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Amazon walks line as prices keep 'antitrust cops' at bay

By Todd Shields and David McLaughlin, Bloomberg News Published: August 13, 2014
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Amazon.com’s treatment of customers means more to U.S. antitrust authorities than how the largest Web retailer pressures publishers and movie studios.

Typically it’s seen as a good thing for a retailer to pressure suppliers to trim prices as that can lead to better deals for shoppers, David Balto, a former policy director at the Federal Trade Commission, said in an interview.

“The antitrust cops clearly would be on Amazon’s doorstep” if it also was pushing those suppliers to charge competing retailers more, he said. Successfully going after Amazon at this stage “would be breaking new territory under the antitrust laws.”

That hasn’t dampened debate about the tactics Chief Executive Officer Jeff Bezos is using against Hachette Book Group, Walt Disney Co. and film studio Warner Bros. The question is whether he’s pushing Amazon toward the same monopolistic territory that tripped up Microsoft, Standard Oil and AT&T.

“They are getting very close to the line,” said Joseph Tabacco, a former senior trial lawyer at the Justice Department who has worked on federal monopoly and price-fixing cases against mining, electronics and pharmaceutical companies.

A telephone call left at Seattle-based Amazon’s press office wasn’t immediately returned.

Amazon, the world’s largest Web retailer, commands 60 percent of the U.S. e-book sales, a market that is projected to jump almost sevenfold to $8.6 billion as demand for paper books falls, according to Forrester Research Inc.

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