If you dissect the contemporary mainstream media coverage of Amazon (or any big-tech), you’d realise it’s mostly paid promotion (and limit the extent of reporting on “anti-trust” action). Amazon usually stands out for its predatory pricing – by outbidding or sustaining losses in a vertical and then driving out the competitors.
Let’s look at the fluff pieces first:
Amazon frugality: How Jeff Bezos’ company cuts costs.
Frugality: We try not to spend money on things that don’t matter to customers. Frugality breeds resourcefulness, self-sufficiency, and invention. There are no extra points for headcount, budget size, or fixed expense.
For instance, being frugal means that Amazon will only pay for economy air travel, even for senior execs, Amazon Web Services Senior VP Andy Jassy told CRN Australia. If an employee wants an upgrade to business or first class, they have to pay for that out of their own pockets.
When it comes to the cloud, Amazon has gotten creative in order to be frugal. For instance, computer storage disks have notoriously high failure rates, so vendors have to cover refunds on faulty disks. But Amazon has reportedly gotten cheaper prices on disks by promising never to return one, CRN reports.
Here’s another:
Jeff Bezos’ first desk at Amazon was made of a wooden door
Bezos had to be frugal. So when Amazon’s then-handful of employees needed desks, the entrepreneur found a cheap solution — he hacked them together himself with a door as the desktop and four-by-fours for legs.
But the self-made billionaire keeps a token reminder about the importance of pinching pennies. Bezos’ current desk at his Amazon office is still made out of a wooden door for the top and four pieces of wood for legs, according to a company spokesperson.
However, all this masks (or makes no mention of the regulatory action here. I will include the now famous essay by Lina Khan on Amazon (and predatory pricing).
Yale Law Journal – Amazon’s Antitrust Paradox
Amazon is the titan of twenty-first
century commerce. In addition to being a retailer, it is now a marketing
platform, a delivery and logistics network, a payment service, a credit lender,
an auction house, a major book publisher, a producer of television and films, a
fashion designer, a hardware manufacturer, and a leading host of cloud server
space. Although Amazon has clocked staggering growth, it generates meager
profits, choosing to price below-cost and expand widely instead. Through this
strategy, the company has positioned itself at the center of e-commerce and now
serves as essential infrastructure for a host of other businesses that depend upon
it. Elements of the firm’s structure and conduct pose anticompetitive
concerns—yet it has escaped antitrust scrutiny.
The action by EU:
Amazon offers to limit use of merchant data in bid to settle EU antitrust probe – TechCrunch
The Commission said its preliminary conclusion is that Amazon’s rules and criteria for the Buy Box and Prime are biased — and “unduly favour Amazon’s own retail business, as well as marketplace sellers that use Amazon’s logistics and delivery services”, which its press release warns “may harm other marketplace sellers, their independent carriers, other marketplaces, as well as consumers that may not get to view the best deals”.
The raids by anti-trust regulators in India:
India’s antitrust raids target sellers on Amazon, Walmart’s Flipkart -sources | Reuters
A Reuters investigation last year, based on Amazon internal documents, showed it had given preferential treatment for years to a small group of sellers on its platform, including Cloudtail, and used them to bypass Indian laws. (https://reut.rs/3rTWXxi)
The investigation found that about 35 of Amazon’s more than 400,000 sellers in India in 2019 accounted for around two-thirds of sales on its India website. Of that figure, two sellers, Cloudtail and Appario, contributed 35% of the platform’s sales.
This narrative ties in with my continual gaze on big-tech (and my alarm bells) on the “wellness market”. Now increasingly, the “cancer-market”. Here’s something that came off recently as a press release:
Amazon partners with Fred Hutchinson on cancer vaccine trial
Amazon and Fred Hutchinson are looking to recruit 20 participants over the age of 18 for the early stage, or phase 1, trial, according to a filing on clinicaltrials.gov, a database of clinical trials run by the National Library of Medicine. The goal is to develop “personalized vaccines” that can treat breast cancer and melanoma, a form of skin cancer, the filing states.
“Amazon is contributing scientific and machine learning expertise to a partnership with Fred Hutch to explore the development of a personalized treatment for certain forms of cancer,” the spokesperson told CNBC in a statement. “It’s very early, but Fred Hutch recently received permission from the U.S. Food and Drug Administration to proceed with a Phase I clinical trial, and it’s unclear whether it will be successful. This will be a long, multi-year process — should it progress, we would be open to working with other organizations in health care and life sciences that might also be interested in similar efforts.”
Since the market in the US is monopolised by a handful of “pharmacy-benefit-managers”, disrupting them will offer an opportunity of financial windfall. This is a “backdoor” entry in healthcare, since cloud computing resources will likely be covered under “marketing-expenses”. There’s no detail about what specific “cloud-computing” resources will be required to “test the vaccine”. I will expect more press releases and fluff pieces around Amazon, saving the world.
RadOncNotes 