Et tu Amazon?: Meet the new boss

I am contractually obligated to have an opinion on the amazon controversies (here and here), so I thought awhile and got one.

My first instinct is to side with the small startup ebookshops (yay Diesel) and local businesses.

But why I wondered? I want to say that this is about power, about Amazon leveraging it size, distribution chain, and capital reserves to unfairly hurt its competition. And certainly that’s true. That is what this is about.

But that dynamic is also standard operating procedure. It’s why Amazons items are routinely cheap; it’s why they operate at as close to a loss in the short term as they can.

So what makes this a bridge too far?

Well, I don’t know that it is. I think some of the fuss is just old anger at leftover at the above battles.

But if it is too far, here is my stab at why:

1. It’s rubbing the losers nose in it.

By way of analogy: It’s one thing for the tall handsome football star to be elected class president. Sure he had some advantages handed to him, but he also worked hard at football, and he is basically a nice guy.

In this scenario Amazon went from just winning the election against the bookish policy wonk it ran against, to taunting the loser afterwards.

Amazon said in effect: We aren’t content with the hidden ways we have advantages over you, we want to flaunt it too. Then it drove away splashing sales tax and overhead costs at the nerd’s shoes.

2. The whole thing makes explicit the advantages Amazon has long enjoyed.

This bothers me. I want to think of the online retailers I shop at as wonderful and unproblematic. This makes it harder to do so.

3. It’s unsustainable. I’m often willing to accept that sometimes Starbucks going to come in and destroy the local coffee shop. After all I like my Frappuccino’s a certain way.

But the kinds of promotions listed above are clearly aimed at the competition and will not survive them. It’s not sustainable savings. The logical endgame is a monopoly where the discounts all go away once they are done using your local Target as showcase.

You could make the case that the same dynamic is true of big boxes stores in general, but again it’s largely hidden (see #1).

4. I had at least one more point in mind when I started this, but I can’t recall it anymore. Sometimes I think this economic stuff is complicated.