Unions Ask FTC To Reject Amazon's MGM Acquisition

A coalition of four labor unions representing about 4 million workers has sent a letter to the Federal Trade Commission urging the agency to block Amazon’s proposed $8.45-billion acquisition of MGM.

The FTC is overseeing the government’s antitrust review of the proposed acquisition. It is also conducting a broader investigation of Amazon’s business practices.

The union coalition, the Strategic Organizing Center (SOC), represents the Service Employees International Union (SEIU), the International Brotherhood of Teamsters, the Communications Workers of America (CWA) and the United Farmworkers.

In a 12-page letter, Michael Zucker, executive director of SOC, contends that the acquisition would “further bolster Amazon’s ability to leverage power across multiple lines of business related to the SVOD market and create further harmful vertical integration in the film industry at large.”



Amazon "has a well-documented history of leveraging its dominance in e-commerce to gain market share in vertically-adjacent markets using a range of unfair and anticompetitive practices,” Zucker continues. “Amazon’s current practices in SVOD and related markets – including leveraging e-commerce power to build SVOD market share, offering Prime Video at below market prices, and exclusionary use of its dominance in the streaming device and cloud computing markets – already raise serious questions of anti-competitive conduct in the specific market that would be affected by the merger.”

“The merger would also create further harmful vertical integration in the film industry at large. The SVOD market has expanded at a rapid pace in recent years. In the process, the production and exhibition of video content has become increasingly vertically integrated. This integration creates a power imbalance between large, vertically-integrated firms and their smaller competitors. It also creates incentives for SVOD providers to limit the content available to consumers via alternative exhibition channels, as well as filmmakers’ access to the increasingly vital content exhibition space that SVOD providers control. SVOD providers’ increasing vertical control also has implications for the integrity and diversity of content available to consumers and, by extension, freedom of expression itself.”

While pushing for a rejection of the acquisition, SOC argued that if it is approved, several conditions should be attached. Those include unbundling Prime Video and delivery and pricing Prime Video at a market rate; providing competitors neutral access to Amazon’s Fire TV Stick device and cloud computing services; limiting the imposition of all-rights contracts on content makers; and requiring that Amazon share viewership data with the content makers with which it contracts.

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