Thread: Agency pricing
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Old 02-04-2011, 07:01 AM   #11
snipenekkid
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don't confuse situations where the venue providing a common place for consumers to access goods and services with an entity called a retailer. An auction is a venue who usually hires a licences auctioneer (many, many auctioneers are independent contractors who sell their services to auction houses and not many auction houses have full-time auctioneers on staff. On retainer sure, on staff, not too often) to conduct the sale for a fee so this is NOT an agency model it is more of a modified consignment model. A flea market it a venue providing a common location, or venue, for the independent reseller to offer goods and services to others. A consignment shop is again, providing a venue as well as some degree of care-taking of the sales process (as in providing a service) to the consignor. In many cases in a consignment shop a seller/retailer rents space from the venue in order to have their own point of presence inside that venue. The venue itself, by definition, does not govern the pricing outside the any agreements with the seller.

So in this new agency model it is moving Amazon from being the actual seller over to the status of a venue which also aids in the distribution of the product for the actual seller. Amazon can also manage payment and funds disbursement to the actual seller. Basically the Agency 5 have move to a custom "Amazon Marketplace Seller" rather than a wholesaler. Problem is they control a huge portion of what has traditionally been the product Amazon bought then sold in their roll as the actual seller/retailer.

Just wanted to maybe add some clarity or make it worse in the subtle differences between the venue/agency types mentioned a couple posts above. And there is zero wrong with this model. However it is how it came to be which raises questions. I have mentioned before it is an odd set of circumstances where all five of the original group and Apple came to a very fast agreement. But if it was collusion then the five needed Apple to act as if it was Apple's idea for the whole thing. Still I'm not 100% sure that is more than borderline OK. Only time and the courts will tell. But it surely is very anticompetitive, in spirit if not in fact.

Last edited by snipenekkid; 02-04-2011 at 07:03 AM.
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