Margrethe Vestager, the European Commissioner for Competition, announced on Wednesday that the E.U. is opening a preliminary look at whether Amazon is acting fairly in its dual role as a seller of goods and a platform that allows others to sell goods.
Let’s say I’m a third-party seller hawking USB cables on Amazon. To determine how to price and advertise my product, I have to rely on the information I get back from Amazon about how my product performs and the limited amount of information I can see about competitors. Amazon, which also sells its own USB cable under the AmazonBasics label, can see how all USB cables perform, and could potentially use that information in non-kosher ways.
To be clear, Vestager said the investigation was in “very early days” and the E.U.’s competition commission had found no evidence this is occurring. But it does show how seriously Vestager and the E.U. are taking antitrust considerations, and how the E.U. increasingly views data itself as an asset that may need regulation.
“The question here is about the data,” said Vestager at a news conference Wednesday. “Because if you as Amazon get the data from the smaller merchants that you host which can be of course completely legitimate because you can improve your service to these smaller merchants. Well, do you then also use these data to do your own calculations? As to what is the new big thing? What is it that people want? What kind of offers do they like to receive? What makes them buy things?”
American politicians on both sides of the aisle have taken their own shots at Amazon, with Donald Trump blaming the company for overtaxing the United States Postal Service and Bernie Sanders introducing legislation aimed at taxing large companies where employees use federal benefits, citing Amazon fulfillment workers as a primary example. But the FTC, both under Obama and Trump, has shown zero appetite to examine any large tech firm from an antitrust angle. (U.S. lawmakers are willing, of course, to hold public hearings where they castigate the execs of various social networks about why their particular flavor of political messaging isn’t working.)
The E.U., especially under Vestager, is different. She’s racked up a series of impressive wins against the biggest tech companies in the world, including a $7.9 billion fine against Google for its use of its own products in the Android OS and a $2.7 billion fine to Google for giving favorable rankings in its shopping engine. She’s also aggressively pursued Apple about its tax schemes in Ireland and hit Facebook with a $122 million fine for misleading regulators about its acquisition of WhatsApp. She is, in short, the world’s biggest and baddest antitrust enforcer.
The look into Amazon is preliminary, and may turn out to be nothing at all. But global tech companies have to be in Europe to be competitive — their grudging acceptance of the GDPR proved that. And unlike an angry tweet from Trump or a piece of legislation about taxes that would do very little to affect Amazon’s bottom line, Vestager’s competition commission has some real teeth. Amazon and Jeff Bezos will be watching this closely.
