Why FTC’s Amazon-MGM Probe Is Based on Flawed Logic

The Federal Trade Commission’s decision today to formally open an in-depth probe into Amazon’s $8.5 billion purchase of MGM signals just how much the Biden administration is changing the course of antitrust inquiries into tech. It’s not just about the obvious targets—Google’s self-evident dominance of the search market, for instance. Instead, basically anything the major tech companies do will be viewed with suspicion.

That may be justifiable given the sheer size and breadth of companies like Amazon. But common sense should also apply. It shouldn’t take an investigation like this probe—which given past history will take six months to resolve, at least—to realize the Amazon-MGM deal is more defensive than offensive. It will do more to promote competition than reduce it. Amazon is buying MGM to assure itself of access to film and TV programming for Amazon’s Prime Video streaming service, which has increased competition in the streaming market and more broadly the television market. President Biden’s executive order today on “promoting competition in the American economy” noted that Americans ”pay too much” for cable TV "in part because of a lack of adequate competition." Well, Amazon Prime Video is helping bring down TV prices.