FTC: Amazon made $1 billion through secret price raising algorithm

Amazon com used a series of illegal strategies to stay on top of online retailing including using an algorithm to push up prices to U.S. households by more than $1 billion, the Federal Trade Commission (FTC) said in a less-redacted version filed on Thursday of its previous complaint against the company.

The newly revealed details also shed light on how the $1 trillion company, which has 1 billion items in its online superstore, required sellers under the company’s Prime feature to use its logistics and delivery services, the FTC said.

Amazon created a “secret algorithm internally code named ‘Project Nessie’ to identify specific products for which it predicts other online stores will follow Amazon’s price increases. … Amazon used Project Nessie to extract more than a billion dollars directly from Americans’ pocketbooks,” the FTC said.


Source: FTC