The government must recognizes that new market entrants can't compete if the existing giants are allowed to deploy whatever competitive practices they want.
But would Google, for example, have gotten as far had the Department of Justice not pursued antitrust litigation against Microsoft in the late 1990s? Unlikely. Microsoft's overwhelmingly dominant market power and position would have allowed them to force computer manufacturers to use Internet Explorer instead of Google.
The same problem holds true today. Amazon, great as they are, will ultimately falter. They're subject to gravity just like everyone else. And then either one of two things will have happened: it will have been feasible to invest in potential competitors to Amazon, dozens will have emerged, a few will succeed and they're ready to replace Amazon as a major employer.
That's where the FTC comes in. Their job isn't to wag their finger at big businesses and tell them that making money is evil . Their job is, yes, to protect current businesses who are forced to both advertise on Amazon and to accept far worse placement in each product search because they can't afford not to be on the platform.
When the case goes to court, Amazon will argue that none of their practices violate existing regulations. If they manage to make that case successfully, good for them. But as an early stage investor, I need to at least see that the government recognizes that new market entrants can't compete if the existing giants are allowed to deploy whatever competitive practices they want. If there's no rule of law, there's no future market worth betting on.
Whether or not FTC succeeds in court, the lawsuit's very filing shows that the agency at least recognizes that what's good for tech giants and their current investors is not necessarily what's good for tech startups and the economy's long-term needs. That's exactly the kind of regulation – and regulators – we both want and need.
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