Don’t make Amazon a monopoly

[Commentary] Whoever thought up Amazon’s latest idea for squeezing other retailers – offering money off to people who scanned prices in US stores with its smartphone app and then bought the goods on Amazon – deserves an award for bad timing. Amazon’s $5 offer is a textbook example of why the Supreme Court changed US antitrust laws four years ago to discourage free-riding by discounters. It has caused outrage among retailers and politicians at a time when Amazon needs all the political support it can get.

While Amazon is blithely using its rivals’ property as a storefront, it wants antitrust authorities in Europe and the US to help it control the e-book market. The European Commission and the Department of Justice have launched twin probes, provoked by deals under which publishers set prices for their e-books rather than letting Amazon, Apple and Barnes & Noble do so. The chances of the European Union abolishing such “agency” deals as an illegal form of price-fixing are significant but it should hold back. As the US accepts – and the e-reader case shows – it can be good for consumers if suppliers price their products as they wish rather than giving a distributor free rein.