[jagged-chisel]

Suppose Costco allowed other vendors to be present and selling in their stores. Costco requires these vendors to use Costco's checkout systems. Costco then takes the data gleaned from those sales to determine which products to compete with and then begins aggressively pushing their competing product.

Is this fair to the vendors?

[nerdponx]

This is an interesting thought experiment. Maybe the objection is that Amazon is erroneously considered a neutral marketplace, and not a "store". But practically is there a difference between these arrangements, other than the incidence of who technically is the retailer and who is the wholesaler?

I think the real issue is how people shop online versus in stores. Online, they see a linear feed of individual products and buy whatever is near the top. In a store, they see a variety of displays, and it's almost hard not to comparison shop even a little bit.

It's much, much easier to be "anti-competitive" on a web store than a physical store. Imagine if Costco did what Amazon does, deliberately making Kirkland products easier to find in the store and look more reputable/trusted compared to other brands.

So I don't think the problem is that this particular move by Amazon is any more anti-competitive than anything a normal store with store brand would do. The problem is that Amazon already engages in other anti-competitive activity, so pretty much anything they do related to their own store brand is distasteful.

[dathinab]

No in that case Costco would likely get into legal problems.

Actually there had been legal cases with unfair market practices in grocery stores between different competing products sold there. I think there is currently a ongoing case with Oreo.