Is Amazon Creating a Cultural Monopoly?

[Commentary] For months, a group of writers calling themselves Authors United have campaigned, mostly unsuccessfully, against the business practices of Amazon.com. It is perhaps the writers’ lack of legal expertise that has given them the freedom to put forth what antitrust experts described to me as a highly unorthodox argument: that, even though Amazon’s activities tend to reduce book prices, which is considered good for consumers, they ultimately hurt consumers. The authors are, in essence, trying to make the case that Amazon is bad not only for writers, but also for people who buy stuff on the site -- and they’re taking this approach for good reason.

US courts evaluate antitrust issues very differently, nowadays, than they did a hundred years ago, just after antitrust laws were established to keep big corporations from abusing their power. Back then, judges tended to be largely concerned with protecting suppliers from being squeezed by retailers, which meant that, if a corporation exercised monopoly power to push prices down, hurting suppliers, the company could easily lose an antitrust case. But by the nineteen-eighties, the judiciary’s focus had shifted to protecting consumers, leading courts to become more prone to ruling in favor of the corporation, on the grounds that lower prices are good for consumers.