The Washington Post reports that Washington, DC's attorney general, Karl Racine, yesterday filed an antitrust suit against Amazon, "alleging that the e-commerce giant wields monopoly power that has resulted in higher prices for consumers."
The accusation is that Amazon fixes prices "through contract provisions with third-party sellers who peddle their products on its platform. The attorney general said that Amazon prevents sellers from offering their products at lower prices or on better terms on any other online platforms, including their own websites, and that that prohibition results in 'artificially high' prices across e-commerce sales."
"The DC Attorney General has it exactly backward — sellers set their own prices for the products they offer in our store,” Amazon spokesman Jack Evans said in a statement. “Amazon takes pride in the fact that we offer low prices across the broadest selection, and like any store we reserve the right not to highlight offers to customers that are not priced competitively.”
The Post provides some context:
"The suit follows years of Washington antitrust scrutiny of Amazon and comes as consumer advocates have called on the Biden administration to bring federal antitrust charges against the company. Biden recently nominated one of the company’s key critics, Lina Khan, to the Federal Trade Commission.
"The latest legal salvo highlights the critical role attorneys general are playing in checking tech giants’ power, following years of little action from the federal government. Last year, groups of state attorneys general brought two antitrust lawsuits challenging Google’s dominance in search and advertising. A separate group of 48 attorneys general filed a landmark antitrust suit against Facebook, seeking to break up the social networking giant."
- KC's View:
I have to admit I am a little skeptical about this suit, largely because Amazon is transparent on its own site when products are being offered by marketplace vendors for a lower price than even Amazon sells them. It would just seem to run counter to Amazon's commitment to eliminating friction and doing things that are consumer-centric.
But, who knows? Maybe there are incriminating documents that will prove the case. Maybe Amazon has been fooling us all these years.
But I'm dubious, and think it may be hard to prove that Amazon is bad for consumers.