US Senator Elizabeth Warren has proposal to break up Amazon
The US presidential candidate proposes a plan to break up big tech corporations.
Why does Elizabeth Warren want to break up Amazon?
Senator Warren outlined her proposal in a blog post on big tech companies like Amazon that she perceives as monopolies. In a blog post, Warren wrote about how she would split the corporations.
‘The steps I’m proposing today will allow existing big tech companies to keep offering customer-friendly services, while promoting competition, stimulating innovation in the tech sector, and ensuring that America continues to lead the world in producing cutting-edge tech companies,’ wrote Warren.
‘Here’s what will change: Small businesses would have a fair shot to sell their products on Amazon without the fear of Amazon pushing them out of business,’ wrote Warren.
Warren’s first step would be to break up different aspects of a company through legislation. For example, Amazon Marketplace, a third-party vendor would have to split from AmazonBasics, the company’s personal brand.
Second, she would appoint regulators to stop mergers between tech companies, like Facebook’s acquisition of What’s App.
‘Google couldn’t smother competitors by demoting their products on Google Search. Facebook would face real pressure from Instagram and WhatsApp to improve the user experience and protect our privacy. Tech entrepreneurs would have a fighting chance to compete against the tech giants,’ wrote Warren.
Could Elizabeth Warren succeed in breaking up Amazon?
There is scepticism that Warren’s plan will pass in the US Congress. Herbert Hovenkamp, professor at the University of Pennsylvania law school, said that the proposal may not pass before the next election.
‘It won’t pass before the next election for sure and I think there’s going to be a lot of pushback even within the Democratic party and the reason is these broad-scale divestiture or breakup provisions are likely to produce much higher prices,’ noted Hovenkamp.
Regardless of the outcome of the proposal, Warren has sparked discussions about how powerful tech companies should be.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
European Central Bank meeting
Learn about how the ECB meeting affects interest rates and price stability ahead of the next announcement on 24 October 2019.
- How might the next meeting affect the markets?
- What are the key rate decisions to watch?
- Why is the Governing Council announcement important for traders?
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.