Amazon is facing a £900 million ($1 billion) lawsuit that claims its Buy Box algorithm breaks competition laws by unfairly favoring products sold by the American giant and preferred vendors.
This class-action complaint was brought by consumer-rights warrior Julie Hunter against the e-commerce goliath to the UK's Competition Appeal Tribunal, a specialist court that handles gripes of monopoly abuse and whatnot.
Hunter slammed the e-commerce goliath for using what she called a "secretive and self-favoring algorithm" that ensures shoppers buy stuff primarily from Amazon and select third-party sellers, which unfairly shuts out competitors and squashes competition. She argues that tens of millions of Brits are owed compensation for being potentially forced to pay inflated prices for goods forced onto them, and she intends to secure that windfall by appealing to the tribunal.
Basically, when you search for a product on Amazon and click on a listing, you'll get a page
like this that has details and photos of the thing, customer comments, and so on. Crucially, if that item has multiple suppliers, Amazon decides which supplier will fulfill the order when the user clicks on the "Buy Now" button on the right-hand side of the desktop page. The area of that page is known as the Buy Box.
According to Hunter, and others, the algorithm that chooses the supplier is unfairly biased to selecting Amazon and third-party companies who pay large fees to the US giant. Specifically, she claims Amazon unfairly promotes not only itself but also retailers who sign up for Pro Merchant accounts and pay monthly commission and closing fees to appear as the Buy Box option. Suppliers who aren't selected are buried down the page, thus this feature prevents people from finding potentially cheaper options and blocks other third-party vendors from competing fairly, it is claimed.
"Many consumers believe that Amazon offers good choice and value, but instead it uses tricks of design to manipulate consumer choice and direct customers towards the featured offer in its Buy Box," Hunter
said in a statement.
"Far from being a recommendation based on price or quality, the Buy Box favors products sold by Amazon itself, or by retailers who pay Amazon for handling their logistics. Other sellers, however good their offers might be, are effectively shut out – relegated down-page, or hidden several clicks away in an obscure corner of Amazon's website," Hunter continued.
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