Amazon shipping containers at Miami International Airport (Florida, USA)
The Wall Street Journal reported on October 3 that Amazon has deployed a secret algorithm to assess how high it can raise prices while competitors can still raise prices.
The algorithm, dubbed Project Nessie, was first revealed late last month in a complaint filed by the US Federal Trade Commission (FTC), accusing the e-commerce giant of violating the country's antitrust laws.
Project Nessie will raise prices and monitor whether other retailers like Target follow suit. If competing retailers maintain lower prices, the algorithm will automatically bring Amazon’s prices back to normal.
Nessie allegedly helped Amazon increase profits by raising prices until the company stopped using it in 2019
“We again urge Amazon to act quickly to eliminate the cover-up and allow the American public to see the full extent of what we allege are its unlawful monopolistic practices,” said FTC spokesman Douglas Farrar.
Project Nessie is just one of several allegations the FTC has leveled against Amazon for illegally maintaining its dominance in the e-commerce industry.
In a September FTC complaint, Amazon was accused of using a variety of methods, such as being down-listed, to prevent sellers from offering products at lower prices on competing platforms.
Commenting on the lawsuit, Amazon said the FTC was "wrong on the facts and the law" and said it would make that case in court.
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