From The Washington Post:
Europe’s antitrust regulators have opened a preliminary probe of Amazon.com to see whether the e-commerce giant has stifled smaller competitors who sell clothing, toys and other goods through its website, marking the region’s latest inquiry into the business practices of a U.S. tech giant.
The concern at hand is whether Amazon’s use of sales data from third-party merchants gives it a leg up in selling its own products, said Margrethe Vestager, the European Union’s competition chief, on Wednesday. More than half of Amazon’s sales now come from third-party merchants that do business on the company’s site, as the retailer aggressively recruits small and medium-size sellers to join its marketplace. (Jeffrey P. Bezos, the founder and chief executive of Amazon, owns The Washington Post.)
“The question here is about the data,” Vestager said at a news conference. “If you as Amazon get the data from the smaller merchants that you host … do you then also use this data to do your own calculations on what is the new big thing? What is it that people want? What kind of offers do they like to receive? What makes them buy things?”
Link to the rest at The Washington Post
PG says if governments punish successful companies, they may find fewer of them appear and last.
One of the reasons Amazon offers consumers such great prices and selection is because it does a superb job of giving them what they’re looking for at a price they like.
PG suggests Amazon got where it is today because it has always paid more intelligent attention to its customers than anyone else. That’s why Walmart’s stock has advanced about 40% over the past decade, while Amazon’s stock increased nearly 2,200% in value. On Fortune magazine’s list of most-admired companies worldwide, Amazon is #2 (right behind Apple) and Walmart is #26.
On Fortune’s top-50 list, PG saw BMW, Adidas, Unilever and Nestlé as the only companies headquartered in the EU, which is a larger market than the US. PG wonders whether EU-style regulation of competition is hurting far more people and organizations than it helps.
Ms. Vestager seems to be unfamiliar with how Amazon makes money. It does sell its own products, but it sells far, far more products from other businesses. And Amazon almost certainly makes far more money helping other businesses sell their goods than Amazon makes from selling its own goods.
As an organization, Amazon is so successful in part because it shares the wealth – with its own customers by offering low prices plus great selection and service, with third party sellers because it allows them to sell on the most sophisticated online website known to human kind and even a large number of indie authors by paying them far more money than they could earn by trying to deal with stone-age traditional publishers.