Oh, I thought this was going to be about Amazon building their own rackmount machines for their data centers. Instead, it's about Amazon Basics selling a CPU cooler.
Author of the article confused ODM vs OEM.
He claimed Cooler Master did the design but there is a way more likely case: Cooler Master just bought a white label product like Amazon Basics.
I hate Amazon more than most but this is a heatsink and fan; not rocket science. If they stole the design, I'm sure the lawyers will work that out. Competition is good, cm charging 3x more is not and they deserve to be undercut.
> If they stole the design, I'm sure the lawyers will work that out.
I'd guess that depends on how much someone can afford the massive legal costs to take one the richest companies on the planet to court. It doesn't look like lawyers solved the problem for Peak Design when amazon ripped off their bag design.
Competition is good, selling cheap, lower quality knockoffs of other people's products is not. Companies like Amazon have so much money that they will always be able to sell a knockoff product for less than it cost the creator to research, design, refine, and manufacture the real thing, and then make sure their rip off version it the first thing any user shopping on Amazon sees. Why would a person bother creating something when you know that the moment it gets popular Amazon will just steal your design and undercut you, possibly before you've even had a chance to recover your investment?
> Unless component makers want to get absolutely fleeced by Amazon undercutting it with knock-offs, they need to offer customers an alternative that Amazon can't undercut.
How is a small company supposed to able to sell at a comparable price to Amazon? Or reliably develop uncopyable tech advantages for products that are already commodities?
1. Amazon can source parts and manufacturing services in larger scales, at better prices.
2. Amazon doesn't lose margin to advertising, marketing or sales partners.
3. Amazon can give its products greater visibility than even the highest paying advertiser on their site.
4. Amazon will get customers at greater scale, amortizing fixed costs like design and other overhead across more sales.
5. Amazon can scale production up and down to avoid waste, given their bird's eye view of real time demand.
6. If Amazon wanted to, it could even scale sales up and down so that they only use free slack in its warehouses and logistic systems, essentially eliminating those costs for itself.
There is a reason Amazon is an antitrust target. Their vertical integration tilts everything their way decisively for anything they can decently copy.
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[ 2.6 ms ] story [ 26.4 ms ] threadI'd guess that depends on how much someone can afford the massive legal costs to take one the richest companies on the planet to court. It doesn't look like lawyers solved the problem for Peak Design when amazon ripped off their bag design.
Competition is good, selling cheap, lower quality knockoffs of other people's products is not. Companies like Amazon have so much money that they will always be able to sell a knockoff product for less than it cost the creator to research, design, refine, and manufacture the real thing, and then make sure their rip off version it the first thing any user shopping on Amazon sees. Why would a person bother creating something when you know that the moment it gets popular Amazon will just steal your design and undercut you, possibly before you've even had a chance to recover your investment?
How is a small company supposed to able to sell at a comparable price to Amazon? Or reliably develop uncopyable tech advantages for products that are already commodities?
1. Amazon can source parts and manufacturing services in larger scales, at better prices.
2. Amazon doesn't lose margin to advertising, marketing or sales partners.
3. Amazon can give its products greater visibility than even the highest paying advertiser on their site.
4. Amazon will get customers at greater scale, amortizing fixed costs like design and other overhead across more sales.
5. Amazon can scale production up and down to avoid waste, given their bird's eye view of real time demand.
6. If Amazon wanted to, it could even scale sales up and down so that they only use free slack in its warehouses and logistic systems, essentially eliminating those costs for itself.
There is a reason Amazon is an antitrust target. Their vertical integration tilts everything their way decisively for anything they can decently copy.