Better Boundaries


Article from Issue 270/2023

Is the whole high-tech scene imploding? If so, it won't be the first time, but every time it implodes, it comes back a little different, so even temporary implosions are relevant.

Dear Reader,

Is the whole high-tech scene imploding? If so, it won't be the first time, but every time it implodes, it comes back a little different, so even temporary implosions are relevant. The layoffs continue, with more pink slips circulating through the tech giants. Meta announced another round. Microsoft sent away the remnants of its ethics and society team. Members of both parties in the fractious US Congress are clamoring to reign in the power of big tech. Where will all this lead? At least for this news cycle, all eyes are on Amazon.

The number of ongoing investigations into Amazon practices is really quite extraordinary [1]. The probes include antitrust, privacy violations, deceptive advertising, and so-called dark patterns (manipulative tricks played within a user interface to make the user spend money, sign up, or stay signed up when they want to quit). Of course, in such cases, the subject is always innocent until proven guilty; however, given the current state of public opinion, the pressure is for the government to make something stick.

The antitrust issues are the most uncertain, and they could have the biggest implications. Amazon has been under scrutiny for years with its massive share of the online retail market. What is it? A free market for all products, or a captive market for its own products? The problem is, Amazon is both, which isn't illegal, but if they use their power to preference their own products over others, it could mean trouble. The US Federal Trade Commission (FTC) is currently reviewing whether to nix Amazon's recent purchase of iRobot, a company that makes robot vacuum cleaners that are sold over Amazon's platform, as well as its purchase of One Medical.

Privacy investigations are also nothing new for Amazon. According to reports, current investigations include a look at the Ring doorbell camera, which tells you who is at your front door (and also, allegedly, tells Amazon who is at your front door). And Alexa, that cute little desktop assistant that plays favorite pop songs on demand? She is under scrutiny for alleged violations of the Children's Online Privacy Protection Act.

An investigation from the FTC is not exactly like a lawsuit from the US Department of Justice Antitrust Division, but it could signal a more hawkish stance regarding the venerable tech tradition of big fish getting bigger by swallowing little fish. On the other hand, the Antitrust Division seems to be on the trail also.

Amazon's reach into our lives is truly breathtaking. From the retail items you buy online, to the colossal Amazon Web Services business, to Amazon Prime Video and Music services. The company also owns lots of other companies and products you don't even know about, and they even recently purchased MGM Studios. Their massive size and penetration into so many different markets makes it quite difficult to keep an eye on them. Businesses, in general, often push the limits to maximize profit. Ideally, they don't break the law, but sometimes, especially in industries that are still relatively new, the distinction between pushing the limits and breaking the law is not always clear. It is up to the government to define where the limits are, and that can take lots of energy, resources, and patience. These kinds of investigations help to stake out those limits, and in the long run, that could be good for Amazon and the industry in general, because clearer boundaries lead to better behavior – and ultimately, better protection from future investigations.

Joe Casad, Editor in Chief

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