So far, the fines have been solidly in the "acceptable cost of doing business" category. If anything, the fines are at least an order of magnitude too small.
For a sense of scale, VW North-America (~38B) is of a comparable revenue to Amazon EU (~44B). But the VW emissions scandal cost them almost a full years of that revenue, ... and they're not leaving the market. (In general, US fines are much higher than EU fines, BTW). Don't forget that such fines are generally unlikely to be levied very frequently because court battles are drawn out and law enforcement has limited resources too. Additionally, specifically in the EU (but also partially in the US) there's the issue that enforcement is fractured across states, so it's easier for a corp like this to absorb the occasional loss - had this fine been scaled for the entire EU, not just Italy, the cost might have been significant, but alas. Additionally, while punitive damages in civil litigation are obviously problematic, they do address real issues that (AFAIK, IANAL) the EU (an it's member states) doesn't have a real answer for - which makes rules-breaking less disincentivized. Finally, fines that are related to past revenue and disregard stock price and current revenue and growth are likely in any case to have less impact in shaping behavior in rapidly growing sectors (as in sectors with huge profit margins) - and amazon's EU business is rapidly growing.
If the aim of enforcement is to at the very least ensure a change in behavior, and, failing that, to actually fine a company out of business, then EU fines need to be much, much higher. Given how rarely they're levied, the extreme delay in collection, and how small they are, I kind of doubt they're enough to really trigger the kind of behavior you'd want - namely that large corps actually follow the rules right off the bat, and not just after years of being able to essentially manipulate the market into whatever shape they like.
Also keep in mind it takes year, but often the EU courts don't allow these nonsensical fines. The media doesn't usually post the appeals year later where this is lowered to 1/10th the size or thrown out.
Italian and most politicians love this to show they are doing something, instead of the hard work to define out working standards that actually help online e-commerce for small to medium sized business.
It's more appropriate to say that the EU is pro-competition. They don't care as much about free markets than about competition as means to an end. If there is not enough competition in the market, they often deliberately change the rules to create more.
Its a strange world to me where being pro-competition is a god thing when it means to deliberately hurt outsider and prop up internal alternatives that are not competitive.
And I think at least in the cases I observed it hasn't fixed the 'problem' either.
I was only explaining how things are, not whether they are good or bad.
The EU is a single market consisting of many sovereign states. Sovereign states are naturally protectionist. Each member state wants to support domestic businesses over their rivals from other member states, but a single market can't work like that. To overcome these natural tendencies, the EU set up a regulatory environment that undermines the advantages established businesses have in their home markets, in order to allow businesses from other member states successfully compete against them.
That same attitude bleeds to dealings with businesses outside the single market. EU regulators see large profits and large market shares as signs of insufficient competition, and they see insufficient competition as something inherently negative.
It's not really pro-competition. It's pro-competitors-who-maximize-employment-and-tax-revenue.
"We will back your participation in this "competition" only as long as your participation furthers our preconceived objectives about how the world and society and economy should work."
It stems from the idea that being an FTE at one place for a long time (and not really having any class mobility) is a good and decent thing to encourage for most of your society. Stability above upside.
It's the root cause of why the USA has a startup culture and Europe does not.
It's fine if that is your belief, but to pretend that it's "competition" when they have their thumb on the scale tilting it toward a specific social ideology is a bit disingenuous.
The term you're looking for is social market economy or rhine capitalism [1]
The core idea is that we see the market as a means to an end, not some end in itself. When the market is incompatible with societal good, the market needs to change, not society.
A market by itself only optimizes for maximum profits for shareholders, at the expense of everything else. Often, you want your economy to optimize for different things, so you direct the market to support your goals.
It's the root cause why inequality is so much worse in the US, why you have a much bigger housing crisis, why health care in the US is such a mess, why there's homeless people everywhere etc etc.
> It's the root cause why inequality is so much worse in the US, why you have a much bigger housing crisis, why health care in the US is such a mess, why there's homeless people everywhere etc etc.
I don't think a single part of this claim a) logically follows from the previous paragraphs, or b) is actually true.
For just one example: the housing crisis is a lack of supply, which is the result of the exact same kind of status-quo-maintaining, market-forces-secondary-to-regulatory-aims (NIMBYism by property owners and their representatives) thing you describe as being the European norm.
To say that these philosophical differences are the root cause of failures in very complex systems is of course the popular and prevailing European narrative about the USA. (There is another, equally popular and equally false (but self-congratulatory) one in Europe about gun violence in the USA.) I just don't see much evidence to substantiate it.
Counterexample to your housing crisis claim: Vienna, Austria.
44% of the housing stock is in public ownership, two thirds of the population live in public housing. Rent is affordable and housing stock is of high quality.
Market forces would not have solved this, as there is very little profit to be made with low-cost housing - so the lack of housing was fixed by state intervention and Vienna has the highest quality of life in the world [1] as a result.
Prohibitions on adding supply, mostly driven and incentivized and rewarded by existing landowners who directly profit from constrained supply and high prices.
> The core idea is that we see the market as a means to an end, not some end in itself.
The market was never an end to itself. Literally go back and read anywhere from Smith, Hume to Hayek. That is just a straw-men argument.
> When the market is incompatible with societal good, the market needs to change, not society.
And who and how is it determined, what the social good is? Are bureaucrats loosely connected to politicians loosely connected to voters a better an more reliable form of social preference allocation then the price mechanism under the same law? Not by any existing evidence in social science.
But the core of your argument is basically the government whenever it feels like it can just intervene in the market directly and put its finger on the scale. Not by fundamentally changing the rules, just be direct intervention whenever they don't like something. Often that is a foreign competitor and some vague hard to prove claims about market power. And often it is the citizens of that country that end up having higher prices or higher taxes. French book market being a good example.
Many times it has been shown historically that the monopolies far, far, far more often are government created then market created. And laws to establish 'fair competition' are usually strongly sponsored by the very competitors who get crushed in the market, often for good fundamental reasons.
The first Anti-Trust law in the US was by local butchers to prevent centralized butchers with refrigerated rail-cars. Would it really be 'fair competition' to give money to local butchers to prevent them from this 'unfair competition'. No, its how you get a stagnate economy depended on subsidies.
Very often its just governments doing what they want for the political clients that they have. French publishers, German news organization.
A perfect example is Germany where German Newspaper have fought tooth and nails for years against 'Google News' and basically want to monetize every link to their sites. This is all done in the name of 'fair competition' while introducing laws that are really the opposite and hurt user freedom in the process.
> It's the root cause why inequality is so much worse in the US, why you have a much bigger housing crisis, why health care in the US is such a mess, why there's homeless people everywhere etc etc.
If you think housing and health care are examples of 'free market fundamentalism' then you are very badly informed.
Proponents of the free market love competition. If by changing the rules you mean government interference, that they of course oppose. Still, free market people are pro-competition as well as opposed to pro-monopoly and such.
This is obviously nonsense. EU has companies in all businesses and in many many fields the market leaders.
Two big weaknesses though: They are generally behind in the tech world (but even there it depends, see e.g. ASML) where scale really matters and scale is much easier and quicker to achieve with a single language and legal system like US and China.
Where Europe is also weaker is finance, which in the US is a barely regulated free for all compared to the EU context. This in turn reflects in market capitalization and stock prices where a US company with equal (or lower) output than an EU company will generally have a much higher valuation.
> EU has companies in all businesses and in many many fields the market leaders.
I think this is an increasingly optimistic view.
The EU cannot even begin to compete with big US, Canadian, Chinese tech companies. It just doesn't have the drive or initiative to do so. And now that almost everything is a big tech company... the outlook looks bit worrying.
There are other markets other than tech, you know? OP explicitly excluded tech ( with some exceptions like ASML).
Cars, aviation, logistics, trains, elevators, chemistry, pharmaceutical, energy, engines, turbines, defence, to name just a few sectors where there are huge EU-based companies which are market leaders worldwide.
And there are lots of tech companies, most are just focusing on their local and sometimes neighbouring markets - Back Market, Doctolib, N26, Revolut (to name a few i know and have used in France), and are thus smaller than their American counterparts. It has nothing to do with drive or initiative.
My point was that other markets are being eaten by tech.
Cars are a great example - Tesla for example operates as a tech company. Logistics another great example - being eaten by Amazon. Bio is probably next with all the tech funded work being done in Boston now. Etc etc.
And focusing on local markets… we’ll yeah that is a lack or drive and initiative. While you’re focusing on your local market US tech is coming for you.
Tesla are operating as a tech company, and it shows - they have pretty bad quality control issues. They still remain a small manufacturer, and don't have much technological advantage, giants such as VW, Stellantis(PSA+FCA) and Renault having catched up.
Some sectors are moving to tech-first approaches, like fintech, and there are plenty of european ones. Same goes for Bio ( BioNTech?).
Trying to expand before you have a stable local market is stupidly risky. Furthermore, some concepts aren't easy to export, or require significant legal and translation work. EU-based startups have plenty of drive and initiative, try to conquer their local and neighbouring markets ( e.g. Ornikar is a driving license online tutoring startup, who started in France, are expanding in Spain and will probably add more; but each new market is basically redoing almost everything from scratch). Those markets are smaller than the US and China, who are very protective, so the resulting companies are smaller. So what? Not everything is about infinite growth and trillion dollar companies.
That’s the point - why are we always playing catch-up? Why don’t we come up with anything ourselves? Legacy companies just about managing to keep pace doesn’t make me comfortable.
> basically redoing almost everything from scratch
Well yeah that’s part of the problem. Europe needs to get over being so beaurocratic and stubborn.
> stupidly risky
I just think US people would think the risk was worth it, while we wouldn’t… and well just look at the results.
Not everything is about trillion dollar companies but I worry the European tech sector will get entirely eaten by the US if it stays happy to be small and inoffensive. Ideally we’d be able to compete with the US globally. If we aren’t that worries me for our ability for self-determination.
Are you seriously suggesting Stellantis is catching up? You must be joking.
And Tesla sells by far the most BEV, literally 100% more. VW is catching up relatively but globally they are still far behind. And other car makers like Stellantis are basically nowhere. The CEO of Stellantis literally just commented on that.
And Tesla is really not so small anymore and they are growing very fast.
> but each new market is basically redoing almost everything from scratch
This is very true being in that situation. Getting a German bank to buy even a Swiss product is very difficult.
The US is much more protectionist than the EU, there are lots of sectors where entering the market is nearly impossible in the US. And saying that Europe has no competing counterpart is ridiculous, just look at Amazon total market share in the different European countries and compare to the US.
The parent probably meant that Amazons market share is much higher in the US than in the EU [1], meaning that in the EU there is thus more competition.
It's because cloud-act and that many company's are not allowed to have their customers data in a US cloud. However Europe has nothing like AWS or Alibaba, Europe and especially Germany is a shitshow par exelance in that regard.
Bull. If they wanted to kill competition from the outside, they could just block FANG from doing business there like Russia and China are doing with massive success.
If anything, the EU's fairness is a massive giveway to US tech firms who could hoover up any fledgling EU competitors.
If the EU blocks Google today there will be a decent search engine in a few days (I think I used a German one until it shut down a few months ago,) a good one in a few months and a Google level one maybe never.
The real problems are: almost everyone use gmail and most people have an Android phone. There will be a 90s like fragmentation for email, maybe by ISP. Not bad at all IMHO. Bigger problem with Android: maps, driving directions, apps delivery and updates. Somebody will provide a plugin replacement for the Play Store, there are alternative map services but it's going to be an interesting season or two.
"It became clear to us in the last weeks, that all political initiatives to create an independent European digital infrastructure have been stalled or postponed for years."
If there where no competitors from outside the EU them or others would create a reasonable search engine.
>It became clear to us in the last weeks, that all political initiatives to create an independent European digital infrastructure have been stalled or postponed for years.
Actually the opposite is true. Only trough regulation you can create nonviolent free market competition. Otherwise, you end up with military competition as the easiest way to win is to dominate and subjugate opponents trough raw force. Slavery and colonization are this types of free market distortions when unrestricted by regulation.
So, regulations are necessary part of free markets. The question is what regulations are good and what regulations are bad.
There are empirical and game theoretical examples where regulations create better outcomes than nonviolent free market competition. There are games where the tragedy of the commons occur i.e. Nash equilibrium creates bad outcome [0]. This is also true in the real world e.g. collapse of the Atlantic northwest cod fishery.
Having a rule of law is not a regulation, is the most basic fundamental prerequisite to having a functioning modern, democratic society. Free markets are built on top of that and regulations come on top of free markets.
And free markets imply free people - slavery is the opposite of that.
Taxing externalities is also necessary, and it's tax, not a regulation. But that is something we're still working on, with little success it seems. See the carbon/pollution international issues with China, Russia, Australia.
You are bending words like regulation and tax to fit your preconceptions in way that disagrees with how other people understand them.
Also, a simple tax can not solve the tragedy of the commons for fisheries as long as fishing will remain profitable. Nash equilibrium involving full exploitation remains as long as there is a profit. Fish are not an externality that can be reduced to avoid taxation, but the objective. While cap on fishing will work.
Of course you can. Competition and free markets are orthogonal concepts. Competition is a process that exists within any regulatory framework, while free markets refer to the extent and stability of the regulations.
Infrastructure is the usual example. If your company owns something like a cellular network or a local power grid, the EU requires that you let other businesses use it for a fair price to sell their services to customers. This regulation creates more competition and lowers the prices for customers, while simultaneously making businesses more efficient and less profitable.
in the US, for a long time, anti-trust was kinda cozy with monopolies - they were accepted as the natural outcome of a free market: the most efficient solution.
In the EU there is more emphasis on market competition, and big monopolists are seen as problematic.
EU had to add regulation to allow startups using other's infrastructure because of the existing regulation that makes laying said infrastructure so difficult.
Do not confuse regulations made to fix even worse regulation with an actual healthy, competitive free market.
In Eastern Europe, after the fall of communism, people would lay Ethernet wire between apartment buildings to create ad-hoc communication networks. There were dozens of them. Today that is illegal and we only have a single Internet provider per city block.
"Regulations reduce competition by raising the bar to entry"
This is literally wrong.
OpenBanking only applies to the biggest banks and not little guys, and it allows little guys to access data stored in huge banks.
How does thay reduce competition? It reduces bar to entry
Banking is one of the most heavily regulated and lacking competitions domains I know. This is why we have innovation in fin-tech startups but banking-startups only in crypto, where regulation is yet fairly light.
"this is why we have innovation in fin-tech startups but banking-startups only in crypto"
I can think of 10 startup banks like monzo and starling and have accounts in 4 of them, where is this lack of competition?
Is it also regulator's fault there is no competition in running water and sewer providers? In your world there is no such thing as capital requirements, barriers to entry, natural monopoly, all issues are summed as 'regulation = bad"
Bells's monopoly was instituted by the government. Using regulation to fix your own previous bad regulation does not suddenly make you a free market savior.
Oh, the usual: patents and regulations. The end result it was that you weren't allowed to create a competing network or even use a non-approved telephone on Bell's network.
It's not about strong vs weak governance. It's just that the US government represents the 401ks invested in the FAANGs, as well as the FAANG employees, and the european governments represent the people that the FAANGs offer services for.
If us-east-1 going down for about 24 hours costs Amazon $1.3+ billion, wouldn't that make the yearly revenue of that region something like $475 billion? I think that's like AWS and Amazon yearly revenues put together.
I still have my doubts about 24 hours of reduced performance on us-east-1 being so costly that it's equivalent to 1% of yearly Amazon revenue. I know that we run some services on us-east-1 and they never completely stopped working during the downtime, so it wasn't a complete region failure.
Rarely they change behavior of companies, because fines are still peanuts compared to profit they gain by this.. so not really getting your comment.. they are relatively so small we cannot even call them fines.
Empirically, we know that is not true. Some legislation embodies bad ideas.
China - alleged communists - have outperformed the EU at creating a viable software industry. Regardless of the arguments about what approaches are good and bad, there is pretty evidence that whatever "good" means, Europe is struggling to achieve it.
>China - alleged communists - have outperformed the EU at creating a viable software industry.
If anything, this could be because of the communist aspect. Companies of a certain size become entwined with the government in China. Funding isn't really a concern when the state backs you up. Similarly, but without state support, the US has Silicon Valley investors who'll always throw cash at companies with the right connections and sometimes random people with decent business ideas.
Does the EU have anything similar to grow companies?
Yeah large companies in the EU never get entwined with the government.
In fact, I would argue because of the many small countries, many companies are incredibly entwined with the government. Because many of these countries only have few large companies.
I think the West loves saying 'all China suggests is because the government just finances every single company'. In reality this just doesn't seem to practically hold up. If all the companies are always losing money and have infinite money. Why are many they so good as scraping, forward looking, innovative and so on.
Its not government money that makes some of the China car makers better at software, or faster at adopting new innovations.
A contractor of Arianespace for Ariane 6 had an issue, RUAG had an issue with fairing. And the Swiss government jumped in. And this happen very often in many industries. I am not confident that all of the recent space companies in China would get the same treatment.
You’re really extrapolating a lot that I didn’t even come close to saying.
Sufficiently large companies are required to have a certain percent of their staff be CCP members making decisions. That also comes with money tied up in the company. That doesn’t mean every company is backed up by the government. You’re making wild straw men and getting enraged at your own argument.
Fines are designed to disincentivize the cost of doing "illegal" business. It's not an insult, but comes across quite capitalistic to not consider the difference.
Considering those companies are American and the US doesn't really have a concept of nudging a company onto the righteous path via relatively small fines, we might see a lot more fines coming up. The US takes a different approach and imposes heavy fines from right the beginning.
Those warning shots from EU counties could very well be interpreted differently than they were meant to be.
A billion is nothing for Amazon. They'll barely feel it. It's not even a slap on the wrist - more like waving an index finger snd saying "behave or else".
[EDIT] - "profits" -> revenue. Wrote the same comment twice and only made the mistake here. Amazon consistently makes over 90B in revenues quarterly.
Fining more than revenue in Italy is one thing and may look bad on paper if you take an italy-centric view but 1B is ~1% of Amazon's quarterly revenue. Amazon is a massive company and Italy could be a loss-leader for years maybe even decades and not make a dent. All the while Italian businesses suffer and wealth compounds somewhere else.
There's also no absolute way to measure the market share/billions (and in which related markets) they've captured by the abuse they've perpetrated. Generally governments fine too little and too late, not too much and too early.
[EDIT] - Apologies, you are right -- I mistakenly wrote "profit" -- I meant to only discuss revenue. The comment has been corrected now.
Please note that I'm talking about revenue not profit ("income"). In 2020 (and 2021, which to be fair are maybe a little bit skewed) Amazon was consistently making >$90B in revenue for the quarter. Key word being revenue.
> The company also delivered its largest quarter by revenue of all time at $125.56 billion, pushing it past the symbolic $100 billion mark for the first time.[0]
Wow it's frustratingly hard to find such a simple thing as revenue for a company graphed by quarter -- ycharts is at least straight forward[1].
I think it's interesting for figuring out whether this was a profitable long-term move for Amazon requires thinking about revenue rather than profit. Compared to the temporary loss due to the fine (who knows what will actually end up getting paid, how it gets paid, etc) the revenue share (that will recur) that matters more long term.
If you paid 1.3B one-time to secure yourself a revenue stream that pays out 200MM than you would have otherwise gained a quarter, you're going to make your money back in ~6 quarters. It's absolutely worth it to take the temporary hit to income (obviously better if you didn't, which they were counting on) -- in fact knowing up front it'd be worth it.
Considering only the hit to short term income makes sense only in the short term, I think -- the Italian industry that was muscled out because they didn't want to use FBA, or the italian logistics providers that weren't chosen because of the incentive to use FBA face more difficulty. Amazon is amplifying solidifying it's own revenue streams, and that effect is likely to persist past a quarter or two.
I may be mistaken but I think of it like the other non-profit making tech companies that are floating around -- unexpected losses in the service of market domination are worth the gained and/or even-more-stabilized revenue streams.
This is not true. A billion hurts - it’s many people’s bonuses, etc. Amazon is all about margins, they’re fighting teeth and nails for
saving money wherever they can. Their efficiency comes from the fact that everything matters to them, and a billion absolutely does matter.
Amazon regularly makes over $90B a quarter now[0][1]. ~1% or lower is not much, especially considering that this abuse of market domination secured them more revenue than it lost.
Hard to quantify (well the authorities gave it a shot) how much the abuse garnered them, but governments tend to under-penalize rather than over-penalize corporations.
I was very careful to avoid writing income for that very reason, I did not say that it was their income -- I said they "made" that much, which they did, they made that much revenue. It's in the link itself as well. 1% of quarterly revenue is still not a lot to pay.
Income can also be a misleading indicator to watch -- if you're going to make a royalty deal for example you'd better do it on revenue, not income.
Apologies I did it again there -- 1% of a single quarter's revenues is not a lot to pay. I mistakenly typed income when I meant to type revenue there like I meant previously.
Until fines recur like revenue does it's a drop in the bucket.
Fines will recur - for one, EU is 27 separate countries, each of them can impose their own fines. Also, Italy itself can impose additional fines if Amazon does not change its behavior and fines for second time offenders can be multiple of the first one.
This fine might not be that much in itself, but it sets the precedent, which makes fines in other countries more likely.
So I meant a percentage/time-based recurring fine -- as in x% of revenue for y quarters kind of fine.
I do agree with you though, just like the australian news outlets fining FB+Google thing, governments are figuring out that international mega corps are also a good source of income by way of fines.
I fear that even this is also short sighted -- even when imposed by static fines like this, the 1.3B number looks huge, but what we can't see is whether it was actually economical for Amazon to do this (I think it was), and the thing is the companies that were destroyed as a result are much harder to re-create in an environment where Amazon still has the overwhelming amount of marketshare/monopoly power. Eventually, if this continues and Amazon decides to hit back, the lack of natural competition (due to fines that came too little too late in regards to anti-competitive behavior) may put the nation state(s) between a rock and a hard place.
I am as much with you as anyone to fine the tech companies but knowing Italy and how corrupt the bureaucrats are there including from their highest level of government to lowest petty officers, I find it a bit hypocritical. OK so Amazon has dominance but over who? Italy has become such a pariah country after last financial crisis I would be surprised if no one even wants to do business there. Italian government of course will oblige, they will happily see their people rot and suffer as they have done over last 20yrs. Ask any of the Italian diaspora, there is not a single thing positive that has happened there in last 10-15yrs. Aside from the Pope.
Pariah country? Ask any large diaspora, and they will readily tell you bad things about their country of origin. That's often why they migrated.
I agree that when it comes to IT, Italy doesn't perform like California, New York state, the UK, the Netherlands, the Scandinavian countries and a few other US or European states or countries. Notice how all those states and countries have English as the official language or a very strong second language.
But Italy has lots of other great achievements in industries areas like culture, food, tourism, and in more traditional heavy industries like car manufacturing, trains, etc.
Italy is at best stuck in the 70s, and it's becoming more irrelevant each day. It's a place where starting a company takes 3 months and costs 5000 euros just for the paperwork, where only 20% of the population completes tertiary education and that can't attract foreign (or expatriated) workers even if they are offered massive tax discounts (see "rientro dei cervelli"). Salaries are so low that an Italian engineer close to retirement earns less than a German engineer at their first job after graduation (which should say something about value added produced and the tax system).
English has nothing to do with it, and there are enough Italians who can speak English to handle all transactions with foreigners.
And the more people talk about "culture, food, tourism", as if Italy were some third world tropical island, the more you know it's getting bad.
Let's not get carried away bashing Italy. Perhaps the best indicator of the standard of a nation is its median life expectancy, which in Italy is 83.2 years, almost 4.5 years more than that of the US. Italy is a first world nation, and a wonderful one in many aspects. The average Italian has a very good life and does not envy the average American.
Yes, California, Washington State, and New York easily beat most other places on the planet when it comes to IT, including Italy. 30 years ago, when high-tech meant electronics, Japan was a leader. When high-tech meant mechanics, Germany was one of the leaders. Now, high-tech increasingly means digital, and the language of the digital age is English. Places where close to 100 percent speak English at a high level at a young age have an advantage.
I visit Italy almost every year, and it's one of the places in the rich world with most immigrants. They literally drown trying to reach Italian shores. Yes, it's not of the highly skilled type, but they are foreign and they want work.
Whereas Italian democracy and public administration leaves something to be desired, Italy didn't have a near coup in 2021, and Italian parties are not busy trying to win elections by preventing voters from other parties from voting. It's whole legal system is not so fragile that half its population cares whether one octogenarian justice dies during what they consider the wrong president.
From a startup perspective, Italy is not where it happens right now, but neither is the US Midwest. Italy's population is very old, and it's not a leader in the English speaking digital economy. Let's see what happens.
And it's not like they're just coasting on their past glory. As an exaple: the country is now criss-crossed by high-speed rail (Frecciarossa), 300km/h, so good that it is out-competing local flights. Most of it built within the last decade
Companies who want to operate in a country have to follow that country's laws and stick by that country's regulations. That's why Apple have to make islands appear bigger than they are for China reasons.
US companies can't just operate the same as they do in the US in other countries where people seem to have more protection from malpractice than in the US. Certainly from the outside looking in.
The US can only take measures in the US on EU companies that are breaking US law and/or regulations. It's not tit for tat like tariffs which are clearly arbitrary.
No if we had a decent system for making the likes of Amazon, Facebook, Apple, et al, actually pay taxes in the countries they clearly do business in I think that would be better than one off fines, however big.
I wish there were some of those "those European tech conglomerates". They'd keep the US giants in check naturally. But the fact that there are pretty much no EU tech giants is not USA's fault...
If the US were to profit from Amazon's extraction of wealth in Italy, I could see where you're coming from. But do they? It's not like Amazon takes the Italian money and builds roads in the US or something.
Confused. Shouldn't we be fining companies that break the law? We should be expanding it, instead of complaining when another country happens to fine a company that happens to be from the same country as us.
As German, fine the fuck out of the corrupt people in Deutsche.
All of the fines you list there (I think) are for breaking various law like dumping oil in to the sea, cheating emissions tests, and money laundering. It's good and right that they're fined for those things (though the fines could be higher..) None of them are big enough to abuse their respective markets. The fines are not symmetrical to the fine Amazon has been given for abusing the Italian courier market, and there is no equivalent EU company that could be fined for abusing any US market either. EU companies tend not to be dominant in the US.
VW's diesel scandal and Airbus's bribery fines aren't antitrust cases though. Foreign antitrust cases in particular are often criticised by nationalists.
I get that emotions are high when we discuss Amazon, but the article seems to imply that they were fined for not adding the "Prime" badge to items that were not fulfilled by Amazon (i.e. that didn't use Amazon warehouses).
Frankly I don't see why that's a problem, the Prime badge is for one-day or two day shipping item. If the seller is not using Amazon for their logistics then they simply can't guarantee the time window so they don't add a prime badge?
From a customer point of view it would make for a worse shopping experience if Prime items weren't fulfilled by Amazon
The article states "The authority said Amazon tied to the use of FBA access to a set of exclusive benefits, including the Prime label, that help increase visibility and boost sales on Amazon.it"
That last part is the relevant part: either you use FBA or you loose visibility/sales. That combined with the dominant position of Amazon seems, from a layman perspective, a textbook case of abuse of market dominance.
Fully transparent that this is just from a quick search, and maybe a degree separate from this, but I kinda didn't know Seller Fulfilled Prime was ever a thing (not accepting registrations now though?).
I would have to look back through my order history, legit I thought prime was always fulfilled by amazon, and that was how they could guarantee the shipping process. But amazon's page even talks about why FBA might not be right for your products (too bulky large etc., i.e. whatever isn't efficient for amazon to store/distribute). But then amazon probably was not content to say "that entire class of products cannot be Prime".
So my view to this was, amazon is selling a product (FBA) and part of what you get is use of the Prime label. But, certainly willing to cede being mistaken if that is not the case.
Amazon planned to enable Prime for Dropshippers working directly for Amazon (called Direct Fulfillment nowadays I think) and 3rd party sellers. It's a bitch to qualify for, so. Because the same performance thresholds apply for those third parties as they do for Amazon's own FCs and 3PLs, and those are strict.
> Frankly I don't see why that's a problem, the Prime badge is for one-day or two day shipping item.
Europe countryside here: I get 3+ days delivery for Prime items regularly (not all the time, especially not in summer since I live in a touristic place and we get city-like Prime deliveries in August) but Prime <= 2 days delivery is not a written rule at all.
You can guarantee it, but you're asking Amazon to guarantee it on your behalf, which they don't want to do, because they don't know that you can keep your promises.
Then the "get it by" date will reflect that and if people want to pay for your one/two-day shipping they can.
Shipping is also free on prime items if you are a prime member so the same general idea applies, Amazon is doing what's right for their customers here, the prime badge takes its value from their fulfillment service that is still stellar compared to everything else.
I'm italian, but I don't really understand the case. As far as I can understand reading italian news, no one was forced to subscribe to Prime program. Of course Prime program is linked to Amazon logistic and subscribing to Prime program force to seller to use Amazon logistic, but I think this is part of the conditions to subscribe to it and it's just a business model.
I guess, and it's just a guess knowing how Amazon is treated in Italy [0], italian retail companies had something to do with this fine.
> no one was forced to subscribe to Prime program.
When I search amazon as a user "prime" products get preferential treatment. There is even a filter for it in Amazons otherwise catastrophically bad search UI, there is no way to filter for prime like properties like free shipping or fast delivery, the only way to look for them is by selecting Amazon prime (TM).
The part that the market authority seems to have based their decision on is that the Prime label increases visibility on Amazon.
By making a particular logistics company a requirement for the Prime label, Amazon's dominant market position raises sales for that logistics company. So far this isn't really debatable, what matters is whether this is an unfair use of Amazon's market dominance.
That wasn't the case when Amazon Logistic didn't exist in Italy, at the time Prime orders were simply shipped using the italian couriers (SDA, GLS, BRT).
The Italian retail sector (i.e., small local shops) is ripe for disruption. The shops pretty much just buy from wholesalers and provide some local inventory in the shop. This usually comes with a high markup. Competition is highly regulated (e.g., sales can only happen during a certain time window each year, most places have a cap on the maximum discount, returns are close to non-existent). I am not sure what other value they add to the retail experience beyond maybe having a relationship with the shopkeeper and going in to shoot the shit while buying stuff.
I'm not surprised that something like Amazon is able to disrupt the system. Even my parents have started buying stuff on Amazon instead of going to the store and they barely use a credit card.
I'm also not surprised that the retail guild/cartel is pushing back through legal means. It will be interesting to see what will happen. My guess is that the Italian consumer will end up losing at the end and will have to pay more for stuff from Amazon.
At a higher level, I believe what we're seeing with these cases, is the nationalization of giant corporations under the umbrella of their "home" governments, and thus, the malignment of these corporations by foreign governments.
It's about power. It's about the inherent misalignment of corporate and government power structures in a world where the US established a "western" free-market system, and now that system is becoming more and more aligned with national governments. Initially through national spy programs, but now more generally in the broader economic landscape.
As such, we see the Chinese forcing companies to headquarter and list their stocks in China (taking HK was a key part in facilitating that). We see Russia force Russians to use Russian social media. We see Europe punishing large US corporations financially to help grow their own competitors.
The longer term result is more segregated power structures. There will also be a pressure to bring smaller nations into these corporate-government power structures, and thus large nations will want to amalgamate neighboring smaller states into their unified system.
This is one big reason why China will likely re-take Taiwan in our lifetime, and Russia will likely (at least try) to fold in Ukraine into its system.
I’m pretty sure it’s all about $. How much tax Amazon pays Italy. Italy can then disperse some of that to provinces to reduce tax burden on local retailers - who’ve taken a beating after Primes rollout.
Doesn't seem this will hold any ground if Amazon decides to fight it...
FBA products have a clear competitive advantage: free shipping for Prime customers, fast and reliable shippings, easy returns, a networks of lockers so you don't have to wait for the package at home (in Italy packages have to be handed to a person, they can't be left in the front yard unattended).
Marketplace products have longer and unreliable shippings, you need to pay extra even if you are Prime customer, customer services is usually subpar, customer protection is inferior and so on...
There's not an abuse, they offer a better service, they get better business.
I disagree with you here. I live in Poland which has a very popular e-commerce website known as Allegro.pl - it's very similar to Amazon. It has its own version of Prime which is known as Allegro Smart which provides benefits such as free shipping and easy returns. A seller that wants to make their products have Smart badge don't have to use Allegro's own delivery method (Allegro One). The requirements for a Smart badge are as follows:
- have at least 5 positive reviews
- at least 98% rating (if their deliveries are slow, they shouldn't expect a high rating from customers)
- passing Allegro transaction identifier to a delivery service
- they have to provide at least one of the following parcel delivery services as a delivery method: Poczta Polska (which is owned by government), DPD or UPS
Amazon forces third-party sellers to use Fulfilment by Amazon in order to have Prime badge, something that a very similar service doesn't do.
While I'm not sure this ruling is good, your argument is making it a bit too easy. Amazon does not naturally "provide better service" that others can't.
> free shipping for Prime customers
could be offered by sellers using other fulfillment too
> fast and reliable shippings
Not something only Amazon logistics are capable of
> easy returns
Not something only Amazon logistics are capable of (at least here in Germany, they just give you a label to put it in the normal postal system, as do most retailers)
> a networks of lockers so you don't have to wait for the package at home
That one is tricky. Although I guess the market dominance argument could still be used to say "well, your problem to figure out how to solve that, it's not absolutely impossible to let others ship stuff to those too"
For the first three, the pro-Amazon argument is of course that if third-parties do parts of it, Amazon has a hard time ensuring and monitoring quality of service, which is a problem for a "premium" product that's supposedly all about that - and which is popular because of a reputation to delivering on that, and it's unfairly harsh to go after that.
(The obvious fix of course would be for Amazon to not do fulfillment for third parties in Italy - if they are not in that market, they can't be accused of distorting it. If that'd be better overall for customers and sellers though? The theory behind the competition law says yes, at least short-term many might disagree)
> Not something only Amazon logistics are capable of
Yet something Amazon logistics consistently does better than others. It is not uncommon for non-FBA sellers to ship directly from China and evem if they ship from Europe they are practically never as fast as Amazon.
> > easy returns
> Not something only Amazon logistics are capable of (at least here in Germany, they just give you a label to put it in the normal postal system, as do most retailers)
Others may be capable of but will they? With Amazon logistics its just a couple of clicks and then you get a QR code to show when you drop of you package at your local post office - no need to even print anything yourself anymore. Sometimes they will just refund without requiring a return at all. And you can rely on getting the refund within a reasonable amount of time without having to haunt the seller about the status. With some random seller who knows what you will get - and you certainly won't know that until you have to go through with it.
I'm not saying Amazon shold not receive fines. But for now I keep using Amazon desite all their problems because, as a buyer, you do get a better, and equally important, consistent service when it comes to fulfilment.
> The obvious fix of course would be for Amazon to not do fulfillment for third parties in Italy
I wish they would do that everywhere. There are other platforms where you can connect with random sellers if Amazon does not have what you want in their warehouses.
The comparison here is not Amazon vs Zalando, it's Amazon vs the typical marketplace seller, which is either an italian small business or a chinese seller or european dropshipper shipping directly from China.
>> a networks of lockers so you don't have to wait for the package at home
> That one is tricky. Although I guess the market dominance argument could still be used to say "well, your problem to figure out how to solve that, it's not absolutely impossible to let others ship stuff to those too"
Poste Italiane (the national postal service) has those kind of lockers as well AFAIK, plus offices in every town where you can collect the packages (OK, that's probably not an advantage given how slow they are and the big queues you have to do each time).
Right, but there is a point to "it says Amazon Prime" == "you can have it shipped to a Prime locker". And just like to get something in a Poste Italiane locker you need to ship it with them (I heavily assume), that needs to involve Amazon logistics somehow, whereas everything else doesn't.
This actually makes me wonder about something I've noticed in Germany: Amazon has a DHL locker on file as my shipping address. But for third-party stuff not via FBA it's not available (at least usually), as Amazon doesn't know if the shipper will use DHL. Can a seller explicitly declare "yes, I'll ship that to DHL lockers" when setting up the product with Amazon, or are they excluded from that too?
But the Amazon locker point you are making it's perfectly in line with this fine: if Amazon would let other ships Amazon packages (and Amazon packages only) to those lockers, it would be clearly a sign they are not abusing their dominance in one market (online sales) to drive another market (logistics/last-mile delivery). Full disclosure: I work for a last-mile delivery company even thou in this case is not direct competence.
Sure it does not naturally provide a better service, but does the better service this come from its dominance position or dominance is a consequence of that?
I mean marketplace vendors could offer the same level of service customer expect from the Prime label products and Prime would lose its competitive advantage.
> I mean marketplace vendors could offer the same level of service customer expect from the Prime label products
If they do, they don't get special highlighting of that on the marketplace though, that's the point of the complaint. Having "Amazon Prime" on a listing is a distinction between you and an arbitrary other third-party seller who doesn't care, if your third-party fulfillment can match or beat Amazon Prime in service quality you don't get any indication of that on the listing.
Interesting! Do you know if that's available in Italy (the page says " This article applies to selling in: United States", but that doesn't necessarily mean there is an equivalent elsewhere)? because that sounds like it would be the solution here...
You work under the impression that Italian laws, and the justice system that enacts them, are a set of coherent and logical measures defined to make life better for consumers and businesses.
As an Italian, let me assure you that it's a naive assumption. The country literally invented civil litigation 2000 years ago, they can go on arguing pretty much forever if they want to.
... But isn't this FBA <> free Prime shipping relation the point that the CMA of Italy believes to be problematic?
I understand the CMA's point from a markets perspective: why would / could the relation between the customer and a different seller impact the prices of shipping for a different seller on the same platform? Prime is primarily a transaction between the customer and Amazon [the shop], for cheaper products and free shipping for their products; allowing it to impact the customer<>seller relationship of third parties could be considered illegal bundling.
The 3rd party seller opts into this bundling as a benefit to offer their customers, though, right? No one is forcing seller X to use FBA or Amazon’s platform at all; they’re doing it because customers prefer it now that they see what’s possible.
To me (in the US), Prime was magical when it first rolled out. It lowered the friction and raised my expectations for online commerce in general. When other players followed suit, my life got even better. Now, someone charging $20 to get me a package “maybe next week; you’ll get it when you get it” is wildly uncompetitive rather than being the accepted standard.
FBA only exists because market dominance makes FBA style shipping arrangements profitable. Without Amazon's scale and marketplace dominance, that shipping and pricing doesn't work.
Market dominance exists because they offer a better service to the customer. It's not like Amazon has always existed in Italy and always had a dominance position. They gathered their position because they offer a better experience and people are willing to pay a premium for that.
Isn't it the opposite? They have so much money from other markets, that they can take over a new market suffering losses for years, but pushing out everyone else.
Lots of people here are missing the point. I read things like "it's a bit fine compared to the business in Italy etc etc"
We don't know much about the reason, but for sure this fine is not for a point in time issue, it's measure are taking considering a large timespan (usually 4/5 years) and similar fines have been give to other companies considering the same factor (mostly for tax evasion)
So, if Amazon was wrongdoing for 5 years, the $1.3B fine is accounting that timespan which means around 250 million dollar per year.
Is the Italian market even worth 1.1b mid-term? I might have a skewed estimate since Amazon is "really small" in Sweden, but that is a LOT of money considering it's 1.1B lost profits and not turnover.
There is a fourth option, that is them retreating from handling logistics for Italian sales only.
TBH the most realistic option is something around 3: pay fines, change nothing (maybe rais prices a bit), make noise to get consumers on its side (Italians disproportionately like Amazon, because of its no-question-asked policy on returns is an absolute rarity there), wait for a friendly government to fix things in its favour.
I don't want to go down the rabbit hole that is politics, but Italian usually don't benefit from "more tax money', the government is not very good at handling money
I'm not sure if I'm misreading the chart, but Health sits just above National Defence, with $796.8 B (12%) of expense, not $1.5T.
Anyway it only makes it more absurd; that the US as a nation manages to be the first military world power using less money than they spend to have a broken healthcare system that ruins people's lives.
It looks like Medicare spending was also included to arrive at $1.5T. A portion of "veteran's benefits" should probably also be included for the VA medical system.
> Like the US is much better at this, throwing trillions of public money in weapons while they can't seem to afford free public healthcare.
The US can afford free public healthcare. It could probably afford free public healthcare with its current public healthcare spending (per capita it spends far more than most developed countries providing that, and per GDP it spends a similar amount), but instead it's spends hyper inefficiently so as to maintain a private healthcare system that costs even more on top of the public system.
Weapons are irrelevant to that, though the US spends too much (and too inefficiently) on those, too.
I'm not saying that Amazon shouldn't pay because they will use the money better. Mine was a response to the parent comment saying that the Italians will benefit from "tax money".
I do believe that is good to tax/fine Amazon appropriately, I just don't believe that the Italian government will use that money for the benefits of the Italians.
Unless you know better, this will also go to pay public health care and public education (among many other things as will be added money to the state revenue)
I didn't said anywhere that companies shouldn't pay taxes... If was for me companies should pay the same amount of taxes as civilians ( 60% ) if not more
To the parent comment stating "Italians will benefit from more tax money" ( the parent comment has been edited and the phrase rewritten to state that the country will benefit )
I don't think we know yet, as Amazon EU did not report per-country in 2020 according to a quick search; but the total revenue was 44bn, and the biggest EU markets are always disproportionately Germany, France, and Italy, so I would expect Italy-sourced revenues to be in the 5-10bn per year.
I believe Amazon has quite fat margins as a monopolist? The days of subsidising losses in favor of market share are long gone as the competitions has mostly been crushed.
In the worst (for Amazon) scenario, we're looking at 20% of localized revenues over a year. Amazon reported an average 5-7% profit margin in the last few years. Even in the worst case, they will be back in pure profit after just a few years...
For illustration, 5% of 5bn is 250m, so if the fine is 1.1bn, it will take them 4 years to absorb it from localized profits only. Peanuts.
Assuming they're able to play by the rules, they might just not be able to. We've seen Google fined over and over for things. I'm not sure Amazon would be different (I guess they have to to remain profitable or pull out).
Business wise, it does seem a little odd to consider Amazon EU as one package, when operating income and costs are as localized and non-homogeneous as they are.
Since it became available here it became the de-facto standard for online purchases, most people don't even look at other marketplaces now and are often willing to pay more just because the order is coming from Amazon (even when it's a 3rd party seller)
Amazons behaviour for which it was fined is not unique to Italy. It behaves the same in almost every country, but it's only Italy that is doing something against it.
The time when Amazon was something new and exciting and good for consumers is long gone. Now it's a monopoly that abuses its market power to stifle competition, and something needs to be done about it.
If other countries would follow the suit, e.g. Germany and France, which are much bigger markets, and in the end USA, or at least some US states, Amazon would be hit hard.
The law needs to be the same for all, and since "with great power comes great responsibility" even harder for those with much more power.
EDIT: Besides, Amazon in Europe is after accused to be responsible for tax evasion. This is a frequent topic in politics, but unfortunately only before elections. After elections, it gets forgotten and nothing is done about it until next elections.
a) They will appeal in Italy.
b) Then they will appeal in Europe.
So I guess it will take quite a while for this to really impact Amazon's wallet. Meanwhile they can invest in order to have this money ready when (*if*) they lose.
> The Prime label makes it easier to sell to the more than 7 million most loyal and high-spending consumers members of Amazon’s loyalty program.
Who are the 7 Million? In Italy? I only find figures between 1million and 1.5million. Can't be europe either, several coutries in the region have more. Very confusing.
It is also forbidden for supermarkets (for example) to give people with a "customer card" discounts. They are obliged to give everyone the discount. So when a cashier asks for a customer card and I tell them I don't have one, the cashier scans their own card to apply the discounts.
Wait, is this true? Are they allowed to tell you to sign up for a free one? (seems to be what happens every time I use a grocery store I don't have a phone number for)
Amazon decided to be a market place, but it's unfair to the sellers on the platform: they are not represented as much on the main site - they don't have a fair space, and amazon use their data to steal part of their market. That's why the Italian anti-trust is striking on amazon.
"Secondo l’Autorità, le società hanno legato all’utilizzo del servizio Logistica di Amazon l’accesso a un insieme di vantaggi essenziali per ottenere visibilità e migliori prospettive di vendite su Amazon.it. Tra tali vantaggi esclusivi spicca l’etichetta Prime, che consente di vendere con più facilità ai consumatori più fedeli e con maggiore capacità di spesa aderenti al programma di fidelizzazione di Amazon. L’etichetta Prime consente, inoltre, di partecipare a eventi speciali gestiti da Amazon, come Black Friday, Cyber Monday, Prime Day e aumenta la probabilità che l’offerta del venditore sia selezionata come Offerta in Vetrina e visualizzata nella cosiddetta Buy Box. Amazon ha, così, impedito ai venditori terzi di associare l’etichetta Prime alle offerte non gestite con FBA."
Automatic translation by DeepL: "According to the Authority, the companies have linked the use of Amazon's Logistics service to access to a set of benefits that are essential for gaining visibility and better sales prospects on Amazon.it. These exclusive benefits include the Prime label, which makes it easier to sell to the most loyal and highest-spending consumers who are members of Amazon's loyalty program. The Prime label also makes it possible to participate in special events run by Amazon, such as Black Friday, Cyber Monday, Prime Day and increases the likelihood that the seller's offer will be selected as a Featured Offer and displayed in the so-called Buy Box. Amazon has, thus, prevented third-party sellers from associating the Prime label with offers not managed with FBA."
The citizens only come the US for high paying jobs because there aren’t enough innovative businesses in Europe to support strong software wages. There aren’t enough innovating businesses because of the tendency of the people to reach for regulation for everything.
You can’t pass a law that demands your economy be better without somehow actually making it better for businesses.
Yes, but Lidl buys those and resells them. It's not like you can sign up with Lidl and pay 39 Euro/month to get a place in the cereal corner. The concept is a very different one.
A marketplace with sellers with third-party fulfillment is obviously different from a marketplace with no third-party fulfillment in a case about the fulfillment market.
A marketplace maker can't have its own shop,
a marketplace maker can't have its own delivery service,
a marketplace maker can't have its own payment processor.
To me the biggest problem with these kinds of platform is information asymmetry. Amazon literally knows about every credit card number and every shipment and every product ever sold, while the customer can't even trust if the numbers on a seller's page are legit or just the result of scams, or if the price didn't change 5 seconds before they clicked on the product page.
The only stategy to rebalance the market is to REQUIRE every company to be as CLUELESS as possible about what happens on their platform, so basically enforce PRIVACY.
Amazon should only know which sellers are on the platform and their catalog of products. It shouldn't know my address or my purchase history.
The sellers should only know which of their products are selling. They shouldn't know my address.
The shipment company should only know my address and what the package broadly is about. It shouldn't know exactly what I have bought or that the purchase was done through Amazon.
All of this could be achieved with a well made public key cryptography architecture and open APIs for being a customer, seller, payment processor and shipment company.
Let's take an example: a seller wants to sell on Amazon.
1 - they create a key pair
2 - they tell Amazon their public key
3 - when I click on the seller's page I receive the public key and now the traffic is encrypted between us, Amazon can see nothing
4 - the seller has chosen the shipment company(s) and payment processor(s) and gives me their public key at the moment of purchase
5 - the customer encrypts the credit card info with the payment processor pubkey, encrypts the shipping info with the shipping company's pubkey and encrypts everything with the seller's pubkey
6 - the seller now delivers the information to the payment processor and shipment company
7 - the shipment company tells the seller how much the package is going to cost and the payment processor tells the seller if the payment has been concluded successfully
8 - the seller prints the tracking paper's encrypted QR code and the shipment company proceeds to deliver it to the customer
So what would be Amazon's role in all of this?
They should provide a website and/or app that just works across all platforms imaginable and is fast and stable and good looking.
They should manage the identities of sellers so customers know they are buying from real people, but nothing more.
Lastly they should collect a fee for every transaction.
E-commerce should be reliable and automated, not a privacy horror fest filled with ads, bogous suggestions and shady practices and policies
Am I right that this is (only) about unfair dominance in logistics? It looks like Amazon Prime is forcing sellers on Amazon to use Amazon logistics and thus putting others out of business.
Forgive my naivety; What happens when a country wins something like this? What is the money used for? How is it fair that the country gets this capital?
Not sure about Italy, but if it's at all like the US it would typically go to the treasury of the jurisdiction in which the fine occurred. It could then (in theory) be treated the same as tax revenue - but government budgets are complicated things, so I'd say the likelihood of the fine providing direct relief to those impacted by the crime are exceedingly low.
Nah, they just read the umpteenth "American company fined by EU country" and assume it's not fair for the company. What they don't realize is how good customer protections laws are in Europe compared to most of the world.
The fact that $1000+ purchases are only covered for a year in the US for example is kind of a joke (in the EU it's 2 years)
Touché. I'm not sure how much the difference in pricing is a direct consequence of consumer protection laws or just import fees, etc.
For the record, an iPhone 13 Pro costs EUR 951 before taxes in France, which means it's 7% more expensive than the US. However with taxes it's USD 1,303, which is probably quite a bit more than any after-tax price in the US.
Sure, but (at least as a country) you are also paying for the disposal of those products so its better to incentivize companies to make things more durable. Plus the cost isn't 2x and often not that much different once you take into account that the EU list price already includes taxes.
The protection goes both ways though. Court ordered compensations are based on actual damages. No one here dreams of getting millions for burning their mouth on hot McD coffee.
The point being, in EU you'd be expected to know hot coffee is hot, and get nothing for pouring it over yourself. At best you'd be looking at medical expenses (loss of income is covered by state).
My understanding is the jury decided that the primary issues was that the warning was not large enough on the cup, and that's why they awarded damages.
I can't really understand being served a cup of hot coffee and complaining that you were not warned that it was hot. Coffee is a hot drink. There’s a natural limit at how hot it can be at 100 degrees, so I don’t really understand ‘too hot.’ What did you expect? You must have known it would be between 0 and 100 degrees and acted accordingly.
Subsequent lawsuits have re-inforced that the coffee was served at a reasonable temperature, and the temperature is the same as served at Starbucks, and recommended by independent coffee groups. My understanding is that McDonald's serve at the same temperature today.
I think the idea that the coffee was 'too hot' is a bit weird and a bit of a myth.
As I say the temperature they served coffee at hasn’t changed and has actually been tested to be ok in subsequent lawsuits in multiple countries. It’s the same temperature as served by other companies.
McDonalds weren’t required to change the temperature as the outcome but they did increase the size of the warning.
And at the end of the day how can any temperature of coffee be too hot? It’s a hot drink. It’s never going to be more than 100. Assume it could be that hot. Other hot drinks like tea have to be made with boiling water so are always served that hot.
I think a lot of people have a knee-jerk reaction to this story that McDonald's must be at fault, but when you look into the details that's not really the case. She even admitted she was at fault and she just wanted someone to pay her medical bills.
All the recent actions directed against Google, Apple, Facebook or Amazon. None of these is a monopoly in any sense of the word. Well, maybe Google, a little.
People often get cough up in definitions of what is or isn't monopoly or what free market is, on HN. And its even often argued in USA politics.
In EU its far less.
What is important is the perceived result (Apple, Google, Facebook have enormous power over daily lives of people) and how people feel (weather something is fair of not). And many inside EU myself included think that
> Google, Apple, Facebook or Amazon
are abusing their market position, that they are doing shady stuff to limit competition, starting to use more and more dark patterns, avoiding taxes (taxes are higher in EU so people are more pissed if somebody is "getting away with it") and generally don't trust them.
So politicians (that want to score points with people) are doing what people want.
Another thing is, that some of this companies are starting to become so powerful that they are starting to worry politicians themselves. So politicians are "defending their turf", by smacking the upstarts when they can. (This is happening in USA as well )
This is a good analysis. Personally, since somebody will inevitably have enormous power over my daily life anyway, I'd rather have it be corporations because they actually have to provide useful stuff to exist and the competition will keep them in check.
Unlike politicians whose first interest is getting elected and second getting reelected with any other concern at a huge distance away.
At the end of day power is power. Once a corporation has enough of it compared to local governments it might as well be "government like entity" themselves, or like in case of defense contractors (not just USA, look at Airbuss in EU, Ariane in France, NSO and others in Israel) where it's hard to draw a line where corporations end and government start.
There are plenty of places with week governments in the world, where global multinationals are above the law (look at Africa, some south America).
If corporations get big enough, this might start happening in more developed world as well.
I perhaps notice it more because I live in small country (Slovenia) whose entire national budget is lower than any one of the FANG's. This is one of the reason I support EU despite it's many shortcomings.
Apple have abused their hardware position to artificially restrict and abuse devs via their app store.
Facebook - Do we really need to do this? Facilitating genocide and election interference both don't fly over here.
Amazon - Being a market place and a seller on said marketplace is a no no. Using your customers data from your market place to undercut them and run them out of business is again a no no.
> Apple have abused their hardware position to artificially restrict and abuse devs via their app store.
A monopoly on their own product is an incoherent market definition that isn't flying anywhere.
> Amazon - Being a market place and a seller on said marketplace is a no no. Using your customers data from your market place to undercut them and run them out of business is again a no no.
Every single retail store in the EU (and the rest of the world) does that. Completely normal. That's what store brands are.
Google is the best kind of monopoly: one sustained by the quality of the product. If there was a better competitor tomorrow, we'd switch in a heart beat and Google could do nothing about it. No consumer harm there.
Apple has created their own hardware platform(s) and it has a healthy competition for it. There are rules to be on it and they are mostly for the benefit of the consumer.
Facebook is simply a forum. If facilitating communication facilitates genocide and election interference it's people who are the problem, not Facebook. Besides, TV & Radio are much bigger facilitators for genocide and election interference and nobody attacks both.
Amazon - any physical retailer is both a market place and sells its own competing products crated using said customer data. Just visit any supermarket.
Do you not find value in Google's offerings? Do you know of better alternatives?
Just talking about Search: I've been using it daily for over 20 years now, I couldn't live without it and I know no better search engine, even though I would switch in a heart beat.
That same Google that uses their monopoly in search to push their other product lines? Such as Chrome, shopping, 'information snippets', news, social networks and a whole raft of other mediocre products that wouldn't even exist if not for their monopoly on search?
Not finding value in Google's offerings is not what it is about: it is about abuse of monopolistic power, and Google is very guilty of that.
While not exactly fan of Google pushing their other offerings, I still have to find someone who doesn't do that on their own properties. Even our office landlord keeps pushing us to rent some more parking spaces.
But that does not make it a monopoly and the very fact that those other offerings are unsuccessful shows that this behavior is not that problematic.
I am willing to put up with it if this means preventing yet another competition stifling, consumer harming, incumbent favoring - regulation.
Like every government beurocracy they just move money around to create opportunity for cronyism and mysterious leaks in the pipe as money is moved around .
There is no interest in going down in history for enlarging the pie.
You can say everything you want about Bezos , Gates, zuckerberg , Larry &sergey and everybody who had beef with the EU (including European entrepreneurs) but at least they started with the ambition of enlarging the pie as opposed to becoming beurocrats
Hard to beat Amazons search function in pure suck, so probably never?
I am not sure what Amazon provides specifically that should make it stand out, I generally end up using third party sites to search for what I need and only end up buying at Amazon when it turns up near the top of the results.
These EU countries sure seem to be raking in a lot of FAANG money. Ideally they should just sit down together and meaningfully reach some common policies around how to operate without being 'abusive' - but of course they wouldn't get to make these billion dollar fines then.
Companies seem to push the boundaries of the law deliberately.
Are these types of fines taken straight out of any "profits" by the accountants so I'm not sure if they don't just effectively "expense" the cost of fines and consequently only pay 60-80% of them?
It does seem high but then it depends on if they are consistently breaking the law. I'm sure these bodies came to a conclusion based on some sort of evidence to show damage to other businesses. How would you deter companies in a different way from breaking the law?
Anyone can enter any store without showing any paper in Italy. The only places where you are required to show proof of vaccination or recovery from covid are:
- Restaurant (if you want to dine in)
- SPAs
- Ski resorts
Last time I checked Amazon didn't have dine-in restaurants, SPAs or ski resorts (at least not in Italy).
You're right, I may have confused it with another EU country. Amazon Italy's revenue is still massively up in 2020 and 2021 compared to previous years. Put it down to the earlier restrictions or mask mandates that are still in place if you will, but it's not organic growth. Just look at the charts, there's a giant jump in revenue in 2020!
Germany as well to enter basically anywhere. France had it too for malls but from what I see right now it's only for tourists? Not sure how that works in practice.
> You can visit a physical store what paper you are supposed to show sorry?
Technically, it's not a paper, but still in many European countries it's not possible to enter many physical stores without a proof of vaccinations. I guess that's what parent's comment is about.
Tech companies are getting fined so often in the EU recently that it seems we're seeing a new article about a 9+ digit fine every other week.