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Oregon joins FTC lawsuit to break up Amazon

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Eric Tegethoff

(Oregon News Service) Oregon is one of 17 states to join the Federal Trade Commission in its lawsuit to break up the online retail giant Amazon.

The FTC has brought an antitrust suit against the marketplace behemoth, charging the company with illegally maintaining a monopoly.

Ron Knox, senior researcher at the Institute for Local Self-Reliance, said half of online sales happen through Amazon's website, meaning small businesses have to play by Amazon's rules if they want to reach potential customers.

"What Amazon is accused of doing is essentially abusing and ripping off those small businesses, those third-party sellers that have to be on in order to reach the customers," Knox asserted. "It does that through these ever-increasing and often exorbitant fees that it charges."

Knox pointed out Amazon also stipulates third-party sellers cannot sell their products for less than what they sell on Amazon's website, which leads many people to buy through Amazon, especially if they have free shipping through its "Amazon Prime" membership. The company countered if the lawsuit succeeds, it would actually hurt consumers by leading to increased prices and slower shipping.

Knox noted the FTC is using a straightforward application of antitrust laws in this suit.

"It says, 'You can't have a monopoly and use illegal and illicit tactics to maintain or grow that monopoly power. You have to let other people compete,'" Knox explained. "What the FTC is saying is that Amazon, through its actions, is not doing that."

Knox believes if courts rule in favor of the FTC and the 17 states in the lawsuit, consumers will see the difference.

"When they see the lower prices, when they see new marketplaces entering, when they have different and innovative ways to ship their goods -- to get goods shipped to their house, and the small businesses can respond to that need -- I think it's going to make for a better marketplace," Knox stressed.

This story was produced with original reporting from Sonali Kolhatkar for Yes! Magazine.