Donald Trump has his administration

looking at Antitrust proceedings

against tech giants Amazon,
Google and Facebook.
What are ANTITRUST laws???
● Antitrust laws regulates the conduct and organization of business
corporations, generally to promote fair competition for the
benefit of consumers.
● These Laws, first, restrict the formation of cartels and prohibit other
collusive practices regarded as being in restraint of trade.
● Second, they restrict the mergers and acquisitions of
organizations that could substantially lessen competition.
● Third, they prohibit the creation of a monopoly and the abuse of
monopoly power.
● The current laws are created before the rise of internet and don’t work
well with these companies.
If these Antitrust laws are for the benefit
of consumers, then why is there an
argument???

Do we need to take actions against

these companies from gaining
monopoly???
What happened in History?
● The most famous example of antitrust was against
Standard Oil Company. John D. Rockefeller owned most
of the oil refineries in US(90%), in the 1890s.
● His monopoly allowed him to control the price of oil in the
market. He also bullied the railroad companies to charge
him a lower price for transportation.
● Consumers of oil were badly affected.
● The govt. used antitrust laws to break the Standard Oil
into smaller parts and remove its monopoly.
Current situation
● Companies fix prices low enough to drive competitors out
of business. Once they had a monopoly on the market,
they would raise prices to regain their profit.
● Amazon business model is based on this principle of
driving out competitors first and then making profit.
● Antitrust laws are not being applicable on Amazon, since
they have not broken the cardinal rule of Antitrust law
Consumer Welfare.
● Amazon has a huge market share in online retail, but it
comprises of many sellers who are competing with each
other to ensure fair trade.
● Amazon is gaining monopoly by not only driving out its
opposition, but also the sellers on its platform.
● Ex - Amazon Basics.
● If a product is receiving a lot of attention, Amazon directly
sells the product from the manufacturer and drives out the
previous seller.
So,
● These companies are companies are gaining monopoly
and power in non-traditional ways.
● So the age old laws are not being able to do anything.
● It is important that governments should step in to control
these companies before they grow out of hand.