The FTC Filed Against Amazon After her 2021 Conviction: An Outsider’s View of the Amazon-Apple Corrupt Practice

These two very different philosophies, each pushed by an outsider unafraid of taking risks, at last have their much-anticipated confrontation. The Federal Trade Commission, now run by Ms. Khan after her stunning rise from policy wonk to policy player, on Tuesday filed suit against Amazon in federal court in Seattle. The lawsuit said that Amazon used unfair and illegal tactics to maintain its power. The suit was wrong on the facts, according to Amazon.

The FTC is analyzing other areas of Amazon’s business, including the Ring doorbell service. The FTC sued Amazon in December 2015, accusing it of illegally snooping on customers with employees of Ring. The FTC alleged that the recordings of children’s voices were being stored in violation of several federal laws.

Joe Simons was the former FTC chair and Donald Trump was the president. But Simons reportedly diverted agency resources from that probe against Meta’s Facebook following the platform’s Cambridge Analytica scandal. Khan, the current FTC chair, has long criticized Amazon’s e-commerce dominance and bulked up the agency’s ongoing Amazon probe after her 2021 confirmation.

Indeed, the FTC this year lost a lawsuit against Facebook parent Meta over its acquisition of virtual reality company Within Unlimited, and later struck out on its attempt to block Microsoft’s purchase of videogame company Activision Blizzard.

Khan was unafraid to challenge companies in court and undeterred by the prospect of some losses when she was the FTC chair.

The report that Khan helped write called for the separations of Amazon, Apple, and Facebook. They “have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons,” the report said.

One of the largest delivery companies in the U.S. is built up by Amazon and it ships more packages than FedEx. It has ventured into healthcare, home security and other fields, becoming one of the world’s most valuable corporations, worth more than $1 trillion.

Private and government research shows that Amazon captures over 40% of the online shopping market in the US, even though the company’s growth has slowed. About two-thirds of U.S. adults are members of Amazon’s subscription service, Prime, as estimated by Consumer Intelligence Research Partners.

What the FTC and Google can tell us about the tech giants: How the Amazon and Silicon Valley are fighting each other in the courtroom

The FTC did not immediately seek a breakup of the company. It asked the court for a permanent injunction and this could change down the road. The case is expected to play out over several years.

Ms. Khan is to blame for the thinkable changes that can be made on the retailer. After spending a few days interviewing her and those around her for a profile in 2018, I thought she understood Mr. Bezos because she was so much like him. Very few people can see possibilities unseen by others and successfully work toward them for years, getting others to join along the way. Both of them shared these attributes.

If Ms. Khan can convince people, the landscape for tech companies will be very different in the future. The antitrust cases have that effect. The government achieved only a muddled victory in its pursuit of Microsoft 25 years ago. Over 1000 start-ups were able to bloom because that had enough force to weaken the software empire.

Silicon Valley spent the summer transfixed by the prospect of Elon Musk and Mark Zuckerberg literally fighting each other, despite the odds of this actually happening being near zero. Ms. Khan and Mr. Bezos are, however, the real thing — a courtroom clash that could have implications far beyond Amazon’s 1.5 million employees, 300 million customers and $1.3 trillion valuation.