The title is a little clickbait-y. As far as I understand it:

1. Think of Amazon as a search engine for products. 2. Amazon wants its site to be the lowest-price destination for products. 3. If Amazon finds your product on another website for lower than its own website, it'll just hide your listing from the search -- this is meant to be pro-consumer (when you go to Amazon you'll get the lowest price).

This is where it gets a bit more complicated: 4. Amazon sells ~40% of its goods under its own purchasing arm, known to sellers as Vendor Central. (These are items shipped and sold by Amazon.com). This purchasing arm wants X% margins from *brands, based on whatever their internal targets. From what I've experienced personally -- their terms are generally better than their competitors (Walmart/Target/Costco/Sams), so it's generally a no-brainer to sell directly to them when I can instead of selling direct.

So when 4 has a conflict of interest with #1-3, you get the systemic effect that in order for the sellers to get their **sweet purchase orders from Amazon, they now need to raise prices elsewhere so the purchasing arm gets their cut. The sellers don't HAVE to sell to Amazon, but then they'd miss out on giant POs from Amazon at good terms.

Designing a system to incentivize sellers to have their lowest prices on Amazon... I'm not sure if calling it a "widespread scheme to inflate prices" is the fairest thing.

*edit: Historically, Amazon VC basically ran at near break-even under Jeff, "your margin is my opportunity" and all that. Since Andy took over there's been a reshuffling of chairs and the different business units have different margin requirements now.

**edit2: the price inflation mostly affects big brands that sell 8+ figs/yr on Amazon, because smaller sellers don't get POs from VC (too small to bother).

1. Average American spends THREE THOUSAND DOLLAR year at Amazon. That’s staggering.

2. As of now the trial is not scheduled to begin until January 2027 (although the discussed injunction is meant to address that). I believe the length of time required to get a decision in court is the single biggest impediment to justice being served. It usually waters down the final judgment, makes costs prohibitive for plaintiffs, and allows perpetrators to continue benefiting from illegal behavior indefinitely. In some cases, the defendant can be elected President in the interim eliminating any chance of facing a court decision.

Companies with as much market power as Amazon simply cannot be allowed to exist. It was a mistake to ever allow it and every response that is not aimed at a total shattering of the company is another mistake. No retail business of any kind can ever be safe when companies like Amazon exist. (And although this article is about Amazon, the same is true of many other companies as well, like Walmart.)

First, this is not new. It's been stated policy for years.

Second, manufacturers get around it in a clever way. They always list their items on their own site at the same price as at Amazon... but then magically almost always seem to have a 20% or 25%-off sitewide coupon available, whether it's for first-time customers, or "spinning the wheel" that pops up, etc.

So I don't know how much this is really raising actual prices in the end.

Otherwise, I'm not sure how to feel about it, because pricing contracts are common on both ends. Manufacturers frequently only sell to retailers who promise they won't charge less than the MSRP, and large retailers similarly often require "most-favored-nation" pricing, so they can always claim they have the lowest prices. If you want to end these practices, then it's only fair to have a law prohibiting it across the board, rather than singling out Amazon.

At least by paying Amazon I can avoid dealing with all that. While I may pass the price to the consumer for Fulfilled-By-Amazon fees, which tends to be around $5.18 ~ $3.5 (quick google search), it's still a lot cheaper than using something like FedEx where it costs $10-12 per order.

The takeaway here is that Amazon has democratized fast and cheap delivery by building a monopoly. As the scale of things go up, the cost of operations can really go down. Think of meal prepping, when you cook food in bulk vs each meal separately, you're saving costs on power, gas and produce.

The only question is whether we can build a public benefit corporation, just like Amazon.

Received several orders that were returned items, with broken open packaging and sometimes the item was something else entirely, purely put there for weight by whoever returned it.

When I went to return some things at a major Amazon distribution center, the return area was closed for the week for some sort of construction or renovation, with no indication of that anywhere on the site. The only messaging was a piece of paper in the window once you got there.

At another separate major distribution center, the return area was a small room with pieces of paper taped to a door with an arrow pointing to the Amazon lockers where the returns are accepted.

Orders are now often so delayed that it makes the Prime subscription pointless. Have had multiple orders over the past year that didn't ship for 3 or 4 days.

Amazon listings are almost half Sponsored listings now, and there are unrelated ads on the side of listings.

Half of the listings are some random made-up brand name, like XIJGNU, which is just a Chinese seller selling low-quality products, and when the reviews get bad enough, they re-list the product under another made-up brand name.

Fake reviews were already rampant before LLMs, but now reviews are effectively useless because they are so easy to fake.

Or ask Gemini what the best deal is, it’s found some good ones.

For smaller stuff, Amazon is usually better than Target or whatever box store nearby.

I just go to Walmart now. And Walmart is no choir boy either but at least I can see what I'm buying.

It was effectively a way to get an excess commission out of amazon if you printed through their printing arm, Createspace/KDP. Not sure if this worked the same for non print on demand books but if you printed through createspace you could set a higher list price and get royalties that were about 100% of the actual sale price.

No idea if the same mechanic is in play with the FBA rules but it seems very plausible to me that the largest impact is has is closing exploits like this.

That doesn't mean it doesn't also entrench market position, raise a few prices at the margin etc but it's very easy to miss the potential for gaming rules, legally, unless you're actively in the system. If an incentive is there the market incentive will be to use it.

Amazon does something similar but with pricing layered on top. Their rec system pushes higher-margin products, sellers notice which items get promoted, then they raise prices knowing Amazon will keep showing them anyway. So it's not just "algorithm adjusts prices" - it's more like the recommendation layer creates conditions where sellers can safely jack up prices without losing visibility.

Basically the algorithm creates artificial scarcity by only showing certain products, which gives sellers pricing power they wouldn't have otherwise.

So Apple coordinated the major book publishers to raise their prices in order to secure their margin expectations.

They settled the lawsuit in the end.

[0] https://www.cbsnews.com/boston/news/us-sues-apple-publishers...

That being said, anyone who’s operated a two-sided marketplace knows that one of the biggest problems is consumers using your site as an index, and then seeking to dodge your fee by meeting with the seller on another platform, where they don’t have to pay it. This was a big problem for my startup.

This is a negative externality, because they’re extracting value from your platform (the list of sellers, products, prices, ratings, etc.), without paying for that value. If left unchecked, this could make running the platform financially unviable. One way to prevent this is to paywall your platform, but not every consumer wants to pay a subscription.

I think it’d be fair for Amazon to prohibit sellers advertising other platforms on its own, but prohibiting them from offering lower prices outside of Amazon outright definitely seems anticompetitive.

https://oag.ca.gov/system/files/attachments/press-docs/REDAC...

Walmart and Pepsi engaged in a blatant decade-long price fixing scheme designed to raised prices and punish small local competitors and were sued for it by Lina Khan's FTC, but - surprise - the case was thrown out the minute Trump took office.

Amazon has been openly doing this for years. They scrape other competitor websites, even though it’s against their terms of service, and if you sell for less elsewhere they find out and punish you. It’s blatantly anti competitive.

> Amazon, vendor [...] fixed prices on [...] This is also an example of Breaking the Price Match, but here, Amazon [...] The plan was memorialized in an email from [...] In other words [...] In response, Amazon insisted on [...] The plan was realized [...] The result of Amazon, [...] price fixing agreement was to increase the retail prices

I don't know how you could even understand what's being alleged without seeing the unredacted version.

Want a desk fan? There are four types of desk fan in the entire world (per Amazon). Page after page after page of listings of the exact same four designs. Often listed with the same re-used marketing artwork.

Put aside brands, quality, et al. Put aside the fact that Amazon removed almost all product specs from their search facility (and is increasingly deleting specs entirely from product pages). Put aside the fake reviews, no-name Chinese drop-shippers.

Every category is stuffed full of the same few copycat products over and over. It is extremely difficult to merely find actual choices! Wrenches? Small compartment storage boxes? Paper towel holders? If you can find even 20-30 unique products in a category now you're living like a king. It reminds me of AliExpress in that sense. Lack of specs, lack of manuals, lack of details about any product. The same listings from different no-name stores repeated over and over.

I used to think maybe AliExpress & co were actually good if you spoke Chinese but a Chinese coworker kindly informed me that nope, it is just as horrible for everyone living in China using Chinese.

I don't know where we went wrong but this is not the future we were promised. Can any of you remember when Amazon was actually good? When their search was useful? Those were some amazing times and how little did we realize they were fleeting.