{"id":2122043,"date":"2026-08-31T21:28:49","date_gmt":"2026-08-31T18:28:49","guid":{"rendered":"https:\/\/analyse.optim.biz\/?p=2122043"},"modified":"2026-08-31T21:28:49","modified_gmt":"2026-08-31T18:28:49","slug":"amazon-rigged-20bn-worth-of-ads-us-ftc-lawsuit-alleges","status":"publish","type":"post","link":"https:\/\/analyse.optim.biz\/?p=2122043","title":{"rendered":"Amazon rigged $20bn worth of ads, US FTC lawsuit alleges"},"content":{"rendered":"

[analyse_image type=”featured” src=”https:\/\/ichef.bbci.co.uk\/news\/1024\/branded_news\/06c0\/live\/06652f80-a574-11f1-b109-879e35c24276.jpg”]<\/p>\n

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\"ReutersReuters<\/span><\/div>\n<\/div>\n
The Amazon logo is seen at one of its offices<\/figcaption><\/div>\n<\/figure>\n<\/div>\n<\/div>\n
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Amazon secretly overcharged more than a million advertising customers by manipulating online auctions it uses to set ad prices, according to a lawsuit filed by the US Federal Trade Commission (FTC) and a bipartisan group of 22 states.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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According to the lawsuit, filed on Monday, the alleged scheme has likely netted the firm $20bn (\u00a314.8bn) from advertising customers since 2019.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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“Amazon overrides and replaces the actual auction results with higher prices set by Amazon to increase its profits,” says a complaint filed in the company’s home state of Washington.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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In a statement to the BBC, Amazon said it “strongly disagrees” with the premise that it misled advertisers and called the suit “misguided.”<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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In addition to advertisers, the FTC, a US consumer watchdog, and the states say Amazon customers have also been harmed as extra costs are passed onto shoppers.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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“Consumers are suffering, have suffered, and will continue to suffer substantial injury as a result,” the complaint states, prompting swift pushback from Amazon.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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“The FTC wants the public to believe this case is about higher prices for consumers. It is not,” Amazon said in its statement.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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The company’s shares fell following the announcement of the lawsuit, closing 2.5% lower on Monday.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Many brands and sellers compete on Amazon to place Sponsored Product ads and Sponsored Brands ads when consumer search for products using keywords on Amazon’s e-commerce platform.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Those placements are then auctioned off to the highest bidder.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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The complaint accuses Amazon of secretly charging advertisers more in so-called “second price” auctions, whereby prospective advertisers expect to pay one cent more than the next highest bidder for each bid they win.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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But in practice, the complaint alleges, Amazon has charged its Sponsored Products advertisers their own winning bid close to 80% of the time.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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The lawsuit states that Amazon’s methods were spurred because “it was unhappy about how much revenue its advertising auctions were generating”. <\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Amazon responded by saying the FTC “fundamentally misunderstands how advertisers operate”. <\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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“Advertisers adjust bids based on real-world performance, not descriptions of auction mechanics,” Amazon said in its statement.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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“Average winning bids fell 50% from 2019 to 2025 on Sponsored Products search ads, and roughly 92% of placed ads are not given to the highest bid,” the company added.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Amazon has tangled with the consumer watchdog in the past.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Last year, it settled a case with the FTC that alleged that it enrolled millions of consumers in its Prime subscription offering without their consent, and knowingly made it difficult for consumers to cancel.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Amazon settled the case for $2.5bn, including civil penalties and consumer refunds.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Sign up for our Tech Decoded newsletter to follow the world’s top tech stories and trends. Outside the UK? Sign up here.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n

[analyse_source url=”https:\/\/www.bbc.com\/news\/articles\/cvgy91nvy27o”]<\/p>\n","protected":false},"excerpt":{"rendered":"

[analyse_image type=”featured” src=”https:\/\/ichef.bbci.co.uk\/news\/1024\/branded_news\/06c0\/live\/06652f80-a574-11f1-b109-879e35c24276.jpg”] Reuters The Amazon logo is seen at one of its offices Amazon secretly overcharged more than a million advertising customers by manipulating online auctions it uses to set ad prices, according to a lawsuit filed by the US Federal Trade Commission (FTC) and a bipartisan group of 22 states. According to the […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[35,226],"class_list":["post-2122043","post","type-post","status-publish","format-standard","hentry","category-politics","tag-bbc-com","tag-crawlmanager"],"_links":{"self":[{"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=\/wp\/v2\/posts\/2122043","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2122043"}],"version-history":[{"count":0,"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=\/wp\/v2\/posts\/2122043\/revisions"}],"wp:attachment":[{"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2122043"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2122043"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/analyse.optim.biz\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2122043"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}