Amazon Earned More Than $1 Billion Through Secret Price-Raising Algorithm: FTC

Contact Your Elected Officials
The Epoch Times Header

The e-commerce giant allegedly deployed a secret algorithm, internally known as “Project Nessie,” that raised the prices on its online store.

Amazon created a secret algorithm that helped the e-commerce giant generate an extra $1 billion dollars, the U.S. Federal Trade Commission (FTC) alleged in a new court filing on Nov. 2.

In September, the FTC and 17 states filed an antitrust lawsuit against Amazon, but many details were withheld until Nov. 2, when a version of the lawsuit with fewer redactions was made public in the U.S. District Court in Seattle.

According to the new, less redacted complaint, Amazon allegedly deployed a secret algorithm, internally known as “Project Nessie,” that raised the prices of items on its online store and, in turn, across the market accordingly.

Knowing that many websites set their prices to match Amazon’s, the company allegedly developed Nessie to increase prices on products that other retailers would follow.

After outside retailers began matching or increasing their own prices, Amazon would continue to sell the product at an inflated price, the FTC alleged, which resulted in $1 billion in excess profit.

The FTC accused Amazon of turning on and off Project Nessie to avoid scrutiny.

“Aware of the public fallout it risks, Amazon has turned Project Nessie off during periods of heightened outside scrutiny and then back on when it thinks that no one is watching,” it stated in the complaint.

“Project Nessie generated enormous profits for Amazon even though its higher prices caused Amazon’s unit sales to decrease. In 2015, for example, Project Nessie’s higher prices reduced Amazon’s gross sales revenue while increasing Amazon’s profits on those reduced sales by an extra $363 million. In 2018, Amazon estimated that Project Nessie increased Amazon’s yearly profits by $334 million.”

The FTC called the algorithm an “unfair method of competition” because it manipulates other online stores into raising prices, allowing Amazon to do the same.

“The sole purpose of Project Nessie was to further hike consumer prices by manipulating other online stores into raising their prices,” the FTC alleged.

By Aaron Pan

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

Kamala, Please Run Again

Kamala Harris hinted she wants to run for President in 2028, despite poor poll numbers and her loss in 2024. If she runs, the big winners will be the GOP.

Rosie O’Donnell vs. Her Therapist

Rosie O’Donnell's therapist attempted to artfully introduce to her client to the possibility that Rosie's outrage might be performative. It didn’t take.

Hamas’s Stubborn Grip on Arms Signals No Desire for Genuine Peace

Hamas’s rhetoric reflects its founding ideology, prioritizing armed resistance over civilian welfare or diplomatic progress.

Off the radar

In the longstanding and brutal ledger of religious persecution, Nigeria now occupies its own grim chapter with its enduring pogrom against Christians.

The New Jackboots? A Wake-Up Call on Antifa and Fascism

An analysis of whether Antifa truly opposes fascism by comparing its tactics and behavior to historical signs and movements of fascist regimes.

USDA Says SNAP Benefits Will Expire for 41 Million People If Shutdown Persists

More than 41 million Americans will go without food stamps next month if Congress does not vote to reopen the government in time.

Newsom Confirms He’s Considering 2028 Presidential Bid

California Gov. Gavin Newsom said he will seriously consider a presidential campaign after the 2026 midterms are over.

‘Showing Up in Droves’—Gen Z Trades Graduation Caps for Hard Hats

The share of Generation Z workers in the construction labor force more than doubled between 2019 and 2023, according to a recent report.

Dallas Doctor Surrenders License After Texas AG Sues for Prescribing Gender Transition Drugs to Minors

Doctor surrendered her medical license following lawsuit by Texas AG Paxton, accusing her of illegally prescribing gender transition drugs to minors.

Trump Hikes Canada’s Tariffs by 10 Percent for Not Pulling Anti-Tariff Ad Immediately

Trump announced he will increase tariffs on Canada by 10% after ad by provincial government of Ontario misrepresented President Reagan’s speech on tariffs.

Trump Rolls Back Emissions Rules on Copper Smelters

President Trump issued a proclamation aimed at reversing a Biden-era environmental rule that enforced stricter air emission standards on copper smelters.

Donor Gives $130 Million to Cover Shortfall in Troop Pay During Shutdown

Trump announced on Oct. 23 that an anonymous donor sent $130M to cover military pay during the ongoing government shutdown.

‘Frustration’ With Canada Led to Trump Scrapping Talks, Not Just Ontario’s Ad: US Official

President Trump cited Ontario’s TV ad as the reason for halting Canada trade talks, but officials say it stems from rising U.S. frustration with Ottawa.
spot_img

Related Articles

Popular Categories

MAGA Business Central