Amazon and Meta, the owner of Facebook, have both agreed to make changes to their retail platforms in order to promote fair competition, according to the Competition and Markets Authority (CMA) in the UK. The CMA conducted separate investigations into the use of advertising data by these US online giants, and they have voluntarily accepted a set of commitments to address competition concerns.
The CMA’s probe into Amazon was launched in July 2022 due to concerns that the company was exploiting its dominant position as the leading online retail platform in the UK. The investigation revealed that Amazon was giving its own seller business an unfair advantage over independent competitors. It was also found that Amazon favored sellers using its own warehousing and delivery services over rival logistics businesses.
An Amazon spokesperson stated that the company cooperated with the CMA during the investigation and welcomed the resolution. They believe it will enable them to continue serving their customers and the thousands of small and medium-sized businesses on their UK store.
This announcement by the CMA comes after a similar outcome in the European Union, where Amazon agreed to address anti-competitive practices related to independent sellers’ data in December.
The CMA’s investigation into Meta, which started in June 2021, was initiated out of concerns that the company had an unfair competitive advantage that could distort competition on its Facebook Marketplace platform. Meta has also committed to certain measures to prevent the exploitation of advertising customers’ data and protect businesses and consumers. Competitors of Facebook Marketplace who advertise on Meta platforms can now choose to opt out of having their data used to improve Facebook Marketplace.
Additionally, Meta has pledged to limit the use of ad data when developing its products, ensuring that it does not gain an unfair advantage over products or services offered by its advertising customers. Meta welcomed the CMA’s decision to close the investigation and emphasized its commitment to implementing systems and controls that validate the non-use of advertiser data from competitors in Marketplace. However, it is important to note that Meta is still under investigation by the European Commission.
Overall, these voluntary commitments by Amazon and Meta aim to address competition concerns and protect fair competition in the retail market, both in the UK and the European Union. These changes will have a significant impact on how these online giants operate and interact with their advertising customers.
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