Amazon Seller Complaints Drawing FTC Interest, Chairman Says
(Bloomberg) -- Federal Trade Commission chairman Joe Simons said Tuesday the agency is interested in hearing complaints alleging that Amazon.com Inc. is punishing merchants that offer lower prices on other e-commerce websites.
“Anyone who wants to complain, we’re all ears,” said Simons in an interview Tuesday. “That’s the type of scenario that would be among the ones that we would want to look at, but I can’t tell you we are doing it for any particular platform.”
Simons, who is leading a broad review of the technology sector and is investigating Facebook Inc., in particular, stopped short of confirming the agency has opened a formal probe into how Amazon treats merchants on its marketplace.
Bloomberg has reported that Amazon third-party sellers have raised their prices on products they sell on competing websites to avoid being penalized by the e-commerce giant. When Amazon discovers a product is cheaper on another website such as Walmart.com, the company alerts the merchant selling the item. It also makes that product’s listing harder to find and buy on its own marketplace, the article said.
FTC officials have spoken with at least one seller who has complained that Amazon pushed out merchants of recycled Apple devices after it made a deal with the phone-maker to sell its products directly on Amazon’s website. John Bumstead, who sells refurbished Apple products, said in a Facebook post last month that about seven lawyers and an economist from the FTC interviewed him.
Amazon declined to comment, but has said sellers have full control over the prices they set.
Online merchants typically sell their products on multiple websites, including Amazon, eBay Inc. and Walmart Inc., which also removes products with “highly uncompetitive” prices compared with those on other sites.
Simons said he generally disagreed with Democratic presidential candidate Elizabeth Warren’s proposal to prohibit large tech companies from selling goods on e-commerce platforms they operate. He said Amazon has “enabled a whole universe of competitors” that might not otherwise be able to reach the consumers they currently have access to through the company.
“As a rule I would say I don’t agree with that,” Simons said. “If you basically said you can’t compete with any of the people on your platform, Amazon could take the position of saying, ‘Okay then we won’t have them on the platform. We’ll just sell everything ourselves.’”
Simons said the task force that’s investigating potentially anti-competitive conduct in the technology industry has been evaluating a broad range of complaints.
“The technology task force is having lots of conversations with lots of people in the industries,” he said. “So part of that process might be hearing these types of complaints.”
A House Judiciary antitrust subcommittee and European antitrust officials are already investigating claims that Amazon may be shortchanging smaller merchants that sell on its marketplace.
So far, criticism of Amazon’s market power has centered on whether it mines merchants’ sales data to launch competing products and then uses its dominance to make the original product harder to find on its marketplace.
The European Commission opened a formal investigation last month into Amazon’s dual role as retailer and platform-operator, focusing on the potential misuse of merchants’ data.
Representative David Cicilline, the Rhode Island Democrat leading the House panel, expressed dissatisfaction with Amazon’s testimony that the company doesn’t use data it collects on sales to favor its own products over those of third-party sellers.
Amazon later defended using aggregate sales data from third-party sellers. In a letter to Cicilline, Amazon said it is a common practice in the retail industry.
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