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Retail Business Review | Thursday, April 14, 2022
The market fails to recognize the total value of Amazon e-commerce and Amazon Web Services (AWS) businesses, rekindling discussion about a potential break-up.
FREMONT, CA: In February, Third Point CEO Daniel Loeb, a billionaire activist investor, revealed to investors his conviction that the market is failing to recognize the actual value of Amazon.com's e-commerce and Amazon Web Services (AWS) businesses, reigniting talk of a possible breakup. On the RetailWire BrainTrust, industry professionals debated whether Amazon should remain a single firm, with some arguing that the online behemoth simply by existing lifts all boats. In June, a bipartisan group of House lawmakers proposed antitrust legislation against the major tech platforms, which some speculated could result in Amazon splitting into two websites — one for third-party sellers and the other for first-party sellers — forcing the company to sell its products. Amazon has been accused of unlawfully competing against marketplace vendors and stealing concepts for its private label products from third-party retailers.
In June, a bipartisan group of House lawmakers proposed antitrust legislation against the major tech platforms, which some speculated could result in Amazon splitting into two websites — one for third-party sellers and the other for first-party sellers — forcing the company to sell its products. Amazon has been accused of unlawfully competing against marketplace vendors and stealing concepts for its private label products from third-party retailers.
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Mondofora’s COO remarked that the essential concern about anti-competitive laws is whether one component of the firm obtains a subsidy that permits them to sell their services below cost, giving competitors an unfair advantage. While there are many aspects of Amazon's actions that show excessive negotiating leverage, with numerous documented instances of abuse, the only portion of the Amazon empire that appears to fit the subsidy definition is AWS, which is rumored to produce the majority of Amazon's earnings.
In terms of customer impact, though, some RetailWire BrainTrust were skeptical that a united Amazon would benefit customers in the long run. MKT Marketing Services’ Lucille DeHart opinioned that any separation within Amazon would impact consumers as they get bundled services, such as Prime Video and Prime membership. Amazon is becoming so dominant that it threatens market fairness, but other companies should be ashamed for not embracing innovation sooner. Amazon's profitable divisions allow them to continue to invest in new ventures.
See Also : Amazon Web Services Companies
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