A federal judge learned on Tuesday that when it comes to providing large corporate customers with office supplies, Amazon is just not a big enough player yet to compete with Staples or Office Depot or the powerhouse that would be created if the two companies joined forces.
According to a story on Wednesday by Reuters, the judge is tasked with deciding whether to issue an injunction against Staples’ bid to acquire Office Depot. The U.S. Federal Trade Commission (FTC) filed a lawsuit to stop the merger last year, arguing the combined company would possess too much market share and that could lead to price hikes — especially with corporate customers. Staples argues that there is enough competition in the market and Amazon is one of the reasons why.
Last week’s the New York Post reported that Amazon is mulling a possible purchase of Office Depot’s corporate unit. The report suggested that the FTC might approve the merger should Staples or Office Depot sold off an important business unit, presumably to ensure competition in the marketplace. The Post acknowledged that conflicting rumors indicated that Amazon was interested in acquiring W.B. Mason, the third-largest office supplier
On the stand, Prentis Wilson, vice president of Amazon Business, a division formed only last year, found himself in a peculiar situation. Typically, business executives talk up their company’s abilities and rarely focus on shortcomings. In this situation, Wilson had to disclose the bald spots, the ways that Staples and Office Depot offered more services than Amazon.
Wilson testified that his business “had no big corporate customers, did not stock shelves and often did not bid for a customer’s business,” Reuters reported. Asked whether Amazon currently acts as the primary supplier of office supplies to an enterprise customer, Wilson said, “Not to my knowledge, no.”
[Editor’s Note: Post updated to correct Wilson’s response to the question about enterprise customers.]
According to Reuters, one of Staples’ attorneys said in opening arguments on Monday that Staples management “fears Amazon.”