Big companies aren’t bad.
At least that’s the perspective of Amazon.com (AMZN) founder Jeff Bezos, who pushed back on concerns that the super-sized e-commerce company should be broken up.
“It is really important that politicians and others understand the value that big companies bring in and not demonize them,” Bezos told David Rubenstein, president of the Economic Club of Washington and co-founder of PE firm Carlyle, at an event Thursday before about 1,550 people at the Washington Hilton. “They shouldn’t vilify big companies. The reason is simple — there are certain things only big customers can do. I know what Amazon could do when we were 10 people; know what could do when we were 1,000 and 10,000, now we are half a million.”
Bezos comments follow concerns raised by President Trump and others over Amazon’s size and ownership of The Washington Post newspaper. In April, Justice Department assistant Attorney General Makan Delrahim suggested that the ‘search by voice’ virtual assistants offered by Amazon, Alexa, was a possible antitrust issue. Delrahim said “once you ask Alexa, ‘where is the closest pizza restaurant?’ Alexa will only hand you one. It is not going to send you ten pages with 100 search results.” He wondered whether they will direct [customers] to their own product and if they did, would that be an antitrust issue.
Others have raised concerns about Amazon’s size and impact on competition as well. Activist investor Nelson Peltz of Trian Fund Management, argued earlier this year that Amazon’s Alexa would only offer Amazon batteries until Scott Galloway, a professor of marketing at New York University Stern School of Business raised the issue in an article. Others have raised concerns about Amazon’s impact on Diapers.com, before the company was acquired and later shut down by the e-commerce giant. Peltz also said that he thinks that at one point the government will step in and do something about Amazon’s size. “I am concerned that they control prices,” Peltz said. “Amazon disturbs me.”
Bezos said Amazon could handle whatever regulations come its way. “Governments should be inspected, big educational institutions, big non-profits, big companies, should get scrutiny,” he said. “It’s not personal. It is what we as a society want to have happen. Whatever regulations are promulgated, this is normal; this is healthy; it’s good; we want to live in a society where people are worried about big institutions.”
He added that any regulations won’t stop Amazon from serving its customers. “Under all regulatory frameworks I can imagine; customers will still want low prices, they still will want fast delivery; big selections; these things are so fundamental, those are the things we do,” Bezos added.
Beyond Amazon’s size, Trump has criticized Amazon’s purchase of the Washington Post, arguing that it acts as a “lobbyist” for the company. However, Bezos pushed back on the criticism as well, arguing that it is dangerous to demonize the media. “It is dangerous to say the media is the enemy of the people,” Bezos said. “It is a mistake for any elected person to attack the media. I think there is no public figure who has liked their headlines. It is okay. It’s part of the process. You don’t take that job, thinking you won’t get scrutinized; you are going to get scrutinized. It’s healthy.”
Bezos’ comments followed increased speculation that Amazon might choose Washington D.C. as the location of its second headquarters — it is based in Seattle. Bezos said he will announce a decision before the end of the year. “The team is working their butts off on it,” Bezos said to boos in the room, hoping for a D.C. destination.
The Seattle Times reported Wednesday that board members have joined Bezos on his Washington trip, which suggests that the company is scoping out the city and considering it. The area is the third-best region in the U.S. for tech talent according to a report from CBRE, behind San Francisco and Seattle.
In January, Amazon narrowed down the list to 20 U.S. locations plus Toronto, Canada. Of those 20, three were in proximity to Washington: In addition to the District itself, Northern Virginia and Montgomery County, Maryland were on the list.
The event was held inside the Washington Hilton, where well-dressed attendees dined, in contrast to about a dozen or so protesters outside, who held up a variety of placards, including one with pictures of a Bezos-headed octopus and another stating, “abolish the rich.” Rubenstein alluded to the contrast, asking, wryly, how many people at the event arrived by metro. “One or two?” he asked, to laughs. He also suggested that many of the audience also attend the annual the White House Correspondents Dinner.
Bezos, the wealthiest man in the world, with a net worth of $150 billion, has come under pressure to be more charitable. Amazon has a market capitalization of about $971 billion, making it the second largest company in the world behind Apple AAPL.
In response to concerns, Bezos on Thursday launched the “Day One Fund,” with a $2 billion commitment, set up to help homeless families and create preschools. The fund will provide capital to existing non-profits that help homeless families and also set up a “network of new, non-profit tier-one preschools in low-income communities.”