
Jeff Bezos can’t promise Amazon employees don’t access independent seller data - pabo
https://www.theverge.com/2020/7/29/21347083/jeff-bezos-amazon-tech-antitrust-hearing-jayapal-questioning
======
granzymes
"Amazon CEO Jeff Bezos said Wednesday he can't guarantee employees have never
used sales data from individual third-party sellers to develop the company's
own products"

There's no way he could make that guarantee. How can you prove a negative? The
best Amazon can do is have policies, logs and access controls and punish
employees if they break those policies. And Bezos committed to doing that.

~~~
ashtonkem
Companies regularly use this trick to get away with crimes. They might
explicitly forbid something illegal, not setup the actual guard rails that
would prevent it, and then give employees every single possible incentive to
break the rules. The moment they're caught they can act shocked, shocked, to
discover that gambling was going on in this establishment, and then throw the
line level workers under the bus.

This is exactly what Wells Fargo to get away with opening fraudulent accounts
in their customers names.

~~~
wiredone
I know of many ex amazon employee anecdotes where people were “taken in the
night” (didn’t have a job in the morning), and had their credentials and their
teams credentials rotated due to a customer or seller data access overstep.

As with most conspiracies the facts don’t add up super well in this case for
Amazon - their whole company is based on trust. The cost of losing it would be
huge, so they’d be super driven to stamp it out.

~~~
run414
When I worked at Amazon, I personally knew someone who put in their two-weeks
notice, and the next day they found out they were fired when their badge
didn't work. From anecdotes I've heard, this happens if Amazon suspects a
person is leaving to join a competitor. Amazon is very serious about
protecting their data.

~~~
Lio
In the UK they would have to put the person on “gardening leave”.

Firing in this way when someone’s done nothing wrong would be constructive
dismissal and prohibited by law.

The fact that Amazon treats their resigning employees in this way doesn’t
increase my trust in them.

It actually just makes them look viscous and petty.

~~~
KptMarchewa
What's the difference between this and gardening leave? Does Amazon not pay
for those two weeks or what?

~~~
Lio
Apart from whether Amazon are paying the two weeks notice that they morally
owe, one obvious difference would be if your next employer asks have you ever
been terminated from a previous position.

Who would want to be placed in the position of saying yes I was fired because
I was suspected of being a security risk?

~~~
Aeolun
You can just say that you were terminated because your manager at Amazon was
insecure and didn’t trust you to not fuck things up?

~~~
Lio
Well you can of course but interviewers often discount candidates that slag
off their old employers on the grounds that they’ll be difficult to manage.

------
tuna-piano
First of all, people like to complain about Amazon owned brands. But this is
just retailing 101, nothing new here. Walk around a Costco and try and find a
non Costco branded product in a variety of categories. People seem to love
Costco's Kirkland brand and (personally) I also enjoy the AmazonBasics brand.
Why have I never heard a peep about Costco?

You can make an argument that Amazon's market power has enabled it to gain
success in some aspects of online retail.

But to the proponents of the "market power has helped Amazon strangle so many
industries", you have to answer - how did market power help:

-Amazon grow Whole Foods?

-AWS become the most popular cloud service?

-Kindle become the most popular ereader?

It seems to me a much better explanation than "market power abuse" is that
Amazon's culture and people have enabled it to dominate a variety of
unconnected industries.

~~~
alextheparrot
The argument I’m familiar with goes as follows: Stores choose all their goods,
bazaars provide stalls for merchants. People don’t like when one tries to
masquerade as the other, or, be both.

Costco, being a store, can choose foods or goods that have been rebranded or
independently sourced and no one really cares — they are still fully
autonomous. They have always taken ownership of the product, so a change in
supply seems to be completely within the store’s wheelhouse.

On the other hand, Amazon is a bazaar. Merchants line up, trying to get you to
purchase from their stall using various tactics. Merchants get unhappy when
they see that the bazaar’s guard uses their ledger to inform the head of the
bazaar which merchants he could kick out. Not literally kick out, but be put
in a worse position so that the bazaar’s own products are now the first ones
people see.

This conflict of interest is in direct opposition of the merchants and may be
in opposition of the consumers.

I personally really like Amazon Basics, as it tends to remove the brand cost.
However, there’s a reason brands became popular in the first place — and the
Amazon Basic brand is not one I associate with “quality”. I think the best
part of the Amazon Basic brand is that it establishes a minimum bar of quality
that Amazon generally needs. I know if so want the cheapest I go to them,
otherwise I do my research or rely on brand reputation like I did before.

This is becoming more of the case with Whole Foods, which I’ve started to
avoid. They were a quality store and that quality (seems to) have gone down.
The issue with the Whole Foods purchase is that there are lower quality
grocery stores already, so I’d be interested in how they’re doing with that
market.

~~~
philwelch
Amazon is fundamentally a store. Third party sellers on Amazon are the
equivalent of Girl Scouts: the store lets them sell cookies on the premises
but that’s not what the store is there for. IMO third-party sellers are close
to a dark pattern since it’s so hard to distinguish them from actual sold-by-
Amazon product listings.

Costco does similar things—both my ladder and my blender were things I
purchased at Costco under the influence from third-party sellers demonstrating
products there. Sure, the stocking and checkout were via Costco, but the same
is true for Amazon.

~~~
mantap
Have you been on Amazon recently? Third party sellers dominate it.

Amazon is fundamentally a bazaar that does a good job of pretending to be a
store, but the mask is starting to slip.

~~~
philwelch
I’ve noticed this when shopping for certain things and I don’t like it. But
honestly they were a store first and they still own the entire consumer
experience. Whenever a third party seller from Amazon contacts me, I am
usually surprised because in my mind, I’m buying from Amazon and not from
them.

Third party sellers who use FBA in particular are more like suppliers to whom
Amazon can outsource part of their job to. In that case I’d say Amazon is a
store, with infinite shelf space, and a very permissive policy about letting
suppliers stock some of that infinite shelf space themselves sometimes.

------
ozten
This was a waste of time.

A 1 year study produced concrete details that can be investigated. Then the
most senior congress people get 2 minutes of sounds bites and no progress is
made. It is a farce. There may well be real violations of public trust or
illegal activity, but this is not the way to effectively examine those
reports.

They don't even let the CEOs talk long enough to commit perjury. It is a dog
and pony show for congress and the CEOs.

~~~
onetimemanytime
Obviously, in 5 minutes nothing can be done. I suppose in smaller setting,
maybe sub-committees, but not here. Here the idea is that later DOJ starts
looking around and let them talk for hours and days. Will it happen?

~~~
ozten
I agree with sub-committees and more focused time. It doesn't make sense for
this sub-committee to tackle so many disparate businesses.

Imagine in 1982 Congress had hearings with AT&T, Exxon Mobile, Ford, Amoco,
DuPont, Boeing, and Eastman Kodak. They probably wouldn't have had the focus
to force the breakup of the Bell Systems.

------
shanemhansen
So I used to work with someone from Amazon retail. He told me, in no uncertain
terms, that Amazon mined their seller data to undercut them. We sold on Amazon
and he constantly told us that we were fools to do so. He even mentioned that
prior to accepting a position he had looked up our seller performance to make
sure he was going to a good company.

Maybe policies have since changed. At the time I was also told the most
popular "test" SKU used by Amazon engineers was a 50 gallon barrel of lube.

~~~
dastbe
I can't comment on any of the meaty stuff, but I can comment on the silly.

> At the time I was also told the most popular "test" SKU used by Amazon
> engineers was a 50 gallon barrel of lube.

Not knowing when this was, but I can say around 2013-2015 that this wasn't a
general thing[0]. Could there have been an engineer who used it a lot? Sure,
but there's a lot of them.

Even if you disregard the crudity of it, it also just doesn't make for a good
test ASIN outside of a small number of verticals. You'd much rather test with
real ASINs where possible (which is almost 100% of the time), or with
something idiomatic to the experience you're developing.

EDIT: though maybe people have become inspired by
[https://observer.com/2015/07/at-1k-55-gallon-bottle-of-
lube-...](https://observer.com/2015/07/at-1k-55-gallon-bottle-of-lube-is-
amazon-prime-days-best-deal/) ? Still, it stands to reason that you want to
test with real products whenever you can.

~~~
cwkoss
50 gallon barrel of lube was a real SKU, I remember a friend sending me the
link because he found it amusing.

Was a couple thousand dollars IIRC

~~~
dastbe
It is, but it's a single particular ASIN. And given the majority of the time
issues/changes arise due the particular characteristics of a particular item
(is it pantry? is it prime? is it a garment? is it a toiletry? etc. etc.)
using any one particular ASIN isn't going to be viable for most developers.

------
jxramos
Bezos gave an incredibly forthright set of testimony. I like how he continued
to answer in the affirmative when the interrogator continued to drop the
aggregate quantity scope. Can they do it for 3 sellers, yes, for 2 yes. That's
basic mathematics, the aggregation will take place over however many are in
the pool be it 100, 50 or even 3. Seems like Bezos stuck to the facts and
reality on that one.

His comment about trying to give helpful answers too when questioned about
organized stolen goods. Bezos did a fine job, his replies were coherent,
concise, and didn't bumble trying to coordinate and mobilize a bunch of
caveats and statements with extensive justifying or clarifying context that
could not be delivered in the compressed timescale he was afforded.

~~~
alexpetralia
Yes, he easily had the most substantive and thoughtful responses of the 4 in
my opinion.

------
aahhahahaaa
>Before the Journal’s report came out, Amazon had told Congress that it
doesn’t access sales data to help guide the launch of its own products.

This is insanely hard to believe. Amazon just started selling batteries and
other random goods under their Basics brand based on ZERO inside sales
knowledge? I'd love to see how they enforce that.

~~~
tuna-piano
Look closely. Amazon claimed they don't access individual seller data, but
they do access aggregated product data.

However, in at least one case the aggregated data was only between two
sellers: Amazon Warehouse (which only sold a few returned items) and the
original seller.

"Amazon draws a distinction between the data of an individual third-party
seller and what it calls aggregated data, which it defines as the data of
products with two or more sellers."

[https://www.wsj.com/articles/amazon-scooped-up-data-from-
its...](https://www.wsj.com/articles/amazon-scooped-up-data-from-its-own-
sellers-to-launch-competing-products-11587650015)

~~~
mountainb
They do, though. I have been on calls with Amazon reps to discuss how our ad
campaigns have been performing, what can be done, and what additional sources
of data from Amazon we can access through beta programs and the like.
Individual Amazon agents of varying levels constantly check and reference the
private data of individual sellers for all kinds of reasons (again, most of
them justified and useful). In most such cases I have been very impressed on
the search ad side of things. On the outside Amazon ad placement side of
things (Amazon Media Group) they were basically crooks, but that is normal in
display ad world, which is a crooked world full of frauds.

They can absolutely access individual seller data and do so all the time for
all kinds of (mostly mundane) reasons. The aggregated data is also actually
more valuable than the individualized data in most situations.

Amazon unlike Google has tended to open up more accurate sources of data to
larger groups of sellers, in contrast with Google or FB which have tended to
start off giving people lots and lots of free data and then paywalling more
and more of it through the progressive crippling of the keyword tool and so
on.

Frankly Amazon is so bad at selling its own private label products that it
should not concern anyone. They suck at it compared to any other major
retailer that you can think of. I have seen Amazon private labels be
discontinued and fail and have competed with Amazon products successfully in
many different categories on Amazon. They are usually pretty lazy and un-
inventive. When they succeed it is usually at the level of "acceptable
competence, good price to performance ratio" as in many of the Amazon Basics
computer hardware accessories.

It is a major distraction from other serious issues like the endemic crime on
the platform (counterfeiting etc.) which actually poses a serious danger to
customers, to Amazon, to sellers, and to brands as well.

~~~
imtringued
AmazonBasics won't sell if there is no counterfeiting to force you to buy it.

------
llsf
Bezos cannot guarantee that employees may have access 3rdparty sales data. Can
any big retail like Walmart, Costco, Safeway, etc. can guarantee that no
employee ever looked at 3rdparty sales data ? If Walmart sees a cheap item
flying off the shelves, and thinks that it can make a cheap copy of it, then
Walmart would do it. Isn't how store brand work ? and they often use a white
label producer anyway (i.e. same factory, different packaging/label). Walmart,
Costco, etc. they know precisely what products you buy and how often. They can
push you next time to buy their own version of it, by sending you a discount
for for it, or simply rearrange the shelves in store. I understand that
sellers with little to no competitive advantage, are very vulnerable to such
practices. But this is hardly new with Amazon. They could avoid selling
through those channels (that is why you find some products only through
producer website, or direct sales). Amazon has 35% of the e-commerce market in
US, or 6% of retail market in US (Walmart has 9% of retail market in US).
Amazon does not do as well in the rest of the world. The 35% of the e-commerce
market is in US. And even that 35% includes being an agent for 3rdparty
sellers. [https://www.ben-evans.com/benedictevans/2019/12/amazons-
mark...](https://www.ben-evans.com/benedictevans/2019/12/amazons-market-
share19)

~~~
libertine
Isn't this straight forward?

If the employees responsible for product development for Amazon brands have
credentials to access 3rd party data, then assume they used it.

Doesn't matter if only one used it, or all of them - they had access to it,
all the rest is semantics/claims/smoke&mirrors.

------
Hokusai
Gently reminder that Amazon uses to astroturf social sites. If this post sees
a unfair amount of pro-Amazon statements is possible that is part of Amazon's
PR strategy.

\- "Amazon workers are being paid to defend the company on Twitter":
[https://mashable.com/article/amazon-warehouse-twitter-
defens...](https://mashable.com/article/amazon-warehouse-twitter-defense/)

But do not call on people just for siding with Amazon most people are just
expressing their own opinion freely and deserve respect. Just adjust how you
read the threads to account for biased results on voting and side
representation.

------
fennecfoxen
Question. What would a system capable of proving “this didn’t happen” look
like?

~~~
rmrfstar
A hard regulatory barrier between the product side and the sales platform
side.

This already exists in the financial sector. What you would call an
"investment bank" is actually a holding company with a number of subsidiaries.

The investment bank subsidiary does capital raising and M&A advisory, while
the broker-dealer does market transactions. These are separated by a "Chinese
wall" or a "firewall". There are criminal penalties for circumventing the
wall.

~~~
refurb
That's about the only way to do it, but it's still a relatively easy barrier
to get over in my experience (I can't speak to finance).

I work in a heavily regulated industry as well with clear "firewalls" between
different groups. You're basically relying on the company's own good faith and
fear of being punishment to actually enforce it. And the chance of it being
discovered is very low as long as it's not a formal process within the
company.

------
iammru
I'm surprised that people are surprised.

------
uji
ex-AWS employee here. I worked in one of the managed services (can't say which
one because it might reveal my identity). In Managed services, instances are
created in AWS VPC so employees have access to underlying VM.

We have used that capability to get stats about the type of customer
workloads, and devised feature products based on that.

~~~
single_source
whoa...

------
mensetmanusman
He should have said he can neither confirm nor deny.

Not sure I am against commodity goods being driven to razor thin profit
margins.

~~~
IanSanders
>commodity goods being driven to razor thin profit margins.

that's not the only factor

------
panny
Any mention if the same non-guarantee applies to third party intellectual
property on AWS? There doesn't seem to be much to stop them from "borrowing"
code from AWS customers without anyone being the wiser.

~~~
monadic2
This is why you encrypt, it’s not impossible to bypass but it would make it a
gargantuan task.

~~~
IanSanders
If it runs on aws, it must be decrypted at some point. If it's not, then
you're using it as a storage only. There are studies on "decryptionless" data
computation but nowhere near practical stage yet

------
seemslegit
Jeff Bezos probably also can't promise they won't use startups AWS usage to
find out as much as they can about their business in an M&A or just
competitive analysis scenario.

------
tantalor
> “I do not think that’s systematically what’s going on,” Bezos said. “Third-
> party sellers in aggregate are doing extremely well on Amazon.”

Cool so cheating is okay if you do it only a little, great take.

~~~
mc32
That's having your cake and eating it too.

I hope congress does something to curb this behavior where these platforms
glean information from hard working businesses and use that data to inform the
platforms' tactics.

~~~
lemmsjid
I'm honestly intrigued as to how this is so morally unambiguous.

Walmart, any-given-supermarket, Costco, etc., have in-house brands (for
example Kirkland with Costco). These became prominent in the 90's and there
was similar discussion at the time about the ethics of a supermarket
introducing competitors to the brands it stocks. Such controversy has died
down and now it is commonplace. Looking at some updated articles, in-house
brands at those retailers have in many (most?) cases outsold their branded
competitors, so in-house brands like Kirkland are actually the largest brands
in the country.

So my question is: what makes Amazon different, behaviorally, than Costco,
Walmart, Vons, etc.? Both use an (arguably) unfair data asymmetry to introduce
in-house branded products to compete with the external brands they also sell.
You then have brands like Trader Joe's that go out of their way to have an in-
house brand, and make few exceptions.

On open question is: who is this behavior actually hostile to? I think it's
now conventional wisdom that if you're a brand selling in Vons or Trader Joe's
that you need some special sauce to compete successfully with an inevitably-
introduced in-house brand. So what is that special sauce? You have some brands
that are exclusive because of their provenance or method of creation (say, a
particular Scotch). But then you have many brands that are actually
manufactured in the same locations and by the same people as the in-house
brands, wherein the brand itself is a middleman who created a particular
formulation or price/materials ratio that may or may not be the best one.
These would seem to be the most vulnerable to Amazon building an in-house
competitor, or Walmart, or Vons, etc.

I suppose, looking for the other side of the argument, that the question would
be if Amazon has so much monopolistic market clout that the third party has no
way to exist once the in house brand has taken over. E.g. as though Costco
were the only supermarket period, or, more accurately, if Trader Joe's were
the only supermarket period.

~~~
vkou
> So my question is: what makes Amazon different, behaviorally, than Costco,
> Walmart, Vons, etc.? Both use an (arguably) unfair data asymmetry to
> introduce in-house branded products to compete with the external brands they
> also sell. You then have brands like Trader Joe's that go out of their way
> to have an in-house brand, and make few exceptions.

The difference is that Costco very clearly discriminates about whose products
it will stock on shelves, whereas Amazon is more like a flea market that
charges people for renting bazaar stalls to sell from, and POS machines for
processing payments.

I'm not sure that should result in legislative differences, but that is a
pretty significant difference between the two.

~~~
lemmsjid
It's interesting how perspectives differ and I'm not disagreeing with yours.
If you'd asked me before this discussion whether or not I felt, given those
criteria, that Amazon was a store or a flea market, I'd say I'd prefer Amazon
to act like a store, and while it does have flea market aspects, I'd be happy
for it to move away from them and in the store direction.

The times I've actively disliked Amazon was when I bought some cheap but well-
reviewed product and got something that was below cheap quality. I realized at
those times that my natural expectation of Amazon was that it had some quality
threshold for what it sold. I realized my thinking about Amazon did need to
become flea-market-like, e.g. look that gift horse in the mouth! Except that
isn't viable online where you can't personally evaluate what you're buying,
especially on the low end of the market.

I now like buying Amazon Basics at the low end price tier because it has a
certain quality bar. I'd be more than happy, from a pure consumerist
perspective, for Amazon to be mainly stocked with high quality third parties,
its in-house brand filling in the cheaper side of the market, and then non-
premium third parties who have somehow successfully competed with the in-house
brand with some angle (say, sourcing a cheaper process that still gets
results).

------
NoblePublius
What AmazonBasics product isnt a commodity Made in China?

------
ideals
Curious as to what the response is like on internal email lists like @seattle-
chatter.

How are employees responding to Bezos remarks today?

------
hluska
Does anyone believe Bezos?

~~~
mhh__
Not believe as in he can guarantee they didn't?

~~~
monadic2
Not believe as in “this is not a good faith answer”.

~~~
hluska
Exactly. Thanks for taking me literally. You definitely don’t deserve the
downvotes but it appears the average ‘hacker’ here trusts Bezos more than us.
Interesting, hey??

~~~
IanSanders
[https://news.ycombinator.com/item?id=23996125](https://news.ycombinator.com/item?id=23996125)

------
kome
"I'm shocked, shocked to find that gambling is going on in here!"

– From the classic scene in Casablanca, 1942
([https://www.youtube.com/watch?v=SjbPi00k_ME](https://www.youtube.com/watch?v=SjbPi00k_ME))

------
justicezyx
I see no fault on Amazon's side about using the data that are accessible to
them, and exploit whatever value from them.

Naturally, the competition is for a winner to emerge. Not to continuously drag
on in a competition. What Amazon did is natural and reasonable in a
competition.

Secondly, it's a reasonable thing for a platform to access aggregate sales
data. Amazon is a retail platform. It's entirely unreasonable to forbid them
from using such data for the benefits of the sellers and buyers, and for their
platform to function better.

In the end, this is a value judgement: * Is it still a valuable thing to let
the small retailers to operate independently, and be free from of systematic
data-driven competition from platforms?

My feeling is that the small retailers are just an inefficient way of using
society resources. And I support Amazon's strategy.

