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Speaker 1: Hey, guys, ready or not, twenty twenty four is here

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Speaker 1: and we here at breaking points, are already thinking of

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Speaker 1: ways we can up our game for this critical election.

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Speaker 2: We rely on our premium subs to expand coverage, upgrade

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Speaker 2: the studio ad staff give you, guys, the best independent.

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Speaker 3: Coverage that is possible.

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Speaker 2: If you like what we're all about, it just means

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Speaker 2: the absolute world to have your support. But enough with that,

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Speaker 2: let's get to the show everything.

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Speaker 1: So, in the wake of that crash of the F

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Speaker 1: thirty five jet in South Carolina, with a lot of

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Speaker 1: questions remaining about what the hell actually happened there, we've

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Speaker 1: got a new report that outlines some not great details

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Speaker 1: about this very very expensive thing. Put this up on

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Speaker 1: the screen. So they say that the F thirty five

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Speaker 1: fighter jets can only fly fifty five percent of the time,

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Speaker 1: so about half of the time. This is according to

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Speaker 1: a US watchdog. Let me read you a little bit

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Speaker 1: from this article. They say that maintenance issues keep the

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Speaker 1: aircraft on the ground often despite the growing reliance on

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Speaker 1: this plane by the US and its allies. The fleet's

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Speaker 1: mission capable rate, or the percentage of time a plane

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Speaker 1: can perform one of its assigned missions was fifty five percent.

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Speaker 1: That is far below the Pentagon's goal of eighty five

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Speaker 1: percent to ninety percent. The F thirty five share of

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Speaker 1: the US's overall tactical aviation fleet is expected to keep growing.

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Speaker 1: Basically every branch the military is increasingly relying on the

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Speaker 1: F thirty five and moving in this direction in spite

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Speaker 1: of the fact that it is incredibly costly and apparently

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Speaker 1: down from maintenance roughly half the time. This is the

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Speaker 1: world's costliest defense procurement project. Let me give you the

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Speaker 1: numbers here. The Pentagon plans to buy roughly two thousand

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Speaker 1: more of these things by the mid twenty forties, costing

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Speaker 1: one point seven trillion dollars over the program's life cycle,

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Speaker 1: including one point three trillion for maintaining the aircraft. Music

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Speaker 1: to the ears of manufacturer Lockheed.

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Speaker 2: Martin, absolutely and not only that, Crystal, it actually costs

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Speaker 2: forty two thousand dollars per flight hour for F thirty five,

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Speaker 2: forty two thousand dollars an hour to fly this thing.

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Speaker 2: I've always been obsessed with the flight hour costs for

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Speaker 2: a lot of these things. A lot of Americans don't

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Speaker 2: even understand. It's not just about buying the plane. Costs

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Speaker 2: of running these planes is outrageous and it reminds me

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Speaker 2: of there was I think it was a B two bomber.

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Speaker 2: So the B two bomber flight costs per hour, let's

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Speaker 2: go ahead look it up live. Yeah, okay, so B

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Speaker 2: two costs one hundred and sixty three thousand dollars per hour.

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Speaker 2: And at one point we had these guys who flew

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Speaker 2: from like Louisiana all the way to Libya to bomb

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Speaker 2: Isis with a B two drop the bombs, which that's

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Speaker 2: what another million, million and a half and so the

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Speaker 2: cost of the bomb and then fly back it was

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Speaker 2: like a thirty six hour mission. The collective mission costs

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Speaker 2: like ten million dollars for a single bombing run. And

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Speaker 2: it's just one of those we just ride it off.

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Speaker 2: And you know, this was a huge fight in the military.

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Speaker 2: I know aviation geeks are going to get mad at

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Speaker 2: me for screwing up some of the details, but there

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Speaker 2: was this fight around a ten Warthog, which was like

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Speaker 2: it's a very cheap plane. It's much cheaper in order

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Speaker 2: to fly, and it has like the sound that people

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Speaker 2: are familiar with with the machine guns. It was used

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Speaker 2: as a terrorist killer a lot in the Global War

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Speaker 2: on Terror, and especially because a lot of these guys

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Speaker 2: don't have anti aircraft stuff, it was much easier in

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Speaker 2: order to fly and to use. But the air Force

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Speaker 2: was trying to get rid of it because they're much

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Speaker 2: more in favor of these costly gadgets like fifth generation

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Speaker 2: fighters at thirty fives, B two s all these other

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Speaker 2: very very expensive aircraft. I think we're gonna have a

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Speaker 2: reckoning whenever we have another war. We're going to find

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Speaker 2: out that a lot of these costly toy projects, you know,

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Speaker 2: fifty games and all that stuff, that war has not

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Speaker 2: changed that much. It's all about what flies, what actually works,

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Speaker 2: and can you produce a ton of them in a

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Speaker 2: major war of attrition. Just look at Ukraine. You know

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Speaker 2: this is very nerdy, But there was entire ideas in

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Speaker 2: the nineteen nineties called there was a new generation of

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Speaker 2: warfare as in war changed for all time and whateveryone

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Speaker 2: would point to. Was the US campaign against the Iraqi

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Speaker 2: military because the Iraqi Republican Guard and the military was

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Speaker 2: one of the largest militaries in the world. We steamroll

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Speaker 2: them in thirty days. The Highway of Death and they're like,

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Speaker 2: oh my god, like wars forever change, it's all about

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Speaker 2: computers and all that stuff. What are we learning from Ukraine?

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Speaker 2: You would be better off learning the tactics of World

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Speaker 2: War One than you would anything afterwards about the fighting.

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Speaker 1: Well, and also what was like the most critical thing.

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Speaker 1: It's just ammo.

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Speaker 2: Ammo artillery, same fight nineteen twelve. So look, I'm not

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Speaker 2: going to sit here and claim that all of war

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Speaker 2: is exactly the same, but I think war is a

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Speaker 2: lot more analogous in rhymes with some of the major

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Speaker 2: conflicts we've had, as opposed to some video game that

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Speaker 2: a lot of these idiots have been pushing us into

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Speaker 2: for a long time. This is all like, you can

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Speaker 2: nerd out on this stuff forever, and I know people

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Speaker 2: who do. About China and the US and fifth generation aircraft.

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Speaker 3: Here's the deal.

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Speaker 2: We ever got into a war w Taiwan. You know

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Speaker 2: what's gonna matter? Anti shit missiles. You know, a bunch

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Speaker 2: of mines in the middle of the sea. We've been

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Speaker 2: doing that since what since time immemorial. So it's like

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Speaker 2: we can talk about this forever. But the F thirty

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Speaker 2: five is the symbol I think of this new bet

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Speaker 2: that war is just easily outsourced to computers and drones

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Speaker 2: and all this. And I'm not saying those things don't matter,

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Speaker 2: but you know, the very nitty gritty about what can

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Speaker 2: be produced, what can go on time, what actually works? Yeah,

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Speaker 2: what's really employable on the battlefield. We'll find it all

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Speaker 2: out very soon. And most of the time people are

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Speaker 2: totally wrong in terms of the before a major war break.

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Speaker 1: It also just shows there's just literally no cost control. Yeah,

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Speaker 1: you know how much this is the Financial Times. This

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Speaker 1: is not even a US media outlet that's reporting on this,

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Speaker 1: you know, I mean, this GAO report got very little

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Speaker 1: pickup and think of on you know. On the other hand,

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Speaker 1: like any sort of civilian program that was going to

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Speaker 1: like feed the nity or was abused by quote unquote

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Speaker 1: world ar queens or whatever, there would be endless media

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Speaker 1: coverage of that type of waste, waste, fraud, an abuse.

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Speaker 1: But this, I mean this again, most costly defense procurement

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Speaker 1: project in the entire world, and we have so little scrutiny,

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Speaker 1: so little expectations. We're just happy to give literally trillions

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Speaker 1: of dollars to Lockheed Martin for a product that is

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Speaker 1: not standing up to the standards that the Defense Department

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Speaker 1: themselves have set for these jets, so you know, and

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Speaker 1: it also does just raise more questions about what the

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Speaker 1: hell happened in that other incident, because if you're having

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Speaker 1: a lot of problems with these with these jets, did

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Speaker 1: that play into this crash? And the fact that you

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Speaker 1: know they were unable to find the debris for a while,

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Speaker 1: so good, pretty extraordinary. The total lack of oversight and

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Speaker 1: how the Pentagon just gets a pass like trillions to

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Speaker 1: the tune of trillions of dollars to waste money and

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Speaker 1: have no accountability whatsoever. True.

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Speaker 2: All right, we'll see you guys later. You will very

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Speaker 2: rarely see me recommend CNN. But one of the only

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Speaker 2: people who works there who I really like is Harry Enton.

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Speaker 2: He used to work over at five thirty eight. He's

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Speaker 2: kind of their polling guru, and he did a fantastic

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Speaker 2: breakdown which we also on our focus group about the

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Speaker 2: demise of Fox News amongst Republican voters and how their

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Speaker 2: power is waning, how they really need Trump a lot

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Speaker 2: more than Trump needs them. Let's take a listen.

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Speaker 4: Seventy four percent say not Fox News. Now the plurality

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Speaker 4: leader is Fox News a twenty six percent, But the

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Speaker 4: fact is most Republicans are in fact not tuning to

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Speaker 4: Fox News as its main news source. Other follow ups

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Speaker 4: social media twelve percent, broadcast networks at eleven percent. But

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Speaker 4: I think that this is a key number to keep

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Speaker 4: in mind going forward. Seventy four percent of Republican likely

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Speaker 4: voters say the news erance they turn to most is

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Speaker 4: not Fox News. But I guess the other question to

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Speaker 4: flip that is does Fox News need Donald Trump? Yes,

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Speaker 4: this is what I would say is absolutely Fox News

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Speaker 4: needs Donald Trump more than Donald Trump needs Fox News.

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Speaker 3: Why is that?

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Speaker 2: I actually love that clip because they were using the

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Speaker 2: New York Times data to illustrate a point that we

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Speaker 2: keep hammering home. And of course, look, CNN has an

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Speaker 2: incentive to bash Fox. They're just as bad. Ask them

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Speaker 2: how much they need other politicians and Democrats. Okay, so

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Speaker 2: let's put that aside. But the meta point is correct.

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Speaker 2: As we saw in our focus group, we had eight

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Speaker 2: likely viewers or likely voters in the New Hampshire primary

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Speaker 2: GOP primary, only one said Fox is the prime amazing

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Speaker 2: ten years ago, every single person twenty years ago, O'Reilly

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Speaker 2: or earlier? They would have been like a Riley fan club,

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Speaker 2: you know, and that's dead gone. Only one person said

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Speaker 2: Fox and Tucker Carlson. Every other person said some version

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Speaker 2: of Internet.

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Speaker 1: Right, But the Tucker Carlson person was like, I watch

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Speaker 1: him on X exactly.

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Speaker 3: She doesn't even watch.

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Speaker 1: Our great focus group leader there. James like like, oh,

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Speaker 1: you're watching him on X. She's like, yeah, yeah, what

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Speaker 1: it needs to be Twitter. So yeah, I mean, it's

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Speaker 1: just it's a very different era for them. And what's

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Speaker 1: interesting is they also went into like of their viewers.

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Speaker 1: They are having an impact on their viewers somewhat because

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Speaker 1: Trump gets forty three percent of the Fox News viewer vote,

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Speaker 1: which is still like pretty high, but of the Newsmax

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Speaker 1: viewer vote, he's getting seventy six percent. So there's clearly

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Speaker 1: an impact here in terms of their coverage and trying

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Speaker 1: to pump up Rondo, Santis and whatever. So among the

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Speaker 1: people who are still watching them, they have an impact.

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Speaker 1: It's just that they don't have that lock on all

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Speaker 1: of the GOP base. There are other options, and you know,

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Speaker 1: I'm not going to say that that landscape has like

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Speaker 1: really made things better because I'm not sure Newsmacs one

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Speaker 1: American News Network and some of these other you know,

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Speaker 1: like Steedman.

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Speaker 3: Or war Room or whatever.

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Speaker 1: I'm not sure they're providing better information or that it's

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Speaker 1: improving the stag of democracy. It just shows the fractured

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Speaker 1: media landscape has made it so that, you know, Rupert

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Speaker 1: Murdoch who now has stepped down from the top position.

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Speaker 1: But they're no longer the kingmakers that they once were.

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Speaker 1: They no longer have the control that they once did,

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Speaker 1: and that is an astonishing change in American political media.

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Speaker 2: Yep, absolutely, it's now Here's the thing. I'm not going

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Speaker 2: to sit here and defend all these alternatives, but those

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Speaker 2: alternatives are what make our show possible. So I'm going

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Speaker 2: to just defend the ecosystem. People have options for the

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Speaker 2: first time in a long time. Lack of centralized control

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Speaker 2: in general is a net benefit. Will see who emerges

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Speaker 2: whatever real competition news.

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Speaker 1: It creates first possibility exactly, it creates possibility. And even

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Speaker 1: as listen, there's challenges in independent media as well that

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Speaker 1: we've talked about here too, and challenges in the incentive

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Speaker 1: structure for independent media, you know, especially with the amount

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Speaker 1: that tech oligarchs drive the algorithms and create who are

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Speaker 1: the winners and who are the losers in that new ecosystem.

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Speaker 1: So there's a little bit of an illusion of independence.

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Speaker 1: It's not as independent as you would want it to be.

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Speaker 1: But the best thing you can say for is it

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Speaker 1: does create space and optionality and possibility, and that, you know,

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Speaker 1: that is an exciting landscape to be able to look at,

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Speaker 1: you know, in terms of Fox News, ultimately, I think

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Speaker 1: that Harryeton is right that Trump has more power and

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Speaker 1: relationship than they do at this point. And so as

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Speaker 1: much as they wanted to turn the page on Trump

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Speaker 1: or whatever, they're not going to be able to. They're

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Speaker 1: going to fall right back into the extent that they

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Speaker 1: ever low. They've always had hosts there who are sort

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Speaker 1: of like slavishly committed to Trump, but they're going to

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Speaker 1: all be one hundred percent towing the line is not

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Speaker 1: going to be a question because they need his audience.

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Speaker 2: In the words of a great character, chaos isn't a pit,

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Speaker 2: Chaos is a ladder.

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Speaker 3: We'll see you guys later.

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Speaker 1: Hi.

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Speaker 5: I'm Matt Stoler, author of monopoly focused newsletter Big and

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Speaker 5: an anti trust policy analyst. I have a really good

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Speaker 5: segment for you today on this big breakdown because this

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Speaker 5: week the Federal Trade Commission in seventeen States filed an

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Speaker 5: antitrust suit against Amazon, which is, of course, as you know,

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Speaker 5: one of the biggest companies in the world, and the

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Speaker 5: suit was about monopolization and unfair methods of competition. So

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Speaker 5: this segment is about what the case means, the government's claims,

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Speaker 5: and whether the legal arguments that the government is using

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Speaker 5: are strong. Now, for a lot of you, this explanation

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Speaker 5: is going to sound sort of familiar because I laid

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Speaker 5: out what would become the basis for this lawsuit in

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Speaker 5: a video about a year ago. Okay, let's dive in.

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Speaker 5: For almost twenty years, Amazon's business has existed on a

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Speaker 5: very strange premise that almost no one questions extensively. The

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Speaker 5: retail firm is the lowest price option in the market,

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Speaker 5: and it offers quote unquote free shipping to over one

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Speaker 5: hundred million Amazon Prime customers, for which it charges one

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Speaker 5: hundred and thirty nine dollars a year membership fee. The

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Speaker 5: revenue from Prime does not come close to covering its

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Speaker 5: logistics arm, which cost about eighty five billion dollars in

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Speaker 5: twenty twenty two, and one analyst says that the value

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Speaker 5: of Amazon Prime, if you unbundle it is about one

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Speaker 5: thousand dollars per user. So how can Amazon do all

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Speaker 5: of this? How can it be the lowest cost retailer

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Speaker 5: and give free shipping all while making money or at

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Speaker 5: least not losing a ton of it. The answer, as

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Speaker 5: it turns out, is that, as we all know, there

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Speaker 5: is no such thing as a free lunch. Consumers pay

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Speaker 5: for the free shipping. You and I pay for free shipping.

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Speaker 5: It's just we do it through a hidden tax baked

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Speaker 5: into the price of what you buy by an extraordinarily

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Speaker 5: clever scheme orchestrated by Amazon. And that's what the Federal

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Speaker 5: Trade Commission and the seventeen States are suing over. This

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Speaker 5: hidden tax is well known in the industry. Here's Mike Beckham,

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Speaker 5: the CEO of Simple Modern, which is a very successful retailer,

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Speaker 5: and he made that point in August, essentially knowing that

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Speaker 5: the suit was going to come out in some form

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Speaker 5: or fashion. So he says that Amazon should not have

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Speaker 5: normalized the idea of free shipping. They would have won

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Speaker 5: the market without it. Now they are forced to lean

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Speaker 5: heavily on a hidden tax that drives up prices. Aka advertising,

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Speaker 5: because their unit economics don't work without it.

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Speaker 3: What does that mean? All right?

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Speaker 5: Most people think of Amazon as a retailer who sell

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Speaker 5: to retail customers. That is what people think their businesses.

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Speaker 5: But retail end users, you and me aren't really Amazon's customer.

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Speaker 5: In fact, we are really Amazon's product Amazon does you know. Yeah,

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Speaker 5: they sell to us, but they are more of their

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Speaker 5: business is that they operate as a middleman who sells

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Speaker 5: access to us. The actual customers of Amazon, the customers

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Speaker 5: who provide Amazon's retail profit, are third party businesses who

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Speaker 5: rely on Amazon's infrastructure to get their wares to the public. Now,

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Speaker 5: you can see in this picture that sixty percent of

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Speaker 5: Amazon's products are not actually sold by Amazon, but are

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Speaker 5: sold through Amazon by what are called third party sellers. Now,

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Speaker 5: in twenty twenty two, Amazon CEO Andy Jasse, who took

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Speaker 5: over from Jeff Bezos, he said this explicitly, quote unquote,

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Speaker 5: small and medium sized sellers use Amazon not because of

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Speaker 5: the e commerce software Amazon provides, but quote because they

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Speaker 5: get access to a few one hundred million customers end quote.

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Speaker 5: There are extremely high switching costs if you are a

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Speaker 5: third party seller who sells whatever it is sneakers, widgets,

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Speaker 5: cups to move from one online superstore to another. So

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Speaker 5: Amazon and being an online retailler with a deep and

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Speaker 5: rich selection is a business with really significant barriers to entry,

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Speaker 5: and there are only a few players. One result is

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Speaker 5: that Amazon has an overwhelming share of online shoppers. It's monopoly,

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Speaker 5: which means that third party sellers must either pay Amazon

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Speaker 5: what it demands or they lose access to the market.

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Speaker 5: As one seller put it, quote, we have nowhere else

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Speaker 5: to go, and Amazon knows it end quote. Now, as

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Speaker 5: a third party seller, you pay a lot of fees.

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Speaker 5: You pay a fee for listing on Amazon, you pay

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Speaker 5: a fee for using Amazon's warehouse services known as Fulfillment

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Speaker 5: by Amazon. You also have to pay for advertising. What

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Speaker 5: happens if you don't pay, well, if you don't pay,

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Speaker 5: you don't get put in a place on the site

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Speaker 5: where consumers click. So this is one of the things

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Speaker 5: the FTC noted. Advertised products on Amazon are quote forty

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Speaker 5: six times more likely to be clicked on when compared

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Speaker 5: with products that are not advertised end quote. So this

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Speaker 5: actually makes the experience for consumers a lot worse. You've

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Speaker 5: probably noticed in the last few years Amazon when you

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Speaker 5: search for something, it's so full of pay to play

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Speaker 5: ads that actually consumers are complaining that they can't really

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Speaker 5: find organic results. They can't find the best product. They

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Speaker 5: find the product that Amazon put in front of them,

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Speaker 5: which is often higher cost and worse quality. It's a

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Speaker 5: steering problem. As the FTC noted, one senior Amazon executive

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Speaker 5: quote reportedly compared Amazon's advertising and search divisions to the

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Speaker 5: parable of the scorpion and the frog. It was in

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Speaker 5: the advertising division's nature, as the proverbial scorpion, to poison

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Speaker 5: organic search results end quote. And this actually went all

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Speaker 5: the way up to Jeff Bezos, and he said, yes,

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Speaker 5: we want to distort our organic search results and make

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Speaker 5: the extra many billions that will bring in. Now, at

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Speaker 5: this point, the price Amazon charges third party sellers, who

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Speaker 5: again are the real customers, has grown to nearly fifty

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Speaker 5: percent of their revenue.

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Speaker 3: That's what they call the take rate.

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Speaker 5: It's one out of every two dollars if you sell

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Speaker 5: on Amazon, that's what you're giving to Amazon. And it

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Speaker 5: is this money, which one group estimates at one hundred

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Speaker 5: and twenty three billion dollars in total revenue for Amazon

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Speaker 5: last year, that pays for the free shipping as well

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Speaker 5: as Amazon Prime Video, It's music service, Twitch and everything

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Speaker 5: else that comes bundled with Prime. Now what do these

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Speaker 5: third party sellers do Well, They, in turn, and this

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Speaker 5: is where the hidden task comes in, they raise their

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Speaker 5: prices to consumers aka you and me, and then they

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Speaker 5: send that money back to Amazon in the form of fees.

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Speaker 5: It's basically a giant money laundering scheme. Okay, So this

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Speaker 5: leaves one reasonable question that a lot of people can

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Speaker 5: have once you think through this scheme, which is all right,

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Speaker 5: So it's so expensive to go use Amazon, you have

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Speaker 5: to raise your prices. Why can't you just go off

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Speaker 5: Amazon and offer lower price. Why can't you go to

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Speaker 5: Walmart's marketplace, or why can't you go to targets or

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Speaker 5: ebays or why can't you set up your own website

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Speaker 5: and do it? Well, this is a good question, and

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Speaker 5: that's where the scheme gets clever. Originally, Amazon imposed contracts,

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Speaker 5: as the FTC noted, barring all sellers from offering their

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Speaker 5: goods for lower prices anywhere else. So this was an

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Speaker 5: anti discounting measure. They said, you have to through Amazon

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Speaker 5: at your lowest price, and you can't offer it anywhere

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Speaker 5: for lower They originally they did this through contract, They

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Speaker 5: just put it in contracts, but this seems really sketchy,

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Speaker 5: and Europeans as well as Senator Richard Blumenthal complained about

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Speaker 5: what are called price parity agreements. So Amazon dropped it's

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Speaker 5: explicit contractual requirements in twenty nineteen. However, the change was

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Speaker 5: a farce. The firm simple did through code what it

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Speaker 5: couldn't do through contract. Amazon claims the FTC has implemented

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Speaker 5: an algorithm for the express purpose of deterring other online

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Speaker 5: stores from offering lower prices, But just weeks after dropping

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Speaker 5: this requirement, Amazon wrote in an internal memo it would

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Speaker 5: not change its policies, and today Amazon tells sellers that

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Speaker 5: if it detects a lower price on any other online

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Speaker 5: store for their products this, according to the FTC, they

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Speaker 5: will be punished, which is to say, their ability to

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Speaker 5: get their products onto a place on the Amazon website

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Speaker 5: where customers click will go away. And the net effect

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Speaker 5: inaggregate on Amazon is that and this is from Amazon's

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Speaker 5: internal documents themselves. Quote prices will go up now they

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Speaker 5: won't just go up on Amazon, they will go up

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Speaker 5: across and have gone up across the Internet, because remember,

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Speaker 5: it's not it's not just that they have to raise

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Speaker 5: prices on Amazon, they're not allowed to discount those those prices,

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Speaker 5: and this was in the complaint as well. Indeed, Amazon

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Speaker 5: actually tells third party sellers to raise prices. The Amazon

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Speaker 5: VP of Price of Pricing once told a seller's account

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Speaker 5: manager who complained the seller. The seller was complaining that

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Speaker 5: we can't afford to take our prices down on Amazon

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Speaker 5: to match our own website because of all the fees

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Speaker 5: and the Amazon VP of Price he had said, said

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Speaker 5: to his account manager, he said, you know, go tell

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Speaker 5: the seller. You may want to ask him to check

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Speaker 5: if his sales on other sites directly or through distributors

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Speaker 5: is putting him and us at a relative competitive disadvantages.

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Speaker 5: He might get the hint smile emoji. The overall point

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Speaker 5: is that Amazon is degrading the shopping experience, raising prices,

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Speaker 5: and yet somehow still gaining market share. It's able to

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Speaker 5: block third party sellers from going elsewhere, and therefore able

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Speaker 5: to stop potential rivals from entering the market or from

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Speaker 5: expanding in the market or investing in the market. It's

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Speaker 5: a pretty strong complaint, and while anti trust cases are

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Speaker 5: always random, and they depend on the judge. Bill Beher,

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Speaker 5: the former Assistant Attorney General for anti trust under the

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Speaker 5: Obama administration, said it's a good it's good argument quote

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Speaker 5: if the FTC and States can prove even some of

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Speaker 5: the factual allegations in this one hundred and seventy two

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Speaker 5: page complaint, he said, Amazon is in a world of hurt.

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Speaker 3: Now.

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Speaker 5: I want to note something else that I think matters.

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Speaker 5: One of the more disturbing trends in anti trust in

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Speaker 5: law in general is how secretive courts have become about corporations,

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Speaker 5: allowing corporations to hide their dirty laundry under the guys

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Speaker 5: that it's competitively sensitive, whether it is or not. For instance,

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Speaker 5: in the current Google antitrust trial, which is over the

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Speaker 5: two trillion dollars search firms monopoly power, the secrecy ordered

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Speaker 5: by the judge on what should be a public record is,

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Speaker 5: according to New York Times quote unprecedented. Similarly, the Amazon

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Speaker 5: complaint is heavily redacted, large because at this point courts

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Speaker 5: are highly deferential to what corporations claim is our trade secrets.

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Speaker 5: Was very different than the way it was in the

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Speaker 5: nineteen nineties when Microsoft was brought to trial, and there's

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Speaker 5: a ton of stuff that was released.

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Speaker 3: Now.

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Speaker 5: Judges are very scared that anything that might embarrass a

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Speaker 5: company might harm the market.

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Speaker 3: This is a problem.

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Speaker 5: So here are two elements in the Amazon complaint that

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Speaker 5: are partly redacted that I think are important and hopefully

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Speaker 5: we'll learn more in a few weeks or in a

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Speaker 5: few months when the case, you know, some of this

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Speaker 5: stuff might come out.

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Speaker 3: The first is that Amazon.

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Speaker 5: Like Google, has been destroying documents and internal conversations relating

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Speaker 5: to the case, or seems to have so. Amazon executives

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Speaker 5: systematically and intentionally redacted redacted, redacted of the signal messaging

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Speaker 5: app redacted, redacted, redacted, despite the plaintiff instructing Amazon not

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Speaker 5: to do so. The extent of the bad behavior is

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Speaker 5: not clear, since the paragraph alleging wrongdoing is well redacted,

437
00:23:04,920 --> 00:23:10,280
Speaker 5: but that seems pretty bad. The second secretive thing.

438
00:23:10,160 --> 00:23:10,639
Speaker 3: That we don't know.

439
00:23:10,880 --> 00:23:13,119
Speaker 5: We don't know what it is is something that the

440
00:23:13,200 --> 00:23:18,479
Speaker 5: FTC calls notes is an Amazon internal project called Project NeSSI.

441
00:23:19,720 --> 00:23:23,480
Speaker 5: It's an algorithmic pricing system so egregious that the FTC

442
00:23:23,600 --> 00:23:27,280
Speaker 5: determined that it deserved its own legal charge as an

443
00:23:27,440 --> 00:23:29,000
Speaker 5: unfair method of competition.

444
00:23:29,960 --> 00:23:31,760
Speaker 3: So what is project NeSSI.

445
00:23:33,080 --> 00:23:36,440
Speaker 5: We don't know, since nearly all of the information about

446
00:23:36,480 --> 00:23:40,639
Speaker 5: it is redacted, but it looks bad.

447
00:23:41,160 --> 00:23:42,920
Speaker 3: Now. A lot is.

448
00:23:42,920 --> 00:23:46,480
Speaker 5: Gonna come out in this Amazon trial, and Amazon is

449
00:23:46,520 --> 00:23:51,040
Speaker 5: gonna fight tooth and nail. You know, we're gonna who

450
00:23:51,040 --> 00:23:53,320
Speaker 5: knows how it will resolve itself. It's going to take

451
00:23:53,320 --> 00:23:58,040
Speaker 5: a while. But here's the thing. Because of this case,

452
00:23:58,080 --> 00:23:59,920
Speaker 5: because of the Google case, because of a whole bunch

453
00:23:59,960 --> 00:24:02,159
Speaker 5: of cases that are now slimming into the court system.

454
00:24:02,640 --> 00:24:04,800
Speaker 5: I don't think it's fair to say that our interest

455
00:24:05,000 --> 00:24:08,879
Speaker 5: and our pressure in politics doesn't matter. I think it

456
00:24:08,960 --> 00:24:12,280
Speaker 5: actually shows that what we do, what we care about,

457
00:24:12,320 --> 00:24:15,320
Speaker 5: what we pay attention to, what we advocate for, does matter,

458
00:24:15,359 --> 00:24:17,720
Speaker 5: and that we do get responses from our politics.

459
00:24:17,720 --> 00:24:19,040
Speaker 3: It's slow, but it's real.

460
00:24:19,280 --> 00:24:23,159
Speaker 5: So here's an Axios reporter, Ashley Gold, making the point

461
00:24:23,240 --> 00:24:26,760
Speaker 5: that things actually can change in politics for the positive.

462
00:24:26,840 --> 00:24:29,000
Speaker 5: So she tweeted, if you would have told me in

463
00:24:29,040 --> 00:24:31,240
Speaker 5: say twenty eighteen, that's just five years ago, that I

464
00:24:31,240 --> 00:24:33,080
Speaker 5: would barely have time to cover all of the tech

465
00:24:33,119 --> 00:24:35,920
Speaker 5: anti trust cases actually coming to fruition because the whole

466
00:24:35,960 --> 00:24:39,320
Speaker 5: beat being so busy, I would have laughed, What a

467
00:24:39,359 --> 00:24:43,200
Speaker 5: time indeed, what a time. Thanks for watching this big

468
00:24:43,200 --> 00:24:45,679
Speaker 5: breakdown on the Breaking Points channel. If you'd like to

469
00:24:45,680 --> 00:24:48,439
Speaker 5: know more about big business and how our economy really works,

470
00:24:48,560 --> 00:24:50,040
Speaker 5: you can sign up by going to the link in

471
00:24:50,040 --> 00:24:54,440
Speaker 5: the description below for my market power focused newsletter.

472
00:24:54,480 --> 00:24:56,159
Speaker 3: Big Thanks and have a

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00:24:56,160 --> 00:25:05,199
Speaker 1: Good one, Critt