Amazon Prime members are accustomed to cool perks — streaming video, streaming music, free deliveries. Now they’re getting another.
Amazon has cut a deal with food-delivery service GrubHub for Prime members to receive orders from certain restaurants with no delivery fees, at least for a year.
While that’s a big plus for Prime users, it also hints at Amazon’s laser focus on controlling all pathways to your door.
GrubHub is owned by a Dutch company called Just Eat Takeaway.com, which has been losing money on the subsidiary. Just Eat reportedly is seeking a buyer for the delivery service.
Amazon’s deal allows it to purchase up to 15% of GrubHub. Obviously a larger stake is possible if Amazon likes what it sees.
“Being able to give Prime members one year of Grubhub+ and no delivery fees from restaurants is our way of saying ‘thank you,'” Jamil Ghani, vice president of Amazon Prime, said in a statement.
It’s also a way for Amazon to serve notice on rival delivery services that the big dog is putting all its economic muscle and know-how into making food delivery more cost effective.
Most delivery services find that it’s just too labor intensive to profit from schlepping stuff to people’s doors.
Amazon, on the other hand, has fleets of delivery vans and planes, state-of-the-art software and years of experience moving stuff from here to there.
If any company can crack the nut of food delivery on a sustainable basis, it’s Amazon.
But make no mistake: This is how monopolies are born.
A major player enters and dominates a market, and pretty soon no one can compete.
That may not be a grave concern for Prime members, who reap the benefits of a powerhouse business continuously adding value to annual subscription fees running almost $140.
But it’s potentially another step toward market control, and that’s never a good thing for consumers.
So enjoy your GrubHub deliveries, Prime members. But don’t take your eye off the bigger picture.