#mostfavorednation — Public Fediverse posts

Amazon is the global champion of payola. It boasts of *$31 billion* in annual "ad" revenue. That's $31 billion that Amazon sellers have to recoup from you. But Amazon's use of #MostFavoredNation deals (which requires sellers to offer their lowest prices on Amazon) mean that you don't see those price-hikes because sellers raise their prices *everywhere*:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

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Amazon is the global champion of payola. It boasts of *$31 billion* in annual "ad" revenue. That's $31 billion that Amazon sellers have to recoup from you. But Amazon's use of #MostFavoredNation deals (which requires sellers to offer their lowest prices on Amazon) mean that you don't see those price-hikes because sellers raise their prices *everywhere*:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

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She points to the sky-high fees Amazon extracts from sellers (45-51% of each dollar!) and the company's use of #MostFavoredNation deals to force sellers who raise their Amazon prices to pay those rents to raise prices everywhere else, too:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

Now, a new Amazon Paradox has dropped, and it drills into another way that Amazon overcharges most of us by as much as 29% on nearly every purchase, disqualifying it from invoking that consumer welfare cheat code.

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She points to the sky-high fees Amazon extracts from sellers (45-51% of each dollar!) and the company's use of #MostFavoredNation deals to force sellers who raise their Amazon prices to pay those rents to raise prices everywhere else, too:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

Now, a new Amazon Paradox has dropped, and it drills into another way that Amazon overcharges most of us by as much as 29% on nearly every purchase, disqualifying it from invoking that consumer welfare cheat code.

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The lack of competing retail outlets lets Amazon impose other rent-seeking conditions on its sellers. For example, Amazon has a "#MostFavoredNation" requirement that forces companies that raise their prices on Amazon to raise their prices everywhere else, which makes everything you buy more expensive, whether that's a Walmart, Target, a mom-and-pop store, or direct from the manufacturer:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

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The lack of competing retail outlets lets Amazon impose other rent-seeking conditions on its sellers. For example, Amazon has a "#MostFavoredNation" requirement that forces companies that raise their prices on Amazon to raise their prices everywhere else, which makes everything you buy more expensive, whether that's a Walmart, Target, a mom-and-pop store, or direct from the manufacturer:

https://pluralistic.net/2023/04/25/greedflation/#commissar-bezos

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Now, Amazon is turning the screws. A new report from the @ilsr details the 45% #AmazonTax that every merchant pays to reach you:

https://ilsr.org/AmazonMonopolyTollbooth-2023/

That 45% tax is passed on to you - whether or not you shop at Amazon. Amazon's secretive #MostFavoredNation terms mean that if a seller raises their price on Amazon, they have to raise it everywhere else, which means you're paying more at #WalMart and #Target because of *Amazon's* policies.

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Now, Amazon is turning the screws. A new report from the @ilsr details the 45% #AmazonTax that every merchant pays to reach you:

https://ilsr.org/AmazonMonopolyTollbooth-2023/

That 45% tax is passed on to you - whether or not you shop at Amazon. Amazon's secretive #MostFavoredNation terms mean that if a seller raises their price on Amazon, they have to raise it everywhere else, which means you're paying more at #WalMart and #Target because of *Amazon's* policies.

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Amazon uses both tacit and explicit "#MostFavoredNation" deals to hide these price-hikes. Under an MFN deal, sellers must not allow their goods to be sold at a lower price than Amazon's - so when they raise prices to cover Amazon's increasing fees, they raise them everywhere:

https://pluralistic.net/2023/04/25/greedflation/

It's not hard to understand why Amazon would raise its fees: the company has an effective e-commerce monopoly.

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Amazon uses both tacit and explicit "#MostFavoredNation" deals to hide these price-hikes. Under an MFN deal, sellers must not allow their goods to be sold at a lower price than Amazon's - so when they raise prices to cover Amazon's increasing fees, they raise them everywhere:

https://pluralistic.net/2023/04/25/greedflation/

It's not hard to understand why Amazon would raise its fees: the company has an effective e-commerce monopoly.

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Amazon binds its sellers over to something called #MostFavoredNation status. That means that sellers can't offer their goods more cheaply than they do on Amazon - even if it costs them (lots) less to sell in Target or direct from their websites. This means that every time a seller adds a dollar to their Amazon sale price, they have to add a dollar to the price of their goods *everywhere else*, too.

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Amazon binds its sellers over to something called #MostFavoredNation status. That means that sellers can't offer their goods more cheaply than they do on Amazon - even if it costs them (lots) less to sell in Target or direct from their websites. This means that every time a seller adds a dollar to their Amazon sale price, they have to add a dollar to the price of their goods *everywhere else*, too.

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Not only that, but the Big Three's deal with Spotify includes a #MostFavoredNation clause, which means that the independent artists who aren't under Sony/UMG/Warner's thumb have to take the rock-bottom rate the Big Three insisted on - likewise the small labels who compete with the Big Three.

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Not only that, but the Big Three's deal with Spotify includes a #MostFavoredNation clause, which means that the independent artists who aren't under Sony/UMG/Warner's thumb have to take the rock-bottom rate the Big Three insisted on - likewise the small labels who compete with the Big Three.

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