'Amazon Sniper' Lina Khan Now Targets Amazon Web Services

by Kwon Jaehee

Published 23 Dec.2021 11:10(KST)

▲Lina Khan, Chair of the Federal Trade Commission (FTC) [Image source=Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] The U.S. Federal Trade Commission (FTC), led by Chair Lina Khan, known as the "Amazon sniper," is now pushing for an antitrust investigation into Amazon's core business, its cloud services. This move is interpreted as a precise strike targeting Amazon's vital points.

According to the Wall Street Journal (WSJ) and Bloomberg News on the 22nd (local time), the FTC is understood to have launched an antitrust investigation into Amazon Web Services (AWS). The focus of the FTC's investigation is whether AWS, which holds a dominant No. 1 position in the cloud market, used its market-dominant status to incentivize customers to purchase AWS services while discouraging the use of competitors' software. AWS currently holds a 41% share of the global cloud market.

The FTC's decision to target AWS is based on the assessment that AWS's influence is growing. AWS has experienced its third communication outage this month alone, causing cloud service disruptions. On this day, at 7:35 a.m. Eastern Time, a communication failure occurred at servers in the Northern Virginia region, which covers Boston, Houston, and Chicago. This disruption affected clients such as the cryptocurrency exchange Coinbase, streaming service Hulu, and Google's business messenger Slack, causing service interruptions. Previously, on the 7th of this month, AWS experienced a communication outage that paralyzed services for about nine hours.

If the FTC's investigation concludes that Amazon violated antitrust laws in its cloud business, Amazon is expected to suffer significant damage. As antitrust investigations expand not only to Amazon but also to big tech companies in general, there is a higher possibility that business expansion and mergers and acquisitions will face greater restrictions than before.