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Illustration: Sarah Grillo/Axios

Amazon is mounting a vigorous defense against the charge that it stifles competition, with founder Jeff Bezos pushing back on critics in his annual shareholder letter and the company modifying allegedly anti-competitive practices in recent months.

The big picture: The top antitrust regulator in the European Union has said her probe of Amazon is “advancing,” while lawmakers, including some presidential candidates, hammer the company in the United States.

Driving the news: In Bezos' annual letter to stockholders Thursday, the Amazon CEO countered two lines of criticism: that his company is strong-arming third-party sellers on its platform, and that it has monopolistic power over the market.

  • “Third-party sellers are kicking our first party butt. Badly,” Bezos' letter said. It pointed to Amazon's investment in Fulfillment by Amazon and the Prime program as "the very best selling tools we could imagine and build" for its third-party merchants.
  • “Amazon today remains a small player in global retail," the letter said in another section. "We represent a low single-digit percentage of the retail market, and there are much larger retailers in every country where we operate. And that’s largely because nearly 90% of retail remains offline."
  • “It certainly looks like they’re concerned about the growing scrutiny on their market power,” said Stacy Mitchell of the Institute for Local Self-Reliance, a longtime critic of the company, who also argued Bezos was downplaying Amazon's power over its marketplace.

Background: Amazon’s critics have ramped up their pressure in recent years, saying the company uses its scale to muscle out competitors in a growing array of businesses.

  • In a 2017 law review article, a then-law student named Lina Khan traced how the company had become a dominant player without running afoul of current antitrust legal standards in the United States.
  • Last year, European Competition Commissioner Margrethe Vestager announced she was probing the company's dual role running a marketplace for third-party sellers and competing against them with its own private label products. (Amazon maintains its private labels constitute a tiny percentage of sales.)
  • Now, Amazon is a regular target for progressives. Sen. Kamala Harris (D-California) told Axios in January, around the time she launched her presidential campaign, that "Amazon should be subject to oversight that protects the dignity of workers and ensures fair competition."
  • Sen. Elizabeth Warren (D-Mass.) released a plan in March to break up Amazon and other tech giants and ban marketplace platforms from selling products on their own service.

Amazon has also pulled back on some practices that have put the firm in the crosshairs of regulators.

  • In March, Amazon stopped banning third-party merchants in the United States from offering lower prices on other sales platforms, after Sen. Richard Blumenthal (D-Conn.) raised concerns about this practice, which was discontinued in Europe under regulatory scrutiny in 2013.
  • It has also stopped a series of special promotions for the private-label products business Warren has criticized on the campaign trail, according to CNBC, although it told the outlet they had been experimental.

"I'm glad Amazon pulled back on some anti-competitive behaviors after I raised concerns about their business model, but I'm still deeply concerned that their own private-label sales on their platform are projected to hit $25 billion by 2022," said Warren in a statement.

  • "That's why we need to separate the Amazon platform from their retail operations."

Go deeper

Scoop: Gina Haspel threatened to resign over plan to install Kash Patel as CIA deputy

CIA Director Gina Haspel. Photo: Win McNamee/Getty Images

CIA Director Gina Haspel threatened to resign in early December after President Trump cooked up a hasty plan to install loyalist Kash Patel, a former aide to Rep. Devin Nunes (R-Calif.), as her deputy, according to three senior administration officials with direct knowledge of the matter.

Why it matters: The revelation stunned national security officials and almost blew up the leadership of the world's most powerful spy agency. Only a series of coincidences — and last minute interventions from Vice President Mike Pence and White House counsel Pat Cipollone — stopped it.

Updated 8 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Coronavirus deaths reach 4,000 per day as hospitals remain in crisis mode — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden says, "We will manage the hell out of" vaccine distribution — Biden taps ex-FDA chief to lead Operation Warp Speed amid rollout of COVID plan — Widow of GOP congressman-elect who died of COVID-19 will run to fill his seat.
  3. Vaccine: Battling Black mistrust of the vaccines"Pharmacy deserts" could become vaccine deserts — Instacart to give $25 to shoppers who get vaccine.
  4. Economy: Unemployment filings explode againFed chair: No interest rate hike coming any time soon —  Inflation rose more than expected in December.
  5. World: WHO team arrives in China to investigate pandemic origins.

John Weaver, Lincoln Project co-founder, acknowledges “inappropriate” messages

John Weaver aboard John McCain's campaign plane in February 2000. Photo: Robert Schmidt/AFP via Getty Images)

John Weaver, a veteran Republican operative who co-founded the Lincoln Project, declared in a statement to Axios on Friday that he sent “inappropriate,” sexually charged messages to multiple men.

  • “To the men I made uncomfortable through my messages that I viewed as consensual mutual conversations at the time: I am truly sorry. They were inappropriate and it was because of my failings that this discomfort was brought on you,” Weaver said.
  • “The truth is that I'm gay,” he added. “And that I have a wife and two kids who I love. My inability to reconcile those two truths has led to this agonizing place.”

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