The FTC is out for blood! First Google and now Amazon. My understanding of the case against Amazon is that Amazon has become a monopoly and abused it’s market leading status to maintain dominance and hurt the competition.

I will say that I use Amazon frequently. I used to be an Amazon Prime member but I opted to stop membership because I didn’t see any additional benefit. The 2-day shipping was a nice benefit, but with careful planning normal shipping was equally acceptable for me as well. Plus, by going with normal shipping, it not only broke the vicious dopamine reward cycle of buying and getting packages practically next day but also saved me more money since I had to think about whether or not I really needed that item. Plus, many of the percieved benefits to Amazon Prime were “Nice to Have” for me. So I cancelled membership.

Over the years of using Amazon, I have two major issues with Amazon. First, Amazon allows any/all vendors who wish to sell goods. So many of these goods tend to be low priced items from OEM manfuacturers in China that US companies source to get their goods from. What ends up happening is there are multiple “knock offs” of a similar US brand/model that flood the market. With so much choice, it’s hard to even know what to buy because sometimes the Chinese made products by these OEM manufacturers are worse than the OEM manufacturers with US partners. I try to support American companies selling through Amazon but it’s tough trying to find a proper product. Second, Amazon using customer data to also get “in on the market.” Over the years, I’ve noticed Amazon selling their own “Amazon branded” merchanidse whether it’s clothes, office supplies, common electronics and even food items. Amazon’s participation in this market pushes out the small business owners.

I believe Amazon should have a duty to promote US owned and operated companies. Companies should be forced to have a presence in US and pay US taxes if they wish to sell to US consumers. I also believe Amazon should NOT be participating as a seller competing against the other small business owners. I think it’s great that Amazon provides a platform to the business owners seeking an e-commerce revenue source. I also think it’s great that Amazon even provides the inventory and supply chain logistics for small business owners. And in return the business owners pay a fee. However, does Amazon currently pay a fee to itself to store, list, pack Amazon branded products online? I’d be curious to know.

I think Amazon is marching slowly towards a vertical ecommerce integration. First they have the Amazon ecommerce platform. They also built and market their own server and hardware services for other web based platforms. Then they introduced to small business owners the ability to maintain inventory without the warehouse overhead AND also introduce logistical/supply chain management by packing/shipping products to customers. Then they expand into making their own brands of customer goods from clothes to food to electronics. Although Amazon probably will be unable to own manufacturing companies, Amazon’s sheer size allows them to control the manufacturers. Then utilizing the ecommerce platform, inventory management and supply chain logistics, Amazon can easily outsource, outcompete any small business owner.

My solution to Amazon’s problem would be
!) Amazon should just be forced to ONLY provide the tools for ecommerce and not be allowed to participate in it. I believe that will be good for small business competition and is in line with US’s view of “capitalism.”
2) Amazon voluntarily requires foreign sellers list their US base of operations to ensure US taxes can be paid. It woud not affect current US business owners selling on Amazon nor would it affect US owners thinking about selling on Amazon. This requirement would then force foreign OEM manufacturers to spend money/time/resources on establishing an office in US so that taxes can be paid to local, state and federal governments.