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In the Land of Trillion Dollar Goliaths | Amazon and monopoly power



When a firm holds too much market power in any sector, we then see these firms begin to abuse its power in order to stay on top and that is deeply concerning. In the Land of Trillion Dollar Goliaths, Amazon is a growing monopoly of online commerce and some would say we have passed the tipping point where we could see any real challengers to their supremacy.

We recently reported that Amazon had reportedly accessed 3rd party seller data in order to gain a competitive edge. According to The Wall Street Journal, Some Amazon employees have said that they accessed 3rd party seller data in order to gain an edge in the market for its private label products. The claim from employees fly’s in the face of Amazon’s previous insistence that they do not access non-public data. The data in question is access by Amazon employees for the explicit purpose of what features to add to a product and how to price it.

Today Sen. Josh Hawley (R-MO) is formally calling on federal prosecutors to open a criminal antitrust investigation into Amazon. In a letter addressed William Barr the Attorney General of the United States, he posits that Amazon’s data pillaging that were outlined in The Wall Street Journal, “alarming for America’s small businesses even ordinary circumstances.” He goes on to say “But at a time when most small retail businesses must rely on Amazon because of coronavirus-related shutdowns, predatory data practices threaten these businesses’ very existence.”

Senator Hawley concludes that “Antitrust law imposes criminal penalties on companies that try to acquire or maintain monopoly power. Amazon’s data practices, as reported by the Wall Street Journal, appear to meet that description.”

“Antitrust law imposes criminal penalties on companies that try to acquire or maintain monopoly power.”

United States Senator Josh Hawley

Amazon has a God-like view of the market place to tip the scales of competition in their favor. Amazon’s General Counsel even testified to Congress that it did not use third-party data to inform how to create its own products. Now that testimony is under scrutiny from the House Judiciary committee and are seeking clarification on weather Amazon lied to Congress.

Since The Wall Street Journal’s report, Amazon has opened up an internal internal investigation looking into the issue.



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