Amazon's World Domination is Great for Consumers, Bad for Everyone Else

The company wants to control everything bought, sold, and processed -- including mobile payments and even your local babysitter.

Amazon's goal is simple: It wants a cut of everything bought, sold, or processed. It wants to sell everything bought or processed, to help you buy everything sold or processed, and to process everything bought, sold, or processed. It's the anti-Lloyd Dobler of American companies, and if Cameron Crowe ever directs a dark, dystopian, Bizarro World sequel to Say Anything, Amazon could star.

Reuters reported Tuesday that Amazon plans to launch a marketplace for local services--think Angie's List, but conveniently located right there on Amazon. That comes on the heels of the news that Amazon will manage subscription payments for startups, as an alternative to PayPal. Since Amazon already has 240 million consumers' credit cards on file, give or take, the company can process your phone bill for Ting (one of its test customers) or a digital music subscription. Just as Facebook wants you to log in to every site under the sun with Facebook, Amazon wants to put a "Login and Pay with Amazon" button everywhere you might want to buy something.

It's pretty genius. Amazon is already great at burning both ends of the commerce candle: On the back end, it's happy to host your e-commerce site or mobile app on its S3 service, as well as warehouse and fulfill orders for third-party products and sellers on Amazon.com. If it can start nabbing a slice of each transaction from a stable of partners selling things on their own sites (especially recurring payments like subscriptions), Amazon will basically be the Mafia don who gets his cut from all the smaller dons' territories--tribute to the boss, just so they can stay in business.

On the flip side, Amazon's Login and Pay is the next step in making itself every consumer's best friend, ready to tackle any need you might have. Remember when Amazon was the place to buy cheap books? Now it'll sell you everything from clothing to groceries--you can even pay Amazon $100 a year just to make the process of buying actual goods speedier and more satisfying.

All your transactions are belong to us

What's the next step? Amazon might as well just become a bank. I can have my paychecks deposited directly to my Amazon Bucks account, and then pay my cell phone bill and the babysitter I booked through Amazon's service marketplace, as well as order up products through my Amazon-branded phone, the barcode-scanning Amazon Dash wand, or even just by mumbling my heart's desires into my Fire TV's microphone-equipped remote control. Products will just appear on my doorstep, even on a Sunday, and possibly via drone.

Look, all this convenience is great for the consumer--I've never made a late-night emergency diaper-restocking run for my kid's entire life, because Amazon Mom delivers them faithfully to my doorstep each month before I ever run out. But the more of the marketplace Amazon controls, the more we're going to see it throw its muscle around with suppliers--the people who actually make the stuff.

Amazon's dominance in the book-publishing industry has led to a standoff with Hachette Book Group that Amazon isn't in a rush to resolve. And now another standoff with Warner Home Video is keeping people from preordering The Lego Movie on Blu-ray.

As companies and entire industries grow more dependent on Amazon's help to reach their customers, Amazon will use that leverage to win more favorable contract terms--that's just business. It's hard to feel a lot of pity for Warner Home Video or a big-five publisher like Hachette, but Hachette's authors are caught in the middle. And as Amazon expands its reach into marketing local services and processing payments for small businesses, those mom-and-pop operations could find that big-business tactics can feel awfully personal.

Amazon is scheduled to announce its much-anticipated, allegedly 3D smartphone next week in its (and Lloyd Dobler's) home town of Seattle. Maybe this is the last piece of the puzzle, the thing that turn us all into zombiefied Amazon shoppers everywhere we go. Or maybe it will help tip the scales in the other direction, and Amazon's suppliers will say, "Enough. We want to do business with a Lloyd Dobler of a company instead of a supervillain in the making, before our customers start to love Amazon's convenience more than they love us."

This story, "Amazon's World Domination is Great for Consumers, Bad for Everyone Else" was originally published by IDG News Service .

Join the discussion
Be the first to comment on this article. Our Commenting Policies