The 14 Juiciest Quotes From the House Antitrust Report

By Gilad Edelman

On Tuesday afternoon, the House Antitrust Subcommittee released the long-awaited report summarizing its findings from a 16-month investigation into competition in online markets. The investigation, which focused on Apple, Amazon, Facebook, and Google, was the first major congressional antitrust activity in decades. The report gives the most thorough look yet into how Congress, particularly the Democratic leadership of the subcommittee, views the power of Big Tech—and how it proposes to solve the problems that power has caused.

At more than 400 pages (and 2,540 footnotes), it’s not easy to summarize, but my WIRED colleagues and I picked out some of the most revealing portions—including newly released internal emails, interviews with former employees, and the subcommittee’s own dramatic conclusions.

Amazon

Illustrating the extent of Amazon’s overly broad approach to identifying the relevant market and its top competitors, in response to the Committee’s request for “a list of the Company’s top ten competitors,” Amazon identified 1,700 companies, including Eero (a company Amazon owns), a discount surgical supply distributor, and a beef jerky company.

One of the key challenges when deciding whether a company is a monopoly is defining the market it competes in. Here, Amazon is trying to play down its dominance in online retail by emphasizing how many companies compete against various lines of its business. But it may have had the opposite effect. When you can claim everyone under the sun as your competitor—and even forget that you own one of them—it’s a sign that you’ve gotten pretty big. The committee report concludes that Amazon has a monopoly share of online retail.

“In 2010, I started working on the Amazon marketplace team … It was widely known that many (10+) of my peers were running very successful [third-party] accounts, where they were pulling private data on Amazon seller activity, so they could figure out market opportunity, etc. Totally not legitimate, but no one monitored or seemed to care.”

The investigation focused on the conflicts of interest that arise from so many third-party sellers having no choice but to do business on Amazon, even as Amazon competes against them with its own products and services. Here, a former employee alleges that Amazon staff used their insight into third-party seller data to unfairly compete against them with their own side hustles.

A 2010 review of its baby formula business identified Amazon’s “most frequently matched internal competitor” as ABCBabyFormula, which “typically … price[d] 15-20% below [Amazon’s] cost” … The document notes of ABCBabyFormula that “manufacturers do not sell to them directly and believe they are sourcing black market stolen goods.” Amazon frequently price-matched, at significantly below-cost, a competitor that it had reason to believe was sourcing baby formula from illegal and potentially dangerous sources—indicating the lengths to which Amazon was willing to go to ensure product selection and, in turn, growth.

Amazon famously operated on thin profit margins while its stock price soared. Selling below cost in order to drive out competition—so-called “predatory pricing”—is technically illegal, but it’s very hard to prove in court that a company is doing it. The House investigation uncovered several internal documents showing how committed Amazon was to selling below cost to undercut competitors, even ones on its own platform.

While Amazon often denies public reporting that it steals and copies technology from young startups, Amazon’s emails suggest that it does replicate some of the startups it meets with or invests in. An email out of Amazon’s Lab 126 regarding Ring indicated that Amazon “could easily replicate all of their hardware to be better, [and] operate in a more secure and robust infrastructure, for a LOT less than [the] cost of buying them.” In the same email chain, Amazon employees wondered “if we move forward with due diligence, then decide not to buy [Ring], could we have legal issues if we go into the market by ourselves as a competitor and materially impact their business?”