Has Amazon become too powerful

examination : That's how powerful Amazon is

Jeff Bezos has risen to become the richest man in the world. In the German online trade alone, almost half of sales are now accounted for by his Amazon group. The “Amazon Watch Report”, published for the first time, examines how dominant the company is on the basis of market power in various industries. It was created by the University of St. Gallen in cooperation with Payback, the management consultancy Etribes and the agency factor-a, which specializes in Amazon. You have calculated your own index value, which indicates how great the dominance is in the respective area. It is highest for books with 7 out of 10 possible points. Here Amazon has a market share of almost 20 percent.

But the company also has more than 16 percent of electronics and computers, toys, baby items, sports and leisure. The dominance is lowest in the fields of drugstore & beauty, clothing & shoes, and groceries.

Amazon's next destination is the healthcare industry

"The report shows that Amazon's dominance has become a threat to many retailers," says Payback managing director Dominik Dommick. “And Amazon is striving for ever greater dominance”. It is probably no coincidence that the discount provider dedicates itself to the analysis of Amazon, because the relationship between the companies is ambivalent: Previously you could also collect Payback points on Amazon, but the partnership ended in 2014.

But it is clear that Amazon continues to expand. The latest goal is the health sector: Amazon recently bought the online pharmacy Pillpack. The group, which once started as an online bookseller, is advancing into more and more areas. In addition to trading in all its breadth, there is its own music and video service. There, the group invests large sums of money in film or now sports rights or in-house productions. Observers suspect that this area is cross-subsidized; it then serves more as a customer loyalty tool via the Prime premium program.

Does Alexa serve customers or Amazon?

"But it is problematic when a dominant company, especially a platform operator, uses coupling strategies to create incentives for customers not to switch to another platform," said Heike Schweitzer, co-chair of the Competition Law 4.0 Commission recently in Tagesspiegel. “From this point of view, Amazon Prime can possibly have negative consequences for the competition.” And with another innovation, the Alexa voice assistant, Schweizer has doubts as to whether it always serves the interests of customers or rather those of Amazon.

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