antitrust
When is time to take antitrust action against Comcast?
When is time to take antitrust action against Comcast?
It’s hard to read about U.S. comeptition law without wondering when Comcast is going to face consequences for its clear abuse of its market power.
Antitrust official inappropriately lauds Amazon's "disruptive business model"
Antitrust official inappropriately lauds Amazon’s “disruptive business model”
DOJ antitrust head William J. Baer, speaking at a London antitrust conference:
By conspiring with Apple, which was seeking a fail-safe way to enter the market, five major publishers and Apple reached an agreement to drive the industry to an agency sales model and seize back control over and raise retail pricing of e-books. The department successfully challenged this conspiracy to quash Amazon’s disruptive business model, forcing the defendants to terminate the contractual agreements they had used to effectuate the conspiracy. Since then, Amazon’s disruptive business model has continued to stoke competition in the e-books marketplace.
That is an inappropriate way for a federal antitrust official to speak about a major market participant. Amazon did not make noise about Apple’s ebooks collusion for the good of its customers. They did it because low prices keep them on top, and because no other company is willing to bear the losses Amazon can endure, there is no end to their dominance in sight.
Apple’s attempt to raise prices in cooperation with five publishers did not end well for the Cupertino company and rightly so, but their motivations were logical. Amazon maintains low prices and therefore the illusion that they are doing customers a favor, and in the long run doing authors and publishers a favor by expanding the pool of would-be customers who can afford ebooks.
However, there is at least some truth to the concerns authors and publishers have expressed about Amazon’s dominance. The company is in a position to decide what books a large majority of book buyers can access. It’s a wise short-term strategy both business-wise and legally because it is as quiet and passive as Apple’s conspiracy was bold and aggressive. But long-term it’s likely to expose the company to regulatory inquiry at a time when Amazon is contemplating things like drone delivery, which will likely face stiffer regulation sooner than later, especially when put to retail use.
Of course based on Assistant Attorney General Baer’s comments at the Chatham House Annual Antitrust Conference, Amazon has at least one friend in a position, and a mindset, to lionize them despite questionable competition strategies.
$22.5M FTC fine against Google for Safari tracking
$22.5M FTC fine against Google for Safari tracking
Michael Liedtke, writing for Associated Press:
In the Safari case, Consumer Watchdog argued that the fine amounts to loose change for a company like Google, which generates about $22.5 million in revenue every four hours.
It’s a very good deal for Google, especially because they don’t need to admit liability. It’s a decent deal from the FTC’s perspective, as well, because it’s (sadly) the largest fine they’ve ever levied in this context. I’m not sure how effective it’s going to be, but if you’re unnerved by Google’s privacy issues, there’s always DuckDuckGo.
Supreme Court Will Address Antitrust State Action Exemption
Supreme Court Will Address Antitrust State Action Exemption
Steve Semeraro at the Antitrust & Competition Policy Blog:
Government actors are charged with a duty to act in the public interest and thus can generally be trusted to restrain trade only when the public will benefit. Private actors, by contrast, are driven by the desire to maximize profit and will thus restrain trade when it is privately beneficial but harms the public interest. On 26 November, the Supreme Court will reenter the fray, hearing oral argument in FTC v. Phoebe Putney Health System.
This is an interesting part of antitrust law: the exemption from antitrust liability for state actors and, in very limited circumstances, private actors acting under the supervision of the state. These issues are more relevant than you may think if you’re not a law student/lawyer/professor/large-scale businessperson.
Consider my recent Amazon prediction, or the reach of international competition law.
Find more information about FTC v. Phoebe Putney Health System at SCOTUSblog, or read the 11th Circuit’s opinion at Google Scholar.
Amazon's "phantom" 20% VAT for UK ebook sales
Amazon’s “phantom” 20% VAT for UK ebook sales
Ian Griffiths and Dan Milmo of The Guardian, quoting ” a contract seen by the Guardian,” presumably between Amazon and one of its UK publishing “partners”:
If the base price exceeds the base price … provided to a similar service then … the base price hereunder will be deemed to be equal to such lower price, effective as of the date such lower price comes into effect.
That’s a good deal, especially coupled with the recent ebooks settlement.
The US antitrust regime is focused on protecting consumer interests. That means that as long as Amazon’s book selection continues to rise and their prices continue to fall, they’re unlikely to see any problems on the competition law front.
That’s probably not good for consumers in the long-run, especially given Amazon’s DRM and control over your devices and library. I’m going to go out on a limb here and predict that Amazon will face some antitrust scrutiny of its own in the next year.