If you are still having trouble accepting the fact that climate change is real, then you are definitely not factoring in the overwhelming consensus of science. Earlier this week, the academic journal BioScience released a scientific research paper providing data from the past forty years, all pointing to the conclusion that our planet is currently in a state of climate emergency. Then, if the paper’s research is not enough on its own, perhaps the fact that over 11,000 scientists authorized it will help convince you.
At the bottom of the report, there are 11,258 signatures, all coming from different scientists across 153 countries and multiple disciplines. The paper’s multi-disciplinary approach creates room for a variety of evidence, demonstrating how global warming is effecting the planet from geological, biological, physiological, neurological perspectives and beyond.
This is also a wake up call about the fact that the science on climate change is no longer divisive. In science’s unbiased eyes, the Earth is in an unequivocal state of emergency.
“Climate emergency” is the exact diction that the paper uses to define the planet’s current situation. The words associated with climate change have evolved many times over the years. From “global warming” to “crisis,” language can certainly affect the way people think about the issue. The authors of this paper decided on “emergency” because it provokes more urgency than mere “change” but not as much chaotic hopelessness as “crisis.” After all, the purpose of the paper is to unveil proof and evoke action, not to have people helplessly bury their heads in the sand.
The paper outlines six major changes people must enact if they want to save the planet. Namely,
Implement massive energy efficiency practices and move to low-carbon renewables.
Reduce emissions of toxic pollutants such as methane, black carbon and hydrofluorocarbons.
Restore global ecosystems across reefs, forests, grasslands and more while preventing further biodiversity loss.
Reduce the consumption of animal products and opt for plant-based foods.
Focus less on economic GDP growth and more on sustaining ecosystems and human well-being.
Lower fertility rates to reduce the world population.
As the paper makes clear, these changes are hardly suggestions, but more like necessities at this point. If we do not alter our priorities in a timely manner, we will face the worst of climate change’s wrath and be utterly defenseless to it.
Like most realistic studies on the climate crisis, this paper is not for the faint of heart. It opts for harsh truth over optimism. That being said, the research is not without occasional glimmers of hope. The outline of solutions points us in the right direction. Similarly, the authors acknowledge recent surges in environmental protests and eco-friendly ingenuities across the world as ongoing positive changes. Data-wise, fertility rates are already dropping and more people are switching from fossil fuel burning to more sustainable, renewable energy practices. Likewise, even politics are slowly catching on to the issue, with the UK Parliament declaring a climate emergency and United States Reps. Alexandria Ocasio-Cortez and Earl Blumenauer and Sen. Bernie Sanders all introducing the Green New Deal to Congress.
The world is far from perfect, and more action is still needed if we want to combat climate change effectively. However, the science is nearly unanimous, and the debate surrounding the issue’s severity is no longer a point of contention. Now, we just need people in power to stand with science, believe in the facts, and put in place urgently needed changes to begin to find ways to save us all from possible extinction.
Boomerang Mistake being made by Manufacturers Likely soon to face Backlash
Under former President Barak Obama, a number of environmental policies were pushed to lower carbon emissions and combat the climate crisis across the United States. Ever since Trump entered office, though, the White House has been working to rollback much of the eco-friendly progress that Obama helped make possible.
In response to Trump’s careless approach to environmental issues, the state of California has taken it upon itself to put a cap on carbon emissions, with Governor Gavin Newsom proposing fuel saving and zero-emission requirements for automobiles throughout the state.
Being the most populated state in the nation, California is known for its traffic-filled cities and its progressive-minded people. Currently, the state is also feeling the effects of global warming firsthand, with unparalleled wildfires, droughts, and coastline erosion taking tangible tolls on the state’s residents and natural beauty. Therefore, it makes sense for California to go after cars in the battle against climate change, and if Trump is not going to help the Golden State, then it will make the changes for itself.
California’s proposed statewide legislation includes calling for lighter and more eco-friendly fuel-efficient vehicles. The state wanted to uphold Obama’s stringent goal of a 54.5 mpg average by 2026 rather than Trump’s far more lenient 36 mpg target. While this fuel-efficient technology might make cars more expensive up front, it would actually help drivers save money in the long run as they would not have to fuel up as often—thus avoiding the daunting California gas prices and pleasing the everyday car owner.
But, of course, these proposed policies did not please car manufacturers. With California setting its own emissions standard apart from the federal standard, car companies feel that it would be too difficult and expensive for them to adapt their vehicles just to fit a single state’s independent regulations.
State vs Federal – Who will Win the Urgent Fight for Environmental Policy Reform in the US?
For these reasons, many car companies sided with Trump and eventually solidified the federal government’s standards as universal, barring California from creating its own separate policies. Among these car companies that backed Trump were General Motors, Toyota, Hyundai, Mitsubishi, Mazda, and Fiat Chrysler Automobiles. These uber-wealthy corporate entities were powerful enough to sway policies against California.
Notice the irony, however, that hardly any of these companies produce American cars. Many of them are headquartered in Japan with the exceptions of Hyundai coming from South Korea and Fiat coming from Italy. General Motors is the sole American company on the list, and it is based in Detroit, over two thousand miles from the West Coast.
Despite the pushback, California is determined to continue fighting for environmental policy reform. Many of the state’s citizens and politicians alike are enthused about the idea of fuel-efficient and zero-emission requirements taking place. Even if Trump and an army of foreign auto corporations may have won this round, the Golden West is not giving up and will continue to campaign for constructive policies and initiatives in the ongoing battle against the climate crisis.
After their Destructive Secret was out, Exxon Mobil had yet to face Accountability until Now
It is no secret that Exxon Mobil hasn’t been the kindest to the planet over the years. The big oil company is one of the nation’s most prominent gasoline providers, and fueling automobiles is the world’s leading purpose for fossil fuel burning and the foremost cause of greenhouse gas emissions.
For years Exxon has gone unchecked for the environmental damage they have done as a company—after all, they were never really doing anything illegal. However, former Exxon Chief Executive Officer and U.S. Secretary of State under President Trump, Rex W. Tillerson is currently in hot water. The man is facing two legal battles, one in New York and one in Massachusetts, for allegedly lying to investors about the risks and impacts of global warming.
The Case Casts the Primary Offense towards their Investors, not the Environment
At last, Tillerson may be held accountable, but these are not environmental trials per-se. Instead, they are hitting the oil tycoon where it really hurts: his wallet. And the cases are not about compensating for ecological destruction, but something far more pertinent to those who navigate the corporate world: money.
In both New York and Massachusetts, Tillerson is accused of knowingly providing investors with false information about the climate crisis. Reportedly, Tillerson sold climate change as underwhelming, insignificant, and perhaps even good for business. Meanwhile, he depicted Exxon Mobil as a champion of environmentalism. While the company does do some philanthropy in that area, these statements clearly omit some essential details, namely that Exxon does far more harm than good for the natural world.
It may be a Fraud Case, but Tillerson’s Case could be a First Step towards an Environmental Win
Thus, the trial is really just a fraud case, a dry instance of one person deceiving another for financial benefit. These cases happen all the time and usually do not garner much attention. Given Tillerson’s prominence, though, and Exxon’s dodgy history in the battle against climate change, this particular fraud case has made some noise. While Tillerson argues that the press attention is unnecessary, pandering, and based on corporate stigma rather than facts, many environmentalists are happy to see a big oil company put on the stand and questioned about its impact on the planet.
At the end of the day, the trial is mainly about money, but the larger implications of Tillerson having to answer for Exxon’s climate denial involves something much more significant. Trojan-horsed as a fiscal wrongdoing, Tillerson’s current predicament stands as a testimony to environmental justice and shows that rich business executives are not immune to consequences.
If all this is confusing, that’s probably because major corporations usually try to mask these muddy legal situations with jargon and loopholes in order to maintain their quality public images. Right now, however, Tillerson may be caught in a trap, and Exxon’s lies, deceits, and blatant disregard for scientific accuracy are finally becoming apparent in black and white, even if what really brought him to the stand is printed in green.
Zuckerberg stumbled and evaded while attempting to respond to AOC on Facebook Behaviors and Policies, especially its Political “Lie Exemption” Policy
While Mark Zuckerberg’s controversial Libra cryptocurrency project is what initially got him into the House for another hearing on October 23rd, the House Financial Services Committee Members took this as an opportunity to express their concerns about Facebook’s paramount involvement in a variety of controversial issues.
Each committee member was given five minutes to address their Facebook policy concerns with Zuckerberg, and they did not waste their time, especially Alexandria Ocasio-Cortez as she interrogates him regarding Facebook’s influential role in endangering the nation’s democracy and general safety.
Here’s a brief rundown of the topics she addresses that continue to put Zuckerberg and his insidiously dangerous Facebook ‘megaphone‘ under hot water to this very day:
Libra Cryptocurrency: Another Scam to hide behind an Outsourced Entity in order to Evade Accountability? This time, he’s going for the Poor and “Unbanked”
On June 14, 2019, Zuckerberg released his plans to launch a cryptocurrency project called Libra on Facebook, and since then, it’s been facing a lot of criticism from the government and anti-trust regulators.
The Libra cryptocurrency is a part of Facebook’s future mobile payment system, proposed at Facebook’s annual developer conference in April. The crypto currency project aims to allow Facebook’s 2.4 billion worldwide users to exchange payments with minimal fees and without the need for a third-party software.
“It’s not that Facebook is evil, which it may or may not be. Facebook hasn’t shown an ability to think through unintended consequences or prevent bad actors from weaponizing its platform.”
ScotT Galloway, Marketing Professor at NYU, Author of “The Four”, well-known for his unsparing critiques of influential tech companies
But, while the idea appears to have good intentions behind it, much like many of Zuckerberg’s other ideas, the problems and potential dangers are in the details.
So, the real issue is in how the Libra cryptocurrency project can potentially influence Facebook’s extremely wide global user base in a number of negative ways.
“If 50 percent of Facebook users all of a sudden use this coin, then you potentially have a new reserve currency globally. If you would weaponize a global currency and start monkeying with it, you could have what capitalists fear more than war: a recession–or some sort of a global economic meltdown.”
SCOTT GALLOWAY
California Representative Congressman Brad Sherman interrogated Zuckerberg extensively on this topic during the Financial Services Committee Hearing, which illustrated these repercussions specifically.
Brad Shermon eloquently points out a pattern that Zuckerberg struggles to answer. He appears to be attempting to hide behind platitudes of egalitarian ideals in order to avoid accountability for content controlled by his platform.
“…but for the richest man in the world to come here and hide behind the poorest people in the world and say that’s who you are trying to help, you are trying to help those to whom the dollar is not a good currency—drug dealers, terrorists and tax evaders..”
Rep. Brad Sherman to Zuckerberg at the House FInancial Services COMmittee Hearing
Cambridge Analytica: AOC cites Facebook’s Biggest Scandal that brought ‘Catastrophic Impact’ to American Democracy in the 2016 Election
But the House Financial Services Committee wasn’t having it, and AOC Exposes Facebook’s Flaws for All to See:
"So, you won't take down lies or you will take down lies? I think that's just a pretty simple yes or no."
Complete exchange between @RepAOC@AOC and Mark Zuckerberg at today's House Financial Services Cmte hearing.
Alexandria Ocasio-Cortez begins her five-minute interrogation by citing Facebook’s Cambridge Analytica Data Scandal from 2018. Her reasoning is that, before even considering the Libra cryptocurrency issue, it’s important to analyze how Facebook handled Cambridge Analytica because the Libra cryptocurrency project has potential for far worse.
Essentially, AOC gave Zuckerberg a chance to make a case for himself. He had an opportunity to show that he and Facebook are equipped to adequately deal with the repercussions of establishing Libra, and to answer this fundamental question: has Facebook learned from its past mistakes regarding the Cambridge Analytica Data Scandal so that they could take the necessary actions to ensure that data scandals won’t happen again?
Next she asks, what year and month did Zuckerberg first become aware of Cambridge Analytica? He doesn’t remember, but it was probably around March 2018, when the scandal became public.
When did Facebook COO Sheryl Sandberg become aware of Cambridge Analytica? Again, Zuckerberg says he doesn’t know, so AOC asks a follow-up question. Did anyone on his leadership team know about Cambridge Analytica prior to when the initial report came from The Guardian on December 11, 2015? Now, for this one, Zuckerberg believes that this was the case and that members of his leadership team were tracking it internally. Additionally, he takes this opportunity and appears to try to avoid responsibility by saying that he was aware of Cambridge Analytica as an entity, but he also wasn’t aware of how they were using Facebook specifically.
When was the issue discussed with his board member Peter Teal? Once again, Zuckerberg proclaims his ignorance, to which AOC iterates that his answers are unacceptable. It is unacceptable that he did not properly discuss the “largest data scandal” with respect to his company that had “catastrophic impacts on the 2016 election.”
While Zuckerberg flaggingly scrambles to defend himself by explaining that they did discuss the issue when it happened, he fails to answer whether Facebook is capable of being accountable for their actions by addressing their mistakes with handling data privacy so that they wouldn’t be repeated. If Facebook truly cared about handling data privacy, then they would have taken extensive measures to address the issue. Maybe then, Zuckerberg would’ve actually remembered enough about the issue to answer AOC’s questions.
Facebook Policy allows Politicians to Pay to Spread Misinformation
Zuckerberg’s seemingly flagrant irresponsibility with regards to handling Facebook leads AOC to confront him on the current hot topic: “Facebook’s official policy to allow politicians to pay to spread disinformation in 2020 elections and in the future.” She demands to know how far this policy could be pushed before Facebook decides to fact-check and take down these posts, because, again, they have the potential to influence the next election directly.
Could politicians enact voter suppression by advertising wrong election date to zip codes with primarily black communities? Zuckerberg vaguely explains that content will be taken down if it were to cause an obvious immediate harm. Okay, but what if it’s not obvious? Will his answer suffice then? The answer is likely no, because infinite ways can be found to dodge this issue, then, once again, and we’re back to square one.
Further she presses him, Could she (AOC) run ads targeting Republicans in primaries saying that they voted for the Green New Deal? Zuckerberg is unsure, but answers that she probably could. Elizabeth Warren recently did something similar in her “Zuckerberg Supports Trump” ad.
Does Zuckerberg see the potential problem here with a complete lack of fact-checking on political advertisements? To that, he appeals to common morals: lying is bad. His logic is that he doesn’t want to prevent constituents from seeing that politicians had lied, which clarifies that Zuckerberg won’t take these ads down.
The problem with this logic is that the general public is assumed to have the ability to differentiate between lies and the truth. But, as this current presidency has proven, many, if not most, people clearly do not.
Thoughts on Zuckerberg’s On-Going Dinner Parties with Far-Right Figures? Debatable, or so he tries to imply.
Further, Zuckerberg’s on-going dinner parties in which he cultivates relationships with known politically far-right figures is also suspicious. After all, there have been numerous times that alt-right entities abused social media platforms in the service of discrimination and hate crimes.
Did Zuckerberg discuss the alleged social media bias against conservatives, and does he believe that this bias exists? Zuckerberg indicated that he couldn’t remember the question or answer it, appearing to want to avoid confirming or denying these associations under oath, so AOC moved on.
Next she asked Zuckerberg to explain why he named the Daily Caller, a publication well-documented to have ties to white supremacists, an official fact-checker for Facebook? Once again, Zuckerberg tries to escape responsibility by saying that they don’t actually appoint independent fact-checkers and that they come from an independent organization called the International Fact-Checking Network (IFCN) that has rigorous standards for who they allow to serve as a fact-checking entity.
White-supremacist-tied publications meet a rigorous standard for fact-checking? Zuckerberg had no answer, which is again, an indicator that she had pushed him into areas he would prefer to avoid. After research, it turns out that he lied, or at minimum mis-led in his answer on multiple points, First, the (IFCN) have generally “certified” a total of 62 organizations globally, but it is, indeed, Facebook and presumably Zuckerberg personally, that chose the 6 in particular that are Facebook partners.
There’s a Pattern Here: Facebook and other Social Media Platforms Need to be held Accountable
Clearly, Zuckerberg still thinks that he could get by with excuses in an effort to absolve himself from the endless blame that Facebook receives from The Media for meddling with numerous socially-influential affairs.
It’s hard not to notice that while Mr. Zuckerberg has been given many chances to make amends for Facebook’s failures, the opportunity has been for naught, apparently, because his private for-profit company is only interested in maintaining user engagement, which he now claims is in the name of free speech and equality. However, clearly, these cannot actually be achieved without specifically executing processes that address the discriminatory practices.
Imagine a Monster Dictator who claims he wants to Free us all from “Traditional Gatekeepers” while he Controls the Ultimate Gate with Iron Fist
Here, a man who almost single-handedly controls the world’s largest social network – with users counted in billions, implies that there is any connection whatsoever with heroes of the history of journalism and what is now disparaged as “The Media” but was once called the 4th Estate.
People having the power to express themselves at scale is a new kind of force in the world — a Fifth Estate alongside the other power structures of society. People no longer have to rely on traditional gatekeepers in politics or media to make their voices heard, and that has important consequences.
– Mark Zuckerberg
Claiming that, somehow, thousands of independent newspapers with tens of thousands of writers and editors, challenging governments and investigating corruption and lies is similar in any way to a digital dictatorship that controls every word or image through its algorithms, and has as its only goal to maximize private profits, is an outrage – and yet this point has only been hinted at in even the most critical coverage.
Express Ourselves at Scale? Really? As long as His Algorithm deems it in Facebook’s Monetary Interest
Mentioning the “traditional gatekeepers” blocking voices, as if his private, for-profit platform has no gate and makes no decision in which voices are heard and by whom is a lie, told in plain sight, so enormous it is shocking.
Except, as he clearly hopes, on hearing vague pronouncements about a fantasy world, most will just switch focus, away from the real way his digital empire functions to some kind of vague discussion of “free speech”. And, in the case of political advertising, speech that he collects millions of dollars to promote and propagate, with no thought of actual free speech that will be drowned out and silenced by his dictatorial decision. That’s the real gatekeeper at work.
Talking about “free speech” as having any role whatsoever on a platform where exposure is controlled 100% by the same network’s private corporate ownership is worse than any Jospeh Goebbles propaganda the Nazi’s ever came up with and is an Orwellian nightmare come to life.
Since Zuckerberg’s speech was clearly designed to confuse and cover up this simple, obvious fact, using Trump style repetition of simple irrelevant lies to influence people to abandon the more complex truths, the underlying truth bears repeating.
I heard #MarkZuckerberg's ‘free expression’ speech, in which he referenced my father. I'd like to help Facebook better understand the challenges #MLK faced from disinformation campaigns launched by politicians. These campaigns created an atmosphere for his assassination. pic.twitter.com/h97gvVmtSZ
Yelling “fire” in a Crowded Theater is of no use if the Crowd can be digitally disappeared at any time
Claiming that “censorship” of “free speech” is not appropriate for a platform that controls who sees and hears that content 100% at all times has to stand as the criminal obfuscation of the century.
As misleading propaganda it is brilliant in its stupidity. To imply that any speech at any time is “free” on a platform that controls access by each and every user at all times is ludicrous at best and vile propaganda at worst.
Have millions of dollars to spend to ensure that your lies are seen by millions? No problem. Have inflammatory disgusting views to share? Sure, the algorithms love anything that increases “engagement”.
On the other hand, as members of the actual 4th Estate found out during the “Great Purge” of 2018, if Zuckerberg & Co decide that you should not be seen for any reason, usually a reason that pertains to increasing profits for Facebook, then you are disappeared, Pinochet style, and can forget about your “free speech” being heard or seen ever again.
Nice way to build a “5th Estate “ to protect us from “traditional gatekeepers”.
We intentionally made a Facebook ad with false claims and submitted it to Facebook’s ad platform to see if it’d be approved. It got approved quickly and the ad is now running on Facebook. Take a look: pic.twitter.com/7NQyThWHgO
Algorithmic Crimes are the Real Story, bigger and worse than Traditional Antitrust Violations
Just mention the word “algorithm” and we all tend to get glossy-eyed and begin to lose interest.
Never mind that the results of your Google search are controlled by algorithms that “decide” what you should be allowed to see or not, while what you may buy is controlled by the private, infinitely biased algorithm employed by Amazon, whose only goal is to increase its own profits at your expense. And then there’s Facebook.
A master of dystopian science fiction would be hard pressed to envision a more sinister, hellish world than the one we already inhabit, where what you think, what you think you “know”, what you believe and what you consume are all controlled by what are essentially robot brains, owned and controlled by evil private corporations with trillion dollar market caps.
And Mr. Zuckerberg has the nerve to talk about “Free Speech” on Facebook? In the words of Greta Thunberg “How dare you!”, and as in the struggle against the powers that profit from the accelerated extinction of future generations, it’s time to end the Algorithmic Dictatorships and, via the real Fourth Estate and free the billions that are, as yet, unknowingly victimized, by whatever means necessary.
According to “a source knowledgeable about the probe” and quoted by Reuters and The Washington Post in stories today, more than 30 attorneys general will announce the investigation next week.
In response to the news Google issued the following statement:
“We continue to work constructively with regulators, including attorneys general, in answering questions about our business and the dynamic technology sector”
Google representative Jose Castaneda
The source also intimated that the probe would be focused “on the intersection of privacy and antitrust”, but did not give any further detail.
In July, the US Justice Department announced that it would begin a broad investigation into the possible anticompetitive practices of the largest technology companies. It has been considered likely that Google, Amazon, Facebook and possibly even Apple would be in the crosshairs.
The Federal Trade Commission, who are also responsible for the enforcement of antitrust violations, is looking into Amazon and Facebook and whether they have abused their dominance in online retail and social media, respectively.
Google, after having large fines levied against them in Europe in March for antitrust violations relating to online advertising, will now face the task of changing the outcome of similar accusations of misconduct in the US.
Amazon also has had difficulties coming out on top in European cases. Only yesterday in Paris, the Commercial Court handed down a verdict against the online giant, resulting in a 4 million euro fine and a demand that 7 key clauses in their agreement with “marketplace seller partners” be brought into compliance with French laws.
Meanwhile, Facebook is also under scrutiny as they are under investigation by the FTC for a potential breach of antitrust regulations. Similar to Google in the European case mentioned above, the probe into facebook involves its social media, digital advertising and mobile applications.
Graphic / Lynxotic / Adobe Stock
In a separate matter, Facebook is also under scrutiny by the European Commission in questions relating to its new Crypto Currency “Libra”. A more general inquiry into its possibly anticompetitive behaviors within the EU in also underway.
Overall, it appears likely that these various probes are only the beginning, as all of the massive tech companies mentioned are already the target of governments and politicians, particularly in the US and Europe.
In a peculiar twist, both Republicans and Democrats in the US seem to agree on at least one thing, that these companies are too big and too powerful and should be investigated at minimum and potentially targeted in antitrust actions for illegal behaviors.
The Trump Administration, AOC, Elizabeth Warren, even Joe Biden have come out in favor of breaking up big tech at the hands of the government, after serious violations of antitrust law have been established.
Most significant aspect is not the tiny fine, but the requirement that Amazon change it’s marketplace seller agreement on 7 of 11 practices that were deemed unfair
In a related development to our opinion piece published yesterday, the commercial court in Paris fined the giant US firm for clauses in it’s mandatory agreement for sellers that were found to be abusive and unfair.
In an exclusive story published (in French) by Next INpact the verdict was explained based on ongoing local coverage of the story.
In the article, which you can read in a google-generated translation provided below, it is noted that, similar to the US marketplace, in France approximately 60% of the income for Amazon’s online retail sales is generated by third-party sellers, using the Amazon Marketplace. Total sales are approximately 5 billion Euros per year.
Screen Shot of the Court Document (can be downloaded as PDF below
Of the 11 clauses that were scrutinized in the suit – 7 of them were deemed to be in violation of:
”Article L442-6 of the Commercial Code prohibits “to submit or attempt to subject a trading partner to obligations creating a significant imbalance in the rights and obligations of the parties”.
– Next Inpact reporting on the verdict in the commercial court of paris
Some examples of the offending clauses are summarized in the verdict, which will sound very familiar to US marketplace sellers:
“one of them allows Amazon to modify at any time, without notice, and in its absolute discretion the contract binding to sellers.
Result: either the seller resigns or he loses a significant share of turnover. A clause deemed “exorbitant of French law and contrary to all uses” concludes the decision.”
Nextinpact.com
“Another clause pinned, the one that allows Amazon to terminate a contract with immediate effect “for any reason and at any time by simple notification.
‘A contractual condition much too “general, discretionary and imprecise”, considers the court which notes the absence of notice and proportionality.”
“In the end, the court ruled that 7 of the 11 clauses pinned by Bercy were clearly unbalanced to the detriment of third-party sellers.“
nextinpact.com
With US anti-trust actions potentially moving forward at anytime, it is doubtful that this ruling, although representing little more than a “parking fine”, will be overlooked by prosecutors seeking to build a future case against the giant retailer.
As follows the full, rough, translation of the original article:
EXCLUSIVE.
The Paris Commercial Court sentenced Amazon to a fine of 4 million euros. The platform is also obliged to amend seven clauses under penalty. In question, the existence of a significant imbalance to the detriment of third-party sellers passing through this marketplace. Next INpact releases the judgment of 2 September 2019. In 2015 and 2016, the Directorate-General for Competition, Consumption and Fraud Control launched several surveys of marketplaces accessible in France. The goal? Gauge this sector and update any anti-competitive or restrictive practices.
Three companies stand out, all related to Amazon: Amazon Payments Europe, Amazon Service Europe and Amazon France Services, respectively APE, ASE and AFS. In December 2017, Bercy revealed his procedure initiated before the Commercial Court in July 2017. The administration recalled the ban on restrictive practices. Article L442-6 of the Commercial Code prohibits “to submit or attempt to subject a trading partner to obligations creating a significant imbalance in the rights and obligations of the parties”.
It claimed for this purpose in particular a civil fine of 9.5 million euros. The importance of this amount is easily explained. The company generates in France a turnover of over 5 billion annually.
And more than the majority of sales (60%) are made by third-party sellers, those using its marketplace. During its investigation, the DGCCRF identified several clauses that constitute a significant imbalance. They relate to contracts linking third party vendors with Amazon.
The jurisdiction of the French courts
Over the 49 pages, only APE, which deals with the part “payment”, could finally be put out of cause, not the other two companies. In this respect, Amazon France Service has been considered as a commercial partner of ASE, associated in the development of marketplaces.
ASE has also tried another circumvention: to oppose to the court the clause that attributes jurisdiction to the Luxembourg courts, while ensuring that two thirds of its sellers would be installed abroad.
The blow of the sword touched the water: the provisions in question being police laws, they are not subject to contractual conditions.
A significant imbalance
In the body of the decision, three points were sought: the existence of an economic bid, obviously unbalanced contract clauses and finally a possible rebalancing for the benefit of sellers in the benefits of using this platform.
The criterion of the tender was retained without difficulty, by the combination of several ingredients. Vendors face non-negotiable clauses. Amazon enjoys an economic power without equivalent.
The site is even essential for small third-party sellers, boosted by the network effect (or snowball).
“Amazon is obviously one of the” superstars “of the Internet, which this network phenomenon explains the exponential growth.
11 clauses were identified by the Minister of the Economy in his procedure.
For example, one of them allows Amazon to modify at any time, without notice, and in its absolute discretion the contract binding to sellers. It is up to the seller to look for this information published in the conditions of the site.
Unhappy, he can still terminate the contract, “but then without having had time to find a substitute,” said the court.
Result: either the seller resigns or he loses a significant share of turnover. A clause deemed “exorbitant of French law and contrary to all uses” concludes the decision.
Amazon was unsuccessful in arguing that trading with 170,000 vendors was impossible in an automated process. What the court told him was that “the automated system, precisely because it is, would work just as well with notice.”
With a certain malice, he also recalls that billions of transactions are made every day and that Amazon is in perfect ability to send them a letter on the order, and another on the state of delivery.
discretionary clauses
Another clause pinned, the one that allows Amazon to terminate a contract with immediate effect “for any reason and at any time by simple notification.”
A contractual condition much too “general, discretionary and imprecise”, considers the court which notes the absence of notice and proportionality.
Similarly, Amazon offers the possibility of imposing limits on salespeople based on “performance factors” without explaining their scope and the consequences of non-compliance with the evaluation criteria.
Still in the same vein, the platform is sanctioned for having the freedom to prohibit or restrict access to the site “at its sole discretion”. According to Amazon, the idea is to fight against the sale of dangerous products.
Only problem, the consular judges have not found this clarification in the contract. Same fate for the part that authorizes ASE to refund a customer even in case of non-return of the product of the third-party seller.
An imbalance not compensated by the benefits removed
In a logic of “balance”, the court then examined whether the imbalance of most pinned clauses was not offset by a series of benefits for sellers:
consumer confidence for Amazon, tools sharpened to facilitate management commercial operations, in addition to the storage of products.
The judges mainly recalled that these different benefits are not offered, but have as counterpart “the level of the various commissions paid to ASE by the third vendors”.
And these different benefits also benefit ASE for its own products and attract more and more third party sellers.
“On the other hand,” he says, “some of the shortcomings, especially those relating to business performance indicators, are such as to allow Amazon Service Europe to use a stipulation to, after testing a new product on a market. launched by a third-party seller, favoring the sale of his own to determine that of the third-party seller after aligning his price “.
7 censored clauses, 4 million euros fine
In the end, the court ruled that 7 of the 11 clauses pinned by Bercy were clearly unbalanced to the detriment of third-party sellers.
Amazon will have to modify them. 3 will remain intact, and one has been modified during the procedure. Amazon will have to modify them within 6 months, on pain of 10,000 euros per day.
Rather than the 9.5 million euros defended by Bercy, the court has finally revised down the fine to 4 million euros, especially given the good faith of Amazon, and different “positive steps” since the opening of the procedure.
Note however that the DGCCRF had requested the parameters of the algorithm used, from the United States, to highlight the products in the “Buy Box” Amazon … In vain.
The court finally refused the publication on the grounds that the press release of Bercy dated December 18, 2017 had been very widely (disseminated) and that this judgment should suffer a similar fate.
The observations in this article are based on candid conversations with long time sellers on the Amazon Marketplace platform. As is typical, none of the sellers would agree to be named, for fear of retribution by the giant online retailer.
Reading titles of articles like “Amazon May Have a Counterfeit Problem”, the sellers we spoke with could only laugh at the equivocation and doubt. This, apparently, is not a “maybe” thing for those with intimate knowledge of the situation.
“The real situation is that Amazon’s fee structure and shipping requirements only allow for counterfeit, illegal import or “gray market” products (such as returns that are still “new” but not factory sealed) to be sold at a meaningful profit.”
– anonymous marketplace seller
There are plenty of lawsuits by well known manufacturers who claim there is a big problem with fakes selling on the Amazon platform. Daimler AG, the company that produces Mercedes-Benz products, filed a lawsuit in Washington State, and Birkenstock, the European shoe maker, has complained loudly and publicly about the situation, and ultimately pulled their Brand from the site altogether.
The problems go much deeper than this. According to the sellers we spoke to the issue is literally built into the entire inventory of more than 500 million products listed on the site.
One reason why this is not fully reported, or even spoken of, is the fear of retribution.
A second reason is the way Amazon uses a legal strategy of “having it both ways”; customers feel like they are always buying from Amazon itself when buying on the site, or at least that they are protected by Amazon. At the same time when bigger problems do arise, suddenly, the marketplace is a pseudo-public area which can not be directly linked back to Amazon and for which they claim to have no liability.
But it is the third reason that shields the mega-site, more than anything else, from bad publicity: the fact that, in order to understand the issues thoroughly, a deep investigation into its history and business practices is required.
Apparently, according to our extremely experienced sources, it all goes back to the time, before 2008, when Amazon was still primarily an online bookstore (For years, in fact, the site’s tagline was “Earths biggest bookstore”).
Ponzi Reinvented for the Digital Age: with the blessing of the US Gov.
The “business model” at that time was simple yet brutal; buy books directly from publishers at the full wholesale price and sell them for that same amount with “free” shipping (for prime members).
And in doing this they accomplished many things, all near and dear to their founder’s heart:
-Annihilate all book sellers, online or off, since selling at zero margin could only be done by losing billions, which, in-turn, only an online Wall Street financed “dot-com darling” could afford.
-Addict the suppliers (publishers) to the steady flow of sales, with the percentage from Amazon relentlessly rising until it is the only significant buyer.
-Preemptively destroy any online seller by putting the barrier to entry so high that it would be suicidal to even try to compete (see the diapers.com saga)
-Brain-wash the public into thinking that it was “normal” to be able to buy products at wholesale prices (with free shipping) and that there was nothing “fishy” about the fact that only Amazon could afford to do it (by losing billions, on paper).
An Offer they Couldn’t Refuse: Sell or Die
From a Businessweek / Bloomberg story about how Bezos forced Diapers.com, owned by Quidisi, out of business (buying them out after the strong-arm mafia-like practices outlined below):
“Quidsi could now taste its own blood. At one point, Quidsi executives took what they knew about shipping rates, factored in Procter & Gamble’s (PG) wholesale prices, and calculated that Amazon was on track to lose $100 million over three months in the diaper category alone.
When Bezos’s lieutenants learned of WalMart’s counter-bid, they ratcheted up the pressure, telling the Quidsi founders that (Bezos) was such a furious competitor that he would drive diaper prices to zero if they sold to Bentonville.”
-report published in Businessweek and recounted in “The EVerything store”
All of this was a spectacular success, for Amazon, as can be attested to by the recently acquired “richest man-in-the-world” title. Amazon lost billions per quarter for decades and, and, yet, as the “last man standing” eventually turned that around into the creation of the world’s richest human. All stemming from virtual monopoly in online sales of ALL products in the US (over 50%, with the second largest online seller at 6.6%). Imagine even one other online retail company with more than 20% and it’s easy to see there is no “competition” for Amazon and no real alternative for buyers or sellers.
And what about sellers on the Amazon Marketplace? Did they benefit from the massive success of the platform (as they contributed more than 50% of revenue to the giant retailer)?
All the anecdotes of “some guy in Minnesota” who resells Walmart clearance items, aside, the only winners in that part of the story were and are …wait for it… counterfeiters, illegal importers and gray market sellers. Oh, and Chinese “no-brand” factories that sell on Amazon in the US.
Why?
It seems that, square in the bullseye of Amazon’s hit-list, in addition to anyone that sells anything who’s not on Amazon, is the very group that has kept the company afloat all these years: The millions of, mostly small, sellers on the marketplace all trying to eke out a living.
They have zero leverage and no where else to go to sell online (remember virtually all the customers are already locked into the Amazon platform due to the “bribery” of too-good-to-be-true prices and free shipping), therefore, they can be gouged with impossible fees.
The fee structure is, as you might expect, complicated, but fees are the highest of any online marketplace and never fall, only rise, which they do often, according to sellers. For items at lower price points deducted fees can be as much as 50%. The real costs are hidden in fees like “variable closing” and other made-up monikers to obfuscate the real reasoning behind the math. But in practical terms, selling a $8 item can cost up to $4 in added fees.
But, and this is the complicated bit, even that might work for a legitimate seller if not for the fact that, in many cases, the seller is competing against Amazon itself! And, as you have seen above, prices have no bottom limit as profit is not required for Amazon to “win”.
To wrap this mind-boggling concept up with a bow: if any company wants to realize even 1 cent of retail profit after fees, selling on the Amazon Marketplace, it must acquire the goods for roughly 70-90% below standard retail prices, and even that might not be sufficient.
Who can do that? Chinese no-brand factories shipping directly to the US with subsidized USPS shipping rates, counterfeiters, illegal importers and gray market sellers. Period.
A thorough investigation of the millions of sellers currently selling on Amazon would, without a doubt, say our sources, turn up not just a few bad apples, but a system that is virtually rotten to the core. Beyond even Elizabeth Warren’s wildest fears.
Thankfully, weekend headlines were replete with stories denouncing Trump’s most recent barrage of racist tweets, these singling out Rep. Elijah Cummings and Baltimore, and the district that he represents.
@TheRealAdolfHitler: What if Hitler was on twitter? would he tweet about “rat infested” Jewish areas of Berlin?…
Even CNN, until recently not known for hard line resistance, pointed out and criticized the Nazi-like tone and technique in the tweets – how they echo the Nazi era anti-Semitic propaganda, that labeled Jews as “parasites” and used photos of rats to imply filth and disease. Infestation was also a concept used, the implication that Jews, like rats, carried disease and decay.
The most alarming, discouraging element of this ongoing debasement of our political discourse is the possibility that this disgusting circus could be extended initially through 2020, and even into another four years and beyond.
“It can’t happen here” is a well known phrase and the title of an influential novel from 1935 by Sinclair Lewis. In many ways, as others have pointed out, Trump echos the main character and could even conceivably have used his story as a blueprint for his career in politics.
The phrase, “it can’t happen here”, seems to be contradicted on a daily basis since November 9, 2016, and the degree to which the horrors of the past can be repeated, or at least echoed continues, with seemingly no end in sight.
The “enemy of the people”, as Trump has labeled the media (at least all that dare to speak out against him), seem to be the only hope, ultimately, of effecting a change for the better, which can only come once Trump is no longer in power.
The attacks on Cummings were racist propaganda, of that, there is no doubt. There is also a clear motive for the attacks, since the target is the chairman of the House Oversight Committee, which is charged with overseeing the Executive Branch, including the office of the President.
After years of endless lies, Trump appears to be upping his game, ahead of the coming election. With a clear pattern of weekend twitter propaganda, such as the “go back” tweets, which for most represented a new low, and yet are clearly outdone by this weeks sequel.
Many articles and famous figures have responded, from the Baltimore Sun’s scathing inditement, to CNN’s Victor Blackwell and his live on-air, heart-felt reaction, and even Stephen Curry’s comment on his segment:
It's this kind of boldness that our country needs! Keep calling him out. I'm not from Baltimore- but I know countless people who are. Teammates, family, hardworking employees. All People that represent the best qualities of what it means to be American! & who want to live there!
As the years of this presidency have progressed, and the lies and vicious attacks have escalated, the press has also adapted and evolved.
For almost a year after the 2017 inauguration, the press generally avoided using the word “lie” in reports of Trump’s “untruths”. There was an attempt to maintain respect for the office and to somehow show deference to a man that, ultimately, has proven himself to be beneath that courtesy. As the lies continued to pile up and the press was directly attacked on many occasions, boldness and honesty begin to seep into the reporting.
“…all of us, starting with the media, must speak out now, and not stop until he is gone.”
Now, the words “racist” and “bigot” are necessary and accurate in any description of the man, or his actions and ideas. The tweets of the last few weeks have set a new lower standard, even for Trump, in how blatantly his bigotry and racism can be displayed.
The congressman himself had several strong responses to the attacks that should be seen:
Mr. President, I go home to my district daily. Each morning, I wake up, and I go and fight for my neighbors.
It is my constitutional duty to conduct oversight of the Executive Branch. But, it is my moral duty to fight for my constituents.
Mr. President, we can address this together. Two years ago, I went to the White House to ask you to endorse my bill to let the government negotiate directly for lower drug prices.
Ultimately, unless we want to see a future that mirrors the almost 12 years, between the time that Hitler became chancellor of Germany until his death, and experience a fate that is potentially even worse: all of us, starting with the media, must speak out now, and not stop until he is gone.
In the past, comparisons with Hitler were a kind of “red-line” that was seldom crossed, as the horrific historical legacy of the Nazis was thought to be too extreme, even to contemplate, in a modern day figure.
“Afghanistan would be wiped off the face of the Earth – – it would literally be over in 10 days” -because- “I just don’t want to kill ten million people”
Now, we are talking about a man who only last week boasted that, if he wanted, “Afghanistan would be wiped off the face of the Earth – – it would literally be over in 10 days” because “I just don’t want to kill ten million people”. Implying that he could change his mind about not killing 10 million in Afghanistan, or anywhere else, at any time.
This past weekend may, one-day, be seen as the beginning of a march toward 2020 and another Trump term, with consequent escalation of all the ugly policies and actions.
It could be just the beginning, with all this power-drunk behavior, from a man that has indicated that he believes his supporters might “demand” that he serve more than 8 years. And “joked” that he feels he should be “president for life”, after repealing the 22nd amendment.
Combine these disturbing ideas and extrapolate, even just slightly forward, and step by step, we are talking about a future that is virtually impossible to imagine in its potential for hate, death and destruction.
We are entering a time when the transition to calling “a lie” a lie, a “racist” a racist and soon a “fascist” a fascist, will either work to eventually re-establish the goal of democracy and equality and truth as our real American greatness, or Trump will indeed be a new, far worse, version of Hitler, Goebbles and the Third Reich all rolled into one.
Hyperbole? Hysteria? This is a time when a single man or woman can influence the future of this country and the world. Will it be this man? This racist, bigoted, hateful, corrupt “rat” of a man?
Or will it be you, as one of millions who will stop him? As history indicates, the real choice is to begin the movement to stop him now, or look forward to horrors from which the world itself may not survive.
At a staged speech in front of the White House on Monday under the auspices of a pre-planned “Made In America” event, Mr. Trump started off, as he often does, from the teleprompter, then, veered off into continuation of the weekend’s twitter tirade. The traditional, annual, event which is coordinated with “Made in America Day” and “Made in America Week” is a standard “pro-America” pep rally meant to give the President the opportunity to tout his patriotic agenda.
After a few remarks from the usual scripted pro-American manufacturing playbook, and his usual boasts about how the stock market and job market success are due, exclusively, to his having been elected, he launched into a defense of his racist tweets that have been dominating the news cycle over the weekend.
Reporters present pushed Mr. Trump to respond to the trending topic, rather than continue with the purported theme of the day, praise for American made jobs, products and manufacturers. In response to one reporter’s query:
“Does it concern you that many people saw that tweet as racist and that white nationalist groups are finding common cause with you on that point?”
He replied:
“It doesn’t concern me because many people agree with me. And all I’m saying, they want to leave, they can leave.”
Everything New is Old Again
This exchange led to additional back and forth on the theme “Love It Or Leave It”, a hackneyed slogan from the sixties, and, with 50 year anniversaries of the Apollo Moon landing and Woodstock this summer, it seems oddly fitting that a Republican President, echoing Nixon, should be trying to re-ignite that tired refrain.
Even as reporters continued to try and question the motives and meanings of his, clearly racist, tweets aimed at the congresswomen, Trump continued to beat the “love it or leave it” drum:
“If you’re not happy in the U.S., if you’re complaining all the time, very simply, you can leave. You can leave right now. Come back if you want, don’t come back, it’s OK too. But if you’re not happy, you can leave,” Sadly this all seems like a scripted melodrama straight out of the Nixon campaign.
Meanwhile the specter of alleged communist sympathy, taking us all back to the “HUAC” witch hunts of the 50s, of all things, was hurled at the target of Trump’s weekend tweets, by none other than that schizophrenic sycophant, Lindsey Graham:
I see [Lindsey Graham’s] biggest issue w/ Trump’s racism is that it doesn’t go far enough – Graham wants to bring back 1950s McCarthyism, too.
GOP is doing this because they have no plan for our future.
We’re the ones fighting for healthcare, edu, good jobs, & they got nothing.
– ALEXANDRIA OCASIO-CORTEZ – IN A TWEET
I see @LindseyGrahamSC’s biggest issue w/ Trump’s racism is that it doesn’t go far enough – Graham wants to bring back 1950s McCarthyism, too.
GOP is doing this because they have no plan for our future.
We’re the ones fighting for healthcare, edu, good jobs, & they got nothing. https://t.co/pfAEATWbJl
Tired, Old Ploy, Once Again Trotted Out to Muddy the Waters
This entire episode, starting with the offensive tweets, is obviously a ploy to draw battle lines – again harkening back to the Nixon campaign and his “Silent Majority” refrain, complaining that protesters against the Vietnam war were a small minority, and that he spoke for the majority in his (soon to be proven criminal and corrupt) positions and policies.
Sadly, unless the strategy is undone by a more enlightened electorate, we could be headed for a similar fate: Nixon won in a landslide in 1972 only to resign before almost certain impeachment in 1974 after a “long national nightmare”.
Hopefully the parallels with ‘69 – ‘72 will end in November 2020.
Trump’s Goons Set Loose on Cities Across the Nation: Some ICE raids Currently Underway
As promised, ICE raids are in progress across the country, as announced by the Trump administration and widely reported.
There have been over 2000 immigrants targeted for arrest in a host of major cities: New York, Chicago, Miami, Atlanta, Baltimore, Los Angeles, Houston, San Francisco and New Orleans. It appears, possibly as a tactic, that smaller rural communities are also seeing action.
Receiving reports of attempted but reportedly unsuccessful ICE enforcement actions in Sunset Park and Harlem.@NYCImmigrants and advocates are connecting with residents and distributing resources door to door.
Mayors in some cities have spoken out strongely against the actions, such as New York’s Mayor de Blasio as seen in the above tweet. The Mayor’s Office of Immigrant Affairs added a video to remind those affected of their options under the law.
The video reminds those targets and any other immigrants that they have the right to refuse to open their doors and do not have to respond, according to the law in New York City, for example.
According to witnesses in areas already targeted in New York, people appear to be avoiding going out in public and streets are quieter than usual.
In what was likely not a coincidence, on Saturday, Trump chose to hurl xenophobic insults at Democrat Congresswomen, implying that they are not American and should “go back and help fix” the “places from which they came” :
The tweets, clearly meant for the progressive wing of the Democratic Congress, were not only racist and xenophobic but also, as is sadly, no surprise, wrong. Alexandria Ocasio-Cortez was born in New York City, Rashida Tlaib was born in Detroit and Massachusetts Congresswoman, Ayanna S. Pressley was born in Cincinnati. Only Ilhan Omar of Minnesota, was born outside the country, in Somalia.
“You are angry because you can’t conceive of an America that includes us. You rely on a frightened America for your plunder.
You won’t accept a nation that sees healthcare as a right or education as a #1 priority, especially where we’re the ones fighting for it. Yet here we are.”
– Alexandria Ocasio-Cortez, in Tweet responding to trump’s tirade
You are angry because you can’t conceive of an America that includes us. You rely on a frightened America for your plunder.
You won’t accept a nation that sees healthcare as a right or education as a #1 priority, especially where we’re the ones fighting for it.
So interesting to see “Progressive” Democrat Congresswomen, who originally came from countries whose governments are a complete and total catastrophe, the worst, most corrupt and inept anywhere in the world (if they even have a functioning government at all), now loudly……
When @realDonaldTrump tells four American Congresswomen to go back to their countries, he reaffirms his plan to “Make America Great Again” has always been about making America white again.
The LA Times reported, in an interview with Melissa Taveras of the Florida Immigrant Commission, based in Miami, that the onset of possible raids was like waiting for a hurricane:
“The overall environment is very much like a hurricane: When is it going to come, is it going to hit us, is it going to move north?”
Melissa Taveras , Quoted in the L.A. Times
“The overall environment is very much like a hurricane: When is it going to come, is it going to hit us, is it going to move north?” she said. “We have people in Homestead, Little Havana, Little Haiti — where we know there are concentrations of immigrants — distributing ‘know your rights’ pamphlets. That seems to be effective because we’re already hearing reports of people not opening their doors.”
Her organization was advising families to be sure to have a relative or attorney’s contact information memorized in order to contact them, if detained, and that they need to be sure to give them details of where they are taken, along with full name and birthday, in order to help try and get them released, if arrested.
Teeth or not in Inquiry? Jawboning or action for Targeted Tech?…
Commenting on the antitrust review announced by the Justice Department on Tuesday, in an interview on CNBC, Mnuchin said that “it is good that the attorney general is going to look into this”.
Also saying that Amazon has “limited competition”, “hurt small businesses”, and that it was “absolutely right” for the Attorney General to look into “these issues”.
Amazon "has destroyed the retail industry across the United States," says Treasury Secretary Mnuchin. "It's absolutely right the Attorney General is looking into" anti-trust issues. pic.twitter.com/z5Mhc96xMa
On Tuesday, the Justice Department announced via press release that it would initiate a review to determine if major online platforms had “reduced competition, stifled innovation or otherwise harmed consumers”.
”The Department of Justice announced today that the Department’s Antitrust Division is reviewing whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers.”
Department of Justice Release from Tuesday, July 23, 2019
Interestingly, the idea of some kind of antitrust action against Amazon, Google or Facebook is one that is gaining traction among Republicans and Democrats alike. Senator Elizabeth Warren in particular has often spoken of the need for intervention.
Each of the “market-leading online platforms” have built-in defenses against traditional antitrust actions, which have traditionally looked for dominant companies where consumer prices were directly impacted by use of monopoly profits (such as in United States v. AT&T and later, v. Microsoft).
In the case of Facebook and Google, profits are hidden behind “free” products and services which allow the companies to claim that no harm comes to consumers as a result of their power. Naturally, the idea that the products and services come without cost is losing credibility in light of the many scandals and instances of harm, monetary or otherwise.
Kindergarten Colors and “Consumer Obsession” while Evil Lurks Beneath…
In the case of Amazon, it is even more complex, since, as a company famous for enormous losses rather than profit, all while using various loss leader strategies to prove that it is “consumer obsessed” and not a monopoly at all.
Indeed, Amazon’s response to the Justice Department’s press release was, through a spokesman, that Amazon accounts for “less than 4% of US retail sales” and that “small and medium-sized businesses are thriving with Amazon”. Not mentioned was the dominant 50% share of the online sales market.
By comparison the second largest online sales channel, eBay, for 2019 is estimated to reach 6.1%, while Walmart’s online platform has an approximate 4.6% share.
Rarely has the media been able (or willing) to unravel the deeply complex history of Amazon’s strategies – which can be traced all the way back to the incredibly favorable pricing of it’s stock during the dot.com bubble boom and it’s “stealth” transformation from “The World’s Largest Bookstore” into “The Everything Store” over a ten year period.
The closest definition for its business behavior is as a “monopsony”, which can be defined as holding a monopoly over suppliers or labor, not consumers.
And this is where the “hurt small businesses” comes in. Any small retailer wishing to survive, let alone make a profit, must have online sales in some form (ask Walmart if you doubt that online sales are a necessary requirement for a brick and mortar retail business in 2019) and the domination in that area – that is to say the control of the customers, by Amazon is so extreme that joining the Amazon Marketplace is the only option (other than trying to survive with 90% fewer online sales).
And the Marketplace is controlled with an iron fist by Amazon. For example, since around 2006 all communication between Amazon Marketplace sellers and their buyers is handled by an encrypted, anonymous messaging system designed to prevent sellers from obtaining any direct email addresses from buyers.
This amazingly elaborate system is a glaring indicator, hiding in plain sight, that Amazon views its “selling partners” as anything but.
Although third-party sellers accounted, for example, for 50% of paid units sold on Amazon in 2016, every customer was considered to belong 100% to Amazon and zero percent to the seller.
With fees that can total up to 50% (they use a complex exponential sliding scale which makes it impossible to quote any exact figure) the seller is doomed to have no brand value and no “good will” value as long as it agrees to cooperate on the platform. Not selling on Amazon, unless extremely well capitalized (such as a start-up with hundreds of millions of dollars), is a death sentence.
Naturally, the waters remain muddy, since examples of the precise opposite can be pointed to – if you are a manufacturer and your products are extremely cheap (you are probably in China) and you like to offer your margin to Jeff Bezos as “his opportunity” and, particularly if your products will harm an Amazon competitor that refuses to sell on Amazon, the red carpet will be laid at your feet.
3 Brands Take Over Earth, Almost No-one Notices
It’s odd, as an observer, to note that there is not a single “brand success story” that can be pointed to as having built their brand through the Amazon third-party Marketplace. Could this be more than a coincidence?
”What I am glad we never did and that we’ve avoided so far is being on Amazon”
Jen Rubio, co-founder and chief brand officer of Away
Take, for example, Away Luggage, who went from being a “direct to consumer” start-up founded in 2015 to recently reaching a valuation of over one billion dollars and who made it a point NEVER to sell on Amazon;
She added that a “deal breaker” was that Amazon does not share customer data with vendors.
”Just sticking to our guns and not going on the [Amazon] platform was important for us”
Jen Rubio, Away
In our own recent interview with a long time Amazon Marketplace seller, who insisted on not being named, “or my children’s lives would be in danger”, he stated that many more behaviors towards seller “partners” are anything but collegial.
One of many examples is the “co-mingling” policy. As with much of what goes on behind the scenes at Amazon, this is an opaque, complex concept where all products that reside in any Amazon warehouse (supplied by various sellers participating in the “Fulfillment by Amazon” program) are considered to be “co-mingled” once they arrive.
When an item is purchased from a particular seller any item from any supplier is “picked” and shipped to the buyer. If that item is somehow inferior or even counterfeit, the seller whose name is on the order is automatically blamed although there is no way to trace the item’s true origin.
Our anonymous interviewee stated that, in one case, he was put out of business and even sued as having sold a counterfeit item, even though all his inventory was purchased from the original authorized manufacturer, and he could prove it.
Why didn’t he fight the false and obviously bogus accusation? $50,000 to $100,000 in Legal fees and no chance of any remedy other than, perhaps, re-instatement with no guarantee that the same thing wouldn’t happen again 2 days later.
One could get the impression, surveying the various accounts from sellers, across many walks of life, that Amazon’s perspective is not only that it is unimportant what happens to a particular seller that runs into problems on its platform, but that the demise of any seller is a “win” and that harm to any seller is harm to a competitor, even if that entity is technically a “Marketplace Partner”.
If true, this is as disturbing as any “consumer harm” effected through higher prices, as the sellers, who are also consumers let’s not forget, are just as trapped in the platform’s private “hell” as any consumer who is forced to pay higher prices as a result of monopolistic behavior.
Stories like the one above are “out-there” by the thousands but, strangely, hard to find online. A search on Google (oh yes, one of the other companies being scrutinized by the Justice Department) for “Amazon harms sellers” would often, in the recent past, bring up nothing but links to Amazon itself and how it is harmed by “counterfeit sellers” as if all the problems on the platform are created by the “other guy”.
Interestingly, even that is beginning to change, and there are more and more articles by reputable outlets such as Forbes , The Verge and INC who are daring to take information publicly gathered, as in our case, often from anonymous sources fearing retribution, and report on it without fearing similar retribution to its own organization. It seems likely more such stories will be published in the coming days and months. And perhaps, as they say, one day, the chickens will come home to roost.
