Etsy and Equality Fights on the Internet

This week, thousands of people selling products on Etsy go on strike to protest the company’s rising tariffs. And what seems like a fight for a little corner of the Internet is really one of the longest-running battles for our digital world.

Etsy is one of the thousands of Internet companies that bring together people with something to sell and those who may be interested in accepting it. Because of their role in connecting the two parties, these intermediaries charge a fee that could be 15 to 30 percent of each sale. (Etsy charges much less.)

Technicians call these markets and they are everywhere. Most of Amazon’s e-commerce sales come from the fees the company charges independent retailers for the cat toys and phone chargers we find and buy on Amazon. Apple’s app store, Airbnb, restaurant delivery apps, and Uber are also markets that connect customers with people offering apps, rental homes, restaurant meals, or an airport trip.

It is a constant in the digital world that these intermediaries are hated by the people and companies that depend on them. Almost always, at least some app developers, restaurants, Etsy dog ​​portrait creators, Substack newsletter writers, and other marketers believe that rates are too high, that the rules aren’t fair, that they’re being abused, or all the above.

These conflicts may be inevitable. In 2022, running your own business almost always means relying on technology intermediaries that make your business possible, but can also make it more difficult.

Look, I want to acknowledge that in this Etsy dispute, as with the fury of Apple developers in the face of the company and the dissatisfaction of Amazon retailers to sell to the big digital mall, both sides are right.

It is undeniable that Etsy, Amazon and Apple do a lot of work for people who sell things through them. Without Etsy, dog portraits should try to create their own websites or stores and search for customers on their own, and deal with tasks such as processing credit cards and providing customer service.

Etsy does all this for them, in exchange for a rate that goes up to 6.5 cents for every dollar of sales of what has been 5 cents. Merchants fighting Etsy also have other disagreements with the company, including the fact that it effectively punishes individual business owners if they can’t respond immediately to potential customers and that the company requires sellers to pay to advertise their products in sites like Google, Pinterest, and Facebook that are the most lucrative.

Etsy has said that some of the company’s approaches may be unpopular right now, but that they will benefit marketers in the long run.

At times, these complaints may seem teary or abstract, but put yourself in the shoes of Etsy vendors, restaurants that sell food through the Grubhub app, or companies that make iPhone apps.

They like to be able to find a lot of customers in one place, but they may be upset that Etsy, Grubhub, and Apple dictate so much about how they do business, take a lot of their money, and grow more powerful with their work.

These disagreements affect the prices we pay, and are very much at stake for millions of people trying to make a living doing what they love.

One question that is always asked about market disputes is what is a fair fare to charge people who offer a trip with Uber or sell a dog portrait. But I also wonder if the imaginative technology industry has not been imaginative enough to look for alternative ways to make money.

Almost all markets charge a commission and often other commissions when we buy something. Even in the metavers, apparently, companies will still make money by charging a commission from people who sell virtual reality doodads. Is there another way, and would it be better?

A couple of years ago, a Goldman Sachs investment analyst suggested that instead of fighting developers who might bother to pay up to 30 percent of digital gun sales on an iPhone game , Apple could recoup its costs to support the application economy in a different way. Analyst Rod Hall suggested that developers pay for some or all of the Apple technologies that developers use to create and distribute iPhone applications.

This approach would definitely create a whole new set of problems. And it doesn’t address the complaint of iPhone developers or those protesting Etsy sellers who like to have a central place to sell their stuff, but hate the way these markets have so much power over how they run their business. .

There are no magic balms for enduring internet fights by intermediaries like Apple and Etsy. But I appreciated Hall’s attempt to reimagine how markets earn revenue. It seems like we could use more experiments to try to bring peace to one of the most enduring disputes on the Internet.

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  • Ukraine has said it has stopped a Russian cyber-attack attempt on the country’s electricity grid. My colleague Kate Conger writes that the spread of sophisticated cyberattack raises new concerns that the Russian government may increase the use of digital weapons in Ukraine and potentially in the United States.

    Related: Russia’s technology industry is facing a brain drain as thousands of workers flee the country. And Vice writes that Twitch video streamers in Ukraine are bringing images of the war to Russian viewers.

  • Here are the most lucrative people in the United States: According to the latest report from ProPublica based on data from the Internal Revenue Service, technology billionaires such as Bill Gates and WhatsApp co-founder Jan Koum were among 10 of the top 15 revenue generators. 2013 to 2018. And because of the design of the U.S. tax system, tech billionaires tend to pay much lower rates than other extremely wealthy people.

  • Bribe to work in the office: My colleagues have a fun article about the benefits that tech companies offer workers, such as a Lizzo concert, window seats for everyone, free fried chicken, and terrarium classes, to get them back to an office. .

That The SAP dog who was naughty to eat all the sweets in the house. (But he will do it again.)

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