MadHATTERS HATTERs Bulletin Board Free trial

The digeconomy is coming (just ask the government)

11 July Subscribe
Tech news, HAT-slanted 
Issue 124

Another trillionaire

As of the 25th of April, Microsoft is now a trillion-dollar company, and five out of the five largest companies in the global economy are technology companies.

Is that too many? 

The US presidential election is getting fired up (at least on the Democratic side) and all of the candidates on the left are interested in more FAMGA regulation. We've already written about European legislators doing the same thing. 

At least since the 1980s, we've looked at antitrust legislation (or rather, the Americans have at the very least) in terms of what it means to the consumer. When we were breaking up oil conglomerates and steel monopolies, it was done to minimise the risk of large price increases. What was the negative behaviour risk when Facebook acquired Instagram, other than your pictures loading faster?

I mean - you've read the newsletter before, you know what it is. It kind of rhymes with Feta.

To the consumer, big tech merges mean better services at continually low or free prices (at least in the short term), but "generate a lot of non-price complaints." The argument here, that we've made over and over again, is that without a consumer voice in the mix of the Internet we're all screwed. Maybe the regulator operates with our best interests at heart, but maybe they don't - we need to democracies to keep governmental authority in check (in the west, anyways), and need the same balance online.

See if this doesn't put a little chill in your bones as you watch Amazon continue its march to global domination - it's from a great Vox article last week about regulation:

A now-infamous story Brad Stone recounts in his book about Amazon, The Everything Store, tells of Jeff Bezos’s thuggish behavior toward a startup called Quidsi that was trying to break into the e-commerce business with brands like Diapers.com and Soap.com. Bezos took notice of the company and dispatched an Amazon senior vice president to have lunch with Quidsi’s founders. The SVP’s message was simple: Amazon was thinking of getting into the diaper business and Quidsi should consider selling to Amazon as a way to make it happen.

Quidsi didn’t want to sell. So Bezos made clear it was an “offer you can’t refuse”:
 

Soon after, Quidsi noticed Amazon dropping prices up to 30 percent on diapers and other baby products. As an experiment, Quidsi executives manipulated their prices and then watched as Amazon’s website changed its prices accordingly. Amazon’s pricing bots — software that carefully monitors other companies’ prices and adjusts Amazon’s to match — were tracking Diapers.com.


This began to worry investors, who became hesitant to put more money into Quidsi. And then Amazon ratcheted up the stakes by rolling out a new service called Amazon Mom that offered huge discounts and free shipping on diapers and other baby supplies. Quidsi executives calculated, according to Stone, that “Amazon was on track to lose $100 million over three months in the diaper category alone.” By November 2010, Quidsi’s board agreed to sell to Amazon. A few years later, the Amazon Mom program ended; a couple of years after that, the Diapers.com brand went away entirely.

Cheap nappies today, the end of society tomorrow?

Yours in HAT,

Leila Trilby, Editor-in-chief

The present

HAT News

Symposia. We're hanging out in Cambs to talk about being a Digital Person last week! Huge thanks to John Naughton, Jon Crowcroft, Irene Ng, Graham Hill, and Max Van Kleek for your contributions. Slides and more are online if you want to follow up.

Metrics. You can't fight what you can't see! Big ups to Terry and team Asia for the newly-launched HATLABs analytics platform. Yay for data!

Events. AWS Summit was today and CogX is coming - if you're heading that direction we're putting together a gang of street-toughs I mean network of startup founders if you'd care to join

Jonathan Holtby, HAT Community Manager

Previous Issues