1. Amazon is in a world of legal hurt — I just read the less-redacted version of the FTC’s monopoly lawsuit. Lots of evidence of Amazon execs knowingly screwing consumers & killing competition, aware of their own wrong-doing.
A few highlights. First, destroying evidence.
2. Here’s an exec saying that blocking sellers from offering lower prices on other sites is "a dirty job, but we need to do it."
3. This is wild — Amazon retaliates so harshly against sellers who discount elsewhere that a competing platform (maybe Walmart?), in order to attract sellers, had to create an algorithm that ensures sellers’ prices can never ever drop below what they charge on Amazon.
4. “Prices will go up,” declared Jeff Wilke, Amazon’s CEO of Worldwide Consumer, after implementing an algorithm that makes it impossible for competitors to win market share by lowering their prices.
5. Amazon's secret price-raising system, Project Nessie, fleeced at least $1 billion from shoppers.
To evade detection, Amazon turned Nessie off when attention to prices was highest, such as during the holiday season.
6. If you control a spigot that can dump tens of millions of dollars into your lap just like that, you are a monopoly. No question.
7. Why is there no alternative to Amazon? Here’s Amazon using its price manipulation tools to kill Jet, an upstart competitor. Three months after Jet launched, it was forced to "revise [I [its] price leadership strategy…”
8. And here’s Amazon doing the same to Walmart
9. And here’s Amazon doing the same to Zulily.
10. Here’s Jeff Bezos, founder of "the world's most consumer-centric company," telling executives to stuff “defect” ads in front of shoppers — ads that aren’t relevant to their search — because it’s a way to make lots of money.
11. Stuffing ads into results also helps Amazon steer shoppers away from lower priced products.
12. Lots of new evidence about how Amazon thwarts competition by forcing sellers to use its fulfillment.
Amazon had an “oh crap” moment when it looked at the numbers and realized that Seller Fulfilled Prime (SFP) was undermining its monopoly control of e-commerce.
13. A top executive couldn’t sleep as he realized that SFP was helping independent shippers compete against Amazon.
14. Amazon realized SFP was like playing without a monopoly moat.
15. Amazon moved to kill SFP after an executive learned that UPS was advertising that its fulfillment service could fulfill Prime orders.
With just the thought of having to compete on the merits, this executive was "losing [his] mind."
16/16. Also fascinating is the fact that at every turn, there's someone inside Amazon saying "don't do this, it's bad for shoppers!" And Amazon does it anyway.
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1. My colleague Ron Knox just published a killer guide to resisting monopolies. It shows that fighting monopoly power isn't just a job for the government — it's something regular people can do every day in their communities and workplaces. microcosmpublishing.com/catalog/zines/…
2. Resist Monopolies! — published by the great folks at Microcosm — weaves together the stories of people across the country pushing back against corporate domination — and winning.
3. The book brilliantly connects today’s struggles to our long, rich history of anti-monopoly activism — and the heroes, then and now, leading the way. It’s an essential read. microcosmpublishing.com/catalog/zines/…
1. How strong are your state’s antitrust laws? Does your state AG have all the tools s/he needs to go after corporate abuse? What can your state legislature do to fight monopolies? ILSR has new resources for you, created by my colleague @ronmknox: ilsr.org/independent-bu…
2. Back in the 19th century, states were the first on the scene when corporations started to amass too much power. They came up with the first antitrust laws, which inspired federal law.
3. Today, states are playing a pivotal role in reviving antimonopoly law. They’re blocking mergers that would hurt workers, investigating landlord collusion to raise prices, suing to break up Big Tech, going after the PBMs that kill pharmacies, and more. ilsr.org/articles/state…
1. Big news! The FTC took action today to end Walmart’s stranglehold on the grocery market. The agency filed suit against Pepsi for giving illegal and unfair price advantages to Walmart while charging competing grocery retailers higher prices. ilsr.org/articles/stacy…
2. It is a violation of the Robinson-Patman Act for a large supplier to collaborate with a big retail chain to help it drive smaller retailers out of business and dominate the market. But for the last 40 years — until now — the FTC declined to enforce the law.
3. Walmart has deftly exploited the lack of enforcement. For decades, it has strong-armed suppliers, demanding special deals while forcing suppliers to hike their prices to competing chains and independent retailers.
1. A hallmark of the dark ages of antitrust was that the agencies often went after small players for collusion if they banded together to survive against a dominant corporation. @linakhanFTC just undid part of that legacy & offered a critique of it. ftc.gov/news-events/ne…
2. During the dark years, antitrust enforcers treated anything that might be deemed collusion among small businesses or other small players as a cardinal sin — even as they viewed the exercise of market power by a single large dominant corporation as benign or even beneficial.
3. The result was a lot of absurdity. Like Monty Python level absurdity. In 2012, for example, the DOJ's Antitrust Division went after book publishers who had attempted to collectively counter Amazon’s near-total monopoly over e-books. ilsr.org/articles/dojs-…
1. For decades, local grocery stores thrived. Then in the 1980s, the government stopped enforcing a key antitrust law. Rapid consolidation followed, giving rise to food deserts & a price spike. Our new graph shows the dramatic impact of this policy shift. ilsr.org/articles/polic…
2. Today, when growing corporate concentration seems to be an inevitable fact in every sector, it’s remarkable to look back at the grocery industry in the period from the 1930s to the 1980s.
3. Competition was fierce during these decades. Competing retailers rose & fell as consumer habits changed and new innovations upended old ways of doing things.
1. The conventional explanations for food deserts—that these places are too poor or too rural to generate enough spending on groceries, or too Black to overcome racist corporate redlining—fail to grapple with a key fact: food deserts didn’t used to exist. theatlantic.com/ideas/archive/…
2. Poverty and ruralness have been with us forever, but food deserts arrived only in the late 1980s. Prior to that, even the smallest towns and poorest neighborhoods could generally count on having a grocery store — and often they had several.
3. The Deanwood neighborhood of DC is typical of the trend. In the 1960s, this high-poverty community had more than half a dozen grocery stores — several that were local Black-owned businesses, plus a Safeway. By the 1990s, there were only two. Today there are none.