The authors of the Guild of America West, Public Citizen, People’s Parity Project and 31 other groups have called on the U.S. anti-terrorism organization to block Amazon acquisition of MGM Studios “to reduce Amazon’s growing dominance”.
In a letter to the Federal Trade Commission (FTC), the groups criticized Amazon’s decision to acquire a movie and television studio behind James Bond, Legally Blonde and Shark Tank. “It is the latest step in Amazon’s major decision to create more integrated governance centers for businesses and consumers,” the letter said.
“With the acquisition of MGM Amazon will be able to control the content it needs, as well as the control of additional advertising rights and intellectual property (IP) that allows it to expand its reach to consumers and other businesses,” warns the letter. “This increases Amazon’s ability to lock consumers out of its wide range and punish businesses and employees who do not comply with its requirements.”
The FTC has launched an investigation into the deal in July, Reuters reported. In addition to reviewing the merger, the agency is investigating Amazon as part of a series of ongoing investigations into Big Tech.
On May 26, Amazon said it would buy MGM for $ 8.45 billion, making the deal an e-commerce giant for the second largest after buying wholesale groceries for $ 14 billion in 2017.
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If Amazon were allowed to have MGM, consumers would be forced to subscribe to Amazon Prime because much of the content would be exclusive to it, rather than available on most platforms, the book said. Businesses will also face significant pressure from Amazon.
The letter warned that if the deal was approved, Amazon could destroy its competitors from its Fire TV products by denying other platforms to broadcast access to its content.
Amazon’s IP control over MGM content including sequels or gaming rights will allow it to continue to exercise power over its e-commerce platform, it said.
“Amazon may compel competitors to prioritize Amazon content and product placement within non-Amazon products in order to gain access to content or IP rights,” the letter said.
It also raised many concerns raised by senators including Elizabeth Warren who asked the FTC to completely review Amazon’s MGM acquisition.
Warren has asked the FTC to consider the potential for competition in the broadcasting services and entertainment products. Anti-trust watchdog should also look at “the broader implications that this transaction could face for employees, small businesses, and global competition as Amazon – already dominating many markets – accelerates its operations independently,” said senator in his letter FTC Chair Lina Khan.
In June Amazon requested that Khan be withdrawn from anti-trust issues related to a major online marketing company because of research he had done with his former lawyer.
Senator Amy Klobuchar also warned that the MGM merger “has the potential to affect millions of consumers”. At the House, Representative David Cicilline said the agreement “strengthens what we already know – [Amazon] is focused on expanding and focusing on their power to govern”.
There was ample evidence that Amazon was using the combined elements of its platform as a cudgel against its competitors, the letter said.
“The proposed MGM acquisition will enable the potential to exploit additional weapons that could be used by consumers, businessmen, and workers,” concludes the letter, calling for a halt to the merger and further investigation into “Amazon’s widespread environmental abuse.”
