By any other name an Amazon driver? Last week, prosecutors for the National Labor Relations Board concluded that a group of 84 unionized Amazon drivers in Palmdale, California are, in fact, employed by Amazon.

That may not sound like an especially startling revelation, but implications are potentially huge for the world’s largest online retailer. That’s because the house Jeff Bezos built is built on a foundation of contractors.

Painful Contractions

Contrary to popular belief, there is no such thing as an Amazon driver. Last year, when Vice referred to “Amazon drivers” in a headline, the company got in touch to set the record straight: Those weren’t Amazon drivers, they were “drivers delivering for Amazon.” Amazon’s delivery network is largely made up of delivery service providers (DSPs), small firms that contract out their drivers. These firms often work exclusively for Amazon; Amazon sets the rate of pay and the schedule for the drivers, but crucially does not actually employ any of the nearly 280,000 DSP drivers worldwide.

Amazon argues that its DSP program powers entrepreneurship, but its detractors say that it’s a convenient way for the company to exert the rights of an employer without taking on the associated responsibilities. In its most recent quarterly filing, Amazon listed the “characterization of delivery drivers” as a regulatory risk to its business. Well, now that risk is looking a little bit more real:

• The 84 California drivers have been a particularly persistent bunch — they unionized with the Teamsters in April 2023 and negotiated a contract with their DSP, but Amazon wouldn’t negotiate because it was not their employer. The drivers were later terminated, and traveled the country striking outside different Amazon warehouses.
• The Teamsters said although the NLRB’s conclusion is regional, it hopes to replicate the win elsewhere. An Amazon spokesperson told The Daily Upside that the Teamsters were over-egging their gains.

A spokesperson for the NLRB emphasized that the decision doesn’t count as a “ruling,” but rather the NLRB’s first step in litigation. “If the parties don’t settle and a complaint is issued, a hearing will be scheduled with an NLRB administrative law judge who can order make-whole remedies,” the spokesperson said. And if that judge rules in favor of the prosecutors, Amazon can take the case to federal appeals court.

Taking One for the Team: The Teamsters Union, which represents the only unionized Amazon warehouse in the US, is a growing thorn in Amazon’s side. Amazon has taken the fight to the heart of US employment law enforcement, the NLRB itself — it joined forces with SpaceX and Trader Joe’s in filing a lawsuit earlier this year to argue the NLRB is unconstitutional. 

The algorithm is jacking up our rent — or, at least, the government seems to think so. The Justice Department launched an antitrust lawsuit against private equity firm Thoma Bravo’s RealPage Friday for allegedly helping property managers conspire to drive up rent on millions of units across the US.

The Devilish Rent Down in Georgia

According to the Zillow Observed Rent Index, the average US rent has risen more than a third since the early days of the pandemic, from $1,551 in February 2020 to $2,069 on July 31. The DoJ’s civil suit, filed in North Carolina federal court, claims RealPage, which controls an 80% market share of commercial revenue management software for housing rentals, is squelching competition with its algorithm and holds an illegal monopoly on rent-setting software.

RealPage’s price-setting algorithm collects data on rents from competing landlords (some of it public and some confidential), allegedly allowing them to raise rents in illegal price collusion. The DoJ said landlords using RealPage own 30% or more of the rental apartments in some cities; the lawsuit focuses on southern hubs including Atlanta, Charlotte, Dallas, and Nashville. Recent legal victories prove the suit may have a chance of going forward:

• On the real estate front, The National Association of Realtors agreed in March to pay $418 million to settle claims that its members conspired to keep agent commissions high. The association agreed to scrap its standard 6% commission on house sales, which was more than double what is typical in other countries.
• On the price collusion and algorithms front, in May a judge declined to dismiss a DoJ antitrust suit against Agri Stats, a meatpacking industry data provider accused of collecting and sharing confidential data that let its meat-processor clients conspire to hike prices for restaurants, grocery stores, and consumers.

Rent Dissent: While the case could be a landmark test of how algorithms and AI impact anticompetitive market behaviors, RealPage denies all allegations. “RealPage’s revenue management software is purposely built to be legally compliant, and we have a history of working constructively with the DOJ to show that,” the company said.

It’s been war out there for VCs lately, so Y Combinator — the early-stage investor that helped launch Twitch, DoorDash, Dropbox, and more — is venturing into new, more explosive territory.

The startup accelerator has begun backing Ares Industries, a defense company that builds “low-cost cruise missiles.” That’s a seismic shift for Y Combinator, which previously avoided the defense market. 

‘Missiles are Cool’

Why? Because that’s where the money is. For fiscal year 2025, the Department of Defense has requested a budget of $850 billion, so it’s not hard to see why tech startups are looking to be courted by the US military. Y Combinator underwriting Ares is just the latest addition to the growing relationship between Silicon Valley and the Pentagon:

• Ares founders Alex Tseng and Devan Plantamura say wars in the Middle East, Ukraine, and possibly the Taiwan Strait are creating a need for their missiles. They’re priced at $300,000, and are expected to be 10 times smaller than the DoD’s current long-range ship missiles, as well as 10 times cheaper than what the DoD currently pays. 
• “The United States is not adequately prepared,” Tseng said in a blog post. “In a potential conflict, our stockpiles will run out in weeks, and we currently don’t have the industrial capacity to build at a rate that could win a war, much less deter China.” 

While Plantamura’s bio on the Y Combinator website explains that he is “a serial entrepreneur in the defense technology sector with a passion for safety, ethics, and compliance no matter the product,” Tseng’s simply says, “Missiles are cool.”

Strange Bedfellows: Silicon Valley and the Pentagon were not always the best of friends. Tech startups traditionally shunned the idea of their products being harnessed by the military for warfare, and the DoD already has a list of go-to suppliers like Boeing and Lockheed Martin. But that’s changing as the cost of war increases.

The Defense Innovation Unit, a DoD organization, has handed out dozens of contracts worth more than $5.5 billion for products including autonomous drones and cybersecurity software since its inception in 2015, Bloomberg reported. Also, PitchBook estimates venture capital firms invested roughly $35 billion across 627 deals in 2023. Just this month, the Peter Thiel-backed Anduril Industries raised $1.5 billion to ramp up production of autonomous weapons for the US military and its allies. War: What is it good for? A whole lot of money, obviously.