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State officials in California and Washington are reportedly looking into Amazon's handling of third-party sellers on a platform where the company also sells its own, competing products. Amazon faced similar scrutiny in 2019 from the European Union.
The news of a California investigation was first reported Friday in The Wall Street Journal. A subsequent New York Times report corroborated the earlier one, and also noted that Washington was in the mix as well. Both papers cite unnamed sources familiar with the inquiries.
Amazon has long been dogged by suspicions that the company uses its position as gatekeeper of the world's most popular online marketplace to gain an unfair competitive advantage over other sellers on the platform. Over the years, the company has added more and more private label brands to its collection.
The Timesreport notes that California officials want to know if and how Amazon uses seller data to inform its own private label moves. The Washington investigation is also interested in finding out if Amazon makes it harder for sellers to peddle their products on other platforms.
Neither state commented on the record in response to either report, nor did an Amazon spokesperson.
Whatever may be happening in state offices behind the scenes, reports of these investigations amount to another PR hit for a company that's had its share of them in 2020. Its earlier troubles mostly tie to the coronavirus pandemic and the company's missteps as reports emerged of unsafe working environments in Amazon warehouses.
Concerns inside and outside the company have had a number of impacts. Back in April, tech workers called out sick to protest working conditions. This came only a few days after two warehouse workers who publicly criticized the company were fired. That firing also led one VP, who called the move "chickenshit," to quit his job.
The internal struggles are having an impact on the outside as well, with some Amazon customers sending the company a message by canceling their Prime subscriptions.
These state investigations are just one piece of a bigger picture that's seen the U.S. government go after Big Tech more and more at both the state and federal levels.
SEE ALSO: Amazon's proposed federal anti-price gouging law (surprise!) protects AmazonFacebook got hit with an investigation from the Federal Trade Commission in summer 2019 just as an earlier one had wrapped up. A few months later, in September, multiple states – including New York, Colorado, Florida, Iowa, Nebraska, North Carolina, Ohio, and Tennessee, as well as Washington, D.C. – launched antitrust investigations into Facebook and Google both.
The U.S. Congress also joined the fray at around the same time, asking Facebook, Google, Apple, and Amazon for records. The letter sent by the U.S. House of Representatives Judiciary Committee expressed concern over "competition problems in digital markets" and possible anti-competitive behavior from the biggest and most powerful players.
Topics Amazon