In a gesture with unforeseeable consequences for the online consumption habits of millions of Americans, the Biden administration filed this Tuesday a lawsuit against Amazon for carrying out monopolistic practices aimed at “increasing prices, deteriorating quality and harming consumers and “Stealing innovations from companies.”
The Federal Trade Commission (FTC) and 17 attorneys general from as many states accuse Amazon of “preventing its competitors from lowering prices, degrading quality for its customers, overcharging customers and sellers, hindering innovation, and others.” to prevent them from competing fairly.” The lawsuit, which estimates that around 100 million buyers are affected by these practices, estimates the damage at hundreds of millions of dollars per year. “Rarely in history,” the FTC said in a statement sent this Tuesday, “has antitrust law been used in such a way that this case could do so much good for so many people.”
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These legal actions can be interpreted as part of the Biden administration’s offensive to limit the power of large American technology companies. Other outstanding cases were against Google, which was accused in a Washington court of abusing its dominant position in Internet search, or against Microsoft, whose attempted purchase of the video game company Activision was challenged.
“Our complaint exposes how Amazon has used a variety of punitive and coercive tactics to illegally maintain its monopolies,” FTC Chairwoman Lina M. Khan said in the commission’s announcement of her tenure has. It has been the scourge of Silicon Valley since the Biden administration. “The lawsuit alleges in detail that Amazon exploits its monopoly power to enrich itself while simultaneously increasing prices and increasing service for the tens of millions of American families who shop on its platform and the hundreds of thousands of companies that run their businesses “Today’s lawsuit aims to hold Amazon accountable for these monopolistic practices and restore the lost promise of free and fair competition.”
Anti-discount measures
Some of the tactics reported by Khan include “anti-discounting measures that penalize sellers and discourage other retailers from offering lower prices than Amazon.” These ploys to undermine the success of competitors include downgrading sellers to better ones Providing deals as the multinational corporation by placing them so low in search results that they become virtually invisible. Amazon is also accused of preventing companies from benefiting from membership in their products’ “Prime” club, which provides free shipping.
According to the lawsuit, Amazon also harms competition by requiring sellers to use its internal logistics services or by forcing them to sell their products on the site founded by Jeff Bezos at lower prices than anywhere else on the Internet. a practice that was already the subject of a separate lawsuit filed last year by the California attorney general.
The states added to the case are Connecticut, Delaware, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New Hampshire, New Mexico, Nevada, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island and Wisconsin.
Khan made the Amazon investigation one of his professional crusades long before he joined the U.S. government. In 2017, while attending Yale, he signed an influential legal article denouncing the Seattle company’s desire for a monopoly in the United States. Then, as part of a congressional investigation into alleged abuses by the tech industry, he worked on a 450-page report on how the greed for market control by Amazon, Apple, Google and Meta had “hindered innovation, limited consumer choices and weakened democracy.” .”
Earlier this year, the FTC sued Amazon for “defrauding” millions of its customers into joining the Prime program, for which they pay a monthly or annual fee. The commission also forced a multimillion-dollar settlement to bury allegations of data breaches by the company’s home devices such as Alexa.
Founded in 1994, Amazon is the second largest employer in the United States. In its nearly three decades of existence, it has evolved from a site for buying books at competitive prices, too competitive for a publishing industry that forced a profound rethink, to offering consumers all kinds of products, from vacuum cleaners to furniture and household appliances. The company’s logistical advantages and the unrivaled speed of its deliveries can also be blamed for the deterioration in the working conditions of hundreds of thousands of workers, as well as a profound change in the habits of the Americans who supply a vast country to its last corner in the boxes of the characteristic Amazonian smile.
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