The New York Times reports that the European Union’s top antitrust regulator has begun an investigation into whether Amazon “unfairly uses data collected from third-party sellers who rely on its platform,” utilizing it to “promote its own products at the expense of other retailers … Regulators said they were examining whether Amazon was hurting competition by abusing its dual role as a retailer that sells its own goods and a marketplace where other merchants sell products.”
“E-commerce has boosted retail competition and brought more choice and better prices,” said Margrethe Vestager, Europe’s competition commissioner. “We need to ensure that large online platforms don’t eliminate these benefits through anticompetitive behavior.”
According to the Times story, “The investigation highlights the growing importance of data in measuring the power of tech platforms. Regulators in Washington and Europe are looking more closely at whether the methods that companies like Amazon, Facebook and Google use to collect and hoard data give them an unfair advantage over rivals without comparable access to the same kind of data.”
And, the Times notes, “Europe has been at the forefront of regulating the tech industry on issues like antitrust, tax evasion, privacy protection, and the spread of hate speech and other harmful content.”
At the same time, the Times reports, the British Competition and Markets Authority has “begun an investigation into a $575 million investment led by Amazon in the London-based food-delivery service Deliveroo,” based on concerns that the investment actually is a de facto acquisition, which would be a potential violation of the nation’s antitrust laws.
“E-commerce has boosted retail competition and brought more choice and better prices,” said Margrethe Vestager, Europe’s competition commissioner. “We need to ensure that large online platforms don’t eliminate these benefits through anticompetitive behavior.”
According to the Times story, “The investigation highlights the growing importance of data in measuring the power of tech platforms. Regulators in Washington and Europe are looking more closely at whether the methods that companies like Amazon, Facebook and Google use to collect and hoard data give them an unfair advantage over rivals without comparable access to the same kind of data.”
And, the Times notes, “Europe has been at the forefront of regulating the tech industry on issues like antitrust, tax evasion, privacy protection, and the spread of hate speech and other harmful content.”
At the same time, the Times reports, the British Competition and Markets Authority has “begun an investigation into a $575 million investment led by Amazon in the London-based food-delivery service Deliveroo,” based on concerns that the investment actually is a de facto acquisition, which would be a potential violation of the nation’s antitrust laws.
- KC's View:
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Amazon lately has been seeing a lot of political opposition being raised to its business model. Sen. Elizabeth Warren (D-Massachusetts), who is running for the 2020 Democratic presidential nomination, has made breaking up Amazon (and Facebook and Google and Apple) one of her campaign planks. And, as Fast Company reports, the Retail Industry Leaders Association (RILA) - urged on by members Walmart, Target, and Best Buy - is urging the federal government to “prioritize control of information - primarily through data collection - just as much as market power and price control” as it conducts antitrust probes.
Add to that the fact that the Trump administration is no fan of Amazon founder-CEO Jeff Bezos (he owns the Washington Post in a personal investment, and the President doesn’t particularly like the tone and volume of its coverage), and you have Amazon potentially facing nine miles of bad governmental and regulatory road.
And that’s not all …
CNBC reports that a federal appeals court has ruled that Amazon can be held liable for products sold through its online Marketplace for third-party vendors. The story says that the decision “related to a case in which a Pennsylvania customer … purchased a retractable dog leash” from a vendor on Amazon called The Furry Gang. At one point, the leash recoiled - and the customer was blinded in one eye. The Furry Gang reportedly has gone completely off the radar, and so the customer wanted to go after Amazon.
This new ruling is just the beginning of the process - it means that the customer now will be able to take Amazon to court and sue for damages.
The CNBC story points out that “Amazon has previously escaped liability for its vendors’ products. Last year, a judge in Tennessee ruled the company was not liable for damages caused by a defective hoverboard that exploded, burning down a family’s house. The plaintiff, who bought the product on Amazon’s site, claimed the company did not sufficiently warn of the product’s dangers.”
What this all means is that Amazon seeing a variety challenges to the ways in which it has done business. What’s the old Mike Tyson line? Everybody's got plans... until they get hit. It sounds like Amazon’s going to be taking on some body blows, but I suspect that Jeff Bezos has built an organization capable of absorbing them and effectively fighting back.
It isn’t all negative news for Amazon, by the way.
Bloomberg reports that the company is asking the Federal Communications Commission (FCC) to let it launch 3,236 communications satellites into space, where they would circle the planet in low orbits and allow it offer internet service to terrestrial residents.
Amazon isn’t alone in this quest - the story notes that “the FCC already has approved nearly 13,000 low-Earth orbit satellites,” including more than eleven thousand that will be launched by Elon Musk’s Space Exploration Technologies Corp.
Here’s how the technology works: “At low-Earth orbit -- altitudes of 112 to 1,200 miles (or about 180 to 2,000 kilometers) -- satellites need to race around the globe to stay aloft, completing orbits in as little as 90 minutes. As one moves toward the horizon it will hand off signal duties to the next satellite coming by. Many satellites are needed if continuous, widespread coverage is the goal.”
When you are doing stuff like this, dealing with antitrust probes must seem awfully pedestrian. Not unimportant, but not like challenging gravity and making physics work for you.
