jericsinger

I promise you, everyone is trying their best. But the food and ingredient supply chain is extremely complex and doesn't lend itself to strict structure. Tracking an ingredient through multiple vendors in multiple countries while it changes form from raw material to component ingredient to sub-product to product requires a massive effort, care, and judgment. And it's definitely a chain that's only as good as its weakest link, so one small mistake early in the chain can void all subsequent efforts, no matter how diligent. My point is, it's really hard to do well, and nigh impossible to do perfectly.

This is not true. It's possible, perhaps probable, that Phillip-Morris employees have invested personally in the industry, but all retail states so far have strict domesticity requirements that no national corporation could satisfy. Colorado's even contemplating a law that forbids publicly traded companies from owning stakes in a licensed entity. But even if this weren't the case, it would make zero business sense for a heavily regulated, multi-billion dollar corporation to invest resources in marijuana right now. The revenue opportunity wouldn't register on their income statement, and would never come close to justifying the additional scrutiny they'd surely receive from regulators. The reasonable strategy for them is to wait until marijuana receives federal blessing and then acquire the best companies or teams available, or try to launch new products backed by massive marketing spend.

Organized crime is pretty well purged from Colorado (and likely Oregon and Washington as well). Prior to retail taking effect, the DEA and Colorado law enforcement flushed out anyone with even a remote relationship with, call it, persons of interest. Since then, all participants have been subjected to background checks, where the thoroughness ranges from cursory (for, say, an hourly employee) to proctological (for a license owner). There are currently strict domesticity requirements for all "owners" (broadly defined by the state enforcement agency as anyone with "control"), i.e., at least two years of residency in the state of Colorado. Then of course there is the standard clean background check. New laws under consideration would open the market to out-of-state investors as of Jan 1 2017, but those laws are awaiting the governor's signature.

This is called traceability, and it's a fundamental aspect of food quality and good manufacturing practice (GMP) throughout the food industry. The devil is in the documenting.

Network-based business models have always tended toward monopoly (AT&T, ConEd, and Western Union, to name a few early US examples). The internet doesn't change this dynamic at all; rather, by providing the first (more or less) open network in history, it simply removed what used to be the greatest impediment to a networked business: the construction of the transmission network.

The internet hasn't "changed" economics, it's just enabled a specific type of business model.