Amazon rigged billions in ad pricing, lawsuit from states and US watchdog alleges
Summary
The US Federal Trade Commission (FTC) and 22 states have sued Amazon, accusing the company of secretly raising ad prices by changing online auction results. The lawsuit claims this practice has earned Amazon about $20 billion since 2019 and has harmed advertisers and customers.Key Facts
- The FTC and states filed the lawsuit in Washington state on Monday.
- Amazon is accused of replacing auction prices with higher prices to increase profits.
- Amazon denies the claims and says the lawsuit is based on misunderstanding.
- The alleged practice involves charging advertisers near their own bid prices instead of the expected lower second-price auction rate.
- The lawsuit says these higher ad costs are passed on to customers, causing harm.
- Amazon's stock price dropped by 2.5% after the lawsuit was announced.
- Amazon previously settled a separate FTC case in 2024 for $2.5 billion over Prime subscription issues.
- Amazon says average winning ad bids have actually gone down in recent years, and that most ads are not given to the highest bidder.
Read the Full Article
This is a fact-based summary from The Actual News. Click below to read the complete story directly from the original source.
