The last thing that Jeff Bezos needs is to anger the federal government through the Federal Reserve while the company is being examined for antitrust violations. | Photo by Mark RALSTON / AFP
While the Department of Justice launches investigations into giant technology companies for anticompetitive practices, one might think Amazon would be deserving of additional scrutiny.
After all, Amazon has put countless companies out of business and has been crushing the competition, as its revenue is now half that of Walmart’s. Its ability to undercut pricing on virtually every product it sells is unquestionably harming its competitors.
Yet now the Federal Reserve has been looking into Amazon thanks to the new frontier that is cloud computing technology.
The Cloud Is Now the Center of Everything
The Wall Street Journal reports that the Federal Reserve paid Amazon a little visit this spring to look into how the company’s cloud computing business interfaces with the nation’s banking system.
As the amount of required computing power and storage grows exponentially, tickling financial services, banks have turned to companies like Amazon and Microsoft for their cloud capabilities.
The cloud now controls databases that provide risk analysis for banks and brokerage traders and processes millions of payments each day. If you have mobile access to your bank account or securities brokerage, all of that information and processing occurs in the cloud, along with numerous other processes.
The Federal Reserve is apparently concerned about how robust Amazon’s systems are, including how thoroughly they are backed up, and their resiliency in the face of hacking assaults.
The conditions under which the Federal Reserve examiners conducted their scrutiny were apparently very stringent.