SEATTLE (dpa-AFX) - Amazon's proposed takeover of MGM is under fire again after the appointment of Lina Khan as the chairperson of the Federal Trade Commission by the White House. The deal is supposed to open up a 4000 plus video library including films and TV series for the Amazon-run streaming service, Amazon Prime Video.
Lina Khan, an associate professor of the Columbia Law School, had published an article in the Yale Law Journal in 2017 against the monopoly of giant corporations titled Amazon's Antitrust Paradox. Khan took a step back into history to say that the Sherman Law of 1980 and the Clayton Act of 1914 had more to talk about than just 'predatory pricing' to undercut the competition. She said, 'Congress enacted antitrust laws to rein in the power of industrial trusts, the large business organizations that had emerged in the late nineteenth century.' The employment of Khan is seen as a long-impending attempt to empower the FTC.
Companies doing sizable mergers are made to submit their applications to the antitrust watchdogs who scrutinize the merger for possible monopolizing elements that can hurt the free market. However, giants like Amazon, Google, and Facebook are often exempted from these steps as they provide the services at a much reduced cost, thus contributing to welfare.
FTC usually shares this role with the Justice Department. The two departments had in a failed attempt tried to block At&T's acquisition of Time Werner in a staggering $85 billion deal.
Amazon's acquisition is going to be the companies second most expensive business after the company acquired Whole Foods for $13.7 billion. The move will allow the tech giant to add films like the James Bond franchise, Pink Panther, and TV series like 'The Handmaid's Tale' and 'Vikings' to its already vast library. This will help them take a step forward in the competition against the likes of Netflix and Walt Disney.
Another deal under process is the WernerMedia and Discovery merger worth $43 billion which, the insiders believe, can take up to a year under scrutiny. The agency's ability to block such a deal is still in doubt as Walt Disney Co.'s acquisition of Fox and the AT&T-Time Werner deal got the green signals despite strong antitrust issues.
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