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Is Amazon the new Apple?

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johnk:
There seems to be a trend in DC forums for threads about particular business methods in the tech industry to turn into an anti-big business rant. I've worked in big business, and yes, I'm well aware of just how far companies will go to maximize returns to shareholders. I find some aspects of modern business distasteful. But then again, that's the company bosses' duty - maximising long-term returns.

As I've said in another thread, this is all circular. Most companies are ultimately owned by the investment funds that run people's pensions. These funds demand high returns, because people who buy pensions want the best possible returns. Beating up big business is all very well, but offering an alternative to modern capitalism would be more interesting.

Renegade:
...offering an alternative to modern capitalism would be more interesting.
-johnk (April 20, 2011, 07:23 AM)
--- End quote ---

There are actually some excellent models out there. Some can dovetail very nicely with modern capitalism.

However, bringing them up here is tenuous at best as they touch on economic models, which are both politically influenced and more importantly, philosophically influenced, which makes them tantamount to religious.

I try to temper my cynical attitude towards certain ideas with some humor. Sometimes I fail.

I can't help but comment on this:

...maximize returns to shareholders... ...that's the company bosses' duty - maximising long-term returns.
--- End quote ---

That is pretty much a mantra today, but the foundations for it are based on logical contradictions. (As far as that's worth anything - http://en.wikipedia.org/wiki/Tractatus_Logico-Philosophicus )

I'd best stop there as it's not really helpful.



The important point to take away from Deozaan's post there is that Amazon is destroying the market. It's not good for vendors or consumers. It's a win-lose-lose proposition. Amazon wins, and everyone else loses.

johnk:
I can't help but comment on this:

...maximize returns to shareholders... ...that's the company bosses' duty - maximising long-term returns.
--- End quote ---

That is pretty much a mantra today, but the foundations for it are based on logical contradictions.-Renegade (April 20, 2011, 07:47 AM)
--- End quote ---

It's more than a mantra, it's the board's duty (not a legally enforcable duty, but a fundamental principle of business).

But I am an optimist, and I have seen examples in recent years where companies have successfully increased returns to shareholders by emphasizing their ethical business practices, being transparent in their dealings with consumers and suppliers, increasing their donations to charities, and being generally good people. Increasingly, consumers seem to reward ethically sound companies with their custom. In the UK, at least, I also sense an increased willingness to make the effort to support local, small businesses, even if the price is slightly higher. There is a growing awareness that the consumer has to take responsibility for the world we are creating.

And that's the key. We get the companies, and the world, we deserve. Consumers decide where their money goes. I don't like Apple, I don't buy Apple stuff. Every vote counts. Be optimistic.

Footnote: Very small example of how things are changing (nothing to do with big business): I visited the web site of a local restaurant this week, just to get their phone number. I noticed that the modest web site contained a statement of business practices, including transparency. Example: every bottle of wine on the menu is priced at "cost price plus £8". I was impressed.

f0dder:
And that's the key. We get the companies, and the world, we deserve. Consumers decide where their money goes. I don't like Apple, I don't buy Apple stuff. Every vote counts. Be optimistic.-johnk (April 20, 2011, 08:24 AM)
--- End quote ---
Be optimistic when the world is full of sheeple? :(

Footnote: Very small example of how things are changing (nothing to do with big business): I visited the web site of a local restaurant this week, just to get their phone number. I noticed that the modest web site contained a statement of business practices, including transparency. Example: every bottle of wine on the menu is priced at "cost price plus £8". I was impressed.-johnk (April 20, 2011, 08:24 AM)
--- End quote ---
Impressive!

Renegade:
I can't help but comment on this:

...maximize returns to shareholders... ...that's the company bosses' duty - maximising long-term returns.
--- End quote ---

That is pretty much a mantra today, but the foundations for it are based on logical contradictions.-Renegade (April 20, 2011, 07:47 AM)
--- End quote ---

It's more than a mantra, it's the board's duty (not a legally enforcable duty, but a fundamental principle of business).

But I am an optimist, and I have seen examples in recent years where companies have successfully increased returns to shareholders by emphasizing their ethical business practices, being transparent in their dealings with consumers and suppliers, increasing their donations to charities, and being generally good people. Increasingly, consumers seem to reward ethically sound companies with their custom. In the UK, at least, I also sense an increased willingness to make the effort to support local, small businesses, even if the price is slightly higher. There is a growing awareness that the consumer has to take responsibility for the world we are creating.

And that's the key. We get the companies, and the world, we deserve. Consumers decide where their money goes. I don't like Apple, I don't buy Apple stuff. Every vote counts. Be optimistic.

Footnote: Very small example of how things are changing (nothing to do with big business): I visited the web site of a local restaurant this week, just to get their phone number. I noticed that the modest web site contained a statement of business practices, including transparency. Example: every bottle of wine on the menu is priced at "cost price plus £8". I was impressed.

-johnk (April 20, 2011, 08:24 AM)
--- End quote ---

Wise words. :)

The cynical side of me though can't help but be nauseated at the duplicity in a lot of companies though.

Maersk and "K" Line are now just starting to use sulphur reduced fuel (which is more expensive), which is a good thing in the shipping industry. But there are still shipping companies that will take "second hand" computers and tech gadgets for transport to Ghana where they are dumped as garbage, which is "illegal", but it's not illegal to transport "second hand" equipment.

Philips, GE, and a host of other companies will tout their wondrous efforts to be environmentally friendly, but they still produce light bulbs that are specifically engineered to only last a certain period, then die. There is a light bulb that has been on since 1901 at a fire station in the US! It's over 100 years old! Planned obsolescence is environmentally unfriendly. The list goes on there.

There are systemic problems that are difficult to solve. And every step forward is good, but it's simply not enough to claim that you helped an old lady across the street when your backyard is full of rotting corpses. I gave a dollar to charity... and robbed 10 from a kid. ??? Nah. I don't buy it.

I would have some respect for some of these companies if they would come out and say, "We're doing this and this and this and this, and they're all bad, but we change it all at once. We need cooperation from the rest of the industry, and here's our proposed schedule on how to do it." Transparency is admirable and commands respect. It's ok to have problems if you're willing to admit them and work to fix them.

That's probably the biggest obstacle for me to view things more optimistically.

But as you point out that restaurant, that's a bold and admirable thing to do.

I also have issues with advertising. While it's easy to say that "consumers can vote with their wallets", that's not really true. The average consumer cannot compete with the billions of dollars that are spent to convince them. Heck, there are child psychologists that work at nothing but how to indoctrinate advertise to children. It's not a fair fight. It's a slaughter. Consumers are nothing more than sheep in an abattoir.

I would love to see consumer education based on facts. That's not going to happen though.

Again, it's a systemic problem.

Can you blame companies? Well, yes and no. They're also caught up in the system, like some poor bugger who needs to put food on the table, and needs that job at the local abattoir. Is it his fault he's killing sheep? Well, yes and no. Can you blame him? Well, yes and no.

The big problems start when some nitwit figures out that he can also turn the abattoir into a brothel. Then every abattoir is the same within a short period. It's a downward spiral as Apple and Amazon are showing. They've turned the abattoir into a brothel. Now all the other abattoirs out there will follow suit.

Doom and gloom... :(

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