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Facing regulatory threats, Amazon ups its Q1 lobbying spending to all-time high

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Facing regulatory threats, Amazon ups its Q1 lobbying spending to all-time high

Amazon.com Inc.'s first-quarter lobbying expenditures reached an all-time high this year as the company prepares for new potential regulations related to antitrust and other concerns.

Seattle-based Amazon spent $5.1 million on lobbying in the first quarter, up 70% from $3.0 million in 2017, the inaugural period of the last presidential administration, according to the Center for Responsive Politics, a Washington D.C.-based nonprofit that tracks money in politics. Amazon broke the $1 million mark on first-quarter lobbying in 2015 and has steadily added to its lobbying expenditures ever since.

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Industry analysts and policy experts said Amazon's size — the company's market capitalization now exceeds $1.6 trillion — increasingly makes it a target in Washington.

"People understand that Amazon is big and provides what are seen as a lot of critical products and services," said Scott Kessler, global sector lead for technology, media and telecommunications at investment research company Third Bridge. "We've seen a variety of different types of market participants express their concerns and, clearly, Amazon doesn't want that to be a one-sided conversation."

Among Amazon's priorities this year is its planned $8.45 billion acquisition of MGM Holdings Inc., which may face antitrust scrutiny. Amazon is also facing a probe from the Federal Trade Commission regarding its relationship with third-party sellers, which make up the bulk of the company's sales, as well as an antitrust lawsuit from the District of Columbia related to pricing requirements for its third-party sellers.

Amazon did not return inquiries for this story. But Alex Petros, policy counsel for Public Knowledge, said he expects the company will continue to increase its lobbying spending amid growing bipartisan momentum on antitrust regulation.

"They know they are going to be regulated," Petros said of Amazon. "They are trying to grow, and at the same time, Congress is waking up to the power of dominant digital platforms."

Lobbying dollars provide Amazon with access to lawmakers, including meetings with policy-makers, to share its concerns about more regulation, especially in the antitrust realm, Petros noted.

Sometimes, that leads to lobbyists convincing policy-makers to tweak language within a bill or to change a clause to favor a company, said Craig Holman, government affairs lobbyist for Public Citizen, a non-profit consumer advocacy organization.

Amazon understands that lobbying expenditures "endear" the company to lawmakers and their staff, which guide the direction of the policy-making, Holman said.

Amazon's top lobbying issue this year is listed as Computers and Information Technology, which encompasses a range of topics including data privacy, broadband infrastructure, cloud computing and cybersecurity.

Also among the top issues were labor and antitrust affairs, with filings addressing competition in the e-commerce space, workforce development and minimum wage legislation. Amazon raised its minimum wage to $15 in 2018 but continues to face labor backlash among employees worldwide over working conditions.

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Another priority for Amazon is in the defense arena, as its cloud computing unit, Amazon Web Services Inc., continues its push to win the Pentagon's Joint Enterprise Defense Infrastructure contract, worth up to $10 billion, noted Michael Hettinger, founder and manager of the Hettinger Strategy Group, a government relations and federal market advisory firm.

"The DOD is a frontier they certainly want to be successful in," Hettinger said, pointing to the Defense agency's large and growing budget.

Lobbying is not Amazon's only tool of influence. Hettinger also noted that Amazon can use its second headquarters facility in Arlington, Va., to further discussions with policy-makers and to showcase technology. "Having a really cool facility to bring members of Congress to, right across the [Potomac] river, is a smart thing," Hettinger said.

Public Citizen's Holman said Amazon is also making significant campaign contributions to individual lawmakers and supporting trade groups and think tanks that advance its business interests.

"They are using every influencing tool available to them," Holman said.