EU Files Antitrust Charges Against Amazon Over Use of Data

European Union regulators have filed antitrust charges against Amazon, accusing the e-commerce giant of using data to gain an unfair advantage over merchants using its platform. From a report: The EU's executive commission, the bloc's top antitrust enforcer, said Tuesday that the charges have been sent to the company. The commission said it takes issue with Amazon's systematic use of non-public business data to avoid "the normal risks of competition and to leverage its dominance" for e-commerce services in France and Germany, the company's two biggest markets in the EU. The EU started looking into Amazon in 2018 and has been focusing on its dual role as a marketplace and retailer. In addition to selling its own products, the U.S. company allows third-party retailers to sell their own goods through its site. Last year, more than half of the items sold on Amazon worldwide were from these outside merchants. Executive Vice President Margrethe Vestager, the EU commissioner in charge of competition, said it's not a problem that Amazon is a successful business but "our concern is very specific business conduct which appears to distort genuine competition." Amazon faces a possible fine of up to 10% of its annual worldwide revenue, which could amount to billions of dollars. The company rejected the accusations.

Pity the didnâ(TM)t add...

[zkiwi34]

Biggest reseller of stolen goods in the world, overtaking eBay.

Unilaterally fixing this myself

[will4]

Simple as don't shop there much.

I spend under $100 a year at Amazon. My next door neighbors in their 40s with two teenagers get a package delivered 3 or more times a week.

I've seen this Amazon "switch and bait" (TM) for products in multiple categories where's there no Amazon basics and then 12 months later there are multiple Amazon basics.

I do not buy Amazon basics for the same reason why I don't buy the Walmart model of a TV for example, lower quality at a marginally lower price.

Obviously true

[drinkypoo]

Amazon literally collects data on what's selling and then "creates" (labels) items to sell as "Amazon Basics" in order to compete. And they don't give that data to anyone else. They are profiting directly from unfair competition with third party sellers.

Re:Obviously true

[thegreatbob]

I've bought a small number of minor items (cables, ear buds, etc.) from their Amazon Basics labeling, and found that while they're generally tolerable, they tend to motivate me to do proper research and buy from some other brand.

Re:

[John.Banister]

Sure, perhaps from one of these brands [buzzfeednews.com].

Re:

[thegreatbob]

The "never heard of 'em" factor similarly drives me to conduct additional research. I don't explicitly avoid this stuff, I just try my best to make sure I know what it is that I'm buying.

Re:

[John.Banister]

Sounds like a good practice.

Re:

[Nrrqshrr]

Why wouldnt they? The data is there, the buyers are there, the items they want to buy are there. Everyone is surprised that Amazon wants to get more money by circumventing the middleman, who in this case happens to be the original seller.
They are using the tools they have efficiently.

Re:

[drinkypoo]

No one is surprised, you're talking about a straw man.

Some people are incensed, but that's not the same thing.

Letting individual participants gain too much control over the market is always harmful. Because we know that, we're not surprised.

Re: Obviously true

[drinkypoo]

Because Amazon is big enough to have de facto monopoly status, and we treat such companies differently because they have greater impact on markets. Are you new?

Will Amazon be brought to book ?

[Alain Williams]

The trouble is the glacial pace of EU investigations.

Re:

[Anonymous Coward]

I hope that Amazon gets hit with a giant fine (As in tens of billions). Their (Amazon) only wish is to drive every other retailer to the wall with their predatory pricing. When they succeed (As they will if left unchecked) they'll raise their prices and we'll have no choice but to dig deeper.

Avoid Amazon ... While you can that is.

Re:

[Applehu Akbar]

Their (Amazon) only wish is to drive every other retailer to the wall with their predatory pricing. When they succeed (As they will if left unchecked) they'll raise their prices and we'll have no choice but to dig deeper.

And if you get your wish and Amazon simply pulls out of the EU market, you will have no choice but to dig even deeper.

A monopoly is an enterprise that by preventing the open market from operating in its line of business imposes prices higher than a free market would bear. Pharma is an example of this. Amazon is not.

Won't happen

[martynhare]

If Amazon kills smaller retailers, manufacturers would have less incentive to provide discounts relative to RRP, which as a result, would cost Amazon more per unit sold - resulting in less profit. This means that they do not compete too aggressively against most smaller general-purpose retailers, to keep them around for the purposes of leveraging their data to determine potential cost-savings so that when they negotiate with manufacturers, they can obtain the same (or better) deals.

Also, Amazon uses dat

Absolutely Happens

[SlashbotAgent]

Amazon absolutely uses 3rd party sales data to influence which products Amazon stocks and sells directly.

I suspect, but do not know for sure, that it is yet another automated algorithm.

Firewall

[stikves]

Amazon is both a global marketplace and the biggest seller on that marketplace.

That is a very big conflict of interest right there. Yes many people benefit from Amazon sales. (I too sell some of my older knickknacks and whatnot, but they are continuously pushing smaller sellers out for larger ones. That is a story for another time). And yes, customers benefit from the competition.

However their Amazon brands have access to private information from third party sellers. And that information is not even sold at any price. So if let's say Sony wants to get market research on OLED TVs, they cannot for example buy the sales trends from Amazon. But Amazon can look at all those trends, including Sony merchandise, do some machine learning to figure out most important features, and produce "Amazon Basics TV with Prime" or some other similar product.

Nobody should object to individual parts (Amazon marketplace, and Amazon brands). They are both part of free competition. However we should ask a firewall installed between the two. If Amazon products can access data, so should the third party sellers. If the data cannot be shared with third parties neither should Amazon have access to that.