From Humans Need Not Apply, by Jerry Kaplan, pg 101-102:
there’s another reason the financial markets value the company at more than six hundred times earnings (2013), when the average is around twenty times earnings: they look forward to the inevitable time when the company extracts monopoly prices after locking in its customers and scorching the earth of competitors. And this is as it should be. Shoppers aren’t stupid; they will go where they get the best all-around deal, including convenience, service, and other factors. They aren’t concerned with whether their short-term purchasing behavior may restructure the retailing landscape to the detriment of future consumers any more than the original residents of Easter Island worried about whether the trees they chopped down for firewood might contribute to a desolate, bleak landscape for their descendants.
Categories: The Political Economy of Digital Capitalism