Amazon Executive Compares the Company’s Advertising to Parable of Scorpion and Frog by@linakhantakesamazon
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Amazon Executive Compares the Company’s Advertising to Parable of Scorpion and Frog
by Lina Khan (Finally) Sues AmazonOctober 19th, 2023
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The court filing in FTC v. Amazon exposes Amazon's ability to profitably degrade its service for customers, a telltale sign of its monopoly power. This is demonstrated through tactics such as manipulating search results, flooding the search results page with paid advertisements, and punishing sellers who offer lower prices elsewhere. Despite these practices, Amazon continues to experience double-digit growth in overall sales, highlighting its dominant position in the market.People Mentioned
‘Illustrate a scorpion biting a frog, a pond in the background’ Image created by HackerNoon AI Image Generator
FTC v. Amazon Court Filing, retrieved on Sep 26, 2023, is part of HackerNoon’s Legal PDF Series. You can jump to any part in this filing here. This is part 30 of 80.
1. Amazon has (redacted)
229. Amazon (redacted)
230. (Redacted)
231. In theory, relevant advertisements can be useful to shoppers in some instances. Importantly, Amazon (redacted)
232. (Redacted)
233. (Redacted) Another senior Amazon executive reportedly compared Amazon’s advertising and search divisions to the parable of the scorpion and the frog: it was in the advertising division’s nature as the proverbial “scorpion“ to poison organic search results.
234. (Redacted)
235. By flooding its search results page with paid advertisements, Amazon (Redacted)
236. As one Amazon executive explained (Redacted) Moreover, because Amazon’s anti-discounting conduct punishes sellers who offer prices at rival online stores with lower fees, many sellers set their price on Amazon-high fees and all-as the price floor across the internet.
237. (Redacted) According to public reports, Amazon engineers found that "[w]hen sponsored ads were prominently displayed, there was a small, statistically detectable short-term decline in the number of customers who ended up making a purchase." (Redacted) While fewer shoppers were finding what they wanted, advertisements were making more money- "[ a] lot of it."
238. (Redacted) Despite degrading shoppers’ experiences, Amazon continue to have double growth in overall sales, not losing meaningful numbers of shoppers to rivals.
239. (Redacted)
240. Amazon's ability to profitably worsen its service for customers is a hallmark of monopoly power.
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This court case 2:23-cv-01495 retrieved on October 2, 2023, from ftc.gov is part of the public domain. The court-created documents are works of the federal government, and under copyright law, are automatically placed in the public domain and may be shared without legal restriction.
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