Margrethe Vestager, the European Union's competition commissioner, said concerns had been raised over how Amazon was using data from third-party sellers and whether it was helping the company predict the 'new big thing.'
- The European Union's competition commissioner, Margrethe Vestager, said on Wednesday that the EU had started a preliminary investigation into Amazon over potential antitrust violations.
- She said concerns had been raised over how Amazon was using data from third-party sellers and whether it was helping the company predict the "new big thing."
- Vestager has a track record of taking tech companies to task. She slapped Google with a $5 billion fine in July for abusing the market dominance of Android.
The European Union is investigating another tech giant for potentially shady dealings — this time it's Amazon.
In a press conference in Brussels on Wednesday, the EU's competition commissioner, Margrethe Vestager, answered a question from a journalist about whether the EU suspected Amazon of committing antitrust violations.
She confirmed that her team had launched a preliminary investigation into how Jeff Bezos' company was using data from third-party sellers on its platform. It is not yet a formal inquiry, she added.
Explaining the thinking behind her exploratory work, Vestager said:
"The question here is about the data, because if you as Amazon get the data from the smaller merchants that you host — which can be of course completely legitimate because you can improve your service to these smaller merchants — well, do you then also use this data to do your own calculations? What is the new big thing, what is it that people want, what kind of offers do they like to receive, what makes them buy things."
She said it remained "very early days" as the EU gathered information on the issue, including sending questionnaires to Amazon third-party sellers. Copies of the questionnaire were sent using the email address EC-ANTITRUST-INVESTIGATION@ec.europa.eu, according to reports in Germany.
"We have no conclusions, we haven't formally opened the case, but we are trying to make sure that we get the full picture because we saw it in our own sector inquiry and this is also what a lot of people are talking about by now, so we do the follow-up," Vestager added.
Third-party sellers are an important part of Amazon's income, generating $9.7 billion of revenue in the second quarter of 2018, up 40% year-on-year. The company did not immediately respond to a request for comment.
Amazon is already under pressure in the US over its market dominance. At the end of August, US President Donald Trump hinted that he thought Amazon, among other tech companies, could be a "very antitrust situation," and news emerged in September that US Attorney General Jeff Sessions was open to investigating Silicon Valley giants.
Vestager has a track record of taking tech companies to task. She handed Google a fine of $5 billion in July for anticompetitive practices related to its Android operating system. She also announced in August that her team was launching a review of smartphone chargers, which could spell trouble for Apple. Back in 2016, the EU forced Apple to pay $16 billion in back taxes to Ireland, which the company just finished paying.