Amazon has its rich hands in just about everything. Early September, Amazon was valued at $1 trillion. Not only does Amazon sell everything, it basically owns everything. In addition to practically leading the e-commerce market, it’s acquired companies in a number of different markets for the past 10 years, with each new investment reaching great success.
Massive growth in companies like Amazon is problematic and monopolistic because they control all platforms and in return, decimate any and all competition. Not only does this severely injure small businesses and entrepreneurs, it is killing innovation. By stifling competition the smaller guys lose, allowing few companies to get their ideas in the marketplace.
In one of its most interesting buys, Amazon purchased Whole Foods Market for $13 billion in June of 2017. The Atlantic reported about an hour after the purchase, Amazon’s stock rose to a valuation of $14 billion, boasting that it essentially bought the company for free.
The company bought Zappos in 2009. In 2014, Amazon purchased Twitch, a game-streaming service that Amazon owner Jeff Bezos brilliantly bought for its cloud computing, in order to get all of Twitch’s 100 million users onto Amazon’s web services, according to Business Insider.
Amazon not only delivers media content – they produce it. Bezos purchased The Washington Post in 2013, according to Wired. It is also quickly becoming the third-largest ad platform in the United States and it could supersede Google and Facebook since Amazon’s business model can track all of its customers’ purchase patterns, according to CNN.
It seems easy for monopolies to accommodate their customer’s needs. They are able to offer better products, provide quicker delivery (in Amazon Prime’s case same day), and lower its prices, driving out all competition. Small companies with great ideas and products may not be able to compete with what Amazon offers its consumers.
In theory, antitrust laws try to protect a free, fair and competitive market from anticompetitive practices of large corporations. Balancing the interests of small businesses and the consumer can be a difficult task.
Being a big business is not a crime, but its tactics can be. Fortunately, the government has shown willingness to intervene when large businesses conspire unfairly.
For example, in July 2013 the courts decided that Apple Inc. and five of the largest publishers in the industry were in violation of the Sherman Act, a law that prohibits “‘monopolization, attempted monopolization, or conspiracy or combination to monopolize.’” In other words, Apple was punished for lowering prices and driving out all competition.
In a lot of ways, big businesses benefit consumers, which can make it difficult to justify enforcing antitrust laws solely for the sake of small businesses. They offer everything that small businesses just can’t. They have stocked products, fast shipping, are usually more convenient and easily accessible to do anything on any device.
However, one company reigning over everything is dangerous, elitist and completely anti-American. If nothing changes in the near future, entrepreneurs will have no chance to earn their place as leaders within the marketplace of ideas.
When monopolies become too big, America risks losing its future. The next revolutionary company never makes it, getting sucked up by some large conglomerate and leaving the world and its consumers with less options. It forces them to buy every good from one large company who profits on the small company’s need, stifling competition and concentrating wealth.