Amazon accused of rigging its platform in India
US senator Elizabeth Warren called for breaking up Amazon. com and Indian retailers demanded a government probe into the company after a Reuters investigation showed that the e-commerce giant had copied products and rigged search results in India.
The Reuters report reviewing thousands of internal Amazon documents found that the US company ran a systematic campaign of creating knock-offs and manipulating search results to boost its own private brands in India, one of the company’s largest growth markets.
Wednesday’s report showed for the first time that, at least in India, manipulating search results to favour Amazon’s own products, and copying other sellers’ goods, were part of a formal strategy at Amazon and that at least two senior executives had reviewed it.
Linking to the story on Twitter, Warren, a long-time critic of Amazon, said “these documents show what we feared about Amazon’s monopoly power that [it] is willing and able to rig its platform to benefit its bottom line while stiffing small businesses and entrepreneurs.
“This is one of the many reasons we need to break it up.”
A group representing millions of India’s brick-and-mortar retailers said on Thursday the government must launch an investigation into Amazon.
“Amazon is causing a great disadvantage to the small manufacturers. They are eating the cake that is not meant for them,” Praveen Khandelwal of the Confederation of All India Traders told Reuters. The group says it represents 80-million retail stores in the country.
Indian retailers say that foreign e-commerce businesses such as Amazon and Walmart’s Flipkart indulge in unfair business practices that hurt smaller firms, allegations the companies deny. Amazon did not respond to a request for comment on reactions to the report.
In response to questions for Wednesday’s report, Amazon said: “We believe these claims are factually incorrect and unsubstantiated.”
It added Amazon displays “search results based on relevance to the customer s search such products have’ private query, irrespective of whether brands offered by sellers or not”.
Warren, a Democrat, advocated the break-up of Amazon and other tech giants in 2019 when she was running for president. Since then, as a senator from Massachusetts, she has continued to apply pressure on companies such as Amazon.
In sworn testimony before Congress last year, Amazon founder Jeff Bezos said the company prohibits its employees from using data on individual sellers to help its private label business. And, in 2019, another Amazon executive testified that the company does not use such data to create its own private label products or alter its search results to favour them.
The documents reviewed by Reuters showed how the company’s private brands team in India secretly exploited internal data from its India unit to copy products sold by other firms, and offer them on its platform.
The company promoted sales of its private brands such as AmazonBasics by rigging search results on its platform in India so that its products would appear, as one 2016 strategy report put it, “in the first two or three ... search results”.
The Alliance of Digital India Foundation, a nonprofit representing some of India’s biggest start-ups, said the practices are “highly deplorable , calling into the Indian start-up”ecosystem”. question “the credibility of Amazon as a good faith operator in
In a blog post, the group urged the government to take action against “Amazon’s predatory playbook of copying, rigging and killing Indian brands”.
On Thursday, Ashwani Mahajan, a top official in the economic wing of the Rashtriya Swayamsevak Sangh, the ideological parent of Indian Prime Minister Narendra Modi’s ruling party, urged the country’s consumers on Twitter to “#boycottAmazon”.