[kirinan]

Andreessen makes some really excellent points in there, but there a few that just strike me as incorrect:

> Another classic Krugman rhetorical maneuver. According to Paul, keeping prices low is a sign of monopoly power, but of course he’d also say that keeping prices high would also be a sign of monopoly power.

Yeah its both. You can be a monopoly by having ridiculously high or low prices, mainly its really low then really high and if you think Amazon wouldnt raise everything by 100$ if it could, you're just wrong.

> It will startle every single business owner and CEO in the world to learn that negotiating with suppliers is now a business tactic that is “out of line”.

No negotiating is smart. Strong arming is wrong. Amazon is strong arming people not negotiating. They are playing the game where if you don't agree with what they are doing they are taking their toys and leaving. This causes economic harm to the company because of Amazon's volume to the point where the publishers have to use Amazon's terms which is monopolistic power.

[fleitz]

That's pretty much how negotiation works.

If a company doesn't give me the raise I want, I accept an offer from a company that does give me the raise I want: "Taking my toys and going home"

If you say "Well, I don't agree with you, however, I'm going home and leaving my toys here for you to play with" then you'll probably end up at home without any toys.

Taking your toys and going home is your BATNA. Hachette has a shitty BATNA and is hence losing the negotiation, because they don't have any toys Amazon wants, and hence Amazon doesn't care they are going to go home and whine to daddy Krugman that little Jeffery isn't sharing his toys.

It's 2014, taking words from a text file from some author, putting them into a PDF isn't some kind of miracle that warrants 90% of the cost of the book.

[ameister14]

The case mentioned a lot in the article, that of Standard Oil, is one where prices were kept very low, and continuously lowered through improved efficiency. Even when they had 90% market share, Standard Oil kept prices low for consumers.

There's a real argument to be made about the efficiency of monopoly, particularly where a destructive pattern of competitive behavior had been the norm previously. Rockefeller made that argument, albeit unsuccessfully at the time, but I don't think it is any less compelling for that.

Even if you allow that Amazon is a monopoly, competition is not intrinsically good. Competition is generally good where it improved the options and prices available for the consumer. That wasn't really the case with big publishing companies before.

[dminor]

If Amazon wants to charge less for Hachette's ebooks, how would you have them negotiate that?