A coalition of 34 progressive advocacy groups,
led by Demand Progress, on Tuesday sent a letter to Federal Trade Commission Chair Lina Khan urging the FTC to block Amazon’s acquisition of MGM Studios “to slow Amazon’s
growing dominance.”
“This acquisition is not simply a one-off deal for streaming content; it is the latest move in Amazon’s overarching strategy to create numerous
interconnected points of dominance over businesses and consumers,” states the letter. “We applaud the Commission’s investigation of this merger because it is a clear example of
Amazon’s larger pattern of monopolistic practices... [Amazon] has a long history of combining and utilizing its many businesses together as an integrated whole to weaponize them against workers,
businesses, and ultimately consumers.”
The proposed $8.5-million acquisition, announced in May, is part of Amazon’s push to pump up content for its Prime Video streaming
service, which is one important draw for its lucrative Amazon Prime membership program.
Following the MGM acquisition announcement, Sen. Elizabeth Warren (D-Mass.) urged the FTC to
conduct a “broad” and “meticulous” antitrust review of the proposed deal.
In July, the FTC opened an extended probe that could last six months or more.
Earlier this month, a coalition of four labor groups sent the Commissioner a
similar letter urging rejection of the deal.
This latest letter’s timing was “hastened” by events around a proposed $2.5-billion merger of two big U.S. food
distributors, according to The Information.
In May, Core-Mark Holding announced a deal to acquire Performance Food Group. On Aug. 11, Core-Mark announced that the waiting period
required by the HSR Act (Hart-Scott-Rodino Antitrust Improvements Act of 1976) had expired, and —although the FTC sent them a form letter on Aug. 9 stating that its investigation of the merger
"remains open and ongoing" despite that expiration — the companies now plan to close the deal by early September latest. Originally, the deal wasn’t expected to close until the first half
of 2022.
The lack of a formal challenge by the FTC “surprised both of the companies, as well as some of FTC Chair Lina Khan’s key allies, who had expected her to challenge
any major attempt at corporate consolidation,” writes The Information, adding that it’s clear that “Khan’s allies — and not just her foes — are scrutinizing
every move she makes.”
After announcing the MGM deal, Amazon petitioned the FTC to try to force Khan to recuse herself from investigating or prosecuting antitrust actions against
Amazon, asserting that Khan had “built her academic and professional career in large measure by pronouncing Amazon liable for violating the antitrust laws.”
To date, the FTC
has declined to comment on the petition, and Kahn has not recused herself from the matter.