, but we would rebate them
| for what would not sell as an incentive to make sure we put
| out products that actually sold.
|
| But I would literally come in every day to the larger stores
| and put product on the shelf and argue with the manager about
| inventory and clean up our area.
|
| None of the stores I worked at explicitly sold shelf space (I
| think), but our corporate worked with their corporate to
| determine how much space in each store would maximize their
| revenue. I am sure newcomers would have to do extra to
| guarantee they would make enough money for the stores to take
| risks on them.
|
| Needless to say, they had _all_ of our sales data when it
| came to developing store brands.
| legitster wrote:
| Also, continuing on, grocery stores are a very apt
| comparison. Foot traffic and purchase behaviors are very
| heavily tracked.
|
| Firstly in an analogue ways - managers are always watching
| were customers are going/ what they are looking at/etc. The
| security team at a one co-op bragged that their cameras
| could read the time on your watch.
|
| Secondly, there are all sorts of new tools stores are
| trying out to automate this. Software that analyzes footage
| to generate heatmaps. Or using the in-store wifi access
| points to generate heatmaps (even if you don't connect,
| your phone will give away your position when looking for
| networks). This is especially important in mall settings
| where they need to calculate foot traffic estimates as a
| way of pricing storefronts.
| legitster wrote:
| If you want to learn more about some of the platforms out
| there:
|
| https://www.getblix.com/retail-foot-traffic
|
| https://www.aislelabs.com/products/flow/
|
| https://documentation.meraki.com/MR/Monitoring_and_Report
| ing...
| threatofrain wrote:
| One thing I've always wondered is whether there's any
| interest in using in-store cameras for tracking the
| information people show on their phones, such as
| location, health, financial data, or even passwords.
|
| Esp. since COVID I imagine a lot of people inputting
| their passwords in front of a camera at the register.
| gumby wrote:
| This is how Frys Electronics ran too, which is not that
| surprising as it grew out of the Fry's grocery stores.
| nitwit005 wrote:
| Some of the stock is essentially fully managed by third
| parties. If you see a bunch of Coke products in a store,
| there is likely to be a "Merchandiser" that visits and
| restocks it. It's a strategy by brands to get their product
| into more stores.
| dannyr wrote:
| It's the scale!
|
| A lot of things that Big Tech is doing is usually fine if
| you're a company with a small market share.
| tedunangst wrote:
| Good thing there's an exception for mom and pop stores like
| Walmart.
| mattnewton wrote:
| Reminds me of the Florida laws that explicitly carve out
| exceptions for businesses that run theme parks (cough cough
| Disney)
|
| https://www.businessinsider.com/florida-censorship-law-looph...
| mod wrote:
| In Arkansas, specific laws were in place to disallow gambling
| at any establishment besides Oaklawn (a horse racing track),
| and Southland (dog track).
|
| A couple of years ago they allowed for four casino licenses
| in the state, so there's a couple more options.
| nostrademons wrote:
| It makes me wonder why Google or Facebook hasn't bought Great
| America yet.
| jbverschoor wrote:
| Not for bezos anymore
| Jaygles wrote:
| Another difference between Amazon and physical stores is that
| Amazon has pagination. If a product ends up on the second or
| third page, it will likely not be seen by the vast majority of
| customers.
|
| With physical stores, your options are always all right in
| front of you.
| root_axis wrote:
| Stores are constrained by the limits of physical space, it's
| exactly the same thing as an Amazon "first page" except at
| least with Amazon you have the option to visit the second
| page. In a physical store anything that would have been
| relegated to the second page is simply unavailable.
| officialjunk wrote:
| there is an analogous experience at physical stores, though.
| the proximity of items to entryways, cashiers, etc matters
| for sales. also, which height shelf a product is put on also
| matters. some at eye level, for example, and others at
| children's eye level, make certain products more prominent.
| if you are trying to place a product at a store, how much it
| would cost you depends greatly on where in the store it is
| placed.
| Jaygles wrote:
| Sure, but I would argue that that is more of an analogy to
| the first page of products only. Things that are beyond the
| third or fourth page may as well be in the back of the
| store, and not on the shelves.
| lotsofpulp wrote:
| Things that are on the third or fourth page would not be
| in the store period as it would be too costly to carry
| all that inventory in a retail environment.
|
| The analogy is useless. Consumers are lucky that the
| internet even gives them a 3rd or 4th page.
| TheCapn wrote:
| The closest example I've seen used before is the notion that
| you get to the shelves and go to grab a case of Coca-Cola,
| but as you reach to grab it a voice beams at you from your
| side saying "Wouldn't you prefer <our brand> instead? Its $1
| cheaper!"
|
| Now, which kind of works as an analog to these companies
| prioritizing their products on the search algorithm, but I
| don't really think applies to the practice of gathering such
| data.
| noboostforyou wrote:
| Physical placement within a store makes a difference* and
| it's something that stores will manipulate to negotiate deals
| with sellers.
|
| * https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2741065/
| nerfhammer wrote:
| for physical stores sellers fight over having products placed
| on eye-level shelves vs. not
| 8note wrote:
| Or at the front of the store, vs a back corner
| zer00eyz wrote:
| Your point is valid and correct.
|
| Most of you remember Twinkies, its parent company going
| bankrupt and them being gone... Those products were delivered
| to stores, fresh every day(ish) by manufacturer employees and
| put ON THE SHELF by them... This still remains true for tons of
| products.
|
| For some products grocery stores function like a merchant on
| amazon.
|
| Data tracking... well that really matters to a grocery store,
| because people have "brand loyalty" and tend not to return
| (ever again) if their "item" is out of stock. These anchor
| items are often loss leaders (detergent is the massive
| example).
|
| Amazon isn't any different than anyone else, and isn't even the
| biggest one (Walmart still has that crown).
|
| Oddly I could make an argument that amazon, being allowed to be
| dominant and pushing large retail out of business would be good
| for everyone... a return of small retailers might happen on the
| back of that.
| frumper wrote:
| Amazon claims it doesn't have liability if those Twinkie's
| cause harm like the grocery store would.
| zer00eyz wrote:
| The sale of contaminated beef has happened many many times
| in my lifetime, leading to massive recalls, even lettuce
| has seen contamination and outbreaks. The liability has not
| been on the store, rather the supplier/manufacturer of
| those products.
|
| The local ford dealer wast at fault for your pinto
| exploding of the tires blowing off your SUV.
|
| You didn't get to sue the store that sold you cigarets or
| round up that gave you cancer...
| jdeibele wrote:
| Welcome to the concept of "joint and several liability".
| Say you were in a phone booth and a car jumped the curb
| and ran you over but didn't manage to kill you.
|
| Your attorney would sue the motorist but maybe they don't
| have insurance. Maybe they borrowed the car - the owner
| would get sued. The city would get sued because the curb
| was too low. The gas station would get sued because there
| weren't protective barriers around the phone booth. The
| phone company would get sued because the phone booth was
| too close to traffic. The maker of the phone booth would
| get sued because it wasn't made properly. And probably
| other things that I can't think of.
|
| Fortunately for gas stations there basically aren't phone
| booths anymore. But be careful loaning your car or gun to
| somebody else.
|
| https://www.investopedia.com/terms/j/joint-and-several-
| liabi...
| rdtwo wrote:
| Yeah but if the manufacturer went kaput or the store was
| negligent in sourcing beef you could sue. Both of these
| are a problem with amazon. If target sold Chinese cribs
| that killed kids for example you can bet folks would sue
| target and not the manufacturer
| zer00eyz wrote:
| The idea of negligent sourcing is interesting... you
| would have to prove that they knowingly bought and sold a
| bad product.
|
| The idea of "blame the retailer" is, to a degree,
| protectionist. Your solving the problem of "can't sue the
| chinese manufacturer" by blaming the retailer. The
| reality of the world we live in has changed so
| drastically since those laws were made that we should
| probably revisit those.
|
| Blaming retailers only serves to have fewer, larger
| retailers, not choice (and competition). This entire line
| of thinking presents a massive potential to lead to less
| choice, in retailers and products, leading to LESS
| competition.
| spullara wrote:
| No, they wouldn't. Target had nothing to do with it.
| frumper wrote:
| It's odd to say that the only company you had a direct
| business relationship with had nothing to do with it.
| Product liability does apply to the seller of that
| product, in addition to the manufacturer and distributor.
| That doesn't mean retailers won't fight it, or that it is
| easy to prove. It's just how the laws are in the US.
| 8note wrote:
| If I drink a coca-cola and it turns out it had rat poison
| in it, I'd likely blame coke, and not the grocery store,
| even though I have no direct business relationship with
| coke.
| felipellrocha wrote:
| I mean, those are still awful. This would be a two birds with
| one stone kind of situation.
| Paedor wrote:
| There's a great episode by planet money on the difference
| between Amazon and physical stores, the transcript is here:
| https://www.npr.org/transcripts/697060225.
|
| They mention two key differences. The first is just that Amazon
| is arguably more dominant than any physical distributor, and
| has more power over offerings.
|
| The second is that if you make a new product for a retailer,
| the retailer usually has to invest in you to some extent, by
| giving you physical space and buying your product for resale.
| So, there's some shared risk and for developing new products.
| Amazon, on the other hand, doesn't need to give you anything to
| see how a new product will play out, so it might have too much
| of a position of power.
| Hongwei wrote:
| I buy the first, not the second. Retailers often charge
| consumer packaged goods companies (CPGs) for preferential
| placement _in aisle_ and carry no risk on inventory. The
| bigger the retailer (eg. bestbuy, walmart), the more likely
| they can assume no risk on inventory with a full return
| policy to the CPG. Best Buy just rents out space on their
| store floor to individual brands.
| [deleted]
| Cerium wrote:
| Trader Joe's is the closest to Amazon in this regard. They
| introduce new products as the name brand, the best sellers are
| cloned and then replaced with the store brands.
| dec0dedab0de wrote:
| Aldi is similar, which is kind of interesting because Trader
| Joes is one of the Aldis. I always wonder how they get away
| with blatant trademark infringement. They come up with
| similar product design for the purpose of confusing
| consumers. I assume they have deals with most of the name
| brand products, or their parent companies.
| arrosenberg wrote:
| I don't know about Trader Joe's specifically, but a lot of
| "Store Brands" are made in the same place as the name
| brand. It's just a giant game of price discrimination.
| rurp wrote:
| This is very true. I worked at Traders many years ago and
| at least back then the store brands were often made by
| the same name brand company.
| dreamcompiler wrote:
| From what I've read, TJ's doesn't infringe. They simply pay
| the original manufacturer to make a run of the product with
| TJ's label on it.
| mindslight wrote:
| Part of the agreement seems to be that the manufacturer
| goes out of their way to make a worse version for TJ's.
| Honestly they should be taken to task for flooding the
| market with fake competition, but that applies to the
| majority of brands in these days of megaconsolidation.
| mindslight wrote:
| But Trader Joe's doesn't sell anything that is name brand?
| The whole store is store brand.
| dhosek wrote:
| There are a handful of non TJs brand items. Not many, but
| some.
| mullingitover wrote:
| They absolutely sell other brands, my local TJs has a huge
| stack of White Claw in the beer aisle.
| jandrese wrote:
| They stock plenty of third party Wine in my area, although
| the beer is all Trader Joe labeled. There are a handful of
| other things that aren't Trader Joe store brand or
| completely generic (yet?).
|
| Not that it would matter here, the law in question sets the
| market cap miles above where Trader Joe's is.
| N1H1L wrote:
| Costco does too - Kirkland is their own brand.
|
| Same with Kroger's - Private Reserve
| what_ever wrote:
| I think Kirkland is just Costco making a bulk deal with one
| of the manufacturers and slapping Kirkland brand on it.
| dhosek wrote:
| Same with Trader Joe's store brands, or at least that was
| the case in the past as I recall reading in _The Fearless
| Flyer_.
| TchoBeer wrote:
| I think Trader Joes does that too?
| lotsofpulp wrote:
| It's the same with the other retailers. They do not own
| their own factories.
| N1H1L wrote:
| But Amazon Basics doesn't own the factories too - at
| least not yet.
|
| Same with Trader Joe's
| jjcm wrote:
| Safeway, Kroger, and Costco's market caps are all under the
| 600b limit. Even Walmart is under this.
|
| What makes Amazon different is Amazon controls 38% of all
| online retail sales in the United States[1]. No company comes
| close to their dominance in the market.
|
| [1]
| https://www.bloomberg.com/news/articles/2019-06-13/emarketer...
| missedthecue wrote:
| And because they trade at a frothy multiple.
| 8note wrote:
| How much big box retail sales does Walmart control?
| nerdponx wrote:
| Somewhat OT, but I love how this "kitchen sink" idiom has become
| so warped over the last several years.
|
| As far as I know (native AmE), the original expression was
| "everything but the kitchen sink", which evokes the idea of
| taking everything in the kitchen and using it all in a recipe,
| only stopping short of dismantling the kitchen itself.
|
| Whether through mishearing or laziness, the "everything but the"
| part has been dropped. I only noticed it in the last few years,
| but maybe it's been happening for a lot longer than that. So it's
| now totally the opposite: the _only_ thing in the expression is
| the kitchen sink, i guess suggesting that there 's a bunch of
| junk in the sink?
|
| But this title is even better. We have abandoned all pretense of
| caring about the meaning of the expression. In 2021, Chuck
| Schumer is going to call Mark Zuckerberg in to testify, and he is
| going to physically hurl a big metal sink at him.
|
| I know that language evolves and stuff, but it's pretty funny to
| see such a silly corruption of an already-kind-of-silly idiom in
| a "serious" title.
| 8note wrote:
| I think dr Seuss added "even the kitchen sink" at some point.
| crazygringo wrote:
| I think you're confusing it a bit...
|
| One expression still _is_ "everything but the kitchen sink",
| which means all reasonable effort.
|
| But that means the kitchen sink is now the metaphorical "last
| thing", i.e. the _full_ extent of our effort, the theoretical
| maximum.
|
| So to "throw the kitchen sink" at something is to put in _all_
| your effort, literally everything you 've got. (And there's no
| need for junk in the sink...)
|
| It's a different expression with a different meaning but
| derived from the first.
|
| And of course metaphors are very often silly... that's why we
| love using and abusing them! :)
| nerdponx wrote:
| I've never heard that one before, but it would be pretty
| clever. I think most people just use it wrong.
| crazygringo wrote:
| What do you mean using it wrong? The article is using it in
| exactly the way I described. "Throw the kitchen sink at
| something" is a widely used, valid expression these days.
| People are using it to mean expending every effort, so
| people seem to be using it _right_.
|
| And the wonderful thing about language is that however most
| people are using it is by definition what it means:
|
| https://en.wikipedia.org/wiki/Linguistic_description
| bigwavedave wrote:
| Funnily enough, in the TV show "Prison Break", the main
| character's brother's prison nickname is "Kitchen Sink" or
| "Sink". We're told that he got this nickname because if you get
| in a fight with him, he will come at you with everything but
| the kitchen sink!
| mtVessel wrote:
| I agree. One does not "throw the kitchen sink". I think the
| author is conflating it with the "throw the book" idiom.
| [deleted]
| qwerty456127 wrote:
| What if the FAANG companies were paying taxes like ordinary
| businesses do, wouldn't this be enough to fund free medical
| services for every US resident?
| creato wrote:
| It's not even remotely close. FAANG total revenue is $275
| billion [1].
|
| National health expenditures are _$3.8 trillion_ [2].
|
| You'd have to tax FAANG on _revenue_ at a rate of over 1000%
| for this to be true.
|
| 1.
| https://corporatefinanceinstitute.com/resources/knowledge/tr...
|
| 2. https://www.cms.gov/Research-Statistics-Data-and-
| Systems/Sta...
| grumple wrote:
| Your first source does not cite revenue. For reference, just
| Amazon's total revenue for 2020 was 386 billion [1]. Apple's
| was 274 billion [2]. I think your point still stands. FAANG
| alone obviously won't get us there, but taxing corporations
| generally would help (since other nations are able to afford
| state funded healthcare on a level of taxation only slightly
| higher than the US, despite having less income).
|
| 1. https://ir.aboutamazon.com/news-release/news-release-
| details...
|
| 2. https://www.apple.com/newsroom/pdfs/FY20_Q4_Consolidated_F
| in...
| legitster wrote:
| Most businesses don't pay corporate income tax. Income is
| passed through to the owners/partners and it shows up on their
| person income. C-Corps (where corporate income is separate and
| taxable) account for only 5% of businesses in the US.
|
| Also, the Medicare for All proposal (which seems to have gotten
| the furthest) would require ~ $4-5 trillion dollars a year.
| Completely taking Amazon for all it's worth would fund it for
| 1/3 of a year.
| [deleted]
| [deleted]
| xallarap wrote:
| Throw the toilet at big gay AL while you're at it! Or the hotel
| industry. Since trump has a hotel it must be dirtier than a
| bloody 69.
|
| Also, friends sucks.
|
| In other words, we need to cancel the cancel culture movement.
| taylodl wrote:
| This is going to be interesting to watch as these companies are
| HUGE political campaign donors...
| throwaway0a5e wrote:
| They pissed off the left by being sociopathic big businesses that
| treated people poorly. They pissed off the right by exerting
| perceived control over public discourse. They've pissed off
| government in general by swinging around their power when called
| out on these things.
|
| It wasn't a question of if the feds would screw them it was a
| question of when.
| fallingknife wrote:
| That's not really why they pissed off the left though. What
| other industry treats its workers better than tech?
|
| They pissed off the left by moving in on their turf. Big tech
| is a direct threat to universities, journalism, media, and
| entertainment industries. It's not a threat, and even a benefit
| to transportation, oil/gas/mining, and agriculture, which are
| more republican industries.
| lovich wrote:
| >What other industry treats its workers better than tech?
|
| There's a bit of a disconnect between what a FAANG company
| considers an employee and what the colloquial definition of
| employees are at a company.
|
| The large corporations have shed every worker they can that's
| unrelated to their core business, such as by contracting out
| security or cleaning. Then the large corporations say they
| treat their employees better and point at the ones remaining
| who get all the nice perks. The average person however, sees
| someone who goes to work every day at the same corporate
| campus and views them as employees who are _not_ treated well
| fallingknife wrote:
| Yes, but that happens in every industry, and this is about
| why the left hates tech in particular.
| unionpivo wrote:
| Because tech is very good at it.,
|
| There is a reason why a lot of people consider uber and
| other similar business tech, even though their core
| business is not tech.
| jeffbee wrote:
| It's really weird that you attribute this to "FAANG" for
| some reason when contracting out your cooking, cleaning,
| and security is almost universal among modern American
| companies. It's especially weird when you consider that
| physical security at Google is actually inside, not
| contracted out. So FAANG may be different but in the
| opposite way that you meant.
| ffggvv wrote:
| i think what pissed them off is trump winning in 2016. Which
| they then blamed on facebook and "disinformation".. (instead
| of hillary being the worst candidate in history) and the left
| decided they needed to take control of these companies so
| that doesnt happen again.
| cletus wrote:
| Given the current state of the Senate, it seems unlikely there is
| going to be any big legislative changes before 2024. 2022 is
| still eons away (in political timescales) but a fairly likely
| scenario seems to be that the GOP will narrowly gain the House
| and the Democrats will pick up 1 seat in the Senate.
|
| So we're largely arguing academic situations. And the thing about
| that is you then have a lot of people who are virtue signaling
| rather than genuinely arguing a position because they know their
| rhetorics, even their votes, won't change anything. It's why
| opposition parties always vote for campaign finance reform.
|
| So I'm highly skeptical of the need for any government action
| here, be it sweeping legislation or antitrust. There are several
| reasons for this:
|
| 1. Big tech companies are more fragile than you might think.
| Government action is slow. As we've seen from Myspace, Yahoo and
| the like, big companies can disappear almost overnight. If a
| company can face an existential threat and possibly disappear
| within a few years then, by definition, it's not the monopoly you
| think it is. It's certainly not Standard Oil.
|
| 2. Western companies have been largely excluded from Chinese
| markets while those companies have far less restrictions
| elsewhere;
|
| 3. Chinese companies are essentially an extension of the state.
| US companies are not, not to the same degree anyway.
|
| What we actually need is company-agnostic action that protects
| consumers, their data and what you can do that with that data.
| This is sort of happening already thanks to the EU (eg GDPR). The
| US needs to start extending those protections to US consumers.
| And that needs to apply to both domestic and foreign companies.
| crazygringo wrote:
| I can see some app store regulation coming (which will have
| minimal impact on big tech's profits), but there just isn't
| enough political support for breaking up America's success-story
| companies. It's not gonna happen.
|
| But part of me wonders, if it _did_ -- might the broken-up
| companies turn out to be more valuable in aggregate than the
| original ones? Remember, when the gov 't split up AT&T that's
| exactly what happened.
| didibus wrote:
| > This is very clearly aimed at advertising on Amazon,
| potentially Google as well, where merchants often must pay to
| gain visibility in the search results
|
| I'm a little confused here. Are they saying that this would
| prevent a business to pay to be listed at the top as an ad for
| some specific searches in those results?
| psychlops wrote:
| What exactly do these new bills do that the Sherman and Clayton
| antitrust laws don't do already?
| tedunangst wrote:
| Specifically target only companies with $600 billion market
| caps.
| fidesomnes wrote:
| Leftism in a nutshell: biting the hand that feeds.
| throwawaysea wrote:
| Also see WSJ article on Amazon potentially needing to shed
| assets: https://news.ycombinator.com/item?id=27474448
| tschellenbach wrote:
| I spoke to a commission of congressman about this topic. (they
| wanted to talk to small startups). It seems really difficult to
| effectively regulate this.
|
| - acquisitions are part of what make the startup ecosystem work.
| It's not at all clear which acquisitions you should block - the
| bundling approach that google uses makes things like android free
| - you dont want apps on iOS and android running their own payment
| infrastructure since some will abuse it
|
| There definitely needs to be regulation, but its not at all easy
| to see what shape it should take.
| shkkmo wrote:
| You don't think that the huge start up acquisitions market has
| a negative distorting effect on tech entrepreneurship and
| innovation? I feel like it prioritizes growth at any cost and
| deprioritizes the disruption of the established tech players.
| SllX wrote:
| > There definitely needs to be regulation, but its not at all
| easy to see what shape it should take.
|
| How do you draw the conclusion that there _definitely_ needs to
| be regulation if you have no idea what you would be regulating?
|
| Everything about this pan-societal debate has been
| disappointing because it boils down to: "how do we draw up
| Bills of Attainder without calling them that and without
| completely wiping out the free flow of money and capital in the
| Valley?"
| bogwog wrote:
| > acquisitions are part of what make the startup ecosystem
| work.
|
| That's such BS. A startup whose only business plan is to get
| acquired doesn't deserve to succeed in a competitive market. If
| that route becomes nonviable and a bunch of silicon valley
| startups go under, then good riddance.
|
| The US economy needs startups with sustainable business
| practices and highly competitive products and services. Not
| acquihire schemes.
| Jcowell wrote:
| My question is why not ? If it's something thriving in the
| competitive market why should it not be allowed to succeed ?
| flapjaxy wrote:
| It still baffles me how these laws have such broad support but
| ISPs and telcos are no where in the discussion.
| foobarian wrote:
| See above re: lobbying
| optimiz3 wrote:
| Perfect is the enemy of the good.
| smolder wrote:
| The USG has a codependent relationship with its telcos and
| ISPs, just like it does with big tech. You can point to these
| bills as evidence that the USG intends to control tech giants,
| but remember how long people have been complaining about some
| of the issues these bills address, and that they still need to
| be voted on. Also remember that all these companies sell
| services to the USG.
| zero_deg_kevin wrote:
| If past efforts are any indication, whatever regulatory scheme
| they come up with will cost these companies a good deal of time
| and money without doing anything to effectively solve the
| problem.
| paulpauper wrote:
| >The bills may change before they're introduced, and they'll
| inevitably go through a political process that will water them
| down. But even if only a portion of what's written gets passed,
| the tech giants will lose several advantages they've exploited in
| recent years.
|
| Yeah that is the rub.
|
| It's like in 1998 "we're gonna break up Microsoft!"
|
| 2002: "ok Microsoft will agree to make some some changes to their
| business but otherwise whatever"
|
| Big tech is going to get bigger. Congress does not want to risk
| destabilizing the economy and and losing reelection as a result
| by being too hard on tech. These companies employ a lot of people
| and generate a lot of econ value even if there are a lot of
| reasons to complain about their business practices.
| throwaway0a5e wrote:
| The federal government will destabilize the economy the
| nanosecond it sees big tech as a bigger threat to its power
| than economic instability.
|
| The question is can tech boil the frog so they never notice.
| minsc__and__boo wrote:
| >The federal government will destabilize the economy the
| nanosecond it sees big tech as a bigger threat to its power
| than economic instability.
|
| Given that tech companies obey court orders, subpoenas, and
| the letter of the law, I don't think that slippery slope is
| currently a problem.
| summerlight wrote:
| I think this can be easily defeated by breaking companies into a
| cartel of smaller companies which effectively operate as is. This
| $600B cap should go down significantly to prevent this, something
| like $50B but I don't expect that to happen thanks to Walmart,
| Verizon and Comcast.
| sbacic wrote:
| I remember reading once that tech companies, on average, lobby
| less that traditional industries, such as fossil fuels and
| finance.
|
| I wonder if the lesson they will take from this is that, rather
| than reform, they should invest more in lobbying. Considering how
| much money and influence on the public opinion they have, that's
| a rather scary thought.
| WalterBright wrote:
| I read that Microsoft never did any lobbying before the anti-
| trust suit. Once you're big enough to be a target, you have to
| spend money on lobbying, and contribute to campaigns.
| EarthLaunch wrote:
| A graph shared on Slashdot at the time made a big impression
| on me. It shows that until the antitrust pressure started
| ramping up [1], Microsoft didn't lobby (as I recall).
|
| The graph showed a huge spike in lobbying money after
| antitrust. Of course, this makes perfect sense in terms of
| incentives on both sides. Perhaps this [2] was the graph.
|
| [1] https://en.wikipedia.org/wiki/United_States_v._Microsoft_
| Cor...
|
| [2] https://www.washingtonpost.com/wp-
| srv/business/images/micro1...
| Growling_owl wrote:
| > Once you're big enough to be a target, you have to spend
| money on lobbying, and contribute to campaigns.
|
| Absolutely not. You do the opposite of that. You go at layer
| zero. At the population level and enter the culture wars
| arena with the goal of winning.
|
| Some of these companies are structured in a way that the
| founders are poised to retain control of their companies till
| they retire (Google, Amazon, Facebook, Berkshire).
|
| If you are Zuck or Brin or Dorsey and you want to do this
| until you are 95 like Buffett then you are better off barking
| and biting back, acquire a reputation of a fighter so that
| people like Sanders and Warren would leave you alone. There
| will be consequences such as employees criticizing and
| leaving but in the long term you are better off fighting.
|
| When a politician comes after you and your company, you just
| attack back, if you are not prepared to do this you should
| simply not start a proper company and opt for a carrer in a
| hedge fund instead, where you can make money in the dark.
|
| Founders and CEOs should not be the first offender but when
| they are called out they should absolutely attack back.
|
| Sanders is pouring manure all over corporate America since
| 2015 and all he had to endure was Michael Bloomberg attacking
| him back for half a debate, and wouldn't have happened if
| Bloomberg didn't decide to run.
|
| If a guy like Bezos or Zuck were to tweet back at Sanders
| something to the tune "I've started a company in a garage and
| now it has the same credit rating of the US Government, what
| have you done with your life?"
|
| That would be fair game, politicians prey on weakness, they
| smell it and keep biting till you lay there unconscious
| joejerryronnie wrote:
| You've also got to read the room. The mood in the US is not
| in favor of hard charging mavericks of industry. This
| approach today would likely backfire spectacularly.
|
| Big Tech should be locating large employment centers in
| strategic locations around the country. And by strategic I
| don't mean where the talent, resources, or customers are
| located but rather where influential Congresspeople,
| Senators, and Governors are located. Then wield your soft
| power with these folks, e.g. "You can break us up but it's
| just going to cost your district/state massive job losses".
|
| Next, meet with other agitating politicians to find out
| their underlying motivations and help them to achieve those
| things - doesn't even need to be real, just help make them
| look good for their next re-election campaign. So Bezos
| should work out a public deal with Bernie and AOC to raise
| Amazon's minimum wage to $20 an hour. Bernie and AOC will
| look like progressive heroes but would be effectively
| defanged in continuing to attack Amazon (to a large
| degree).
| Growling_owl wrote:
| This strategy would have worked before MMT took over, now
| politicians don't need to bring about jobs, they can just
| print money and pass deficits of epic proportions and
| substitute the private sector with the state.
|
| Especially Democrats they have no regards for fiscal
| responsibility , they'd have no qualms in breaking up
| Amazon, knowing full well that the next step would be to
| install a dependency scheme in the form of UBI financed
| via fiscal deficits.
| klaudius wrote:
| Big Tech should be locating large employment centers in
| strategic locations around the country. And by strategic
| I don't mean where the talent, resources, or customers
| are located but rather where influential Congresspeople,
| Senators, and Governors are located.
|
| I thought this was one of the problems of a Soviet style
| command economy. They would locate production not where
| it was more efficient and made economic sense, but where
| it was politically more beneficial.
|
| If these companies start doing this they could lose to
| more efficient competition. Hope they aren't that stupid.
| 8note wrote:
| *Less efficient competition if they can't get the
| government to vote their way
| ojbyrne wrote:
| At least 1 company has beaten you to that idea:
| https://en.wikipedia.org/wiki/Amazon_HQ2
| skak wrote:
| > _Sanders is pouring manure all over corporate America
| since 2015_
|
| Can you please expand on this? What exactly are you trying
| to say here?
| legitster wrote:
| More critically, "tech" is concentrated into a small set of
| voting districts. Whereas traditional industries are spread
| throughout the country.
|
| Amazon's warehouse network is their most valuable political
| commodity. They are often the highest paying entry level jobs
| wherever they are put, represent a huge local bump in payroll
| and property taxes, and they are being placed in voting
| districts all around the country.
| throwaway0a5e wrote:
| The amount of lobbying you need is going to depend a lot on
| what your industry is.
|
| If you're building mines or manufacturing plants that take
| years to build and then another year to get running right and
| then another five to be profitable and your margins are thin
| you have a much larger interest in ensuring regulations don't
| change or at least not fast because a few percent change in
| profit could mean you never recoup your investment over the
| lifetime of the facility.
|
| It can still take years to build stuff but rarely is it 3+yr
| and tech margins are fatter and once you have something your
| can scale up and down much more rapidly.
|
| I think the "natural" amount of lobbying is going to be lower
| in tech than for industries that do physical things because
| tech has some things that make working with regulatory
| uncertainty less terrible.
| paulpauper wrote:
| It is probably because they are so big and successful and
| impervious to macro factors that they don't need to .
| throwaway1777 wrote:
| I'm pretty sure that's not the case anymore. FAANG definitely
| lobbies now.
| ethbr0 wrote:
| I've come around and landed more on the opinion that we're now
| enabling our jailors.
|
| Light tech regulation was exactly the correct approach in the
| 1990s (and arguably the 2000s). It enabled mind-boggling rapid
| and stunning innovation.
|
| ... However, the massive corporate fortunes built by the winners
| of those times are now primarily enabling rent seeking.
|
| Google and Facebook's other work is interesting in the same way
| that Bell Labs was interesting -- great for a few, but funded by
| taxing everyone (albeit via tracking and ad market control in
| this instance).
|
| And they've learned from their predecessors' demises that part of
| their winnings need to be continually re-invested in buying
| startups that might threaten their dominance.
|
| IMHO, everyone will be better off if Facebook, Google, and Amazon
| are shattered into small enough independent pieces that (1) "get
| bought" is no longer the startup win condition & (2) they have
| peer level competitors in _all_ markets in which they
| participate.
|
| Apple and Microsoft? Mandate open app stores and devices, if an
| owning user so chooses.
|
| Thinking back to the 90s... if anyone has _guaranteed_ revenue
| streams out 10 and 20 years these days, the market as a whole isn
| 't competitive enough. That _should_ be enough time for the
| entire playing field to upend itself.
|
| At least, it used to be.
| andreilys wrote:
| _IMHO, everyone will be better off if Facebook, Google, and
| Amazon are shattered into small enough independent pieces that
| (1) "get bought" is no longer the startup win condition & (2)
| they have peer level competitors in all markets in which they
| participate._
|
| I'm sure Chinese Tech co's would absolutely love to have their
| Western competition knee-capped by their own governments. Will
| make it a lot easier for them to dominate the globe for decades
| to come.
| InvertedRhodium wrote:
| Their services will just be banned and access made difficult
| enough to dissuade the average person. By that point I'm sure
| China will have perfected the technology enough that we can
| just copy them.
| not_exactly__ wrote:
| I think it's a somewhat false dichotomy that splitting up US
| big tech makes China big tech win. The reason being that
| splitting up US big tech allow for more competitive US mid
| tech to arise that can outcompete China big tech in areas
| where it matters. I suppose you also want to prevent China
| Big Tech to throw its money around at Mid Tech the way US big
| tech did in the last 10-15 years.
| ethbr0 wrote:
| It's a valid point. Less so specifically to China, and more
| so generally to all countries with national champions (e.g.
| South Korea).
|
| In some sense, it's a zero sum game, where if you don't scale
| or allow companies to scale, they find the next most
| favorable port. Or their companies succeed because of the
| additional support provided.
|
| But subsidies and government support have always been the
| biggest fracas in international economic politics for
| centuries for the same reason.
|
| To which I'd reiterate not_exactly__'s point: although
| business-harmful actions look like shooting yourself in the
| foot, hampering competition and supporting companies for
| extraneous reasons ultimately makes your economy and your
| companies less competitive globally.
| skak wrote:
| How do you (and most other people, especially Americans) not
| realize how unrealistic this is? It's such a common refrain to
| say "break `em up!" but it seems as if nobody stops to question
| why it never happens despite it's popularity...
|
| These corporations control the government because the same
| people demanding to "break `em up!" have also been demanding
| "small government!" for decades on end, which in practice
| simply means a government that works for the corporate private
| sector.
|
| The morale of this story is that your solution is no solution
| at all, and to the extent that it is a solution the means to
| implement it are nowhere to be found.
| danShumway wrote:
| > These corporations control the government
|
| So proposing these bills is more feasible, because... why
| exactly? Are you under the impression that corporations
| aren't allowed to lobby about bills?
|
| What makes you think that legislating tech will be easier
| than breaking tech up? Complicated rules about vertical
| integration aren't going to be _less_ susceptible to lobbying
| and corporate FUD.
| dalbasal wrote:
| FB is somewhat of an odd man out... I certainly think reversing
| acquisitions would be a positive, but...
|
| With Bell, standard oil and past monopolies... the goal was to
| decentralise while keeping oil and telecom viable. We wanted
| what they made, and didn't want disruptions.
|
| Do we want what FB makes? Is it scarce? I feel like we would
| have a sufficient supply of likes, shares, messages and posts
| regardless. There doesn't need to be a $trn company for those
| to be supplied.
|
| Generally, I think the issues at stake have evolved. Many of
| the problems with today's monopolies are power related, rather
| than efficiency related. I think FB _is_ enormously
| inefficient, but this is kind of besides the point.
| jimmaswell wrote:
| > Do we want what FB makes? Is it scarce?.. doesn't need to
| be a $trn company
|
| People want a social network that everyone else is on, that
| works on all their devices, and isn't full of spam bots or
| bugs. It takes a big company to do this at scale and the
| network effect makes useful social networks scarce.
| [deleted]
| bluefirebrand wrote:
| Facebook the website and Facebook the advertising giant are
| kinda different things though.
|
| By which I mean that Facebook does not make $trn by supplying
| likes shares messages and posts.
| cwkoss wrote:
| I find it very curious how facebook's advertisements
| (especially on instagram) seem to have a lot more products
| that are cheap commodity Chinese products, whitelabeled by
| a glitzy 'startup' brand, and add a 500%+ margin. Very
| often a quick search can find identical items (maybe
| without a brand label) on Aliexpress for a fraction of the
| price.
|
| Google search and on-site ads can be annoying and of
| questionable relevance, but I rarely see items that are so
| egregiously ripping off consumers. I dont see this much on
| twitter promoted tweets either.
|
| What is it about facebook's ad business that encourages
| such a high proportion of overpriced garbage? Is it the
| mediums focus on pictures and video that makes these sales
| work? Is the audience just dumber/less savvy and so these
| platforms are the only places with enough suckers to do
| this successfully?
|
| TikTok's sponsored videos seem to be falling into a similar
| trap to a lesser extent - the markup is less extreme for
| the few I've looked at out of curiosity.
|
| Do Google and Twitter have some process for quality control
| to keep the garbage out that Facebook does not? Or is the
| medium the primary reason for this perceived difference?
| cwkoss wrote:
| In conclusion, I think facebook's advertising arm is
| likely much more societally damaging than other
| platforms, and - so long as it continues at current
| quality level - I would celebrate its demise.
| HeyLaughingBoy wrote:
| The answer's probably a lot simpler than you think.
| Dropshipping is hot these days for the "I'm an internet
| entrepreneur" crowd and the "How To Dropship Guides for
| $19.99" are all pushing Facebook ads and buying from
| AliExpress. The readers likely don't even know that there
| are alternatives: they're just following a script.
|
| The rapid churn when people realize it's harder to make
| money than it seems means that there is always a new set
| of people pushing whatever crap is hot that week.
| dalbasal wrote:
| Perhaps. anchor it wherever you feel it should be anchored,
| and ask the same question. Whatever it is that FB does
| isn't scarce.
|
| We would also not lack for ways of selling whatever
| advertisers on FB are selling. They would be different
| without FB. Different parties would or wouldn't benefit...
| Connecting consumers to businesses is not scarce.
| tmp_anon_22 wrote:
| I think if Facebook got truly broken up worse apps would take
| its place, particularly in communities outside US
| jurisdiction. Say what you will about Facebook, but I believe
| some random FB employee can't just dive through my personal
| messages without consequences. Having met several, I believe
| their data scientists go to great lengths to strip PII and
| generally secure data sets in transit between teams and
| outside parties. Don't tell me some 3 person start-up is
| going to get even remotely close to that level of control.
| pmoriarty wrote:
| The technology field has much deeper problems that increased
| competition alone won't fix.
|
| One of the most pernicious effects of tech advances in recent
| decades has been the rise of surveillance state and
| surveillance capitalism, and the loss of privacy that comes
| with that.
|
| This enabling of spying on everyone is not going to be
| addressed by more competition, and might even enable it further
| if innovation in that space increases.
|
| Another major issue is economic inequality fostered by the
| internet and tech booms which, again, the breakup up (or even
| end) of these companies would not address.
| handrous wrote:
| > One of the most pernicious effects of tech advances in
| recent decades has been the rise of surveillance state and
| surveillance capitalism, and the loss of privacy that comes
| with that.
|
| Exactly this! Two out of five of FAANG derive effectively
| _all_ their revenue from global-scale dragnet spying, and all
| five of them use that kind of data collection as a highly
| effective moat against competition.
|
| It should simply be outlawed. That should be step #1 for
| breaking the tech monopolies.
| ethbr0 wrote:
| I'd say 3/5 (+Amazon). And arguably 5/5 if you include
| product mining within their ecosystems (+Apple +Netflix).
| handrous wrote:
| Yeah, that'd be the "moat" I mentioned, but maybe I
| didn't sufficiently emphasize what a huge advantage that
| is for them. Losing the ability to vacuum up and hoard
| data just wouldn't be _quite_ as big a shock directly to
| the bottom line, in very short order, for the rest of
| FAANG (+M) as it would be for F and G, in particular. It
| 'd hurt the others plenty, however.
| wintermutestwin wrote:
| Haven't we learned that the "break 'em up" fix for monopolies
| doesn't achieve the desired results?
|
| Why not simply get our government to do their jobs and REGULATE
| away practices that are not in the public's interest?
| seneca wrote:
| Because regulation, even when well-meaning, acts as a barrier
| to entry and keeps competitors from even getting off the
| ground. Stifling small companies stagnates the industry and
| smothers innovation.
|
| You can play whack a mole with their bad behavior, but large
| companies can come up with new dark patterns way faster than
| you can regulate them with precise and well thought out
| regulation. You just end up with entrenched interests and an
| ossified industry.
|
| That's not even touching on regulatory capture.
| shakezula wrote:
| Regulatory capture is the true evil of our current setup.
| Ajit Pai was inevitable, and he won't be the last or even
| the worst.
| shakezula wrote:
| The break them up and fix them approach actually worked
| wonders for the end consumers in Bell, Standard Oil, etc...
| [deleted]
| majormajor wrote:
| > Haven't we learned that the "break 'em up" fix for
| monopolies doesn't achieve the desired results?
|
| What do you think are failed examples of this?
|
| Even though you had eventual re-consolidation, the post-
| breakup phone industry seemed like a much more interesting
| and competitive place than the one before it. The fix for re-
| consolidation, of course, could be pretty simple...
|
| Very few people _want_ to do the harder, more innovative,
| more interesting thing if they can make a comfortable living
| doing what they 've always done. This applies to regulators
| as much as to companies. We haven't found any better tool to
| force companies to be in touch with their customers and do
| what the customers want than competition, but we _also_ have
| an economic system that encourages consolidation (because
| competition is HARD!). So the role of government to break
| things back up to keep competitive incentives feels quite
| natural. The market isn 't gonna do it itself.
| smolder wrote:
| I can think of some incentives that would prevent
| hyperconsolidation. Sliding scale taxation based on some
| formula including a ratio of revenue to people employed.
| Maybe take away big company's litigation advantage by
| making them pay an amount somewhat proportional to their
| size into a pool that covers the total costs of litigation.
| Let them recover money on wins. I think such
| incentives/disincentives would be met with the usual: "but
| if we're hostile to big business and restrict growth,
| they'll leave the US for greener pastures!". Is that really
| so bad? Let companies that are hostile to the US public
| leave the US. Penalize their advantage away in tariffs or
| something for fleeing to weaker regulatory environments.
|
| ISPs _can 't_ leave and yet we don't seriously regulate
| them into doing public good or having a competitive market,
| which is mysteriously somehow contentious politically. Many
| others can't leave because their talent pools aren't
| willing to go with them, and that would be even more true
| if the workers had a government that worked for us.
|
| There is a problem with government being full of people who
| would rather stay on the receiving end of a money hose than
| pinch it off for anyone's benefit. All the other apparent
| problems seem to me to be excuses to protect that. Check
| greed or we all suffer. You _can_ check greed without
| stifling ambition. It 's a valid choice.
| danShumway wrote:
| > Haven't we learned that the "break 'em up" fix for
| monopolies doesn't achieve the desired results?
|
| Breaking up has achieved excellent results before, as far as
| I can tell. It's not a permanent solution to the problem, but
| neither is brushing my teeth.
|
| It might be OK to have a process that needs to be
| periodically repeated when companies get out of control. It
| might even be preferable to large legislative efforts that
| significantly change what companies can and can't do. Are
| people really mad that maps show up in Google search, or are
| people mad that Google owns the world? I'm not sure, but
| maybe it's better to precisely target a temporary solution at
| the actual problem.
|
| In general, I'm _more_ on board with bills about vertical
| integration than I am with some other solutions people have
| proposed. But I 'm also not necessarily opposed to skipping
| the whole thing and directly breaking up those companies
| instead. It seems to have had good effects in the past. And
| while I do think vertical integration is a problem, I'm not
| 100% certain that it's the biggest problem or that this is
| the best solution. I'm watching these bills kind of
| carefully.
| andreilys wrote:
| _Breaking up has achieved excellent results before, as far
| as I can tell._
|
| Source?
| ethbr0 wrote:
| Approached from a novelty perspective, I think the
| exception is size and profit margin. These companies are
| simply too big (in terms of cash on hand & ability to
| generate profits). That's always been the problem with
| monopolies -- they get there, and then no one can compete.
|
| Which in this case seems a consequence of first mover
| advantage + capital-light tech scaling (aka large profit
| margins) + huge total addressable markets.
|
| Compared to Saudi Aramco's total profits -- Apple makes
| 63%, Microsoft makes 44%, Google makes 39%, Facebook makes
| 21%, & Amazon makes 13%. [0]
|
| And that's compared to a business that literally pumps
| money out of the ground.
|
| [0] https://fortune.com/global500/2020/search/?fg500_profit
| s=des...
| wintermutestwin wrote:
| Maybe I should go back and read up on it more, but I thought
| Bell was the poster child for the breakup of a monopoly
| creating a multi-headed hydra problem.
|
| Also, wasn't Microsoft a huge waste of taxpayer time and
| money? AFAIK, Gates got away with his monopolistic practices
| and has since been recasting himself as a societal boon.
|
| Despite any possible gains society could gain by breaking
| them up, it seems like a herculean task compared to simply
| having our elected representatives legislate away business
| practices that are a public harm. (and yes, this would
| require our representatives to actually represent the people,
| but so does monopoly breakup)
| majormajor wrote:
| Microsoft never got broken up so it certainly didn't teach
| us anything about breaking companies up not being useful.
| We'll never know what would've happened had they been. It
| might tell us that our laws are too weak, though.
|
| Even if we reduce the story of Bell to "they got split up,
| then Southwestern Bell/Cingular/AT&T and Verizon gobbled up
| the rest of the others slowly" then we can see a big win:
| the _n_ broken-up companies had varying levels of success
| because they tried different things and executed in
| different ways. That 's a massive A/B test of the
| usefulness and efficiency of business practices that never
| would've happened if they'd never been broken up in the
| first place! And we'd have even less competition than our
| current wireless market if that breakup had never
| happened...
|
| One interesting side-note I happened across recently was
| that Rockefeller's peak wealth was _after_ Standard Oil was
| broken up. So what 's the arguments _against_ breaking up
| megacorps? We all know the value of competition, and we don
| 't trust public companies to look much past the next
| quarter if left to their own devices, so why wouldn't we
| want more competition and less giant monoliths?
| dreamcompiler wrote:
| We need to be careful about breakups to prevent re-
| agglomeration. Although AT&T was broken up, the Baby Bells
| eventually merged back together again while nobody was looking.
| The winner was Southwestern Bell, which later renamed itself to
| AT&T. The AT&T we know today is really just Southwestern Bell
| with a new name. Fortunately they have competitors but not very
| many.
| chrisdhoover wrote:
| Thats true but interregnum period between the old bell and
| the new bell brought us a great deal of innovation and
| positive changes to communications.
| Dracophoenix wrote:
| I wouldn't say that's because of Ma Bell's. More like in
| spite of it.
| ethbr0 wrote:
| > _while nobody was looking_
|
| It was done while everyone was looking, and it was explicitly
| authorized because the market had changed.
|
| Wireless had proliferated, and the value add segment of the
| vertical had moved (from circuit-switched lines and long
| distance) to the Internet, where (pre-Time Warner merger in
| laughably late 2016) ATT didn't compete.
|
| There's also the two other surviving "small" clumps of Bells
| called Verizon (Bell Atlantic, NYNEX + GTE) & Lumen (US West
| + Qwest + CenturyLink).
|
| If we want to gripe about the current state of the US ISP
| market, post-ATT re-mergers shouldn't be top of mind.
| Exclusive franchise agreements, lack of common and accessible
| conduit / poles, lack of community-funded competitors, and
| bundling are above it.
|
| Even a hypothetical worst-current-case scenario where 3+ of
| the majors ATT, Verizon, CenturyLink, Comcast, & Spectrum
| were offered at every house, because they all had access to
| each other's last-mile at non-discriminatory rates would
| solve current issues.
| rektide wrote:
| Common carrier laws established in the 1996
| Telecommunications Act were doing a good job insuring that
| ISPs were competitive, by requiring regulated, bulk
| wholesale access to local loop elements to competitive
| (non-incumbent) carriers. Most cities in the US had a wide
| variety of DSL options, which was possible because of this
| common carrier system.
|
| Things were kind of going ok with that!
|
| That all got royally hosed when pro-big-business Supreme
| Court activism sided with Verizon's stance that they
| Verizon should have monopoly rights to fiber, in Verizon vs
| FCC (2002). Now suddenly telecomms could go back to their
| nasty old ways, which they have.
| shakezula wrote:
| The real solution is just to not allow them to merge in the
| first place. Anti trust regulations need teeth first.
| bogwog wrote:
| I wonder why the DOD/FTC/whatever can't/won't impose specific
| restrictions on companies in order to correct anti-trust
| issues? That seems a lot less drastic and risky than a break-
| up.
|
| For example, if Apple is forcing developers to use their
| payments SDK to collect 30%, why can't a government agency
| just force them to stop?
|
| Maybe there was a long official investigation by antitrust
| regulators, and that kicked off a long bureaucratic process
| that ends in a mandate restricting Apple from doing a very
| specific thing, maybe with an appeal/review process,
| expiration date, etc.
|
| No need to get a bill passed that changes the law for
| everyone. A smaller company could still do that same thing,
| but it doesn't matter because due to their size, they're not
| immune to competitive forces. If anything, they'll have a
| harder time pulling it off because developers can get a
| better deal with Apple thanks to the new restriction.
|
| Idk how the law works and whether the relevant regulators are
| able to do something like this. So maybe this comment is
| stupid, but it makes sense in my layman head at least.
| hardtke wrote:
| Being large is not illegal. Having a monopoly in a specific
| product is not illegal. The standard by which the antitrust
| officials judge companies is whether the company controls a
| sufficient part of the market such that the consumer is
| harmed. The problem with the current regulations with
| respect to Google/Facebook is that their products are
| "free" to the "consumer," and free can't be harmful (harm
| is higher prices). The state attorney generals complaint
| against Google tries to recast the "consumer" as
| advertisers. The reason Apple and Amazon get a pass is that
| within their "markets" they are still relatively small. For
| Apple, their market would be all cell phones (or in the
| Epic case the Apple lawyers define the market as all game
| platforms). Since they don't have a majority of these
| markets and consumers are free to switch within the market
| they can't be forced to change behavior. "iPhone" is not a
| market by antitrust definition. Amazon places itself in the
| total retail market where they are still less that 10%. As
| the law is currently written and interpreted most of what
| big tech does is not a violation of antitrust laws -- the
| laws do need to be changed for everyone.
| sjy wrote:
| That's what Apple says, but isn't it a bit early to
| conclude that Epic's arguments (relevantly, that Apple is
| illegally monopolising the market for iOS app
| distribution) are doomed to fail?
| ethbr0 wrote:
| > _why can 't a government agency just force [a specific
| business] to stop [doing a specific thing]?_
|
| (I am not a corporate lawyer) Hopefully didn't take
| editorial liberties with your quote, but wanted it to stand
| on its own.
|
| My understanding is that the US, in contrast to many other
| advanced economies unofficially or officially, takes a dim
| legal view of singling out a company for any purpose.
|
| Either a company is acting within the law, or they are
| breaking the law. What company doesn't (shouldn't) matter.
|
| Which I think is wise as a standing order, as detailed
| specific-company intervention renders it more subject to
| politics, etc. Better to stick to the laws, and then allow
| the courts to apply them evenly.
| gred wrote:
| I usually have a libertarian bent, but I'm finding it hard to
| muster much sympathy here. If these companies have generally
| angered the "small government" crowd, I don't know who they
| expect to protect them from the "big government" crowd.
| king07828 wrote:
| Create a monopoly tax that incentivises large companies to "right
| size". E.g., if the company is larger than X and has captured a
| market (like google with search) then tax all revenue above a
| threshold percentage of the market. For example, the market is
| $100B and the company makes $90B revenue, then tax away
| everything above $40B in revenue. This may take away the
| incentive of a large company to take too much market share and
| may encourage them to enable competitors. The parameters
| (company_size, marketshare_percentage, tax rate, etc.) may be
| adjusted to maximize performance
| cwkoss wrote:
| The 'market size' part seems squishy and game-able.
|
| I've always liked the idea of revenue-neutral progressive taxes
| on corporate revenue. Tax economy of scale.
|
| Ex. Zero corporate taxes on the first 100k of revenue. For
| every order of magnitude above this revenue is taxed at ~1%
| more.
|
| $1M in revunue -> 1%
|
| $1B in revenue -> 4%
|
| $100B in revenue -> 6%
|
| Then reduce other corporate taxes to make it revenue neutral.
| In the most extreme case, the 1% figure or the curve could be
| tuned so that this is the only tax corporations pay.
|
| This encourages companies to split: if your economy of scale
| isn't yielding enough to justify the tax, you could spin off
| multiple smaller companies that would each be more profitable.
| The capacity for corporations to do evil is directly
| proportional to concentration of power. Smaller companies won't
| be able to afford as many lobbyists, their threats to move
| their businesses will be less existential for municipalities
| and they'll get less-sweet sweetheart deals. Being "Too Big to
| Fail" is unsustainable and wasteful.
|
| This would be a massive boon for competition. Small businesses
| would be easier to start. Businesses may choose to stop
| growing: if you're making a healthy profit, don't jeopardize
| your margin in a perpetual struggle to amass the most power,
| leaving room in the market for competitors to coexist and
| meaningfully compete on quality.
| amelius wrote:
| Sounds similar to the EU Digital Markets Act.
|
| https://ec.europa.eu/info/strategy/priorities-2019-2024/euro...
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