August 19, 2021
This is what is widely thought to be one of the most innovative companies in the world, reverse engineering itself into traditional brick and mortar retail — but only after they've destroyed the retail industry.
This is precisely why we have anti-trust laws. So that anti-competitive predators can't destroy industries, to achieve monopolistic power. Sadly, our lawmakers have not only allowed this to happen, most have invested in it.
For far too long, Amazon was allowed to underprice the competion and subsidize its losses in the online retail and delivery/logistics business with the massive profits it gathered from its dominant cloud computing business.
Now that Amazon has crushed the competition and destroyed the value of malls and department store real estate across the country, they will swoop in and pick up retail real estate for pennies on the dollar, and become the new brick and mortar retailer on the block.
But guess what happens when competition is crushed by predatory pricing, and a monopoly rises? Prices go up, and up, and up.
Uber is a good example of how this turns out. Uber was able to skirt typical cab regulations by hiring David Plouffe, a senior advisor to President Obama (hired explicitly to fight regulation). From there, they were able to step in crush the entrenched and highly regulated cab industry, by undercutting them on price. Losses were subsidized by venture capital firms.
And now, according to Bloomberg, the market share of New York City taxis has dropped from 100% to 11% in eight years. Ride hailing apps have gone from zero to 81% of for-hire-transportation in NYC. And the number of yellow taxis on the New York City streets has been cut in half compared to pre-pandemic. And now, you guessed it, it costs more to take an Uber than it does a yellow taxi.
Expect the successful monopoly building by Amazon to have a similar outcome: higher prices of most things we consume, set and controlled by Amazon.