Amazon (NASDAQ: AMZN) has had more than its fair share of detractors over the past few years. While shares of the stock have skyrocketed in the past decade, becoming one of the most valuable companies on the planet in the process, a lot of people have argued that Amazon did so by exploiting other companies, or at least by operating in dubious antitrust territory. As it turns out, thousands of small businesses are coming together across America to launch an antitrust campaign against the online retailer.
A group of various different American businesses, from grocers, bookstores, hardware stores, office suppliers, and more, are working together to pressure congressional representatives to sign in tougher antitrust laws on big tech companies. Additionally, they are hoping to get elected officials to revamp existing laws to make them tougher against companies like Amazon.
Amazon has long been the subject of rumors and claims of various anti-competitive practices. This includes taking private information from third-party sellers on its platform, in which Amazon later develops a similar, competitive product that’s sold cheaper until the competition goes bankrupt. Since these claims started to become more common, regulators have started looking into the company for potential antitrust violations.
This includes the Federal Trade Commission (FTC) as well as the European Commission, the EU’s top antitrust regulatory body. We’ve already seen a number of big tech companies hit with fines and charges in recent years, and it’s possible that these pending investigations could yield similar results in the future. The main problem for antitrust proponents is that these cases don’t have that much financial impact on a company the size of Amazon. Even if the company is hit with a billion-dollar fine, that’s nothing for Amazon to write off.
“Amazon and third-party sellers complement each other, and sellers having the opportunity to sell right alongside a retailer’s products is the very competition that most benefits consumers and has made the marketplace model so successful for third-party sellers,” said an Amazon spokesperson in response to the topic.
Shares of Amazon didn’t really move much in response to the news, which makes sense for a company with a trillion-dollar market cap. Various legal groups all around the world have been honing in on not just Amazon but other large tech companies as well. It’s even become a significant political issue, with representatives from both sides of the aisle expressing concerns about the growing, if not potentially monopolistic powers, of big tech companies.
Amazon Company Profile
Amazon is among the world’s highest-grossing online retailers, with $233 billion in net sales and roughly $311 billion in estimated physical/digital gross merchandise volume in 2018. Online product and digital media sales accounted for 53% of net revenue in 2018, followed by commissions, related fulfillment and shipping fees, and other third-party seller services (18%), Amazon Web Services’ cloud computing, storage, database, and other offerings (11%), Prime membership fees and other subscription-based services (6%), product sales at Whole Foods and other physical store retail formats (7%), and advertising services and cobranded credit cards (4%). International segments constituted 32% of Amazon’s non-AWS sales in 2018, led by Germany, the United Kingdom, and Japan. – Warrior Trading News