Could Amazon be forced to sell its logistics arm?

Controversial plans to break up ‘big tech’ monopolies, which could force e-commerce giants to sell off services such as Amazon Logistics, Google Maps, YouTube and WhatsApp, have been given the green light.

Now that the bills have been approved by the Judiciary Committee, they will progress to the House of Representatives. 

“Make no mistake – the proposals that are being pushed through are significant. Of course, some e-commerce giants have been guilty of poor practices, such as lowering prices to disadvantage smaller rivals, promoting their own products over competitors and even preventing competitors from using their services entirely. Any legislation that ends these abuses is welcome but it’s very important that, in their enthusiasm for reform, US politicians don’t throw the baby out with the bathwater,” argues ParcelHero’s head of consumer research, David Jinks M.I.L.T.

“For example, Bloomberg’s analysis of the legislation reveals Amazon could be forced to sell its valuable Logistics services division, which is the network of warehouses and delivery hubs that power quick delivery of online orders. Indeed, a spokesperson for Congresswoman Pramila Jayapal, who proposed the Ending Platform Monopolies bill, goes further, saying it also has Fulfilment by Amazon (FBA) in its sights. 

“The spokesperson says the bill will force ‘…dominant platforms including Amazon to divest lines of business – such as FBA – where the platform’s gatekeeper power allows it to favour its own services. Numerous third-party sellers reported feeling that they had no choice but to pay for FBA in order to sell their products.’

“In 2015, ParcelHero published an in-depth look at the growth of Amazon and predicted that a global roll-out of Amazon’s then-new logistics service was inevitable, as it would save the company millions in the UK and billions worldwide. Today, Amazon Logistics is a vital tool in fulfilling same-day and next-day orders. If the Monopolies bill passes into law, it would roll back these changes and seriously impact on Amazon’s supply chain and home deliveries.”

For more information, visit www.parcelhero.com