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Comment by losteric | Hacker News Reader

> The trouble with this argument (which gets made a lot) is that this is basically every large retailer.

Alternatively: there's no trouble at all, Walmart/Safeway/etc are all clearly engaging in this anti-competitive practice and must be reigned in. Marketplaces need to be regulated as neutral grounds for sellers, the marketplace cannot double-dip and compete against sellers or engage in practices that reduce competition between marketplace businesses.

Generics and knock-offs are fine, it just needs to be done by independent sellers.

Practices like down-ranking sellers for offering better prices elsewhere is just blatantly violating any sense of neutrality, reducing competition among marketplaces and increasing prices for customers.

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Aren't most of these generics all white-label anyway? I'm less worried about store-brand generics that are often outsourced, and more worried about behavior that drives any of the original manufacturers out of the business entirely because of monopoly over the entire sales chain.

How is it clearly anti-competitive if they are providing a better value for the consumer?

When a name brand has market power and charges a premium for a basic product, then another company entering the market and undercutting them is great for the consumer. We can make regulations to ensure that a distributor, advertiser, retailer and the product owner engage in arms length transactions but there’s nothing inherently wrong with a store brand offering products comparable to name brand at significantly reduced prices.

When considering "better value for the customer", remember that sellers are a customer of the marketplace too (arguably the primary customer!).

imo the problem is specifically generics branded and marketed by the marketplace. That's where a conflict of interest between the marketplace and sellers arises, which ultimately harms end-customers.

Amazon Private Brands (APB) typically buys from the same companies that make the random generics like "XOFUNBO" no-name brands. The issue is Amazon can use it's insider data to buy, brand, and market generics in-house, without paying the fees charged to sellers - achieving costs that 3p sellers fundamentally cannot compete with. Amazon's own corporate training highlights that sharing sales data with 3p sellers is illegal and anti-competitive, I don't know why APB should be seen as any different.

This is not even considering how sellers need to earn end-customer trust while Amazon can muscle coasting on their trust as the marketplace.

Marketplaces must be neutral ground for sellers, full stop. No seller can be given privileged access. Otherwise the market distorts to favor a seller and that ultimately harms the end-customers in the long-term by suppressing competition.

From what I understand the FTC is shifting away from the doctrine that consumer benefit/harm as the deciding factor for an antitrust case.

Okay so take the FTC out of it. Let’s say we’re writing the laws from scratch today. Why would store brand generics be outlawed?

They wouldn't, except for market dominating retailers.

So target and Walmart would still be allowed to do it because they aren’t market dominating? What’s the point?

I have come to this same conclusion as well.

Too many economic opinions are still predicated on the idea that the free market is still working correctly, and that there are effective controls in place. The reality is that - at least in the US - the controls are broken, and have been for a decade or more.

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