US Congressmen plan to start with Amazon and other giants: either split up or give up their own brand products


Tencent technology news on June 11: members of the US House of representatives are ready to propose bipartisan legislation to require Amazon and other technology giants to effectively split into two companies or give up their own brand products, people familiar with the matter said on Friday.
The bill, which may be announced on Friday, will require Amazon and other technology giants to carry out a structural split, the source said. As part of an investigation into the size and power of large technology companies, Congress spent 15 months investigating. Another bill, also likely to be announced on Friday, is aimed at the ability of big technology companies to use their online platforms to favor their own products.
According to a person familiar with the matter, both bills were signed by Republicans and Democrats. Once announced, more people are expected to join. According to the information obtained by foreign media, the ending platform monopolies act says: “if a platform operator owns or controls a business field other than the platform, and the ownership or control of the business field causes an irreconcilable conflict of interest, the business field is illegal.” The wording in the final draft of the bill may change, the source said.
The proposed legislation needs to be passed by the Democratic controlled house and Senate, which may also need strong Republican support. While Republicans are worried about the power of technology companies, many are skeptical about changing antitrust laws.
The proposed bill is one of the five under consideration to curb the dominance of technology giants, including apple, Facebook, Google, and Amazon. Other bills address competitive threats such as data portability and the ability of large companies to make acquisitions. Most of the legislation is narrowly focused on big technology companies. The definition of Companies in these bills is that their market value must reach 600 billion US dollars or more, their monthly active users must exceed 500000, and they must be important trading partners.
Only four companies – Amazon, apple, Facebook and Google – currently meet the parameters set out in the bill, according to people familiar with the matter, and Congress has investigated big technology companies as well. It is reported that Wal Mart operates an online market and owns its own brand products, but its market value is only $392 billion, so it does not need to be bound by the bill.
Amazon operates one of the world’s largest platforms for third-party sellers to sell goods, but it also competes with these sellers. Its business includes selling similar products under its own brand – products that are often cheaper than third-party sellers. The U.S. Congress said that the platform favors Amazon’s own products, harming the interests of sellers, and accused Amazon of using third-party data to inform its own private brand products. Last year, it was reported that Amazon employees used the seller’s third-party data on its website to launch their own private brand product line.
Amazon later launched an investigation into this practice. “I can’t guarantee that this policy has never been violated,” chief executive Jeff Bezos said at a congressional hearing
If the structural separation bill is passed, Amazon may have to split its business into two separate websites, one for its third-party market and the other for its first-party market, or spin off or stop selling its own products. Amazon’s private brand division has dozens of brands, including 158000 products. In addition, the company has hardware products such as Kindle e-book reader, smart speaker echo, streaming media device fire TV and a range of wearable devices.
Amazon did not immediately comment on the proposed legislation. The company has said that “by definition, big companies are not dominant, and it is totally wrong to assume that success can only be the result of anti competitive behavior.”
Other proposals circulating on Capitol Hill are also aimed at changing U.S. Antitrust Laws in response to the perceived dominance of large technology companies. Another bill targets the self priority strategy of big technology companies. This is a way for companies to use the dominant platform or exclusive data access rights to favor other business areas, such as their proprietary products or services in search results. This may affect Amazon’s retail business and Apple’s app store.
Congress has blocked the expansion of big companies in the past. Because Congress had not acted before, critics of the technology industry turned to federal agencies. Google and Facebook are already fighting antitrust lawsuits, while Amazon and apple are under investigation. Democrats at the Federal Trade Commission also want to explore the agency’s power to regulate unfair competition methods. However, the power is relatively untested and may face legal challenges.
All four companies defend their competitive behavior and say they operate products and services to benefit users. So far, Google, Facebook and apple have not commented on the report´╝ł Compiled by Tencent technology / Wuji)