Walmart and Other Retailers Offer Support to FTC’s Antitrust Probe of Amazon

Amazon’s rivals have expressed concerns over the dominance of major tech companies, offering to help officials in their antitrust investigation of the retail giant.

In a letter addressed to the Federal Trade Commission, the Retail Industry Leaders Association — which counts big-box retailers Walmart and Target as members — called out the Seattle-based online giant and other firms, such as Google, for their control over the majority of internet searches, which can impact how price and product information reaches consumers.

“These firms are extraordinarily adept at determining how small changes in the way in which information is conveyed affect consumer behavior — given that nearly everything they do is driven by big-data science and machine learning models,” the group wrote in the letter dated June 30. “The Commission’s approach to retail markets must thus be driven by a recognition that control over an information bottleneck by such a company has the power to skew markets and shape consumer behavior in ways that circumvent the traditional power of price competition.”

The trade group went further in its complaint against Amazon, particularly its alleged practice of competing with its own third-party sellers by using the data it collects to support its own marketplace. (According to independent analytics firm TJI Research, the retailer now has 140 private label brands — up from only 27 in 2017 — and 511 exclusive brands.)

RILA insists that it “does not file this comment to complain about competition” from leading tech companies such as Amazon, Facebook and Google. “Indeed, retail leaders comment to ask for more competition, not less,” it wrote. “But all competition must be on a fair and level playing field.”

In a statement, Amazon wrote in response to the RILA letter, “The retail market is fiercely competitive. Amazon represents less than 4% of U.S. retail. The vast majority of U.S. retail sales — 90% — still occur in physical stores.”

The FTC and the Department of Justice represent the two United States government agencies tasked with antitrust oversight of Silicon Valley’s largest companies.

Early last month, the FTC took on oversight of Amazon and Facebook in a probe of potential antitrust issues, dividing the task with the DOJ, which is examining similar issues at Apple and Google.

Watch the highlights at the 2018 FNAAs.

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