Retail

Scrutiny Of Big Tech Could Slow Amazon's Deal-Making Pace

Scrutiny Of Tech Could Slow Amazon's Deal Pace

While Amazon has committed over $20 billion to investments and acquisitions as of 2017, the scrutiny of large tech companies by the U.S. government could hamper that pace. The eCommerce retailer’s biggest deal was its purchase of Whole Foods Inc. in 2017 for $13.7 billion, The Wall Street Journal reported.

When the outlet asked about the increased government attention, a spokesperson for Amazon pointed to recent comments from Jeff Wilke, chief of the company’s worldwide consumer division. Wilke said, per the report, “We believe the most substantial entities in the economy deserve scrutiny. Our job is to build the kind of company that passes that scrutiny with flying colors.”

Even though Amazon takes in about half of every dollar spent through the web, Chief Executive Jeff Bezos noted in April through his shareholders’ letter that the firm is still only a small player in global retail. But, as he noted at a conference in June, the eCommerce retailer would take bets on new ventures like satellite internet that “move the needle for us.”

At the same time, the firm has tapped into deal-making to grow in markets abroad that are tough to break into. The company purchased Souq, a Middle Eastern eCommerce retailer, for roughly $600 million in 2017. It was also in talks to obtain a controlling stake in Flipkart for a minimum of $10 billion, per unnamed sources cited in the report. (Amazon lost out when Walmart purchased a stake of 77 percent in the largest eCommerce retailer in India for $16 billion.)

The news comes as U.S. Senator Elizabeth Warren (D-Mass.) has put out a plan to break up large tech firms like Amazon and Facebook. Warren wrote in a blog post in March, “Today’s big tech companies have too much power – too much power over our economy, our society and our democracy.” She went on to explain that nearly half of all eCommerce goes through Amazon, and more than 70 percent of all internet traffic is via sites owned or operated by Facebook or Google.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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