It’s not apples to oranges, because the network effects (and coercive pressures they create) are in fact incredibly similar: sellers have to go where most customers are, and most PC gamers begin and end their search for games on Steam, just like most online shoppers begin and end their searches on Amazon.
While that’s true, counterexamples are great ways to disprove overreaching implications like “companies must sell on Amazon to be successful”.
It is not a requirement. It might be the most profitable way to run an e-commerce business (in which case you’re obviously benefiting from the system Amazon created).
Nobody thinks that it’s impossible, which is incredibly rare, but rather that it’s very costly not to comply, which is the source of every monopolist’s power. Could Pepsi refuse to sell at Walmart to avoid the huge wholesale discounts they demand over smaller stores? Sure, but it would shoot themselves in the foot, and that’s the source of Walmart’s anticompetitive power, which coerces Pepsi (and lots of other suppliers) and hurts lots of smaller businesses who don’t get the same discount.
It isn’t a monopoly because they don’t require you to use their store. Epic has a monopoly of epic exclusive games.
And ecommerce sellers don’t “have to” sell on Amazon, so they don’t have any market power they can abuse to extract 40-50% fees from sellers, right?
Amazon requires price matching for most sellers, which is shit and makes this an apples to oranges comparison.
Could Steam back down on their 30% cut? Sure, but not a monopoly.
It’s not apples to oranges, because the network effects (and coercive pressures they create) are in fact incredibly similar: sellers have to go where most customers are, and most PC gamers begin and end their search for games on Steam, just like most online shoppers begin and end their searches on Amazon.
They don’t. My small business sells direct from our site instead of in Amazon, and we do okay.
Anecdotes are not data!
While that’s true, counterexamples are great ways to disprove overreaching implications like “companies must sell on Amazon to be successful”.
It is not a requirement. It might be the most profitable way to run an e-commerce business (in which case you’re obviously benefiting from the system Amazon created).
Nobody thinks that it’s impossible, which is incredibly rare, but rather that it’s very costly not to comply, which is the source of every monopolist’s power. Could Pepsi refuse to sell at Walmart to avoid the huge wholesale discounts they demand over smaller stores? Sure, but it would shoot themselves in the foot, and that’s the source of Walmart’s anticompetitive power, which coerces Pepsi (and lots of other suppliers) and hurts lots of smaller businesses who don’t get the same discount.