Why the US government and 17 states are suing Amazon?

The Federal Trade Commission and 17 states are suing Amazon, claiming the e-commerce giant is an illegal monopoly that abuses its power to hurt both sellers and buyers. Amazon has vowed to fight the massive anti-trust lawsuit in what will likely be the company’s biggest legal test to date.

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Why the US government and 17 states are suing Amazon?

Well, it doesn’t always work that way in real life. The FTC and 17 states are accusing e-commerce giant Amazon of monopolizing the marketplace and abusing its power. A lawsuit filed yesterday in federal court alleging Amazon overcharges sellers inflates prices, and stifles competition.

William Tong is the attorney general for Connecticut. One of those 17 states in this lawsuit. I know it kind of gets buried in other news right now. Politics is shut down and this is a potentially massive story. This is the 17 states and the federal government yeah.
Going after a massively almost incomprehensible e wealthy and successful company for the folks who only know Amazon and they go to the after on their laptop to order the new toothpaste and a new kids or whatever. Explain in layman’s terms what you all believe, Amazon does. And it’s the everyday user experience that hurts the consumer and makes this a worthy lawsuit.

They’re not just massive, not just use a successful, their dominant right. You talk about all the people that are on the app every single day. That’s all of us. I mean, I love it when I’m on Amazon all the time. so is my wife Sue or my kids? It is dominant in our lives and Roethlisberger along with Amazon thinks success is nothing but massive. What’s wrong is using their market power because they’re so dominant to shut out competitors to kill competition and to make everybody play by the rules. For example, effectively get paid the price and everyone sets for the goods that we look for because they can use that technology to find what competitors are selling goods products for and they can undercut. Then in an instant.

And then the sellers on their platform. They try to undercut each other. Amazon punishes them by denying them access to the Prime Nation, but by denying them the Buy button they punish them by pushing down in the search results to maintain that price discipline. So using that power is illegal and we want to stop from doing so.
Do you think it’s anti-competitive behavior? What do you ultimately hope this lawsuit accomplishes? What’s the goal here is it to break up Amazon. Is it to have a financial penalty change the way it does its business? It’s really to stop Amazon from leveraging that power to shut out competitors to exclude any other people online.

I’m selling products directly to consumers and shining out sellers from other choices using other fulfillment services. For example, other than Prime Amazon’s robust marketing fulfillment and delivery system. That’s one of the things that they do use prime as a weapon. And so if you’re a seller, your small business, your mama popping in Connecticut, you know, in the zone increasingly is really your only option.
But to be on Amazon for your products to be high up in the search results you have to get Prime as a designation to access that shipping delivery service. You know, if we get that vibe you’ve got to do everything, Amazon tells you and pay every fee that it tells you to pay and you have no choice in what ends up happening sellers pay Amazon tax. Huge Amazon tax.

That percentage of what they charge all of and that tax effectively gets passed on And those prices go up and they will go up over time increasingly on all of us. Thank you for giving real-life examples because I think I think money stories are hard to follow for everybody, but understanding where something is when you understand that if it’s prime eligible and are saying that the buy buttons are right there, we all can relate.
Amazon’s with us. Thanks for helping us kind of understand, at least according to this lawsuit, you know, kind of how the system goes on to create what we see and how we see it when we shop. That’s fascinating. So the Amazon statement that was put out, OK, and this is what they’re saying.

I want to get your reaction to this that the FTC’s lawsuit would lead to higher prices. Also slower deliveries for customers. And one of the reasons Amazon is so popular is, of course, that next-day service, which we all love. Let’s face it what is your response to that statement? Will this lawsuit successfully hurt consumers? They’re wrong.
And what we do in the anti-trust space in law enforcement If there hadn’t been an anti-trust enforcement action against Microsoft there would be no Amazon. There would be no Google. It would be known ends wouldn’t exist because Microsoft could have stood in the way of innovation more than a generation ago.

But we took strong action. We open up the market. By the way, Microsoft is the second most valuable company on Earth. Still installment in our lives. And so Microsoft is not worse for wear. We just want Amazon to play by the rules and N for it was not to say 2 were not dominant. We don’t have a monopoly.
Power flies in the face of what we experience and know every single day. All of us, our families live in this gigantic Amazon ecosystem. And they’re in control of everything, we all know what will happen. We want to have choice prices will go up, will be beholden to them. And that’s not good for consumers.

Everything gets that. When you say play by the rules, what specifically do you mean? What would you like to see Amazon do? You know, for example, to get the prime designation you know, to get that vibe and to get your products high on search results, you’ve got to do everything.
Amazon tells you what to do, including using fulfillment service. So that’s that’s on its face. Illegal entry into trust law, which is to engage in unlawful exclusionary, conduct to prevent you as a seller from using somebody else, you know, from shipping for somebody else from going up. using another fulfillment service for delivery service.
Amazon says you’ve got to use it all the way through and if you don’t will punish you. For that, you go into two two-part. question here, why now? Amazon has been a mind-blowing success for years. So why the lawsuit now and 2, what would you tell the person who is watching this right now that says.

I’m but I assume anything that’s that’s that big. And that wealthy. There are always some messages behind the scenes some illegal things. But the bottom line is I want my laundry detergent on Tuesday and I want the new kids to toy there in today’s like Prime Promises So I really don’t care.
Yeah, I think people really want to pay share prices and they don’t want to pay any more than they have to pay. And in a free and fair market. And I think that most Americans understand that things are too expensive already. With the inflationary pressure that we feel the supply chain pressure that we all became acquainted with.

So intimately during the COVID pandemic. We all want access to goods and services blue want them prices. It is in a competitive environment and we don’t want one big player locking the whole market up. so I think people understand that the best thing for all of us as consumers in a global marketplace, is for everyone to play by the rules and for there to be competition, not just for clicks wallets for rivals as well.
And at the end game here, the changes they’re big, fine attention is what’s the punishment? If the lawsuit goes your way? Just 10 seconds. Again, want to play by the rules. I want to stop punishing sellers and competitors. And if they do that, we don’t have a problem.

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