Amazon's pillars are hit again! Its local business is stabbed

Recently, Bloomberg reported that the U.S. Federal Trade Commission (FTC) is investigating Amazon, which may involve a heavy fine of hundreds of millions of dollars!

According to internal information obtained by foreign media, FTC investigators have frequently contacted Amazon and its surrounding companies in the past period of time, and collected a large amount of competition information related to Amazon Web Services (AWS). The investigation team was very cautious in refusing to reveal the name and content of the investigation to the media and the outside world, but Bloomberg still contacted an insider who indicated that the FTC is investigating whether AWS has a monopoly in the cloud computing market and whether Amazon's use of AWS services to build the Amazon Mall is compliant.

Cloud computing business is Amazon's true pillar business. Last year, it brought Amazon profits comparable to those of its shopping mall business, and the growth was also very impressive. The news that the FTC has set its sights on AWS has a significant impact. After Bloomberg reported the news, Amazon's stock price fell nearly 1% to $3,381.

This is not the first time that AWS has been targeted. The last time we mentioned it was around August, when the EU imposed a sky-high fine of US$888.6 million on Amazon, also because AWS was suspected of violating the EU's General Data Protection Regulation (GDPR).

In comparison, I think this antitrust investigation in the United States is definitely related to the previous FTC's antitrust investigation into Amazon's mall business. The three major businesses of mall, logistics, and cloud computing are intertwined. If we want to ultimately punish Amazon and force it to split its business, we must conduct a comprehensive investigation and collect evidence.

Like the last antitrust investigation into the mall business, there are still many things missing, and it is impossible to make a comparison without combining it with the investigation of other businesses. For example, the previous foreign media report that "the mall concealed its true income" was a trick discovered after comparing it with AWS data.

When collecting evidence, the investigation team will closely refer to the financial report data released by Amazon. In recent years, Amazon has always emphasized that its largest revenue pillar is AWS. In fact, it just made a small move with the cash cow like AWS to make the mall business seem to have less revenue.

According to ILSR statistics, Amazon's 2020 financial report claimed that its mall business (including retail, Prime membership and mall service fees, etc.) had a profit of US$9 billion. This figure is after deducting more than US$15 billion in logistics system infrastructure costs. In fact, Amazon's revenue from the entire mall business exceeded US$24 billion, far higher than the US$13.5 billion of AWS business.

Without an in-depth investigation of AWS data, it would be difficult to pick out this little move by Amazon in the financial report. The FTC has also learned from this lesson and has chosen to continue investigating the cloud computing business, finding the real situation from Amazon's various businesses as a basis for splitting Amazon in the future. It is an indisputable fact that Amazon uses its dominant position to suck blood from both consumers and sellers. In the end, cross-border philanthropists only fatten their brothers-in-law, and they can make a lot of money just by relying on commissions and service fees. The effect of this Black Friday Cyber ​​Monday is obvious to all. Now the environment of Amazon is very bad. If you want to survive in this market, it is basically impossible without some skills.