Up for debate: Is Amazon getting too big?

Friday, June 30, 2017
 | 
Chris Woodward (OneNewsNow.com)

grocery store aisleA free market strategist says consumers shouldn't worry about Amazon gaining a monopoly on goods and services – because it will eventually be replaced by another innovation.

Amazon recently made a bid for Whole Foods, an announcement that drew the ire of some individuals and groups that say the Internet retail giant is seemingly killing competition and harming jobs. What started as a website to buy books and other items now has a music service, produces its own films, and offers streaming services.

"Imagine getting your pay-TV service, groceries, banking, insurance, etc., all through one company. That's the threat that Amazon poses," Michael Greeson told USA Today. Greeson is director of research at business analysis firm The Diffusion Group.

Iain Murray, vice president at the Competitive Enterprise Institute, isn't concerned at all that Amazon is getting too big.

"Amazon has made its reputation by selling reductions in transaction costs," he explains to OneNewsNow. "Basically it makes the act of shopping for things much cheaper and much more convenient for people.

Murray

"So if they're now going to take this model and apply it to Whole Foods so that you can get delicious food that you want [and get it] more cheaply and more conveniently, then I think that's only a good thing for the American consumer."

Whole Foods has approximately 470 stores. While that's more than its competitor, The Fresh Market, Kroger has nearly 2,800 stores. Based on that, Murray says people are overreacting.

"If anything, what Amazon can do is expand the range of Americans who are exposed to Whole Foods," he continues. "If you love organic ... then in all probability you're going to have a much easier way of getting hold of it if you don't live near a Whole Foods right now."

Murray points out that 20 to 30 years ago, people were worried about companies like Kodak having a monopoly, and later argued that "big box" bookstores were gobbling up the book trade. Today, many of those companies don't exist – and while it may not even exist yet, Murray says something will come along that replaces Amazon.

"It's almost always an innovation that's created outside a big firm and they wipe out the big firms very quickly," he explains. "That's the way the free market works, and there's no reason to get upset about it."

Read CEI's comments on Amazon's plan to buy Whole Foods

Comments

We moderate all reader comments, usually within 24 hours of posting (longer on weekends). Please limit your comment to 300 words or less and ensure it addresses the article - NOT another reader's comments. Comments that contain a link (URL), an inordinate number of words in ALL CAPS, rude remarks directed at other readers, or profanity/vulgarity will not be approved. More details

SIGN UP FOR OUR DAILY NEWSBRIEF

SUBSCRIBE

VOTE IN OUR POLL

After learning the Trump administration is floating new gun laws on Capitol Hill, your reaction is…

CAST YOUR VOTE

GET PUSH NOTIFICATIONS

SUBSCRIBE

LATEST AP HEADLINES

Water rescues underway as Imelda drenches parts of Texas
Israelis contend with prospect of third poll days after vote
US says attack on Saudi oil site was an Iranian 'act of war'
Trump calls new border wall a 'world-class security system'
Striking workers question whether UAW leaders can be trusted
Justin Trudeau campaign hit with 'brownface' photo

LATEST FROM THE WEB

Time to un-tell the Trayvon lies
Princeton study confirms: Gog and Magog a realistic scenario
Virginia public colleges make Asian Americans work harder to get in, study finds
Writer freaks out over people eating delicious Chick-fil-A: 'They’re eating fried chicken SPITEFULLY!'
Violate your oath and turn on American citizens at your legal peril, gun-grabbers

CARTOON OF THE DAY

Cartoon of the Day
NEXT STORY
Minimum wage costing jobs in Seattle

punching into workAn expert on economic policies says a study on Seattle's minimum wage should serve as a reminder of an important trade-off.