13 September 2023

Masters of the Universe, Huh?

What a surprise, it turns out that the big tech executives simply cannot resist crowing to each other about their crimes, which (unsurprisingly) makes it a lot easier for prosecutors and regulators to nail their asses:

In July, the Federal Trade Commission announced a complaint against Amazon over the ways the company has tricked customers into subscribing to its paid Prime service. The Commission argues that Amazon discovered that its customers were accidentally signing up for Prime and were unhappy about it, and that the company nevertheless decided not to fix this confusion because it was making too much money from these accidental signups. To make things worse, Amazon deliberately made it harder to cancel Prime, and celebrated that the new, more complex process resulted in fewer cancellations.

This is historic. Prior to the current administration, the FTC had been in a 40 year decline: underfunded and timid. But the new chair, Lina M. Khan, has brought a muscular, take-no-prisoners approach, working in close coordination with her peers at the DoJ antitrust division and with other agencies to reawaken their long-dormant regulatory powers.,

Many of my peers in the tech-critical world were skeptical, or even derisive. No one is accidentally subscribing to Amazon Prime, after all, nor is it especially hard to cancel service. Why not target the New York Times, which only recently — and reluctantly — ended its practice of forcing you to call a human salesperson and endure a lengthy wheedle in order to cancel the same subscription you had initiated online with just three clicks? Why not go after the Wall Street Journal, which still does this?

If tech bloggers were skeptical, the business lobby got downright conspiratorial. FTC Chair Lina Khan, they said, is pursuing her well-known vendetta against poor, defenseless Amazon. That woman has a conflict of interest — after all, she is best known for her scholarship on the problems of Amazon. How dare an antitrust regulator arrive in office with a widely known, deeply felt, and brilliantly analyzed plan for helping the American people get a better deal from a monopoly?

But the reason Khan took after Amazon is that Amazon admitted that it knew it was tricking its customers. What’s more, it put this admission in writing. This is a surprisingly common pathology among tech corporations. They don’t just do crimes — they commit them to writing. It sometimes feels like every tech CEO has a desktop folder called “mens rea” that’s filled with files with names like PREMEDITATED_MURDER_FINAL_FINAL_1.docx.

But Amazon, Meta, Google, and FTX have all done it. The compulsive hubris of tech leaders, their proclivity for communicating by messaging tools and email, and the near-impossibility of deleting all digital trails of these communications have ushered in a new golden age of provable intent. Here’s the crux of the FTC’s complaint, according to a report from Insider: In 2017, Amazon’s Shopper Frustrations teams noticed that a lot of users who signed up for “FREE Two-Day Delivery with Prime” during checkout didn’t realize that in 30 days, they’d be billed $139. These users scrambled to cancel this unexpected charge, and found themselves unable to do so.


Amazon called its Prime cancellation process “Iliad,” after Homer’s epic about an endless, grinding war.

All of this is why Amazon is in trouble with the FTC: it knew that its users were being confused into handing over their money on false pretenses, it knew how to end that confusion, and instead of acting to end the confusion, the company deliberately made it worse, and put their intention to do so in writing.

America has a lot of corporate lawlessness, but very little of it ever gets prosecuted. Much of that is down to lack of will, but it’s not just indifference or a lack of resource that lets the corporate corruption rage on unchecked. It’s also because it’s incredibly hard to convict a company of many kinds of corporate wrongdoing, since doing so often requires the government to prove that the company intended to break the law.

Normally, this is a big lift. But not, you know, when the company puts its wicked intentions in writing. Sure, it’s hard to prove that a company knew that its customers were being confused into signing up for a subscription, or that they were struggling with the unsubscription process — but not if the company researches alternatives, concludes that this is true, and then admits to that fact in a memo.

Then it’s not hard at all.

And that’s why Lina Khan is picking on Amazon. Yes, they did something wicked in deliberately setting out to trick their customers into signing up for subscriptions without intending to do so — but more importantly, they did something really stupid: they admitted it.

Others have done the same. In 2012, Mark Zuckerberg sent a middle-of-the-night email to his CFO laying out the case for buying Instagram: Facebook would be acquiring a rival that its own users increasingly preferred. If Facebook acquired the upstart, it could set in motion “network effects” that would make it very hard for future competitors to unseat them. (Meta’s newest product, Threads, enjoyed a massive boost from those network effects when it launched recently.) .”

This is not a thing a CEO should put in writing. When it comes to monopolies, intent matters. If you crush your competition by being better than them, that’s fine. But if you take actions to eliminate competition for its own sake, you’re in hot water.

This is what happens when people who have extraordinary luck think that they are extraordinary people.

They are supremely clueless.

Perhaps they should study star of stage and screen Clark Gable, who stated many times that, "He was lucky and he knew it," should be on his tomb stone.


Post a Comment