Amazon.com, Inc. vs Wayfair Inc.: Strategic Comparison

This in-depth comparison examines Amazon.com, Inc. and Wayfair Inc. across revenue, market value, business model, competitive positioning, and long-term growth strategy. Whether you are researching Amazon.com, Inc. on its own, evaluating Wayfair Inc., or weighing the two companies side by side, the breakdown below highlights where each company leads and where the gap between Amazon.com, Inc. and Wayfair Inc. is widest.

On the headline numbers, Amazon.com, Inc. reports annual revenue of $638.0B against $11.9B for Wayfair Inc., while their respective market capitalizations stand at $2.20T and $9.6B. Amazon.com, Inc. is headquartered in United States and Wayfair Inc. operates from United States, and those different home markets shape how each company competes.

Amazon.com, Inc.: Not a retailer. It's an attention tollbooth disguised as a cardboard box. Andy Jassy inherited this architecture from Bezos in 2021 and has spent three years doing something his predecessor never prioritized: making it efficient. The result? If you're trying to understand Amazon in 2025, forget the delivery vans. Follow the margins. Forget the revenue number for a second. It's converting the act of selling things into four separate, higher-margin revenue streams that most people don't even notice. Start with the trick that makes the whole thing work: negative working capital. Customers pay Amazon immediately. That gap — multiplied across hundreds of billions in transactions — creates a permanent float of free cash that funds expansion without borrowing. The problem is, it's the same trick insurance companies use, except Amazon does it with toothpaste and phone chargers. The marketplace is where the model gets clever. It's a tax on a tax. AWS is the profit engine that makes everything else possible. Thirty-seven percent margins. Most companies just don't bother. Advertising is the segment that changed the financial narrative. They're buying. The ad appears at the moment of purchase intent, inside a commerce environment where conversion is directly measurable. Brands can't ignore it. They comparison-shop less. They try more Amazon services. The rest — Whole Foods, Amazon Fresh, Kindle, Echo, Fire TV, One Medical, Amazon Pharmacy — these are either traffic generators, data collectors, or long-horizon bets on massive markets. Devices are sold at or near cost to drive service engagement. None of these segments need to be independently profitable because the financial architecture doesn't require it. Retail generates cash through working capital dynamics. AWS and advertising generate profit. Everything else is funded by the spread between the two. When a mid-size retailer decides where to sell online, the decision comes down to one factor: where are the buyers already standing? Amazon has 200 million Prime members with credit cards on file and one-click purchasing enabled. That's not a marketplace. That's a captive audience with pre-authorized wallets. Walmart, Shopify, and every other e-commerce platform compete for the remaining attention. Walmart is the rival that keeps Andy Jassy awake. Americans visit Walmart stores 150 million times per week. Each visit is a chance to attach an online order, sign up for Walmart+, or scan a QR code that pulls them into digital commerce. Walmart's 4,700 US stores function as fulfillment nodes that enable same-day delivery without the warehouse construction costs Amazon bears. The pitch is consolidation: you already pay us for Office, Teams, security, and identity management. Adding Azure means one vendor, one bill, one support contract. For a CIO under budget pressure, that's compelling regardless of whether AWS has more services. If enterprises standardize on GPT-4 for internal AI and GPT-4 runs best on Azure, the workload follows the model. Shopify represents the anti-Amazon thesis: merchants who want to own their customer relationship rather than rent it from a marketplace. 200 million behaviorally locked-in Prime members. Jassy spent 2023 cutting: 27,000 corporate roles eliminated, dozens of facilities closed or delayed, the fulfillment network reorganized from a national spaghetti map into eight regional hubs. By FY2024, the results were undeniable. It goes after the exact mechanism that converts marketplace traffic into Amazon's highest-margin revenue. The FTC alleges that Amazon punishes sellers who offer lower prices elsewhere by burying them in search results and stripping Prime eligibility. Structural remedies could force separation of marketplace from retail, restrict how seller data flows between divisions, or limit the bundling of fulfillment with search ranking. Any of those outcomes would hit billions in annual profit. That's not a crisis. It's a slow squeeze. The labor situation is the one that keeps me up at night if I'm an Amazon board member. And unlike AWS margins, you can't engineer your way out of it with better algorithms. It's density. Amazon's per-unit delivery cost drops with every additional package in a given zip code. But the logistics network is the obvious part. That's not a rational calculation — it's a psychological one. Most CTOs look at that equation and decide to stay. Breaking into that loop requires simultaneously offering better selection AND better prices AND faster delivery AND a large enough audience to attract sellers. Nobody has done it. When someone searches on Amazon, they're holding a credit card. Purchase intent at the moment of buying decision is structurally different from informational intent, and it's why Amazon's ad conversion rates justify the premium brands pay. Andy Jassy's Amazon is not Jeff Bezos's Amazon. That's the point. It's the regionalization of the US fulfillment network into eight geographic zones where orders are fulfilled locally instead of shipped cross-country. Boring. Defining. The big bet is AI infrastructure. Custom Trainium2 chips for training. Inferentia2 for inference. Amazon Bedrock as the managed service layer where enterprises access foundation models from Anthropic, Meta, Mistral, and Amazon's own Nova family. Amazon Q as the enterprise AI assistant. It doesn't need to be the flashiest AI platform. It needs to be the most convenient one for existing customers. Amazon has to sell it cold. The advertising trajectory is more certain. Prime Video ads reach 200 million households. Grocery surfaces through Whole Foods and Fresh create physical-world ad inventory. The DSP extends Amazon's purchase-intent data across the open web. Healthcare is the decade bet. But healthcare moves at regulatory speed, not Amazon speed. Three years from now, this is still a work-in-progress. The FTC lawsuit is the wild card nobody can model. Structural remedies that separate marketplace from retail would break the flywheel economics that fund everything else. My judgment: Amazon settles with behavioral concessions that cost money but preserve architecture. Nobody remembers this, but Amazon almost got named Cadabra. As in abracadabra. Jeff Bezos's lawyer talked him out of it because it sounded too much like 'cadaver' over the phone. Bezos was at D. E. Shaw in Manhattan, one of the most secretive and profitable quantitative trading firms on Wall Street, pulling in the kind of compensation that makes people stay forever. Not 23 percent. Twenty-three hundred. He made a list of twenty product categories that could work online and picked books for coldly rational reasons. Three million titles in print. No physical store could stock more than 150,000. An online catalog could offer everything. The product was cheap to ship, impossible to damage, and attracted exactly the kind of educated early-adopter who was already comfortable with the internet in 1994. Here's what I find fascinating about the founding decision: Bezos didn't quit his job because he was passionate about books. He quit because he ran a mental exercise he called the 'regret minimization framework.' At eighty years old, would he regret not trying this? Obviously yes. Would he regret trying and failing? The asymmetry of regret made the decision trivial. His boss David Shaw took him on a walk through Central Park, told him it was a great idea for someone who didn't already have a great job, and wished him well. Bezos and MacKenzie Scott packed a car and drove from New York to Seattle. He chose Seattle for two reasons that had nothing to do with tech culture: a major book distributor (Ingram) had a warehouse in nearby Roseburg, Oregon, and Washington state's small population meant fewer customers would owe sales tax. Within the first week, they'd sold books to customers in all fifty states and forty-five countries. They hit that number in the first year. But the near-death moment came later. The dot-com crash of 2000-2001 cratered the stock from over $100 to under $6. The IPO had happened earlier, May 15, 1997, at $18 per share.

Wayfair Inc.: Wayfair spent $1.47 billion on advertising in 2024 while generating $11.9 billion in revenue and losing $492 million. That advertising spend — roughly 12 percent of revenue — is what it costs to acquire customers for furniture and home goods in a category where purchases are infrequent and brand loyalty is weak. The question Wayfair has been answering for years is whether it can build a business where those acquisition costs eventually compound into a retained customer base rather than a recurring expense. Founded in 2002 as CSN Stores by Niraj Shah and Steven Conine out of Cornell, the company aggregated hundreds of niche home goods websites before rebranding to Wayfair in 2011 and going public in 2014. The current portfolio includes Wayfair.com, Joss & Main, Birch Lane, and Perigold, each targeting a different price point or aesthetic. The CastleGate logistics network is the operational moat. Spanning 20 million-plus square feet across 60-plus buildings globally, it positions supplier inventory close to customers, enabling faster delivery and higher conversion rates. In 2024, 25 percent of revenue flowed through CastleGate — up 400 basis points year-over-year — and CastleGate Multichannel, launched in 2025, now allows suppliers to use the infrastructure for non-Wayfair orders, creating a third-party logistics revenue stream. Physical retail entered the picture in April 2024 with a 150,000-square-foot store in Wilmette, Illinois. The pilot found that 50 percent of in-store customers were new to the Wayfair brand and generated a measurable 15 percent sales halo in the Chicago market — data points that suggest the channel adds something the digital-only model couldn't capture.

Amazon.com, Inc. and Wayfair Inc. pursue distinct approaches to generating revenue, and understanding how each company operates is the foundation of any fair comparison between Amazon.com, Inc. and Wayfair Inc..

Amazon.com, Inc. business model: That's roughly what Google pays Amazon every year just to remain the default search engine on Fire tablets and Alexa devices. Amazon pays suppliers 60-90 days later. These merchants pay roughly fifteen percent in referral commissions on every sale, plus Fulfillment by Amazon fees if they want Prime eligibility (and they do — Prime badges increase conversion rates dramatically). The margins are structurally better than first-party retail because Amazon earns fees without touching inventory. But here's the underrated factor: those same sellers now spend heavily on advertising just to be visible in search results on a platform they're already paying commissions to use. The division sells compute, storage, databases, machine learning tools, and about 200 other services on a pay-as-you-go basis. Prime doesn't just generate fees — it rewires shopping behavior. Members consolidate purchases on Amazon because every order feels free after the annual payment. The $139 is a sunk cost that makes the marginal cost of loyalty feel like zero. Google doesn't need cloud profits the way Amazon does — search advertising generates enough cash to subsidize aggressive cloud pricing indefinitely. It's the pricing discipline Google destroys for the entire industry. Shopify powers millions of independent stores, processes hundreds of billions in gross merchandise volume, and has built fulfillment infrastructure that gives small brands Amazon-like delivery speeds without Amazon's fees or data extraction. A marketplace where third-party sellers pay referral fees, fulfillment fees, and advertising fees that collectively approach 50% of their revenue — and still can't leave because that's where the customers are. The advertising business monetizes the exact moment of purchase intent. If that's true — and the evidence appears substantial — then the entire flywheel of seller dependence â†' advertising spend â†' fee extraction is built on coercive practices rather than pure value creation. A new entrant shipping one package to a neighborhood pays the same driver cost as Amazon shipping forty. Every subsequent purchase feels free. They can't match the feeling of having already paid. One Medical plus Amazon Pharmacy plus Prime integration creates something no competitor has assembled: a vertically integrated care-and-commerce loop where the company that delivers your medication also schedules your appointment and sells you the supplements your doctor mentioned.

Wayfair Inc. business model: The remaining 25% of revenue flows through CastleGate, Wayfair's proprietary logistics network, where products are forward-positioned in 20+ million square feet of warehouse space across 60+ buildings globally, enabling faster delivery and higher conversion rates. The company monetizes through product markups on third-party sales, direct inventory sales through CastleGate, and increasingly through logistics services via CastleGate Forwarding and Multichannel, which allows suppliers to use Wayfair's infrastructure for non-Wayfair orders. Wayfair's 20+ million square feet of dedicated home goods fulfillment, with white-glove delivery partnerships and damage-reduction protocols, creates a service level that Amazon struggles to match for large items. This metric suggests that Wayfair's core operations are generating cash, but heavy non-cash charges and restructuring costs prevent GAAP profitability. Amazon, Target, Home Depot, and IKEA all compete aggressively in home goods, with Amazon's logistics scale and Target's store-based fulfillment creating pricing pressure. CastleGate spans over 20 million square feet across 60+ buildings on multiple continents, making it one of the only fulfillment networks globally designed specifically for fragile, heavy, and bulky home goods. The Columbus prototype at 70,000 square feet (half the Wilmette size) tests whether smaller footprints can maintain the experience while reducing real estate costs. Wayfair's proprietary data from 24 million customers and billions of site events feeds machine learning models that already boost conversion by approximately 8% and AOV by 4%. The Germany exit, while costing $102-111 million in restructuring charges, eliminates a drag on international profitability and frees capital for higher-return markets.

The durability of a company's moat often decides long-term winners. Here is how the competitive advantages of Amazon.com, Inc. stack up against those of Wayfair Inc..

Amazon.com, Inc. competitive advantage: Amazon's counter — Bedrock offering multiple models including Anthropic's Claude, custom Trainium chips for cost advantage, and deeper service integration — is technically sound but requires customers to actively choose complexity over convenience. The structural moat remains formidable. AWS's 200+ services create switching costs measured in years of re-engineering. But switching costs in cloud are genuinely brutal — companies don't migrate production workloads on a whim. Every dollar of wage increase, every safety improvement, every concession to union demands flows directly to the bottom line at a scale that no pure software company faces. But cost isn't even the real barrier. The counterintuitive reality is the behavioral lock-in created by Prime. The sunk cost fallacy working in Amazon's favor, at scale, renewed annually. The switching costs aren't theoretical. The marketplace network effect is textbook but worth stating plainly: more sellers create more selection, which attracts more buyers, which attracts more sellers, which generates more advertising revenue, which funds lower prices and faster delivery. Because Bezos understood something about network effects that most retailers still don't: the store with the most selection wins, and you don't need to own the inventory to have the selection.

Wayfair Inc. competitive advantage: This hybrid model allows Wayfair to offer massive selection without carrying full inventory risk, while CastleGate provides a competitive moat through improved delivery speed and reduced damage rates on bulky home goods. This financial profile — massive scale with elusive profitability — defines the company's strategic challenge. Wayfair's response is a strategic pivot: physical retail stores that function as marketing channels, AI-driven personalization to increase conversion and AOV, and CastleGate logistics that create supplier lock-in and operational efficiency. The question for 2025-2027 is whether these initiatives can convert Wayfair's massive scale into sustainable GAAP profitability, or whether the company will remain a cash-burning giant in a low-margin category. In pure-play e-commerce, Wayfair faces Amazon, which offers vast furniture selection through its marketplace and benefits from Prime delivery expectations and superior logistics scale. CastleGate provides a logistics advantage that Amazon has not fully replicated for bulky items. This 'asset-light' retail approach may allow Wayfair to scale physical presence faster than traditional furniture retailers, which carry significant inventory risk. CastleGate, while a competitive advantage, requires massive capital investment. Physical retail expansion is unproven at scale. Wayfair's single most defensible competitive advantage is its proprietary CastleGate logistics network combined with 20+ years of customer behavior data across 24 million active users and billions of site events. CastleGate Forwarding, the ocean freight component, saw 40% year-over-year volume growth in 2024, with a 30% increase in long-term inbound supplier commitments, as small suppliers leverage Wayfair's scale to secure competitive ocean freight rates they could not negotiate independently. This logistics moat is reinforced by Wayfair's multi-brand portfolio strategy. The data advantage is equally critical. Once customers have purchased through Wayfair and experienced the delivery and assembly process, switching costs increase — especially for large-format furniture that requires white-glove delivery. Wayfair's supplier relationships represent another moat. After exiting Germany in January 2025, Wayfair is focusing resources on the UK, Canada, and Ireland where it has stronger brand awareness and logistics scale.

Future prospects matter as much as current results. The growth strategies below explain how Amazon.com, Inc. and Wayfair Inc. each plan to expand from here.

Amazon.com, Inc. growth strategy: The company expanded into every retail category, launched AWS in 2006, acquired Whole Foods in 2017, built a logistics network rivaling UPS and FedEx, and grew an advertising business that now exceeds $56B annually. That's not growth. The irony is, if you're looking at Amazon as an investor, the question isn't whether revenue will grow — it will, at roughly ten to twelve percent annually. The question is whether the high-margin businesses (AWS, advertising, seller services) continue growing faster than the low-margin retail base. If yes, operating margins expand toward fifteen percent or higher. If AI infrastructure spending outpaces AWS revenue growth, or if advertising saturates, the margin story stalls. The longer-term risk is subtler: if the AI infrastructure cycle requires $50-80 billion in annual capex just to stay competitive, and revenue growth doesn't keep pace, AWS margins compress. What would it actually cost to build a second Amazon? Companies build on Lambda, DynamoDB, SageMaker, Bedrock. Bezos built by expanding into everything — books to toys to cloud to groceries to healthcare to space — and worrying about margins later. Jassy inherited a company that had over-expanded during the pandemic (doubled warehouse square footage, hired 750,000 people, then watched demand normalize) and decided the growth story needed to become a margin story. The most important thing he's done isn't a new product launch. Advertising growth is the highest-margin play and requires the least incremental investment. Sponsored products are expanding into grocery, pharmacy, and physical retail. If you're researching Amazon for anyone evaluating the stock, the advertising growth rate is the figure that tells the whole story — it reveals whether the flywheel is still accelerating or plateauing. He'd stumbled on a statistic: web usage was growing at 2,300 percent annually.

Wayfair Inc. growth strategy: The Boston-based retailer operates CastleGate, a 20-million-square-foot logistics network spanning 60+ buildings across multiple continents, which now handles 25% of total revenue through forward-positioned inventory. Strategic priorities include physical retail expansion with large-format stores, AI personalization, and international consolidation after exiting Germany in 2025. Wayfair Professional serves B2B customers including contractors, interior designers, and property managers, contributing a growing but undisclosed portion of revenue. The average order value of $300 in 2024 reflects the company's focus on higher-consideration purchases. The company exited Germany in 2025 to focus resources on profitable markets. Target and Walmart have aggressively expanded their online furniture offerings, with Target's store-based fulfillment network enabling same-day delivery in major markets. IKEA remains the dominant physical retailer in affordable furniture, with 50+ U.S. Stores and a growing e-commerce presence, though its limited selection and flat-pack model differ from Wayfair's assembled delivery approach. Wayfair's most pressing challenge is the structural tension between revenue growth and profitability in a category under severe macroeconomic pressure. The 20+ million square foot logistics network demands continuous investment, and in Q1 2025, supplier inventory acceleration ahead of tariffs temporarily depressed gross margins. Investors are questioning whether the 'scale first, profit later' strategy can ever convert, especially with interest rates at multi-year highs and consumer discretionary spending under pressure. Wayfair's growth strategy in 2025-2027 focuses on extracting more value from existing customers while selectively expanding into new channels and markets. The primary initiative is physical retail expansion, with plans for five additional large-format stores by end of 2026. The Wilmette store proved that physical presence can acquire new customers — 50% of store visitors had never shopped Wayfair online — and drive halo effects in online sales within the local DMA. AI and technology investment is the second growth lever. Visual search, 3D rendering, and augmented reality features are being expanded to improve conversion and reduce return rates, which are critical for profitability in furniture e-commerce. The 40% year-over-year growth in CastleGate Forwarding volume and 30% increase in long-term inbound commitments suggest suppliers are increasingly dependent on Wayfair's logistics infrastructure. With active customers declining from 22 million to 21 million, Wayfair is focused on increasing LTM net revenue per active customer, which grew 3.4% to $555 in 2024. The company is expanding professional design services and Wayfair Professional (B2B) to capture higher-value orders. Wayfair's advertising strategy is also evolving. CFO Gulliver stated that 'with that surge of experimental spending behind us, we can scale those channels as we build them to full efficiency, which will ultimately get us back down to the advertising margin levels we were at earlier in 2024 and eventually even lower.' This indicates a shift from growth-at-all-costs to efficient growth, targeting return on ad spend (ROAS) and customer lifetime value (CLV) metrics. The company plans to open large-format stores in Atlanta and Denver in 2026, and Yonkers, New York in 2027, plus a smaller 70,000-square-foot prototype in Columbus, Ohio. The Wilmette store's success — introducing 50% new customers to Wayfair and generating 15% higher sales in Illinois — provides the proof-of-concept for this omnichannel strategy. The June 2025 launch of Decorify, an AI-driven room design platform using generative AI, aims to reduce customer hesitation in high-consideration purchases and increase average order value. If mortgage rates decline and home sales rebound, Wayfair's core demographic would likely increase spending on furniture and home improvement, driving organic revenue growth. Conversely, sustained high rates or recession would extend the revenue decline and test investor patience. The early strategy was niche site proliferation: by 2005, CSN Stores operated dozens of specialized websites targeting specific furniture categories and styles. The rebranding coincided with a strategic shift from pure drop-shipping to building proprietary logistics capabilities. The company was classified as an 'emerging growth company' under the JOBS Act, allowing reduced reporting requirements. Post-IPO, Wayfair accelerated international expansion, launching in Canada, the UK, Germany, and other European markets.

A closer look at the financial trajectory of Amazon.com, Inc. and Wayfair Inc. rounds out the comparison.

Amazon.com, Inc.: $20 billion. The $638 billion in FY2024 revenue gets all the press, but the real story is how little of that matters to the bottom line. Strip away the razor-thin retail margins and what you find is a $105 billion cloud computing empire, a $56 billion advertising machine, and a subscription flywheel with 200 million paying households — all of it funded by a retail operation that exists primarily to generate the traffic and data that make everything else work. Net income nearly doubled from $30.4 billion to $59.2 billion in a single year. Under CEO Andy Jassy, Amazon reported $638B in FY2024 revenue with approximately 1.5 million employees worldwide and a market capitalization exceeding $2 trillion. $638 billion sounds impressive until you realize that most of it — the online stores segment, the stuff in cardboard boxes — operates on margins so thin you could paper a wall with them. This segment pulled in approximately $140 billion in FY2024. $105 billion in FY2024 revenue. Roughly $39 billion in operating income. $56 billion in FY2024, growing north of twenty percent annually, with margins estimated above fifty percent. Prime membership ($139/year in the US) generates an estimated $40 billion in subscription revenue, but that understates its value by an order of magnitude. Healthcare is a $4 trillion US market where Amazon is still in the first inning. FY2024 revenue reached $638B with approximately 1.5 million employees and a market capitalization exceeding $2 trillion. The business model combines low-margin retail (generating cash through negative working capital), high-margin AWS cloud services ($105B in FY2024), and fast-growing advertising revenue ($56B). Not because Walmart's e-commerce is better — it isn't — but because Walmart has something Amazon spent $13.7 billion trying to buy with Whole Foods: grocery frequency. Over $100 billion in logistics infrastructure. The number that tells the real Amazon story isn't $638 billion in revenue. It's the jump from $30.4 billion to $59.2 billion in net income — a near-doubling in a single fiscal year. FY2022 was the low point: a $2.7 billion net loss driven by pandemic overexpansion — too many warehouses, too many employees, too much optimism about permanently elevated e-commerce demand. AWS contributed $105 billion in revenue and $39 billion in operating income — thirty-seven percent margins on a business that represents less than seventeen percent of total sales. Advertising brought in $56 billion at estimated margins above fifty percent. The market cap above $2 trillion prices in the optimistic scenario. I've seen estimates north of $150 billion for the logistics network alone — the 1,000+ fulfillment centers, the 90-aircraft air cargo fleet, the tens of thousands of delivery vans, the sortation facilities, the last-mile stations. By 2028, Amazon will either be the default infrastructure layer for enterprise AI or it will have spent $100 billion trying. This business hits $80 billion by 2027 without requiring any technological breakthrough — just more surfaces and better targeting on existing ones. Five years from now, it's either a $30 billion business or a write-down. That's the level of improvisation happening in the summer of 1994 — a thirty-year-old quant from a hedge fund, driving cross-country with his wife while dictating a business plan from the passenger seat, hadn't even settled on a name for the company that would eventually be worth $2 trillion. Bezos had told early employees that if they sold $1 million in books by 2000, he'd consider it a success.

Wayfair Inc.: Revenue of $12.2 billion in 2022 declined to $11.9 billion in 2024 before recovering to $12.5 billion in 2025 — a trajectory that reflects the broader contraction in home goods spending after the pandemic-era renovation surge. Consumers who bought furniture during 2020 and 2021 weren't buying again in 2022 and 2023, and Wayfair felt the category reset acutely. The net loss of $492 million in 2024 follows losses in prior years, a consistent pattern driven by advertising investment, logistics infrastructure build-out, and the high fixed costs of the CastleGate network during years when volume doesn't grow fast enough to absorb them. The market capitalization of $9.58 billion implies investors are still pricing in the eventual profitability thesis. Merchant processing fees — $254 million in 2024, down from $258 million in 2022 — confirm the slight volume decline. The Canada duty refund recognized in Q1 2025 provided a one-time gross margin benefit that management proactively reinvested rather than held as profit, consistent with the company's long-standing posture of sacrificing near-term margins for long-term positioning. With 12,800 employees, Wayfair operates at roughly $930,000 in revenue per employee — a number that compares unfavorably to asset-light software businesses but is reasonable for a company managing physical logistics infrastructure at scale. The key metric for the forward outlook is CastleGate penetration: if suppliers deepen their dependency on the network, the margin economics improve structurally.