Why Amazon will (and should) put Performance Bike out of business

[deechee]

Originally Posted by Davist

AWS main customer is Netflix. Netflix is about 40% of internet traffic in the US on any given weeknight. "Commodity" cloud service is also an AWS prime business, and yes, no way you can do it "in house" for any where near what they charge, but some items (research, real time decisions, proprietary stuff) need to be either in private cloud or on premises, of course. If, to your curing cancer problem, you need to rent 10,000 servers for 2 weeks or build a dedicated data center for the same problem, the choice is easy. They offer reasonably priced analytics as well. It can be secure as you need, they're not a glorified supermarket, AWS is the portion of the company that makes money. The issue with Amazon retail is that they are predatory, no or little focus on making money, so they can drive out competition...

Uh, isn't Netflix's video service in house? OpenConnect? I believe a lot of analytics and user info is stored in AWS, but not the actual streaming. That said I have to say, it's not just the retail side which is predatory. Read the reviews on glassdoor. Talk to employees; unless you're single, people in my age range are working crazy long hours to keep their managers happy.

This recent article in the NYT about janitors is a depressing but very telling story of how companies like amazon now run business. While my experience with PerformanceBike is limited, amazon taking over the entire retail map really is not a good thing.

If you're still hesitant, read about their recent brick and mortar book stores. Very limited selection and doing away with employees. Payment is done by face recognition. No need to walk to a cashier or even a self-checkout.

And while we're talking about jobs going away, doctors are going to be dated too.

[fiamme red]

On the other hand, maybe robots will become lazy once they are in charge, and then humans won't be obsolete after all.

[torquer]

What jobs going away?
Amazon is dangling an offer of 50,000 jobs to any locality that meets their terms for a second headquarters:
https://www.nytimes.com/reuters/2017...s-factbox.html
Of course those terms include "The availability of incentives including site preparation, tax credits and exemptions, relocation and workforce grants, and fee reductions."
Who do they think they are, the NFL?

[Black Dog]

Originally Posted by torquer

What jobs going away?
Amazon is dangling an offer of 50,000 jobs to any locality that meets their terms for a second headquarters:
https://www.nytimes.com/reuters/2017...s-factbox.html
Of course those terms include "The availability of incentives including site preparation, tax credits and exemptions, relocation and workforce grants, and fee reductions."
Who do they think they are, the NFL?

Yup. Demanding corporate welfare from what ever city they choose.

[Rada]

Originally Posted by Black Dog

Yup. Demanding corporate welfare from what ever city they choose.

What companies don't?

[Gsinill]

Originally Posted by Rada

What companies don't?

$3B incentives for FoxConn from the State of Wisconsin for creating 13,000 jobs.

[Kirk007]

Originally Posted by Black Dog

Yup. Demanding corporate welfare from what ever city they choose.

yep this is the great American way - from Aerospace, Military, Agriculture, Timber, Oil and Gas, Chemical companies - on and on and on - those stalwart businesses that have pulled themselves up by their own bootstraps (i.e. billions in campaign contributions to our "public servants") are subsidized by the our tax dollars out the ying yang, yet its those lazy takers and renters who have receive benefits from our social welfare programs that are ruining America.

I guess Bezos should be thrown in with the takers and renters because he has, gasp, progressive tendencies and doesn't toe the Make America Great Again line.

[fiamme red]

Here's one comment on the NYT article about Amazon's search for new headquarters:

https://www.nytimes.com/2017/09/07/t...ermid=24011905

This is what disgusts me about major corporations. Their motto is:

Ask not what what we can do for anyone (least of all the country that protects and creates our prosperity), but how much more money raised from the taxes of people struggling to survive on the poverty wages we pay can we blackmail out of the hands of moronic elected officials who are desperate to prance a "win" in front of the electorate.

Then we will pay the lowest possible wages to all but a handful of elites while shirking any responsibility to our worker, the state, the nation, and the poor smucks whose tax dollars built our beautiful facilities. Then when the tax bribes are due to expire, we'll start the whole process all over again, screwing some other groups of optimistic, gullible idiots looking for a "win."

But the only people who will win, in the end, be a handful of overpaid executives and a few shareholders most of whom are already wealthy, but are never wealthy enough to feel screwing a few more workers and tax payers is unnecessary!

It is very similar to the tactics of a professional sports team.

[froze]

Originally Posted by torquer

What jobs going away?
Amazon is dangling an offer of 50,000 jobs to any locality that meets their terms for a second headquarters:
https://www.nytimes.com/reuters/2017...s-factbox.html
Of course those terms include "The availability of incentives including site preparation, tax credits and exemptions, relocation and workforce grants, and fee reductions."
Who do they think they are, the NFL?

Corporate welfare? Really? well what about the tax revenue coming from 50,000 people into the city coffers? 50,000 people buying stuff and paying sales tax, 50,000 people buying homes and paying homeowners taxes, 50,000 employed some of which may be on unemployment, 50,000 people means more new businesses popping up to serve those people which means they pay more taxes into the city coffers not to mention new employees for those too; in other words...money, money, money flowing into the winning city which is why there is a bidding war going on because those cities know they stand to make a mint.

[avalonracing]

Originally Posted by Kirk007

yep this is the great American way - from Aerospace, Military, Agriculture, Timber, Oil and Gas, Chemical companies - on and on and on - those stalwart businesses that have pulled themselves up by their own bootstraps (i.e. billions in campaign contributions to our "public servants") are subsidized by the our tax dollars out the ying yang, yet its those lazy takers and renters who have receive benefits from our social welfare programs that are ruining America.

I guess Bezos should be thrown in with the takers and renters because he has, gasp, progressive tendencies and doesn't toe the Make America Great Again line.

[Skenry]

Originally Posted by froze

Corporate welfare? Really? well what about the tax revenue coming from 50,000 people into the city coffers? 50,000 people buying stuff and paying sales tax, 50,000 people buying homes and paying homeowners taxes, 50,000 employed some of which may be on unemployment, 50,000 people means more new businesses popping up to serve those people which means they pay more taxes into the city coffers not to mention new employees for those too; in other words...money, money, money flowing into the winning city which is why there is a bidding war going on because those cities know they stand to make a mint.

But... But... But... Big business is bad

[Bwana]

I cross shopped a list of some parts I need to finish a build today between four or five different websites. Amazon was the only one that had EVERY part, they were also the cheapest, everything on the list was available with Prime shipping, and two items had same day delivery.

[djg21]

Originally Posted by 54ny77

DARNED good question and one which, I'll guess at $1,500+ per billable hour by senior partners, has been kept at bay for as long as possible.

I'm not an antitrust law expert, nor do I play one on t.v., but I would venture a guess that if, after all these years where nothing of consequence has occurred that would force a structural change at the company, perhaps the law can't keep up (or doesn't know what to do) with Amazon.

I will take a wild-arsed guess that their foray into brick and mortar grocery via Whole Foods acquisition will introduce some more buzz on the subject.

The simple answer is that becoming successful in itself is not a violation of the antitrust laws, and as dominant as Amazon is, it has competitors in the markets it participates in. I’m sure that one could elect never to shop at Amazon and still find everything they wish to purchase either on-line or at brick-and-mortar businesses.

[54ny77]

I agree with all u said. They're doing everything bigger faster cheaper and thus consumers benefit. They don't have a monopoly on selling a bottle of laundry soap.

What I do think is anticompetitive, however, is selling products at a loss. Investors have sustained that absurdity for so many years, it's mind boggling.

Originally Posted by djg21

The simple answer is that becoming successful in itself is not a violation of the antitrust laws, and as dominant as Amazon is, it has competitors in the markets it participates in. I’m sure that one could elect never to shop at Amazon and still find everything they wish to purchase either on-line or at brick-and-mortar businesses.

[djg21]

Originally Posted by 54ny77

I agree with all u said. They're doing everything bigger faster cheaper and thus consumers benefit. They don't have a monopoly on selling a bottle of laundry soap.

What I do think is anticompetitive, however, is selling products at a loss. Investors have sustained that absurdity for so many years, it's mind boggling.

It may be. But more often than not, it is a perfectly legitimate (and often very risky) business strategy. It all depends, and the analysis is always detailed and rarely results in a definitive answer. That is the nature of AT law and economics.

Here’s a very short and simple explanation of predatory pricing from the FTC:

Predatory or Below-Cost Pricing

Can prices ever be "too low?" The short answer is yes, but not very often. Generally, low prices benefit consumers. Consumers are harmed only if below-cost pricing allows a dominant competitor to knock its rivals out of the market and then raise prices to above-market levels for a substantial time. A firm's independent decision to reduce prices to a level below its own costs does not necessarily injure competition, and, in fact, may simply reflect particularly vigorous competition. Instances of a large firm using low prices to drive smaller competitors out of the market in hopes of raising prices after they leave are rare. This strategy can only be successful if the short-run losses from pricing below cost will be made up for by much higher prices over a longer period of time after competitors leave the market. Although the FTC examines claims of predatory pricing carefully, courts, including the Supreme Court, have been skeptical of such claims.

Q: The gas station down the street offers a discount program that gives members cents off every gallon purchased. I can't match those prices because they are below my costs. If I try to compete at those prices, I will go out of business. Isn't this illegal?

A: Pricing below a competitor's costs occurs in many competitive markets and generally does not violate the antitrust laws. Sometimes the low-pricing firm is simply more efficient. Pricing below your own costs is also not a violation of the law unless it is part of a strategy to eliminate competitors, and when that strategy has a dangerous probability of creating a monopoly for the discounting firm so that it can raise prices far into the future and recoup its losses. In markets with a large number of sellers, such as gasoline retailing, it is unlikely that one company could price below cost long enough to drive out a significant number of rivals and attain a dominant position.

https://www.ftc.gov/tips-advice/comp...-or-below-cost