Not that I agree with this argument, but I imagine Amazon might claim that Alphabet was essentially doing the same thing with Stadia, Youtube Game streaming, the Play store, and presumably cloud offerings (I don't know that one for sure though).
Though I suspect the claim that "We at least compete with this other giant tech company hell bent on crushing competition" is probably not the most sympathetic argument in the current antitrust atmosphere.
Also probably the addition of Lina Khan to the FTC who has a more aggressive stance on antitrust than regulators in previous years. See their recent filing against Meta's acquisition of a VR fitness co
Other than Twitch (and maybe AWS, I don't know enough), none of those are monopoly or capable of anti-competition. Even twitch has youtube as alternative
I didn't intend to mean they are the monopoly within their market segment but what's stopping Amazon from creating a game and locking others within their segment out
1) that's only available on Luna sold via Amazon
2) DLC only downloadable with Twitch participation/Prime membership
3) Amazon force EA to use AWS
Instead of making their product compete with their 'competitors', they buy the customers (EA) and force them to use their product. At that point, taking AWS for example, GCP/Azure are no longer 'competitors' and if the end-consumer (me and you), want to play a title, we pay extra because there's no competition in the chain...
>5, Amazon runs the platform that creates the games - EA
"The Games" - No. Some games yes. The people I game with pretty much despise EA and look at them as the company that buys up smaller studios and destroys the culture.
Agreed. I think EA has really popular sports games, however I can't recall the last EA game I played. It might be Titanfall 2?
There's also BioWare - but their last few releases have been disastrous.
Edit: Oh, more recently I loved the Command & Conquer remaster - that maybe counts as an EA game? It was published by them, but I don't think Peteoglyph is owned by EA.
It is a Big Tech consolidation. If the Microsoft, Blizzard and Bethesda isn't an example of consolidation (Which is clearly is) with also Amazon's acquisition of One Medical, then nothing is.
The FTC probably knows it is overdue to break up the Big Tech takeovers, but needs more evidence of this consolidation and behaviour to outright prevent more of this and eventually break them all up.
A large part of it is the political convenience of corporatism. It's easier to "regulate" 1 massive company - hell, they'll do it for you too so you help them guarantee they'll be the only game in town.
It's a lot harder to regulate 1000s or multiples of 1000s of smaller businesses.
Regulation also includes targeted political censorship in this case.
"Standard Oil dominated the oil products market initially through horizontal integration in the refining sector, then, in later years vertical integration"
They were technically horizontally integrated too, since the entire reason they were able to exist is situations where jobs like mining were created in isolated areas with no other places to live.
Workers had no other options but to live in that company town and spend their money in company town stores.
All vertical integration means is that a company has direct control over most/all of the supply chain they need to get their product made and sold. They don't need 3rd parties to supply them with any of the steps in the process.
That obviously gives them a competitive advantage, but it doesn't involve directly removing other competitors the way horizontal integration does.
I'm not so sure that vertical integration is much more innocent than horizonal. Once a single company dominates an industry it has negative effects on the competitiveness of that and adjacent markets.
The incentives become perverse once relatively unrelated businesses are combined. History also shows conglomerates don’t out perform the stand alone companies and it hurts competition and innovation.
I think there’s a certain point where executives run out of ideas but have to be doing something. Then you have investment bankers and advisors pushing these ideas and copycatting each other for that sweet, sweet commission payday.
And it’s not so much that these are great ideas, it’s can they sound okay enough to get that payday before everyone realizes it was all a stupid waste of time five years later. That is, after the acquired company gets its souls sucked out, the talent leaves, and the acquirer discards the husk at a discount.
It self-corrects on generational timescales, which is arguably not good enough. The last "fad" of conglomeration happened in the "go go years", and a generation of business and finance types learned it was a bad idea. Now those people are all retired and a new generation is learning the lesson.
It's not stretching the narrative at all, this is exactly how the executives think at Amazon. Everything must be connected and used to showcase the other parts of the business.
> Amazon runs the platform that sells everything so they shouldn’t be allowed to buy anything.
The issue isn't Amazon buying something.
The issue is Amazon buying something to force them to use their services hence circumventing competition.
EA may previously have used GCP to host their services because they provide a better service and are cheaper.
This forces AWS to do better to compete against GCP and the end-consumer purchasing the game will pay less.
None of these are monopolies. Twitch and AWS are biggest players in their fields, but both have healthy competition
I think it would be way easier to make a case that Microsoft shouldn't be able to buy Activision. It seems like major gaming studios are slowly getting acquired by either Tencent or Microsoft
Vertical integration used to be just as strictly limited for competitive reasons. We know it’s bad, just look at how Amazon leverages it’s sales data to compete against products it sells. They undoubtedly do the same thing with AWS and every other business they own.
They dont have a payments processor yet. Someone tell Jeff
But also: do they disallow competitors to use their services/sell their games? AFAIK antimonopoly litigation requires the existence of an actual market obstruction, not its hypothetical existence.
A million dollar startup could own their servers, run a social platform, develop games, sell merch and license some IP on the side. I didn't say they would actually compete significantly with Amazon. Just that you didn't have to operate at a monopoly scale to control a significant portion of your business stack.
Why? I'd argue a world in which succeed to make vertical integration minimal would be a better one, with less manipulation and corporations vying to become states.
A word with minimal vertical integration is a world filled with middlemen and rent seekers.
The alternative to VI is every single piece of your stack is another company seeking its own piece of whatever pie you’re building (and that company in turn facing the exact same dilemma — nobody builds original things anymore, it’s b2b saas Lego all the way down)
There's quite a lot of legroom between a moderate amount of vertical integration where you attempt to own key parts of your supply chain and being a megacorporation which owns absolutely every piece of your stack, including towns for your employees.
I'm suggesting the optimum for human freedom, welfare and prosperity is achieved when striving closer to the former rather than the latter, not that companies should strive to depend on others as much as possible.
(Though my use of "minimal" in the original post might've been misleading.)
It is illegal for businesses to act together in ways that can limit competition, lead to higher prices, or hinder other businesses from entering the market.
If you run a business selling hosting services for game publishers to run their games, is it not anti-competitive for a competitor of yours to buy your customers and force them to use their services instead of yours?
2, Amazon runs the platform that people use while playing the games - Twitch
3, Amazon runs the platform that hosts the servers to play the games - AWS
4, Amazon runs the platform that you play the game on - Luna
5, Amazon runs the platform that creates the games - EA
how is this not anti-competition for anyone running a company that competes in only one of these fields..