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Over the past few days, information has made it clear that Amazon and its other technology giants will soon be at the center of increased antitrust control by the Federal Trade Commission, the Ministry of Commerce, the United States, and the United States. Justice and Congress.
On Saturday, the Washington Post announced that the FTC would oversee Amazon, following an agreement between the agency and the Justice Department to divide the oversight responsibilities of the biggest tech giants.
In recent months, the FTC has already begun questioning some of Amazon's competitors about the e-commerce giant's business practices, according to an informed source during discussions.
The timing is logical. In February, the FTC's Competition Bureau announced the creation of a new task force to "monitor competition in technology markets in the United States, to investigate potential anti-competitive behavior in these markets." and to take enforcement action where justified. "
The increased focus on regulation comes as activists, lawyers and US presidential candidates such as Senator Elizabeth Warren have accused Amazon of anti-competitive behavior. In the United States, Amazon controls nearly half of all online retail, is the largest cloud computing provider in the world, and even its secondary business – online advertising – is large enough to make the third largest advertising platform in the United States. Facebook.
The FTC now gathers information from Amazon's competitors. To be clear: the FTC's requests that Recode has seen do not mean that the Commission has launched a formal investigation of Amazon. They also do not want to say that these topics would be the focus if the FTC finally opened an investigation on Amazon.
But here are three areas of questioning related to Amazon that the FTC has pursued, according to the source. A spokesman for the Federal Trade Commission declined to comment. An Amazon spokesperson declined to comment on the recording about the potential investigation.
1) Respect of the pricing structure of Amazon
This is an Amazon logistics service more commonly known as FBA in retail. This service allows Amazon sellers to store their merchandise in Amazon warehouses and entrust Amazon with packaging, shipping and customer service management for these orders.
But Amazon sellers can also use FBA to make Amazon store, fill and ship items that the seller has sold outside of Amazon – whether on their own website or on other marketplaces like Etsy and eBay.
The FTC's ABF questions focused on the service's pricing structure. Amazon charges its sellers more for FBA services when they are used for an order placed on a competing website than on Amazon.com.
For example, Amazon charges $ 4.76 to sellers to pick, package, ship, and handle customer service from an FBA item sold on Amazon weighing between one and two pounds.
However, the same item would cost 75% more, or $ 8.35 in FBA fees, if Amazon were to send it to a customer who purchased the product on competing platforms such as Etsy, eBay or the online store. of the seller.
This divergence caught the attention of the FTC, according to a Recode source.
2) Amazon competes with its own sellers
Amazon, which competes with its own vendors, is perhaps the most popular topic among critics of society, including Elizabeth Warren.
Amazon invites small and medium-sized businesses to sell directly to Amazon customers on Amazon.com through a platform called Amazon Marketplace. But Amazon has created more than 100 of its own brands that are often in direct competition with Amazon's third-party sellers.
One question is whether Amazon is unfairly using sales and other data from its sellers to undermine or otherwise defeat these same small and medium-sized merchants. A spokeswoman for Amazon said the company was barring Amazon brands from using the data of an individual seller to compete with the seller. (But Amazon does not say if its own brands can use aggregated data from a group of sellers selling the same product.)
Amazon has also occasionally aggressively promoted its own brands on its website in real estate not available to its vendors.
If you consider Amazon as a retailer, you could argue that many other retailers, including Walmart and Target, are doing the same: Analyze sales trends in their stores to inform the creation of their own brands that they sell to sides of their suppliers.
But if you consider Amazon Marketplace to be more of a "platform utility" – an argument advanced by Warren in his recent antitrust manifesto and originally presented by antitrust expert Lina Khan – you can ask if Amazon should be allowed to compete with its own customers of the company.
3) Amazon Prime Service Bundling
If you're an avid consumer of Amazon, the $ 119 you spend a year on Prime to get the long list of its benefits – unlimited shipping the next day; access to a huge online library of TV shows, movies and songs; free online photo storage; and more – seems to be an agreement. In 2018, Amazon has more than 100 million Prime members worldwide.
But the FTC has expressed interest in whether this bundling of services allowed Amazon to sell unfairly to its competitors. An axis of reflection: if Amazon does not need to benefit directly from the annual Premium contribution, and it is not clear, how are the competitors who must actually earn money with an individual service are supposed to compete? on the price?
Given the size of Amazon, it is likely that the FTC is collecting information on Amazon's other tentacles, beyond the aforementioned three. For example, Amazon has been asked to separate Amazon Web Services from its core business, for example. Other worry about the recent domination of Alexa in the "smart home" space and the fact that Amazon is already competing with manufacturers who integrate Alexa into their devices and other companies that make voice applications – or "Skills" – for Alexa.
For the moment, the only thing that is safe for Amazon is that a thorough regulatory review is underway and will not be dispelled soon.
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