(Photo by Darren Staples/Contributor via Getty Images)
OAN Brooke Mallory
UPDATED 6:35 PM – Monday, March 20, 2023
The Biden Administration plans to take immediate action on at least three of the half-dozen investigations into Amazon and its business practices.
The Federal Trade Commission (FTC) has been investigating the internet giant on numerous fronts since at least 2019, specifically investigating potential abuses of power in online marketplaces and breaches of consumer privacy related to Ring cameras and Alexa, virtual assistant technology.
The FTC is also examining Amazon’s decision to buy the robot vacuum maker, iRobot.
Any lawsuit against Amazon would be considered a high-profile case by the FTC under Chairman Rita Khan, a cynic of big tech who’s most notable for her 2017 academic paper calling out Amazon as a contemporary monopolist that needs to be better regulated.
Amazon is already protected from local anti-trust lawsuits in Washington, D.C., but in California, the upcoming federal lawsuit will pose the biggest challenge yet for a global company.
The exact timing of the incident or settlements is currently indefinite
The FTC is now considering whether to contest Amazon’s $1.7 billion acquisition of robot vacuum maker, iRobot, and FTC lawyers are leaning towards the deal.
According to four people familiar with the matter, Amazon has conducted at least two public privacy investigations, one involving Amazon’s Ring camera and security system business, and the other involving the Alexa voice assistant, which aims to address children’s online privacy.
Khan said that they may have violated protection laws. The results of at least one of their FTC privacy investigations could come out in the coming months.
FTC officials had previously suggested that Khan file a lawsuit against Ring, alleging breaches of privacy and data security.
Broader antitrust lawsuits targeting Amazon’s retail operations could also be filed in the coming months, according to those familiar with the investigation details.
The specifics of one complaint are unclear, but some said it could involve bundling services through their Amazon Prime subscription business and using competitor data to outperform competing retailors on their platform.
The FTC has been investigating practically every aspect of the conglomerate and their business model since 2019, and a lawsuit has been eagerly anticipated.
The agency is conducting so-called “dark-pattern” investigations into issues revolving around customers’ inability to opt out of Prime and other services.
Dark patterns refer to deceptive methods used by websites in order to try and trick users into doing things like subscribing to services that are more expensive than advertised or intended.
The agency says they are also conducting deceptive advertising investigations into the “Amazon Choice” label that the company places on certain products in its marketplace.
They are now investigating how this label is used to advertise products that appear in the search results. Amazon claims this is not the case.
Officials for the FTC and Amazon declined to comment on the probe.
The agency’s lack of execution so far displays the difficulties facing them in taking on a multilayered company like Amazon – and it is suggested that the FTC is choosing its cases with much discretion, according to some insiders who are knowledgeable about their strategies.
The FTC has previously sued Amazon before, alleging that they illegally withheld money from some delivery drivers. Amazon settled the lawsuit and paid approximately $60 million to award the drivers affected.
The agency also lost a lot of money in a lawsuit recently to block Meta’s acquisition of its popular virtual reality app. The judge in the case supported the FTC’s theory that it might be illegal for a company to acquire a product, rather than make it, but found that there was not enough evidence or facts to support the claim.
FTC insiders and observers say the agency is under tremendous pressure in this environment to successfully pursue anti-trust lawsuits against Amazon.
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