Is Seattle’s biggest company profiting -- or more at risk -- because of the coronavirus epidemic?
“Amazon has become the pipeline for a lot of people to get basic goods during the pandemic because retail stores are shut down,” notes Stacy Mitchell, who has aggressively studied the company’s business practices for years.
She leads the non-profit Institute for Self Reliance, and makes the argument that the company has turned into a monopoly.
“In the case of Amazon's platform, you know, more and more of our commerce is now being done in the context of their platform. And that's a private arena that they control, they set the rules. And market participants there don't have access to a lot of information, whereas Amazon has a godlike view of everything that's going on. They're able to watch all of the transactions, all of the companies, all of the buying and selling that's going on there,” says Mitchell, who lives in Maine, thousands of miles away from the Seattle headquarters.
Mitchell has become one of the company’s biggest critics, pushing for Congress to break up the company. She was recently profiled in the New York Times, and has argued that Amazon has become the platform, and the competition at the same time.
Mitchell notes cases where independent companies have gone to Amazon to sell their goods, and then watched Amazon turn around and sell a like item for less.
“It is really thinking about Amazon as a kind of modern day railroad. And the rail system as infrastructure really needs to be neutral and separate from the companies that compete on it. And so in that sense, Amazon the platform, the online website needs to be separate from Amazon, the retailer on that platform, because it just is inherently a conflict of interest when you run the platform that your competitors depend on.”
Congress is investigating a possible antitrust case, and Mitchell believes it could lead to Federal Trade Commission or Justice Department intervention.
Amazon declined to provide an executive to answer any questions this week, citing the coming earnings report. On Thursday, it cited net sales in the 1st quarter of $75.5 billion, up 26% over the same period last year.
