It's easy to make this allegation, but very hard to substantiate it, since there are many factors that influence profit, and just because a company isn't profitable now, doesn't mean that the only way they can become profitable is by starving out their competition and then raising prices. Can you give a single instance of a venture backed startup actually causing price increases after driving out their competition?
How does Amazon empitomise this? What goods have they raised the prices of (and why I say raise, I mean relative to the price before Amazon, not that Amazon merely increased their own prices).
It certainly seems like Amazon is beginning to exercise their strength as a monopsony to gain unfair advantages and extend their business into new areas without actually competing on merits.
I don't see how a single instance of Amazon misusing their monopoly power, equates to price rises across the board. So far I imagine the overall affect of Amazon has been to reduce consumer prices.
Amazon tends to (ab)use their monopoly power through things like shipping costs.
As an emporium of everything, Amazon already has a distinct advantage. Even if prices are higher on Amazon than other e-commerce sites, it makes sense for me to use Amazon because I can get 2, 3, 4 products shipped at once. That can be a big saving.
Additionally, Amazon subsidised widespread free shipping on low-ticket items for many years, in the UK they have only recently gotten rid of it[1].
That free shipping policy, while great for consumers in the short term, did starve out a lot of their competition.
And of course, the larger Amazon gets, the better shipping rates they can negotiate. My orders are now delivered to me by a "Amazon Logistics". It seems they've finally achieved full vertical integration.
