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Despite the conflict of interests in many areas, big tech companies have a close relationship, especially in areas where their interests overlap. For example, Google gives over $20 billion to Apple to stay as the default search engine on Safari. Meanwhile, Apple and Google are tough rivals in the smartphone market. But, the recent case between Amazon and Apple raised concerns about the e-commerce giant’s fairness and treatment of its third-party sellers.
Amazon and Apple are accused of limiting sellers in product pages to raise iPhone and iPad prices
Apple and Amazon reportedly signed an agreement in 2018 to get rid of the majority of resellers. The deal allowed Apple to raise the prices of its products sold on Amazon. Apple later agreed to allow its authorized sellers to sell iPhone and iPad devices in the Amazon marketplace. In return for this favor, Apple shipped Amazon discounted devices.
The deal between Apple and Amazon later turned into a class-action lawsuit, accusing companies of artificially raising the iPhone and iPad prices sold online. The U.S. District Judge John Coughenour refused to dismiss the suit, and the case will proceed. Meanwhile, Apple is facing a $14 billion tax case in Europe.
Business Insider also reveals another secret deal between Amazon and Apple, stating that Amazon’s preferential treatment to Apple expanded to the product pages. As per the report, Amazon allegedly blocked Apple’s rival ads on product pages. The move gave the tech firm a special treatment and unfair advantage over competitors and third-party sellers. The outlet refers to the deal as a “massive preferential treatment.”
While Apple’s rival product pages on Amazon are full of ads to recommend other devices to customers, Apple’s own product pages have only one banner ad on the bottom. This prevents customers from visiting other devices from rival brands like Samsung. Thus, Apple could sell more devices. It remains to be seen if Apple compensated for Amazon’s lost ad revenue, which was demanded by the retailer.
Samsung reportedly complained to Amazon about the special treatment it’s giving to Apple. Other companies that also asked for a similar deal heard from at “least half a dozen salespeople on Amazon’s advertising team” that “they were not able to extend this Apple-style special treatment to their clients.”
In response to BI, Apple said, “The 2018 Agreements significantly reduced the sale of counterfeit and unsafe Apple products on Amazon’s marketplaces and have materially improved customer experience.”