FTC Sues Amazon Over Alleged Ad Price Manipulation
The US Federal Trade Commission (FTC) has filed a lawsuit against Amazon, alleging that the e-commerce giant illegally raised prices for advertisers by artificially inflating auction prices without their knowledge. The agency claims that this deceptive practice cost advertisers $20 billion or more.
The FTC, joined by 22 states, stated in its suit that Amazon's actions allowed it to generate billions of dollars in profits at the expense of its advertising customers. Advertisers allegedly suffered significant harm from higher ad prices, while the states could seek civil penalties and attempt to recover some of the lost money.
Amazon responded by denying the allegations, stating that its advertising policies aim to show shoppers the most relevant ads. The company claimed that its average cost per click for advertisers remained flat from 2019 to 2024, while sales generated from those clicks increased.