The news: A complaint filed with the Federal Trade Commission (FTC) last week by a major union group alleges that Amazon employs deceptive search and advertising practices that mislead consumers about which products are sponsored or owned by the ecommerce giant, adding to the company’s long list of ongoing regulatory and labor issues, per CNN.
- The complaint was filed by the Strategic Organizing Center (SOC), a coalition representing four major unions, which include those representing workers in the service, farm, and communications industries, along with the International Brotherhood of Teamsters.
How we got here: The SOC isn’t the first to allege that Amazon’s search practices are anti-competitive.
- The company’s search practices have been criticized widely for some time, culminating in an October report from nonprofit news organization The Markup, which found that Amazon boosted its own products in search functions and did not clarify which brands were Amazon-owned.
- The report drew reactions from Congress almost immediately, prompting several House members to address a letter to Amazon CEO Andy Jassy asking for proof that prior statements denying the use of nonpublic information to make product decisions were accurate.
- Shortly thereafter, Amazon offered regulators and third-party sellers an olive branch in the form of an announcement for an upcoming product suggestion tool that would let third-party merchants on the platform see popular and unfulfilled user search queries.
But that didn’t cut it: Last week’s FTC filing shows that the consequences of The Markup’s report are still having ripple effects. That, combined with an ongoing labor dispute and harsh penalties from EU regulators, is forming a wave of problems for Amazon.
- Last month, a US labor board ordered a revote in the now-famous Bessemer, Alabama, union drive after it determined that Amazon unfairly influenced the election, in which workers overwhelmingly voted not to unionize, per NPR.
- Troubles lie abroad, too. Regulators in Europe have increasingly cracked down on and fined Big Tech companies like Meta and Google in recent months, and Amazon is no exception.
- Last week, Italian antitrust regulators hit Amazon with a $1.29 billion fine—more than a third of the company’s Q3 profits, per the Financial Times—for prioritizing third-party merchants that use its shipping and logistics services.
What this means: These events signal that the tide of change has come for Big Tech. Aggressive regulatory measures in major foreign markets are beginning to be felt at home in the USs, where voters increasingly support industry regulation while workers begin to organize in droves across industries.
