[kictanet] IS AMAZON UNSTOPPABLE?

Thu Oct 31 08:01:18 EAT 2019

Ohaga

Great points. Let me turn around that conversation.

1. What is the role of Policy Makers and Regulators to curb mischief from
so-called Dominant Players?
2. Should Private Enterprise be cowed from being competitive just because
they fear they will become 'dominant'?
3. Does Private Enterprise really know how to put the brakes on success? I
mean let's look at a scenario - A CEO calls in his Chief Commercial Officer
and Chief Marketing Officer and tells them - 'Guys! You've met your quota
for the year. We have achieved the threshold of dominance. If we sell more
we will be declared 'Dominant' and we can't have that!! So stop selling!!!
:-)
4. The role of a Referee (Regulator) is to ensure a level playing field and
that of a Policy Maker to set the rules of the game. So when players
misbehave and the referee is reduced to whining... who is to blame?

We should ask ourselves fundamental questions on this issue and solve it at
source.

*Ali Hussein*

Tel: +254 713 601113

Twitter: @AliHKassim

Skype: abu-jomo

LinkedIn: http://ke.linkedin.com/in/alihkassim
<http://ke.linkedin.com/in/alihkassim>

Any information of a personal nature expressed in this email are purely
mine and do not necessarily reflect the official positions of the
organizations that I work with.

On Thu, Oct 31, 2019 at 7:23 AM Ohaga JB <durojb at gmail.com> wrote:

> GREAT exposition Hussein and some really thought-provoking questions. But
> if we were to leave out Amazon and bring it closer home, does Safaricom
> hold the same power locally?
>
> In a previous interview by Jackson Biko with the incoming Safaricom CEO,
> Mr Peter Ndegwa (PN) commented about Ghana being a tough market because
> Diageo ONLY owned about 55% of the beer market there.
>
> In some quarters, owning 55% of the market would be considered huge, but
> that's not how PN saw it. Which brings me to my question. With a mindset
> that considers owning more half of the market as being competitive, what
> percentage of the market do you think such an individual will consider
> dominant?
>
> Not accusing PN of anything, but in the backdrop of some of the decisions
> that Amazon has taken to undercut competition under Bezos, there could be
> some wisdom in thinking about PN's style.
>
> Regards,
> JB.
>
> On Wed, 30 Oct 2019, 08:05 Ali Hussein via kictanet, <
> kictanet at lists.kictanet.or.ke> wrote:
>
>> Listers
>>
>> Relevant in this day of Dominance and Market Failures.
>>
>> Not since the heydays of General Motors in the early and mid years of the
>> 20th Century has a company stood over the industry like a colossal. In many
>> ways Amazon is the New General Motors.
>>
>> Regulators and Policy Makers are circling. Globally, led first by the
>> European Union and now the Americans. On can probably say that the American
>> Government has been generally ambivalent to these issues until early this
>> year when arguably first shot was fired by Makan Delrahim, the head of the
>> Ant-Trust Division of the U.S. Department of Justice., when he said of Tech
>> Companies:-
>>
>> " They should think very seriously about their conduct, if you're one of
>> the big guys, you should be careful to make sure you don't snuff out
>> competitors because you think that's good for your business. That not what
>> free markets really mean, and we're going to come down on you like a ton of
>> bricks if that's what you do."
>>
>> This long article by The New Yorker
>> <https://www-newyorker-com.cdn.ampproject.org/c/s/www.newyorker.com/magazine/2019/10/21/is-amazon-unstoppable/amp> exemplifies
>> the conundrum of Capitalism today. At what point does success become
>> poisonous? What is good and what is bad? Where do we draw the line?
>>
>> Regulators are coalescing around the Four 'Cs'.
>>
>> 1. *Concentration*: “The bigger a tech company becomes, the more they
>> can bully, so we need to put hard caps on how big companies like that can
>> grow, on what they can acquire.” said an FTC <https://www.ftc.gov/>
>> official.
>> 2.* Conflict*. According to Rohit Chopra
>> <https://www.ftc.gov/about-ftc/biographies/rohit-chopra>,  the second
>> “C” is the conflict of interest that comes from “both controlling the pipe
>> and selling the oil.” Chopra, who agreed to speak only about antitrust
>> generally and not about Amazon specifically, explained, “If you do both,
>> you will structure your marketplace in a way that ultimately is
>> self-dealing, and you will use the data from those who sell on your
>> marketplace to benefit yourself.” There’s a long history of the government
>> forcing industries to separate distribution and sales; for years, movie
>> studios have generally been prohibited from owning movie theatres.
>> Unfortunately too often Amazon has been accused of this sin. Too often.
>> 3.* Contracts*. The next area of concern is contracts. Big tech
>> companies often make highly restrictive deals with smaller venders. Amazon
>> retains a contractual right to hold sellers’ revenues for long periods
>> after a sale and imposes limits on what data sellers can share with other
>> companies. Another F.T.C. commissioner, Rebecca Kelly Slaughter
>> <https://www.ftc.gov/about-ftc/biographies/rebecca-kelly-slaughter>,
>> said, “There are a lot of terms that go into boilerplate contracts that
>> consumers or workers don’t really have an opportunity to negotiate. It is
>> absolutely appropriate for us to be thinking about banning those.”
>> 4. *Complexity*. Lastly, regulators worry about the complexity of
>> current antitrust law. “You really have to be an expert, or hire an expert
>> attorney, if you feel like one of these companies is acting
>> inappropriately,” an F.T.C. official said. “The law only works when it is
>> simple enough for the little guy to bring an action on their own.”
>>
>> It is recommended reading to all business people, policymakers, activists
>> and regulators.
>>
>>
>> *Ali Hussein*
>>
>>
>> Tel: +254 713 601113
>>
>> Twitter: @AliHKassim
>>
>> Skype: abu-jomo
>>
>> LinkedIn: http://ke.linkedin.com/in/alihkassim
>> <http://ke.linkedin.com/in/alihkassim>
>>
>>
>>
>>
>> Any information of a personal nature expressed in this email are purely
>> mine and do not necessarily reflect the official positions of the
>> organizations that I work with.
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