Criticism of Amazon
has been criticized on many issues, including anti-competitive business practices, its treatment of workers, offering counterfeit or plagiarized products, objectionable content of its books, and its tax and subsidy deals with governments.
Anti-competitive practices
One-click patent
The company has been criticized for its alleged use of patents as a competitive hindrance; its "1-Click patent" may be the best-known example. Amazon's use of the 1-click patent against competitor Barnes & Noble's website led the Free Software Foundation to announce a boycott of Amazon in December 1999, which ended in September 2002. On February 22, 2000, the company patented an Internet-based customer referral system known as an affiliate program. Industry leaders Tim O'Reilly and Charlie Jackson spoke out against the patents and O'Reilly published an open letter to Amazon CEO Jeff Bezos, petitioning Bezos to "avoid any attempts to limit the further development of Internet commerce". O'Reilly collected 10,000 signatures, and Bezos responded with an open letter. The protest ended with O'Reilly and Bezos visiting Washington, D.C. to lobby for patent reform. The company received a patent, "Method and system for conducting a discussion relating to an item on Internet discussion boards", on February 25, 2003. On May 12, 2006, the USPTO ordered a re-examination of the 1-Click patent based on a request by actor Peter Calveley, who cited an earlier e-commerce patent and the Digicash electronic cash system.Canadian site
Amazon has a Canadian website in English and French. Until a March 2010 ruling, however, it was prevented from operating any headquarters, servers, fulfillment centers or call centers in Canada by that country's legal restrictions on foreign-owned booksellers. Amazon's Canadian site originates in the United States, and Amazon has an agreement with Canada Post to handle distribution in Canada and for the use of the crown corporation's Mississauga, Ontario, shipping facility. The launch of Amazon.ca generated controversy in Canada. In 2002, the Canadian Booksellers Association and Indigo Books and Music sought a court ruling that Amazon's partnership with Canada Post represented an attempt to circumvent Canadian law. The litigation was dropped in 2004.In January 2017, doormats with the Indian flag were offered on the Amazon Canada website. Use of the Indian flag in this way is considered offensive to the Indian community and a violation of the Flag Code of India. Indian Minister of External Affairs Sushma Swaraj threatened a visa embargo for Amazon officials if Amazon did not issue an unconditional apology and withdraw all such products. According to deputy commissioner for deceptive marketing practices Josephine Palumbo, Amazon.ca was required by the Canadian Competition Bureau to pay a $1 million penalty and $100,000 in costs for failing to provide "truth in advertising". The fine was levied because some products on Amazon.ca had an artificially-high list price, making a lower selling price appear attractive and giving the company an unfair competitive edge over other retailers. This is a frequent practice among some retailers, and the fine was intended to "send a clear message that unsubstantiated savings claims will not be tolerated". The bureau indicated that Amazon has made changes to ensure that its regular prices are more accurate.
BookSurge
Sales representatives of Amazon's BookSurge division began contacting publishers of print on demand titles in March 2008 to inform them that for Amazon to continue selling their POD books, they must sign agreements with Amazon's BookSurge POD company. Publishers were told that eventually, the only POD titles Amazon would sell would be those printed by BookSurge. Some publishers felt that this ultimatum was monopolistic, and questioned the ethics of the move and its legality under anti-trust law.Direct selling
In 2008, Amazon UK was criticized for attempting to prevent publishers from direct selling at a discount from their own websites. Amazon argued that it should be able to pay publishers based on the lower prices on their websites, rather than on the recommended retail price. Amazon UK was also criticized that year by the British publishing community after withdrawing from sale key titles published by Hachette Livre UK, possibly to pressure Hachette to provide discounts described as unreasonable. Curtis Brown managing director Jonathan Lloyd said that "publishers, authors, and agents are 100% behind . Someone has to draw a line in the sand. Publishers have given 1% a year away to retailers, so where does it stop? Using authors as a financial football is disgraceful." In August 2013, Amazon agreed to end its price-parity policy for marketplace sellers in the European Union in response to investigations by the UK Office of Fair Trade and Germany's Federal Cartel Office.Price control
After the announcement of the Apple iPad on January 27, 2010, Macmillan Publishers began a pricing dispute with Amazon about electronic publications. Macmillan asked Amazon to accept a new pricing scheme it had worked out with Apple, raising the price of e-books from $9.99 to $15. Amazon responded by pulling all Macmillan books from its website, although affiliates selling the books were still listed. On January 31, 2010, Amazon "capitulated" to Macmillan's pricing request.In 2014, Amazon and Hachette became involved in a dispute about agency pricing, when an agent determines the price of a book; normally, Amazon dictates the discount level of a book. High-profile authors became involved; hundreds of writers, including Stephen King and John Grisham, signed a petition: "We encourage Amazon in the strongest possible terms to stop harming the livelihood of the authors on whom it has built its business. None of us, neither readers nor authors, benefit when books are taken hostage." Author Ursula K. Le Guin said about Amazon's practice of making Hachette books more difficult to buy on its site, "We're talking about censorship: deliberately making a book hard or impossible to get, 'disappearing' an author." Falling sales of Hachette books on Amazon indicated that its policies probably deterred customers. On August 11, 2014, Amazon removed the option to pre-order Captain America: The Winter Soldier to control the online pricing of Disney films; the company had used similar tactics with Warner Bros. The conflict was resolved in late 2014, with neither side making concessions. Amazon again began to block pre-orders of Disney films in February 2017, just before Moana and Rogue One were due to be released for the home market.
The law firm Hagens Berman filed a lawsuit in the New York district court in January 2021, saying that Amazon colluded with leading publishers to keep e-book prices artificially high. Connecticut announced that it was investigating Amazon for potential anti-competitive behavior in its marketing of e-books.
Removal of competitors' products
On October 1, 2015, Amazon announced that Apple TV and Google Chromecast products were banned from sale by all merchants effective October 29 of that year. The company said that this was to prevent "customer confusion", since those devices did not support Amazon Prime Video. The move was criticized as an attempt to suppress products competing with Amazon Fire TV products.In May 2017, it was reported that Apple and Amazon were nearing an agreement to offer Prime Video on Apple TV and allow the product to return to the retailer. Prime Video launched on Apple TV on December 6 of that year, with Amazon beginning to sell Apple TVs again shortly thereafter.
Amazon is known to remove products for trivial policy violations by third-party sellers which compete with Amazon's home-grown brands. To compete for product placement where Amazon's own brands are featured prominently, third-party sellers often list themselves with Amazon's Prime program; this increases costs, shrinking profit margins.
Amazon has suppressed other Google products, including Google Home, Pixel phones, and products from Google subsidiary Nest Labs. Google announced on December 6, 2017, that it would block YouTube from the Amazon Echo Show and Amazon Fire TV products. In December 2017, Amazon said that it intended to begin offering Chromecast again. Nest said that it would no longer offer stock to Amazon until the company committed to offering its entire product line.
In April 2019, Amazon announced that it would add Chromecast support to its Prime Video mobile app and release its Android TV app more widely; Google announced that it would, in return, restore access to YouTube on Fire TV. Prime Video for Chromecast and YouTube for Fire TV were both released July 9, 2019. In December 2019, after the acquisition of Honey by PayPal, Amazon began to warn users that Honey was a security risk.
Apple partnership
In November 2018, Amazon reached an agreement with Apple Inc. to sell selected products through the company, selected Apple authorized resellers, and vendors who meet specific criteria. As a result of this partnership, only Apple authorized resellers and vendors who purchase $2.5 million in refurbished stock from Apple every 90 days may sell Apple products on Amazon. The partnership was criticized by independent resellers, who believe that it restricts their ability to sell refurbished Apple products on Amazon at low cost. In August 2019, The Verge reported that Amazon was being investigated by the FTC because of the deal.Marketplace participant and owner
Amazon owns a dominant marketplace and is a retail seller in that marketplace. The company uses data from the marketplace which is unavailable to other retailers in that marketplace to determine which products to produce in-house and at what price point. Amazon markets products under AmazonBasics, Lark & Ro, and other private-label brands. U.S. presidential candidate Elizabeth Warren proposed forcing Amazon to sell AmazonBasics and Whole Foods Market, where Amazon competes against other sellers as a brick-and-mortar retailer.Tim O'Reilly, comparing Ingram's business with Amazon's, noted that Amazon's focus on the customer debilitates the retail ecosystem ; Ingram sought to innovate and build on behalf of all the stakeholders in its marketplace it operates in. According to O'Reilly, Amazon's behavior is driven by its need for growth. Third-party sellers have criticized Amazon's rent-seeking behavior, which includes increasing the cost of doing business on its platform, abusing its dominant market position to manipulate pricing, copying popular products from third-party retailers, and unjustifiably promoting its own brands.
In October 2021, citing leaked internal documents, Reuters reported that Amazon harvested and studied data about its sellers' sales and used the data to identify lucrative markets and launch Amazon replacement products in India. The data included information about returns, clothing sizes, and the number of product views on its website. Rival sales figures are not available to Amazon's sellers. The company also tweaked search results to favor Amazon's private-label products. The strategy's impact reached well beyond India; hundreds of Solimo-branded household items are available in the US. One casualty is the clothing brand John Miller, owned by India's Kishore Biyani. In October 2022, a £900 million class-action lawsuit was filed in the United Kingdom against Amazon over a buy box on its website which "favours products sold by Amazon itself, or by retailers who pay Amazon for handling their logistics".