How Amazon makes everything you buy more expensive, no matter where you buy it

https://pluralistic.net/2023/04/25/greedflation/

by Sindisil • 3 years ago

56 32 3 years ago

icapybara• 3 years ago

The article takes too long to get to the point and is wrapped in so many metaphors and newspeak that I feel like I'm being hustled.

It is possible to write about this topic clearly and concisely.

next_xibalba4• 3 years ago

I was expecting to see some data on how Amazon has driven up prices. There was none. Not even a single chart! This is an exceptionally poorly written article: acrobatic, liberal arts-esque logic and theoretical this-and-that and neologisms abound.

2OEH8eoCRo0• 3 years ago

Amazon blocks sellers from offering lower prices elsewhere.

Evidence (pdf warning): https://oag.ca.gov/system/files/attachments/press-docs/2023-...

SubiculumCode• 3 years ago

Seems like monopoly abuse 101 to me.

seattle_spring• 3 years ago

liberal arts-esque logic

Can you expand on specifically what you meant here?

next_xibalba4• 3 years ago

Sure.

(One of my degrees is in liberal arts, so I speak from personal experience here.)

Many of the fields in liberal arts pump out ideas. Think of it as theoretical physics (less all the math) without any ability/attempt to prove the ideas via rigorous evidence or experimentation. Often ideas are heavily dressed up with pseudo-technical language in an attempt to legitimize them.

See also the works of: Foucault, Jung, Derrida, Freud, etc.

Now, in some cases, this is no big deal. For example, producing a work of art (novel, painting, etc.) does should not have any requirements of proof, evidence, falsifiability, etc.

But in other cases, where the creation of new knowledge is claimed, a lot of this stuff should be thrown on the junk heap. It does nothing to improve the plight of humanity.

abeppu• 3 years ago

What should this data actually be and how would one get it? You can't really do a fair experiment with random assignment where some companies use Amazon and some don't and we see how their prices change over time. Because of the "Most Favored Nation" issue, you can't meaningfully compare prices of products between Amazon and other platforms. Monopolies and anti-competitive practices remove meaningful choices, which naturally blocks or hinders anyone from studying the outcomes of those removed choices.

next_xibalba4• 3 years ago

Because of the "Most Favored Nation" issue, you can't meaningfully compare prices of products between Amazon and other platforms.

Sure you can. Amazon lists millions of SKUs. A huge proportion of those are sold elsewhere, often by sellers who do not also sell on Amazon.

But more fundamentally, if data can't be had, how does the author know this is actually happening? Either it is an unfalsifiable claim or its not, and there should be data. The bottom line is, the author makes an extraordinary claim and thus the onus is on them to provide commensurate evidence.

crazygringo• 3 years ago

This article is... nonsense? It's so badly written I can't even figure out what it's trying to say. But after the fourth time he talks about "enshittification" it's very hard to take seriously. As far as I can tell, it's just an unorganized, stream-of-consciousness "I hate Amazon" rant.

Maybe there's an actual main point in here somewhere, that's connected to the headline somehow, but this article is a shining example of how not to write if you want to actually convince people of a point you're trying to make.

rektide• 3 years ago

I'd love a vote on how hard or easy it is for people. I got it quick.

I also understood the problems ahead of time reasonably well.

I can't see how #enshittification is anything other than an apt world-consuming trend broadly outlining the predominamt trends of capitalism in the world today. And for the new phase of Amazon now that it has attained market capture. To you it seems like a huge turn off, tuned you out, but you've just heaped the term onto your pile of disdain. It's unclear to me what problems you have, why you disagree or what you find inaccurate about the term in general or it's application.

Invictus0• 3 years ago

The article is crap. The main point is in the second half of the article:

Amazon binds its sellers over to something called Most Favored Nation status. That means that sellers can't offer their goods more cheaply than they do on Amazon – even if it costs them (lots) less to sell in Target or direct from their websites. This means that every time a seller adds a dollar to their Amazon sale price, they have to add a dollar to the price of their goods everywhere else, too.

andrewmutz2• 3 years ago

I agree it is nonsense. The closest I can come to a point is: Amazon locks consumers in with prepayment schemes (like Amazon Prime, where you've prepaid for shipping). Then all the sellers have to follow because thats where the consumers are.

But it's an incredibly thin argument. I am a prime member and when I go to buy things online, the fact that I should choose amazon to get cheaper shipping absolutely never enters my mind.

mock-possum• 3 years ago

I mean I wouldn’t say it’s incoherent, its just a lot of anti-Amazon ranting. Not illdeserved in amazon’s case.

Retric2• 3 years ago

That’s a very long post to say “I don’t understand.”

The argument is very simple, Amazon – like other platform businesses – externalizes its costs onto its suppliers by raising suppliers costs it raises the costs consumers pay.

You can agree or disagree with that argument, but it’s not very complicated.

andrewmutz2• 3 years ago

Which costs? Externalities normally refer to parties not involved in the transaction, and the suppliers are involved in the transaction.

augment003• 3 years ago

Doctorow was once a meaningful tech and corporate skeptic, but at some point he became a dogmatist and his takes have become increasingly ungrounded.

huijzer• 3 years ago

As I read it, the article argues that more should be done against monopolies. When companies like Amazon start their flywheel, they provide great value for the customer. However, at some point, the competition is gone and the value for the customer is decreasing. At this point, only the shareholders benefits.

milesskorpen2• 3 years ago

This article emotionally feels right, I get it. But … the issue is Amazon isn’t making this enormous profit. And what profit it does make mostly comes from AWS. Even given reinvestment, I don’t think the article really lines up with reality.

freeopinion• 3 years ago

I swear I heard Jeff Bezos personally thank all Amazon shoppers and employees for funding Blue Origin. Perhaps you mean that Amazon doesn't make an enormous profit per item, but on the whole...

milesskorpen2• 3 years ago

https://www.macrotrends.net/stocks/charts/AMZN/amazon/net-in...

Amazon net profit was $278mm in Q4 2022. That's peanuts for a company of that size.

Amazon profits are not the same as company valuation. People can value a company highly and the company can make few profits (at least for a period of time). Bezos has made a ton of money because of the valuation, not profits.

asimpletune• 3 years ago

Hasn't it always been understood that raising prices after killing competition was Amazon's end game?

That's what I always thought investors understood about the business. What has mattered isn't profit, but rather cash flow. If you have cash flow, and you reinvest that into expansion (for more cashflow), eventually you have a monopoly. The whole point of that is one day you flip the switch, and raise prices.

hkchad• 3 years ago

Tale as old as time, this is the 'Dollar Store' [1] model as well. Come in, offer shit products for cheap, drive other businesses out, raise prices.

[1] https://anderson-review.ucla.edu/how-dollar-stores-contribut...

nborwankar• 3 years ago

As far as some people quickly understanding the point the article is making while others not getting it I recall a quote approximately saying “It’s very difficult to convince a man of something when his livelihood depends on not understanding it”.

DrNosferatu2• 3 years ago

Booking.com operates a similar racket:

“you’re not allowed to sell elsewhere at a lower price”.

Both should be broken up.

PS: And if only rival World blocks enforce anti-trust laws on foreign companies, simple - the US sets straight Booking.com and the EU, Amazon.

coredog64• 3 years ago

Not entirely true. Hotels aren’t allowed to advertise prices lower than what’s on booking.com to users who aren’t logged in. If you are a member of the hotel’s loyalty program, you can and do get lower prices.

Hotel brands prefer this because they get you into their system and they get to keep more of the room rate.

DrNosferatu2• 3 years ago

It's still a (de-facto) monopoly practice.

How Amazon makes everything you buy more expensive, no matter where you buy it

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