In this and later posts, I want to explain how this shift from territorial to functional sovereignty is creating a new digital political economy. Amazon’s rise is instructive. As Lina Khan explains, “the company has positioned itself at the center of e-commerce and now serves as essential infrastructure for a host of other businesses that depend upon it.” The “everything store” may seem like just another service in the economy—a virtual mall. But when a firm combines tens of millions of customers with a “marketing platform, a delivery and logistics network, a payment service, a credit lender, an auction house…a hardware manufacturer, and a leading host of cloud server space,” as Khan observes, it’s not just another shopping option.
Digital political economy helps us understand how platforms accumulate power. With online platforms, it’s not a simple narrative of “best service wins.” Network effects have been on the cyberlaw (and digital economics) agenda for over twenty years. Amazon’s dominance has exhibited how network effects can be self-reinforcing. The more merchants there are selling on (or to) Amazon, the better shoppers can be assured that they are searching all possible vendors. The more shoppers there are, the more vendors consider Amazon a “must-have” venue. As crowds build on either side of the platform, the middleman becomes ever more indispensable. Oh, sure, a new platform can enter the market—but until it gets access to the 480 million items Amazon sells (often at deep discounts), why should the median consumer defect to it? If I want garbage bags, do I really want to go over to Target.com to re-enter all my credit card details, create a new log-in, read the small print about shipping, and hope that this retailer can negotiate a better deal with Glad? Or do I, ala Sunstein, want a predictive shopping purveyor that intimately knows my past purchase habits, with satisfaction just a click away?
Read more From Territorial to Functional Sovereignty: The Case of Amazon
FrankPasquale’s work is excellent. extremely looking forward to this new series
7th January 2018
Notes: 14
WHOLE FOODS: CUSTOMER, NOT RETAILER
This is the key to understanding the purchase of Whole Foods: to the outside it may seem that Amazon is buying a retailer. The truth, though, is that Amazon is buying a customer — the first-and-best customer that will instantly bring its grocery efforts to scale.
Today, all of the logistics that go into a Whole Foods store are for the purpose of stocking physical shelves: the entire operation is integrated. What I expect Amazon to do over the next few years is transform the Whole Foods supply chain into a service architecture based on primitives: meat, fruit, vegetables, baked goods, non-perishables (Whole Foods’ outsized reliance on store brands is something that I’m sure was very attractive to Amazon). What will make this massive investment worth it, though, is that there will be a guaranteed customer: Whole Foods Markets.
(via Amazon’s New Customer – Stratechery by Ben Thompson)
Extremely good essay. well worth a read.
STACKS STACKS STACKS - Jay
Introducing AWS Snowmobile: Exabyte-Scale Data Transport - yes. That is a truck! #AWS #reInvent
Maybe we have mistaken The Cloud’s fiction of infinite storage capacity for history itself. It is a misunderstanding that hinges on a weird, sad, very human hope that history might actually end, or at least reach some kind of perfect equipoise in which nothing terrible could ever happen again. As though if we could only collate and collect and process and store enough data points, the world’s infinite vaporware of real-time data dashboards would align into some kind of ultimate sand mandala of total world knowledge, a proprietary data nirvana without terror or heartbreak or bankruptcy or death, heretofore only gestured towards in terrifying wall-to-wall Accenture and IBM advertisements at airports.
But databases alone are not archives any more than data centers are libraries, and the rhetorical promise of The Cloud is as fragile as the strands of fiber-optic cable upon which its physical infrastructure rests. The Internet is a beautiful, terrible, fraught project of human civilization.
"Ingrid Burrington, “Why Amazon’s Data Centers Are Hidden in Spy Country” (via frankfurtschooldropout)
New piece by the off mentioned, and generally fantastic Ingrid Burrington
Reblogged From frankfurtschooldropout-deactiva
“First, in the name of all that is good and noble, we launch an immediate compulsory purchase order of all Amazon’s UK assets, assessing its value solely on declared profit, backed up with ferocious boots on the ground if necessary. That way we get a shit-hot deal. We guarantee to all workers below senior management level that they’ll keep their job and see significantly improved salary and working conditions within, say, one year, if they stay on.
We guarantee senior management individuals the right to remain at liberty within the UK and offer immunity from personal prosecution on grounds of mass tax fraud, in return for their promise of no legal resistance anywhere in the world, nor co-operation with any international lawsuits launched by Amazon’s global owners. We hold those who refuse on remand in custody, perhaps under anti-terror legislation, enabling the denial of legal representation. Maybe render them extraordinarily to the Chagos and quietly tell the Americans they’re carrying state secrets.
Once we own it, the real fun starts. First rebuild the relationship with the post office from the ground up, so it is symbiotic instead of leaching. Keep open all lines of cross-fertilisation and trade with international Amazon sites, which – after squealing like little piggies for a bit and begging Obama to invade Hertfordshire – they will accept, in melancholy realisation that they’ll still make more than enough to feed their kids. We guarantee all suppliers an improved proportion of their sales that is competitive with independent privately owned bookshops and record stores – and also does not significantly undercut those outlets’ retail pricing.
It would work. It would. Purely in infrastructure terms, if it were run for social reasons with the mission statement of helping to improve our country via the comprehensive distribution of culture…”
