January 26, 2024

Welcome to Letters from CAMP, a newsletter on anti-monopoly activity in Canada and abroad, brought to you by the Canadian Anti-Monopoly Project. In this installment we have:

• Statistics Canada study finds rising margins and market power over the past 20 years
• Amazon shuts down all Quebec warehouses after workers push for a fair deal and safe working conditions
• Big Tech’s center-stage presence at Trump inauguration bodes ill for corporate pushback

Now let’s dive in.

StatsCan Finds Steady Rise in Markups and Market Power

One of the factors we look for to detect the presence of monopoly power is high and rising markups: the price corporations can charge above the cost of the goods and services they sell. This week, new analysis from Statistics Canada found more evidence of what we’ve been saying all along: monopoly markups are on the rise. Depending on the measurement method, average markups in Canada have increased by 5% - 13% since 2001, with the sharpest growth occurring after the 2008 recession.

The report highlights that this rise has been accompanied by fewer new firms entering the market and increased concentration of market power among dominant players. The average markup—a measure of how much firms charge above their costs—has steadily risen, placing a growing burden on consumers.

What’s striking is that companies have been passing these increases onto consumers well before inflation became a headline issue. While Canada maintained a weak approach to competition, incumbent firms were able to squeeze more out of Canadians. Contrary to economic theory, these increasing margins did not lead to a rush of new competitors. Instead, fewer and fewer firms are challenging the position of dominant firms. As debates heat up about how to respond to the threat of tariffs, this analysis reminds us that we cannot fix our position on the global stage without tackling entrenched market power at home.

📚 What We’re Reading 📚

• Harris, More underweighted meat uncovered as big grocers hit with class action lawsuit (CBC)
• Lowman et al., Tools for Reining in Monopoly Utilities (AELP)
• Ball, The State of Video Gaming in 2025 (Epyllion)

Big Tech Doesn’t Love You Back: Amazon Exits Quebec Following Worker Organizing

This week, Amazon announced it would be closing all seven of its Quebec facilities, cutting nearly 2,000 jobs. Officially, the company cited “a review of its Quebec operations” that found it could better serve customers with third party delivery services. But the real reason is to send a clear signal to Canadian workers: organize for better working conditions at your own risk. Quebec is home to Amazon’s only unionized workforce in Canada, with workers organizing in response to concerns over unsafe conditions, low pay, and grueling schedules.

Amazon’s retreat shows the lengths the largest corporations will go to avoid a fair deal for workers. Evidence from other countries shows us why Quebec workers were right to organize for better conditions. Studies show Amazon warehouses have injury rates more than double comparable warehouses and that local warehouse wages fall once Amazon comes to town and starts exerting pressure. This occurs while Amazon extracts an ever-growing share of revenue from third party sellers who make use of their platform.

In response to the closure, Industry Minister François-Philippe Champagne has called for a review of the federal government’s business relationships with Amazon, which account for tens of millions of dollars of revenue annually. But until we address the monopoly power at the heart of this dispute we should expect the future of Canadian workers to be hostage to the whims of tech giants.

📰 CAMP in the News 📰

• Annable and Barghout, Contractors accused of rigging Manitoba Housing bids after years-long investigation want charges stayed (CBC)

Big Tech Buys a Seat at Trump’s Inauguration

“After years of pretending to be Democrats, Big Tech leaders are now pretending to be Republicans,” tweeted Epic Games CEO Tim Sweeney. This sharp critique captures the dramatic shift in political strategy represented by Jeff Bezos, Mark Zuckerberg, and Sundar Pichai’s front and center placement at Trump’s inauguration. Big Tech’s sudden love affair with the incoming administration, including million dollar contributions to Trump’s inaugural fund, is a clear attempt to sway the president away from his previous antipathy for Big Tech and strike deals that would allow them to escape ongoing antitrust scrutiny.

Before their about-face on the issue, Big Tech were the loudest champions of the diversity, equity, and inclusion (DEI) and environmental, social, and governance (ESG) initiatives that have come under scrutiny by Republicans, with some companies even using them in an attempt to justify controversial mergers. At the time, the Federal Trade Commission (FTC) under former Chair Lina Khan correctly pushed back against such tactics, signaling that such commitments could not be a shield for anticompetitive practices.

The ongoing 180 is a stark reminder of why the task must always be to decentralize power within an economy rather than hoping it can be a tool for political goals on either side of the aisle. While political winds may have changed, the power these companies have over our communication, commercial, and social networks is as dangerous today as it was during the previous administration. While we continue to see reasons for optimism in the future of U.S. antitrust, Big Tech’s central role at the inauguration is a discouraging signal.

If you have any monopoly tips or stories you'd like to share, drop us a line at hello@antimonopoly.ca

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