Will antitrust legislation single out Amazon and let retail rivals slide?
Amazon.com is slamming federal legislation that would bar the company from giving preference to its products over items sold by other sellers on its site.
Brian Huseman, Amazon vice president of public policy, writes on a company blog that two nearly identical bills sponsored in the Senate by Sen. Amy Klobuchar and in the House by Rep. David Cicilline would jeopardize “two of the things American consumers love most about Amazon: the vast selection and low prices made possible by opening our store to third-party selling partners, and the promise of fast, free shipping through Amazon Prime.”
Mr. Huseman says that legislation improperly puts Amazon in the same category as Apple, Facebook, Google and Microsoft, despite its very different business model.
He contends that Amazon, as a retailer, is more directly comparable to Costco, CVS, Target and Walmart, “all of which would be mysteriously excluded from the bill’s proposed regulations.”
Mr. Huseman says the legislation is targeted at companies with a market value of at least $550 billion but Walmart, which had annual revenues of $559 billion in 2021, is not included.
“Walmart is excluded despite also being a large retailer that allows small businesses to sell in its online marketplace. Similarly, Target, which is headquartered in Sen. Klobuchar’s home state of Minnesota, is excluded even though it too operates an online marketplace for sellers,” said Mr. Huseman.
“CVS, which is headquartered in Rep. Cicilline’s home state of Rhode Island, is excluded despite being one of the U.S.’s largest retailers, largest health insurance companies, and largest pharmacy benefit managers, all at the same time,” he added.
Mr. Huseman claims that third-party sellers using the Fulfillment by Amazon (FBA) service could be hurt by the legislation despite its intention to protect them.
“A key advantage of using FBA is that businesses can offer their products to shoppers under the Prime brand and accompanying benefits, which leads to significantly higher sales volume because so many customers prefer buying items that are eligible for Prime. Critically, using FBA allows these sellers to bypass all the work required to store, fulfill, and get products delivered to customers with the quick delivery and high degree of dependability consumers have come to expect — all at a more affordable cost than they could do on their own.”
Third parties represent about 60 percent of sales on the Amazon platform.
- Antitrust legislation and the unintended negative consequences for American consumers and small businesses – Amazon.com
- Antitrust Bill Targeting Amazon, Google, Apple Gets Support From DOJ – The Wall Street Journal
- Antitrust Tech Bills Gain Bipartisan Momentum in Senate – The Wall Street Journal
DISCUSSION QUESTIONS: Does Amazon unfairly give preference to products it sells versus those sold by third parties on its marketplace? Will the bills being considered in the Senate and House single out Amazon and let its retail rivals slide?