Labour Unions Want the FTC To Block Amazon’s Acquisition of MGM

Labour Unions Want the FTC To Block Amazon’s Acquisition of MGM
Photo: PHILIPPE HUGUEN / Staff, Getty Images

In a 12-page letter, four major unions on Wednesday called upon Holly Vedova, the acting director of the U.S. Federal Trade Commission’s Bureau of Competition, to block Amazon’s plans to acquire Hollywood studio Metro-Goldwyn-Mayer.

The letter was penned by the Strategic Organising Centre (SOC), a democratic union federation that represents more than 4 million workers in its four affiliated member unions: the Service Employees International Union (SEIU), the International Brotherhood of Teamsters, the Communications Workers of America (CWA) and the United Farmworkers of America. In it, members express concern that the proposed deal could eventually help Amazon shore up its power in a way that could ultimately deal damage to the market for streaming video-on-demand.

“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,” SOC executive director Michael Zucker wrote in the letter. “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.”

Zucker also outlines the SOC’s worry that vertical integration in the film industry writ large — a particularly pernicious problem in recent years — could help large digital platforms like Amazon “leverage gatekeeper power in one market into multiple other lines of business.”

“This merger presents an opportunity for the FTC to curb Amazon’s expansion of power in yet another line of business and place reasonable limits on how one of the country’s largest and most dominant companies is permitted to compete,” Zucker wrote.

Back in May, Amazon announced that plans were already underway to acquire the legacy film studio in an $US8.45 ($11) billion deal that would potentially add thousands of movies and television shows to its catalogue for its roughly 200 million Prime subscribers. Just one day prior, the company had been hit with a lawsuit brought by D.C.’s attorney general for allegedly violating antitrust law by requiring that third-party sellers not offer better deals for their products elsewhere.