FTC Sues Amazon Over Alleged Secret Ad Price Hike

The Federal Trade Commission (FTC) has filed a lawsuit against Amazon, accusing the company of secretly charging businesses more for advertising on its platform. The lawsuit claims that Amazon increased prices through its online ad auctions without informing advertisers.

The complaint alleges that starting in 2019, Amazon made a 'surreptitious' change to its auction system, adding a hidden surcharge called a 'soft reserve price.' This allowed the company to manufacture higher bids, resulting in advertisers paying their own full winning bid close to 80% of the time.

The FTC claims that this practice affected over 1 million brands and sellers, generating tens of billions of dollars in additional revenue for Amazon. The company made $68 billion in advertising revenue last year.