Saturday, September 08, 2012

Amazon Economics: The Amazon Doctrine

 
In the video above, while unveiling the new Kindle Fire HD tablets, Amazon CEO Jeff Bezos explains one the reasons for Amazon's amazing success starting about 1:05:00, it's called:

The Amazon Doctrine

Above all else, align with customers. 

Win when they win. 

Win only when they win. 

That's Amazon's corporate version of consumer sovereignty, explained here as "profit-seeking sellers find that they can make the greatest profit by providing the best possible products for the price (or the lowest possible price for a given product)."

HT: Sprewell

69 Comments:

At 9/08/2012 10:33 AM, Blogger Buddy R Pacifico said...

It's been my opinion, for about the last year and half, that Amazon is aligning with consumers...

by moving to a less text oriented business model.

Lenghty texts, in the form of books, is giving way to short videos in the consumer digital marketplace.

Eg:

MRUniversity's first course consists of ~five minute videos.

BTW, Seattle's downtown skyline now include an Amazon Jungle of buildings that will relentlessly surpass over 6,000,000 square feet.

 
At 9/08/2012 1:32 PM, Blogger Scott Drum said...

I have worked with companies that subscribed to Bezo's premise, and I have worked with those that rejected it. In the long run Bezo's premise holds more often than not. In the short run I have found just the opposite to be true. It depends heavily on whether you are trying to build a major franchise or maximize this year's earnings.

Years ago when I worked for a large consumer packaged goods company, one of my colleagues had a quotation from our CEO on the wall of his office. It said:

"Soy protein is the food of the future."

Underneath it he had penciled:

"But my incentive check comes in June."

 
At 9/08/2012 2:13 PM, Blogger juandos said...

Well as someone who's tried Amazon twice and been twice thoroughly disappointed it seems to me at least that there is quite a gap between what's being said versus what's being delivered...

 
At 9/08/2012 9:39 PM, Blogger VangelV said...

Well as someone who's tried Amazon twice and been twice thoroughly disappointed it seems to me at least that there is quite a gap between what's being said versus what's being delivered...

That is not my experience. While I would be happier if the earlier versions of the Kindle were a bit more robust I have found Amazon to be a wonderful company that has provided me with very cheap books and has helped to lower book prices.

 
At 9/08/2012 10:01 PM, Blogger D Kirk said...

I think thier doctrine is refreshing. At the end of the day, doesn't the economy go round and round based on the end of the line consumer? Perhaps it is a bit idealogical, but i wish my company would be so customer centric.
One way or the other Amazon has staying power through the tech highs and lows.

 
At 9/08/2012 11:00 PM, Blogger Hydra said...

" It depends heavily on whether you are trying to build a major franchise or maximize this year's earnings."


Amen.


Now consider this in the context of government.



 
At 9/08/2012 11:05 PM, Blogger Hydra said...

"profit-seeking sellers find that they can make the greatest profit by providing the best possible products for the price (or the lowest possible price for a given product)."


Yes, but what about

Total Cost = Production Cost + External Cost + Government Cost?


As a profit seeking seller, Bezos is concerned Primarily with the first term on the right side. To the extent that enough enlightened consumers demand that he consider their other costs, he will, but that is likely to exclude (or redefine) what is the lowest price for a given product.

 
At 9/08/2012 11:07 PM, Blogger Hydra said...

"When money talks, it lies. When Big Money talks, it tells big lies. Would you *design* an economic system that consistently leaves anywhere from 20% to 40% of the population worried about paying their bills every month? An agricultural system that destroys the soil and breeds plants for "shelf life" and resistance to toxic pesticides? A food system that produces "food" loaded with sugar, salt, and saturated fats knowing it will make people sick and shorten their lives? A health-care system that profits from sickness and leaves people to die because they can't pay? An industrial system in which a worker is maimed or killed every hour of every day? A system in which workers have to fight and even die for every concession, every scrap, from employers, only to have them take it away again the moment they can? BECAUSE THAT IS THE SYSTEM WE HAVE. These behaviors are not aberrations. They are business as fucking usual. THIS IS CAPITALISM. Not "bad" capitalism. Just capitalism."

Adam Francis Cornford.




Lest you think there are no such customers as consider their true costs and not just the apparent price.



 
At 9/08/2012 11:10 PM, Blogger Hydra said...

" At the end of the day, doesn't the economy go round and round based on the end of the line consumer?"

==============================

No. It goes round and round based on the lowest total cost, as defined above. When we have a completely ethical and moral capitalist system, we can eliminate much of the government cost term. But uless there is some entity that demands consideraton of the second term, business has little incentive in that direction.

 
At 9/09/2012 12:22 AM, Blogger Ron H. said...

"Lest you think there are no such customers as consider their true costs and not just the apparent price."

Well, there's 1.

Heh! Where did you FIND this nutjob?

His first error is suggesting that someone could design an economic system. From that low point the drivel just gets worse.

Although there's no indication what he would prefer to free market capitalism, even you must understand that other "designed" systems have failed and caused tens of millions of deaths and untold misery over the years, and that capitalism has provided better lives for more people than any other system.

"Yes, but what about

Total Cost = Production Cost + External Cost + Government Cost?
"

LOL! That nonsense again!

"As a profit seeking seller, Bezos is concerned Primarily with the first term on the right side. "

You have no clue clue what Bezos is concerned with.

"To the extent that enough enlightened consumers demand that he consider their other costs, he will, but that is likely to exclude (or redefine) what is the lowest price for a given product."

They demand things by not buying his products and services. That would be his clue that he wasn't doing something right. There appear to be 10s of millions of people who love his products and services, so other than you and Adam baby boycotting Amazon, he appears to be doing the right things.

Perhaps your silly Total Cost is already included in the price of amazon products.

"" At the end of the day, doesn't the economy go round and round based on the end of the line consumer?"

==============================

No. It goes round and round based on the lowest total cost, as defined above. When we have a completely ethical and moral capitalist system, we can eliminate much of the government cost term. But uless there is some entity that demands consideraton of the second term, business has little incentive in that direction.
"

What total bullshit. Consumers will decide what businesses succeed and which fail. So far they are voting in huge numbers for Amazon.

Learn some economics.

 
At 9/09/2012 1:10 AM, Blogger Ken said...

This comment has been removed by the author.

 
At 9/09/2012 1:17 AM, Blogger Ken said...

Hydra,

Adam Francis Cornford's whole statement is bullshit. We live an amazing amazing world and it's wasted on the crappiest generation of spoiled idiots. Your sense of entitlement is astounding that you and everyone else are just entitled to someone else's labor for no other reason than you don't want to actually have to work for it. It is you and that attitude that is a sickness on this country and the entire Western way of life. "[O]ur country has become emotionally disconnected from an essential part of our workforce. We are no longer impressed with cheap electricity, paved roads, and indoor plumbing. We take our infrastructure for granted, and the people who build it.

In other words, quit your bitching. If you think you can farm producing more nutritious and healthy food, do it. If you think you can run a medical center that is cheaper and cures more people's diseases and heals more people's hurt, do it. If you think you can build an industrial plant in which fewer workers get hurt less often and are paid better, do it.

Put up or shut up. Otherwise, your just a whiny, spoiled bitch.

These are the things capitalism is responsible for. In 1800, over 99% of the population of the world and over 99% of Americans made less than $700/year. Today, no one in America lives on that (the median of all workers, not just full time, is $25,700/year) and less than 15% of all of humanity does. Life expectancy has doubled. Infanty mortality has tanked. Diseases that scourged mankind for thousands of years have all but been eliminated (except for malaria, which could be stopped by DDT if we didn't have idiots preventing DDT from being used).

Capitalism did this. Non-centrally planned, independent workers coordinating and organizing for their own gains, i.e., capitalism, did this. All top down "designed" systems turned into hellish nightmares. Cornford ridiculously asks "Would you *design* an economic system that consistently leaves anywhere from 20% to 40% of the population worried about paying their bills every month?" forgetting completely that 100% of people didn't have electricity, running water, hot water on demand, super cheap food, cars, phones, refrigerators, washing machines, AC, and millions of other things in this world that make our lives unimaginably better just 200 years ago. All of these wonderful things, brought to us by capitalism, are simply taken for granted. And out of pure greed, all you can say "More. This isn't enough."

 
At 9/09/2012 1:25 AM, Blogger Ken said...

Hydra,

Capitalism is the greatest story ever told.

 
At 9/09/2012 8:50 AM, Blogger hancke said...

Bravo Ken!

 
At 9/09/2012 9:04 AM, Blogger PeakTrader said...

Ken, on a related note, although women are great shoppers, they need a class called "Opportunity Costs."

The first question can be:

Would you rather have $5,000 a year more in real income and buy private birth control or $5,000 a year in less income and receive free birth control?

 
At 9/09/2012 1:24 PM, Blogger juandos said...

"While I would be happier if the earlier versions of the Kindle were a bit more robust..."...

Well vangeIV you bought cheap so you got something cheap...

"...a wonderful company that has provided me with very cheap books..."...

Maybe I should've tried their books instead of their electronics...

Then again when orders a laptop and a Samsung smart phone shows up instead I should've figured there might be a problem...

 
At 9/09/2012 1:28 PM, Blogger juandos said...

Excellent link on capitalism ken and I thank you...

 
At 9/09/2012 3:38 PM, Blogger Hydra said...

You call my total cost equation nonsense, yet you complain about government cost and offer no better equation.

 
At 9/09/2012 3:56 PM, Blogger Hydra said...

Considering that it is surrealist bullshit, cornfords remarks sure stirred up a vendetta.

 
At 9/09/2012 4:08 PM, Blogger Bruce Oksol - oksol@yahoo.com said...

When one orders a laptop, and a SmartPhone shows up, it suggests to me, operator error.

I've used Amazon.com for years, and have been thoroughly impressed. Only one missed order among hundreds, and that was a third-party reseller -- not Amazon.

And the reseller promptly credited me a refund.

Nope, my suspicion with regard to "SmartPhone instead of a laptop," operator error.

 
At 9/09/2012 4:11 PM, Blogger Bruce Oksol - oksol@yahoo.com said...

Bravo, Ken.

 
At 9/09/2012 5:57 PM, Blogger O. Mencken said...

Jeff : You did build that! Good for you (and me).

 
At 9/09/2012 8:03 PM, Blogger Hydra said...

I was taught that externalities and government are part of the study of economics.

You woul like government to be more economical, no?

 
At 9/09/2012 8:40 PM, Blogger Jon Murphy said...

You woul like government to be more economical, no?

The literature on the economics of government is vast

 
At 9/09/2012 9:03 PM, Blogger juandos said...

"I've used Amazon.com for years, and have been thoroughly impressed. Only one missed order among hundreds, and that was a third-party reseller -- not Amazon"...

Well bruce there's the rub...

Was it Amazon or was it a 3rd party?

Considering that I saved the screen shots of what I order online (habit I picked long before Amazon) so I know what I filled out was right...

The other screw-up from Amazon wasn't nearly so flawed...

I ordered six 4 gig SanDisk cards for my Archos player and what showed up were SanDisk alright but in the 16 gig capacities...

Interestingly enough I emailed asking them if they wanted to swap them back for what I originally requested and they said if I could live them so could they...

Cool!

 
At 9/09/2012 9:25 PM, Blogger Ron H. said...

juandos

"Then again when orders a laptop and a Samsung smart phone shows up instead I should've figured there might be a problem..."

Well a Samsung smart phone IS almost as useful. :)

Seriously, did they correct the problem quickly at no additional charge?

 
At 9/09/2012 10:15 PM, Blogger VangelV said...

Well vangeIV you bought cheap so you got something cheap...

I do not think that the Kindle is very cheap and have certainly no trouble with paying a higher price. For anyone who wants to read books on an electronic device the options are limited to e-ink readers like the Kobo or Kindle. Apple and most other tablet manufacturers certainly fail the test because tablets are not suitable for a comfortable reading experience.

Maybe I should've tried their books instead of their electronics...

Amazon does not make electronics. It simply sells electronics made by manufacturers who use it to get customers. I had no trouble buying an excellent lens for my Nikon DSLR. It was much cheaper than my local options and took less time to order and get delivered.

Then again when orders a laptop and a Samsung smart phone shows up instead I should've figured there might be a problem...

Amazon has a very high satisfaction rating. I have only had one order not show up and suspect that was due to the courier delivering to the wrong address.

 
At 9/09/2012 11:28 PM, Blogger juandos said...

"For anyone who wants to read books on an electronic device the options are limited to e-ink readers like the Kobo or Kindle. Apple and most other tablet manufacturers certainly fail the test because tablets are not suitable for a comfortable reading experience"...

There you go again, total nonsense vangeIV...

I see people reading books on their smart phones, I read them on my Galaxy Tab, my brother uses his netbook I see people reading books from their laptops...

Guess what? No failures in any of those devices...

 
At 9/10/2012 3:34 AM, Blogger Ron H. said...

juandos

"I see people reading books on their smart phones,"

I'll bet those are all young people with excellent eyesight. I can do it for a short time in a pinch but wouldn't want to read from my smartphone for very long.

 
At 9/10/2012 6:32 AM, Blogger VangelV said...

I see people reading books on their smart phones, I read them on my Galaxy Tab, my brother uses his netbook I see people reading books from their laptops...

Guess what? No failures in any of those devices...


How many times did you sit on those devices? Or knock them off a desk on a ceramic floor?

My claim is about comfortable reading. And that claim seems to be supported by polls taken by some of the tech sites. People who actually read a lot overwhelmingly prefer to do so on e-ink readers because they do not use a backlit screen as the tablets do and have long battery lives.

 
At 9/10/2012 7:50 AM, Blogger Jon Murphy said...

Some people like e-readers, some people like tablets. It's a matter of opinion. One is not superior to the other. It all depends on what the individual purchaser views as being superior.

 
At 9/10/2012 9:24 AM, Blogger morganovich said...

amazon has really impressed me.

when i first looked at their business model in the 90's, i thought they would never make it. it seemed like selling a commodity online was a recipe for p=mc and no profits.

what i messed was how much customer service matters.

amazon has truly outstanding customer service and fulfillment.

i order stuff from them all the time. with amazon prime, you get free 2 day shipping. i can literally get 12 packs of iced tes shipped to my house in 2 days from amazon cheaper than they are sold in local stores.

it's become an amazing utility.

in a free market, businesses can only succeed by offering customers somehting they want at an attractive price.

this is why free commerce is moral and exactly where the left wing critics of capitalism fall down. they are so used to thinking in terms of command and control and coercion, that they forget that business only thrives when customers choose to patronize it. (unless you can, say, gt a federal mandate to buy insurance or epic bailouts and subsidies, but that is not a free market)

when all have is a hammer, everyhting looks like a nail. when the only political and economic force you know is coercion, then everyhting looks like oppression. this is exactly why the left totally misunderstands capitalism. they leave freedom and liberty out of the equation and assume that to make money, companies must oppress someone as opposed to offering a good or service a consumer values more than the price.

 
At 9/10/2012 12:20 PM, Blogger VangelV said...

Some people like e-readers, some people like tablets. It's a matter of opinion. One is not superior to the other. It all depends on what the individual purchaser views as being superior.

All value is subjective. But I doubt that many people find reading a book on a tablet as comfortable as reading on e-ink devices. That is the only reason why they still exist because they are useless for most other activities when compared to tablets.

 
At 9/10/2012 12:31 PM, Blogger Jon Murphy said...

But I doubt that many people find reading a book on a tablet as comfortable as reading on e-ink devices.

Doesn't really matter, does it? If you are right, then the cost of reading is outweighed by the benefits of the tablet.

I like my Kindle. How others choose to spend their money is up to them.

 
At 9/10/2012 12:41 PM, Blogger givemefreedom said...

Kudos Ken and Morganovich,

Nothing cheers up my day as much as reading a good smackdown of one of the "crew", in this case Hydra.

If I could also add to your comments Morganovich about what the left misunderstands about capitalism, many of them actually fear free markets and capitalism. I think it comes from their own insecurity, they fear having to compete with others in a free market and much prefer to have the government control the economy.

That is what I get from Hydra. What is it you are afraid of Hydra?

 
At 9/10/2012 12:54 PM, Blogger morganovich said...

jon-

"
I like my Kindle. How others choose to spend their money is up to them. "

precisely. i have tried to like kindles and other e-readers. they seem superior in most ways (faster, cheaper, lighter, more flexible etc) but the fact is, i just don't.

i like actual books. i'd prefer to love kindle, but i don't.

that's what makes a market...

 
At 9/10/2012 1:05 PM, Blogger Jon Murphy said...

i have tried to like kindles and other e-readers. they seem superior in most ways (faster, cheaper, lighter, more flexible etc) but the fact is, i just don't.

i like actual books.


There are many people who would agree with you.

I will say, though, I found my Kindle to be extremely useful during University. Many of my classes were not so much textbook based as book and article based. The Kindle allowed me to easily make notes, mark passages, find my location, and jump right to places when discussing in class!

I will say that I don't like how not every book has page numbers. That can make sharing difficult.

 
At 9/10/2012 1:59 PM, Blogger VangelV said...

Doesn't really matter, does it? If you are right, then the cost of reading is outweighed by the benefits of the tablet.

I agree. That is why so many people who love to read own both.

 
At 9/10/2012 2:00 PM, Blogger VangelV said...

i like actual books.

There are many people who would agree with you.


Most readers would. That is why many purchase both whenever there is a work that they are very fond of.

 
At 9/10/2012 3:37 PM, Blogger morganovich said...

of interest, books are now a rapidly shrinking part of amazon's business.

all media combined was only about 1/3 of q2 revs and only 23% of north american revs.

kindle is somehting like 1/2 of books sold through amazon.


 
At 9/10/2012 3:55 PM, Blogger Ken said...

This comment has been removed by the author.

 
At 9/10/2012 3:57 PM, Blogger Ken said...

Jon and morgan,

I like my kindle very much, but am very worried about the content. I don't control it; amazon does. They can delete the contents from my kindle without my consent or knowledge, until after the fact. This pretty much cannot happen when selling an actual book. Once I receive it, they'd have to send someone to my house to get it, which I will likely not give up. Caveat emptor works both ways.

I prefer to read book, rather than the kindle, but the kindle is pretty convenient. But, alas, I am very concerned about the Orwellian aspects of not controlling the data. I buy all the books that I want to keep as books and only use the kindle for what I call throw away books, books that are read then discarded.

 
At 9/10/2012 4:13 PM, Blogger Hydra said...

Jon Murphy said...
You woul like government to be more economical, no?

The literature on the economics of government is vast


===============================

I understand. That is why government cost is included in the Total Cost equation.

Which is not my invention, by the way.

 
At 9/10/2012 4:25 PM, Blogger Hydra said...

businesses can only succeed by offering customers somehting they want at an attractive price.

this is why free commerce is moral and exactly where the left wing critics of capitalism fall down.

==================================

That is why Ford said that it is the Customers that pay the wages, Management just handles the money.


I think you are over reading the critics of captalism. There is such a thing as a free market and such a thing as a fair market.
What we have learned is that the free market will theoretically eventually devolve to the "best" price, it also seems to have an infinite capacity for failing to do so in the instantaneous case.

Typically, the seller of a product has much more information about the product than the buyer, and this assymetric knowledge is used against the buyers interests.

One need not be a left wing socialist or communist to see both the good and bad points of a free market.

Is there anything so plentiful that there is no market for it?

 
At 9/10/2012 4:27 PM, Blogger Hydra said...

" It depends heavily on whether you are trying to build a major franchise or maximize this year's earnings."

================================

Scott Drum hit is onthe head. Theoretically the market will eventually reach the best price, but when in comes down to todays deal, it may depend on how far off the quarter is.



 
At 9/10/2012 4:39 PM, Blogger Hydra said...

they fear having to compete with others in a free market and much prefer to have the government control the economy.

=================================
In a free market, one player will eventually compete better than all others and control the market - often with government help.

What I am afraid of is he morons that confuse the hypothetical perfect free market with the real world.

Total Cost = Production Cost + External Cost + Government Costs


Those who do not understand simply say, well, no problem then: Eliminate the Government Cost and Total Cost will come down. Excetp that without Government costs, government standards, regulations, and monitoring, External costs would be allowed to skyrocket without end.

Until such time as consumers realize the true cost of what they are getting compared to what they are paying, at which point they will institute some kind of government to stop what they see as cheating.

All of which has nothing to do with competition: competition still exists in a regulated market. You can try t sell all the cars you like, but they will have emission controls, same as anybody else.





 
At 9/10/2012 5:40 PM, Blogger juandos said...

:How many times did you sit on those devices? Or knock them off a desk on a ceramic floor?"...

None vangeIV, I like my electronic toys to much to do that...

Sadly I wish I had the same attitude with my other property...

 
At 9/10/2012 5:46 PM, Blogger juandos said...

"Seriously, did they correct the problem quickly at no additional charge?"...

Regarding the laptop for the smart phone ron h Amazon was very quick off the mark and thought quite excellent in the efforts to fix the problem...

The next day after I had sent a notice to them regarding the screw up the notified via e-mail that on the following day Fed-Ex would show up to collect the phone and to deliver the laptop...

It happened just like they said...

Oh man! I've got to wonder what the volume of business is like and the physical resources that have to go into it to make it a working proposition?

 
At 9/10/2012 6:01 PM, Blogger juandos said...

"And that claim seems to be supported by polls taken by some of the tech sites. People who actually read a lot overwhelmingly prefer to do so on e-ink readers because they do not use a backlit screen as the tablets do and have long battery lives"...

Online polls?!?! Come on!

What can I say vangeIV, people are sheep and are willing to fall for any sort clownish gadget that comes down the pike...

Still in many respects that's a good thing...

BTW did you see the list prices on the new & 'improved' Kindles?

E-books were around quite awhile before the Kindle and the Nook...

Regarding battery life on my Samsung Galaxy, when I read books on it the noticiable battery discharge is miniscule even with backlighting on (yes, that's a choice)...

It would be interesting to find out just how long my Tab can hang battery wise just for reading purposes...

The fact is that I also watch movies, cruise the net, and even occassionally write on it with a USB keyboard...

Even when I'm fairly active with it I don't charge but maybe a couple times a week...

 
At 9/10/2012 6:03 PM, Blogger juandos said...

"I'll bet those are all young people with excellent eyesight. I can do it for a short time in a pinch but wouldn't want to read from my smartphone for very long"...

Even with cheaters on ron h?

 
At 9/10/2012 6:37 PM, Blogger Ron H. said...

"Even with cheaters on ron h?"

I can't FIND my smartphone without cheaters, but there's nothing better that 20 year old eyes.

 
At 9/10/2012 7:15 PM, Blogger Ron H. said...

"In a free market, one player will eventually compete better than all others and control the market - often with government help."

You meant to write ONLY with government help.

"Those who do not understand simply say, well, no problem then: Eliminate the Government Cost and Total Cost will come down. Excetp that without Government costs, government standards, regulations, and monitoring, External costs would be allowed to skyrocket without end."

Nonsense. You need to calm down. There are limits to how much damage can be done even with toxic waste, no matter how hard some manufacturers try to poison their own children.

"Until such time as consumers realize the true cost of what they are getting compared to what they are paying, at which point they will institute some kind of government to stop what they see as cheating."

Your understanding of human nature is poor. People don't mind getting a good deal if some of the cost is borne by others. It's when they believe those others are getting a better deal that they complain about cheating.

"All of which has nothing to do with competition: competition still exists in a regulated market. You can try t sell all the cars you like, but they will have emission controls, same as anybody else."

Your understanding of incentives is also poor. In reality auto manufacturers LOVE those mandates, as it relieves them of the extra work of offering those things as options. Every car will have emmission controls, the costs plus a hefty markup will be passed on to every consumer, and there is no concern about the competition, as they all must do it.

Mandate seat belts? Great. Air bags? Great. Emmission controls? Great. Higher gas mileage? Great.

One of the first lesson was with seat belts in the 1950s. Although there was public sentiment in favor of them, when it came time to open their wallets, few customers were willing to put their money where their mouths were, so they bought cars without seatbelts. Once they were mandated, everybody's wallet just opened automatically by government decree. Problem solved.

Thank you Uncle Sam! Ching Ching!

Government, as it so often does, mandated something for which there was little public support.

 
At 9/10/2012 8:59 PM, Blogger VangelV said...

Online polls?!?! Come on!

When someone asks you if you use a PC or a Mac do you lie? I certainly don't. And the polls seem to be supported by reality given the sales of e-readers and their useless nature for anything other than reading.

 
At 9/10/2012 9:33 PM, Blogger Jon Murphy said...

In a free market, one player will eventually compete better than all others and control the market - often with government help.

Then it's not a free market.

 
At 9/10/2012 9:51 PM, Blogger Ken said...

This comment has been removed by the author.

 
At 9/10/2012 9:54 PM, Blogger Ken said...

Hydra,

In a free market, one player will eventually compete better than all others

So? And this isn't really true. This is like saying, there is one programmer who will eventually compete better than all the others.

and control the market - often with government help.

So now you're redefining "free market" with "controlling the market... with government help". Ha!

 
At 9/10/2012 10:02 PM, Blogger Ken said...

Hydra,

Excetp that without Government costs, government standards, regulations, and monitoring, External costs would be allowed to skyrocket without end.

Do you have any proof of this? Or is this just another one of your assumptions? Because really this statement is completely false.

As an example, all the recent financial and housing problems are due to the distortions caused by government, no "external costs" skyrocketing "without end". A good book for you to pick up is The Myth of the Robber Barons, which details the differences between political entrepreneurs and market entrepreneurs. Market entrepreneurs relied on the markets to guide standards and regulations, which resulted in incredible cost savings, which were passed on to the consumer.

And it provides for this fun fact: the only transcontinental railroad to not go bankrupt was wholly privately financed and run. All other transcontinental railroads relied on government subsidies, so didn't control costs, search for efficiencies, nor worry about customer satisfaction the way the only privately financed and run transcontinental railroad did.

In other words, this book provides example after example of businesses without your "government cost" the lowered costs faster than those who took on "government cost".

 
At 9/11/2012 2:08 AM, Blogger Ron H. said...

"I will say that I don't like how not every book has page numbers. That can make sharing difficult."

And even books that do have page numbers may have pages larger than the kindle screen in the font size you prefer so you can turn the page 3 times and still be on page 14 due to reformatting.

 
At 9/11/2012 2:24 AM, Blogger Ron H. said...

Ken

"I like my kindle very much, but am very worried about the content. I don't control it; amazon does."

That's indeed a valid concern.. I believe you can make backup copies of the books on your kindle to your computer or a backup hard drive. I know you can with a Nook. I believe both use versions of Andriod OS and have USB storage connectivity to Windows PCs.

 
At 9/11/2012 6:47 AM, Blogger VangelV said...

As an example, all the recent financial and housing problems are due to the distortions caused by government, no "external costs" skyrocketing "without end". A good book for you to pick up is The Myth of the Robber Barons, which details the differences between political entrepreneurs and market entrepreneurs. Market entrepreneurs relied on the markets to guide standards and regulations, which resulted in incredible cost savings, which were passed on to the consumer.

It is a wonderful book. But when my 12-year old used it for a project the lefty teacher did not react very well to the information and thought that there had to be something wrong with the sources.

 
At 9/11/2012 7:56 AM, Blogger Jon Murphy said...

Excetp that without Government costs, government standards, regulations, and monitoring, External costs would be allowed to skyrocket without end.

Wait...what?

Hydra, most of what you say has substance behind it, but, I'm sorry man, this is just...wrong.

Regulations increase costs, not decrease them. In fact, free markets are all about reducing costs. How else could the standard of living constantly rise in a period of flat real wages? How else could things that were once only toys for the rich now be perceived as necessities of life (think cars, a/c, cable TV, DVD players, computers, refrigerators and freezers, Internet, and single-family homes)?

I'm sorry, man, but your statement is just wrong. I am not saying that to be argumentative; it is as factually incorrect as saying "the earth is flat."

 
At 9/11/2012 7:59 AM, Blogger VangelV said...

Hydra, MOST OF WHAT YOU SAY has substance behind it,....

Really? Since when?

 
At 9/11/2012 8:08 AM, Blogger Jon Murphy said...

Really? Since when?

Always. Hydra does have a certain logic he follows. Whether you agree or disagree with it, there is usually a progression from point A to point B.

 
At 9/11/2012 8:32 AM, Blogger VangelV said...

Always. Hydra does have a certain logic he follows. Whether you agree or disagree with it, there is usually a progression from point A to point B.

I guess I will have to look again. I have never found much substance or logic behind his claims. From what I recall of most of his points he begins with belief and makes claims to support them rather than actual data that is supported by a sound theory.

 
At 9/11/2012 10:04 AM, Blogger juandos said...

"When someone asks you if you use a PC or a Mac do you lie?"...

Why yes I do vangeIV, its none of their business regardless of the reasoning...

"I certainly don't"...

Well that's your fault...

"And the polls seem to be supported by reality given the sales of e-readers and their useless nature for anything other than reading"...

Really vangeIV?

How do e-reader sales stack up against smart phones?

I'm sitting in a St. Louis Bread Company right now with my Tab and the place is jammed...

While I was waiting on my coffee I noted that there must be at least a couple of dozen people if not more 'reading' their iPhones (no, not talking on them) but only a single person with what appears to be a Kindle...

 
At 9/11/2012 10:09 AM, Blogger juandos said...

"I can't FIND my smartphone without cheaters, but there's nothing better that 20 year old eyes"...

Heh!

Yeah, I know what you mean ron h...

My mom who's now 83 no longer needs glasses to read, something she'd been using since her middle forties...

Four years ago she went in to have the glaucoma treated in both eyes and the doctors also did something else that added about 5 minutes to the proceedure...

I'm almost tempted to check that out...

 
At 9/11/2012 10:16 PM, Blogger VangelV said...

Why yes I do vangeIV, its none of their business regardless of the reasoning...

So you lie on this forum because it is none of our business what you think? Note that polls are voluntary. Most people ignore them, as I do, when they are not interested in participating. They do not go out of their way to waste their time answering questions just to lie.

Really vangeIV?

How do e-reader sales stack up against smart phones?


They don't compete with smartphones because they can't make phone calls or surf the web conveniently. They are two very different markets with very little overlap. I know of few serious readers who choose a phone over a Kindle, Nook, Kobo, or some other e-ink reader.

I'm sitting in a St. Louis Bread Company right now with my Tab and the place is jammed...

While I was waiting on my coffee I noted that there must be at least a couple of dozen people if not more 'reading' their iPhones (no, not talking on them) but only a single person with what appears to be a Kindle...


Surfing the web is not the same as reading a book. Did you do a poll? If not, how do you know their reading habits? And if you did how do you know that they did not lie to you as you would? Or is this last bit an attempt at irony to show that you can lie with the best of them?

 
At 9/11/2012 11:27 PM, Blogger juandos said...

"So you lie on this forum because it is none of our business what you think?"...

Nice try vangeIV but that's not what you asked, you said surveys and how many surveys do they have here regarding purchasing?

"I know of few serious readers who choose a phone over a Kindle, Nook, Kobo, or some other e-ink reader"...

Obviously you should expand your horizons more and see how many do use their smart phones as readers...

"Surfing the web is not the same as reading a book"...

Who said they were surfing the web?

"Did you do a poll?"...

Yes actually I was wondering what they were reading...

Turns out most of them were reading an assigned lesson...

" And if you did how do you know that they did not lie to you as you would?"...

They showed me what they were reading...

I probably talked seven or eight of the kids in there...

Wash U students...

"Or is this last bit an attempt at irony to show that you can lie with the best of them?"...

Well as far as I can tell you're the only here so far...

Then again we know you have that inside track on Canada and the al qaeda...:-)

 
At 9/12/2012 7:32 AM, Blogger VangelV said...

Nice try vangeIV but that's not what you asked, you said surveys and how many surveys do they have here regarding purchasing?

That is not what I said. There are users forums and sites like Wired, Gizmodo, Lifehacker, The Economist, etc., that poll their subscribers regularly about which technologies they use and what they feel about them. These are not 'marketing' polls trying to sell products and I suspect that most subscribers who wish to take part are quite honest.

And as I pointed out, the sales data is very clear. In 2011 Apple only managed to sell about twice as many iPads as Amazon sold Kindles. Given the fact that the iPad is a great device that is used primarily to access the Internet, watch video, play games, etc., and the Kindle is mainly good for reading the accomplishment is remarkable. The trend that shows the story best is this one. In an era when reading was supposed to be dying Amazon managed to get more people to read and to read more. Anyone who has used an e-ink device understands why.

Obviously you should expand your horizons more and see how many do use their smart phones as readers...

I suspect that most of them have readers. But I suspect that if they read a lot they do so on dedicated e-ink devices that do not suffer from battery drain and eye strain.

Who said they were surfing the web?

I did. Most people check their e-mail and some of their 'essential' sites regularly using their phones. I doubt that they read Joyce using them.

Yes actually I was wondering what they were reading...

Turns out most of them were reading an assigned lesson...


My BS alert just went off. How do you find an assigned lesson using your phone?

They showed me what they were reading...

I probably talked seven or eight of the kids in there...

Wash U students...


LOL...Why don't you ask the English students how they read their Shakespeare or Joyce. If they do so with an electronic device it won't be a phone. And as I pointed out above, the sales data tells a story very clearly. See the trend?

 

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