2023-09-27 13:31:22
The lawsuit filed by the US competition regulator once morest Amazon will be a litmus test for whether the power of GAFAM can be limited in the United States.
In some ways, the lawsuit once morest Amazon was years in the making. When Lina Khanthen a law student in 2017, wrote “Amazon’s Antitrust Paradox”, a fiery 95-page article published in the Yale Law Journal on the domination of the online commerce giant, the article went around the world. When US President Joe Biden nominated the same Khan (now a professor) President of the American competition authority FTC in 2021, it was clear to everyone that it was only a matter of time before Amazon was in its crosshairs.
The time has come Tuesday. The FTC, along with 17 states, take Amazon to court. Competition watchdog makes a series of arguments to make it clear that Amazon is exploiting its market power to harm both sellers and customers.
Several appeals
If the court follows Khan’s view, set out in a 127-page brief, a number of sanctions are possible: these will financial fineshas the prohibition of certain commercial practicesau dismantling of Amazon by forcing the company to sell its activities.
Khan argued in favor of the latter solution in his 2017 article, although the likelihood of a judge taking such a drastic step is considered rather low. Especially since observers point out that the complaint relates more to Amazon’s behavior than to its corporate structure.
This trial will be a litmus test of whether the power of GAFAM can be limited, as the Biden administration wants.
Litmus test
Amazon is not the first web giant to be challenged by the FTC. The organization had already protested once morest the takeover of the gaming company Activision by Microsoft, as well as once morest the takeover of the company VR Within Unlimited by Facebook’s parent company, Meta Platforms. The court rejected the FTC’s arguments in both cases, which did not harm Khan’s reputation.
In other words, this complaint once morest Amazon, Khan’s arch-enemy, is not limited to breaking the monopoly power of the e-commerce platform. It will be a litmus test to determine whether the power of GAFAM can be limited, as the Biden administration wishes. It’s up to Khan to prove she can achieve this presidential ambition.
If it fails to do so, resistance to the web giants might die much sooner than expected. But if it succeeds, it might have serious consequences on the American technological landscape. Here and there, comparisons are already being made to the lawsuit that the FTC filed once morest Microsoft 25 years ago. “The fact that the competition authority won even a small victory was enough to break the power of the software company and allow 1,000 startups to prosper,” recalls David Streitfeld, a writer specializing in technology, in the New York Times.
It remains to be seen whether Khan can pull off such a “Microsoft moment” a quarter of a century later. Amazon’s combative response clearly shows that the multinational will not let this happen.
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