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Amazon: Marketplace or Monopoly?
An Insightful Article by the New Yorker
This recent story in the New Yorker, titled "Is Amazon Unstoppable?", dives into questions surrounding the state and future of Amazon. It details how Amazon is a process company, not a product company - after all, it has created processes for selling, fulfilling, advertising, and more. However, it controversially also produces its own products, explained by an FTC commissioner as “both controlling the pipe and selling the oil.” This creates unfair competition for the third party sellers on its platform.
So, is Amazon a marketplace or a monopoly? Is it an example of capitalism at its best or the disruptor of capitalism?
The CEO of Birkenstock Americas notes: “Capitalism is supposed to be a system of checks and balances. It’s a marketplace where everyone haggles until we’re all basically satisfied, and it works because you can always threaten to walk away if you don’t get a fair deal. But when there’s only one marketplace, and it’s impossible to walk away, everything is out of balance. Amazon owns the marketplace. They can do whatever they want. That’s not capitalism. That’s piracy.”
On the other hand, Amazon wrote: “There is abundant competition in the retail sector, and many retailers are thriving. There is no power imbalance between Amazon and the sellers and vendors who work with us.”
As consumers and sellers on Amazon, what do you think? Where do you stand?
Check out what our clients say.
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