FTC Expands Amazon Antitrust Probe To Include AWS: Report

A new antitrust probe of Amazon Web Services is the latest in several moves by the U.S. government to look at potential anti-competitive practices by the IT industry's largest on-line companies.


The U.S. Federal Trade Commission is expanding its antitrust probe of Amazon's retail business to now also include Amazon's cloud business unit, Amazon Web Services, according to Bloomberg.

FTC investigators have been talking to software companies about AWS' business practices, Bloomberg reported, citing people familiar with the matter. This would represent an expansion of the FTC's probe into Amazon's online retail business.

AWS has a 48 percent share of the public cloud business versus a 16 percent share for Microsoft, according to Gartner. Alibaba (8 percent), Google (4 percent) and IBM (2 percent) also compete in the space.

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AWS posted net sales of $9 billion for its third fiscal quarter 2019, or nearly 13 percent of Amazon's total sales. AWS sales were up nearly 35 percent year over year. However, AWS operating income in the quarter of $2.26 billion accounted for nearly 72 percent of the company's total operating income of $3.16 billion. The quarter ended Sept. 30.

Amazon Web Services declined to provide further information.

The investigation into AWS is only one of several moves by the U.S. government to examine whether tech giants are potentially abusing their market positions.

The U.S. Justice Department in July said it is looking at how multiple unnamed market-leading online platforms to see how they achieved their market power and whether they are engaging in practices that have reduced competition or stifled innovation.

Possible targets of that probe include Apple, Amazon, Facebook and Google.

A month earlier, seven U.S. senators wrote letters to the FTC and the Justice Department for details of their investigations of those four companies following earlier reports of the potential investigations.

A U.S. House of Representatives panel, the House Subcommittee on Antitrust, Commercial and Administrative Law, in September followed up those probes with an eight-page survey asking the online companies about their industry's competitive and regulatory environments.