FTC Charges Amazon with Driving Higher Prices for Consumers, Despite Amazon Prices Being 13 Percent Less than Other Leading U.S. Retailers

September 26th, 2023

By Robert Bork Jr.

You’ve got to give credit to the FTC and its Chair Lina Khan – in their Tuesday filing of their blockbuster antitrust lawsuit against Amazon, this time they managed to round their argument to fully include the needs of consumers, not just the protection of other, less efficient competitors.

The FTC complaint reads: “Amazon’s tactics suppress rival online superstores’ ability to compete for shoppers by offering lower prices, thereby depriving American households of more affordable options.” And: “By taming price cutters into price followers, Amazon freezes price competition and deprives American shoppers of lower prices.”

FTC argues that Amazon is forcing consumers to pay higher prices by requiring its sellers to use Amazon’s delivery system, while forbidding sellers from offering the same goods on other sites at lower prices. The FTC all but blames Amazon for inflation.

An inconvenient truth, however, comes from an independent marketing analytics company Profitero, which has found that for three years straight, Amazon has led the retail sector in lower prices. Comparing the prices of 15 categories of products from 13 major retailers, Profitero found that Amazon’s online prices were on average 13 percent less expensive than other leading U.S. retailers, including Walmart.

Amazon prices were also lower in 2021 and 2020.

So how will FTC square its claim that Amazon’s standards for sellers is costing consumers dearly?

The facts are not on the side of Chair Khan and the FTC. But one thing can be said of them, at least they are now paying lip service to the consumer welfare standard.