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Photo: Nigel Kirby/Loop Images/Universal Images Group via Getty Images

Amazon does not sufficiently distinguish between its search results and paid ads, potentially "deceiving millions of consumers," according to a complaint filed to the Federal Trade Commission.

Why it matters: Joan Moriarty, research director for the Strategic Organizing Center, a coalition of labor unions that filed the complaint, told the Washington Post the group is "very hopeful" that the FTC will investigate the complaint because Lina Khan (D), a known Amazon critic, is now chair.

  • Our thought bubble, via Axios' Ashley Gold: Many groups seeking to reel in the power of Big Tech are hopeful Khan will be aggressive, but how much she’s able to do is limited by time, as well as FTC funding and staffing.

Details: The complaint alleges that more than a quarter of Amazon search results were third-party ads, but the company does not clearly identify which ones are sponsored results, which could be deceiving to consumers.

  • The complaint is based on an analysis of more than 130,000 search results for popular products.
  • SOC's complaint says that allegedly Amazon's lack of disclosure goes against consumer protection law. They say that for a few seconds after the page loads, ads do not contain any sort of label that classifies them as sponsored content, a practice which the SOC called "lazy-load."
  • Amazon "is unlawfully deceiving millions of consumers by failing to 'clearly and conspicuously' disclose which of its search engine results are paid advertisements rather than 'organic' search results," the complaint says.
  • "[T]he overwhelming proportion of advertisements — advertisements which are not identifiable as ads — within Amazon’s search pages throws into question the fundamental integrity of 'search' on Amazon’s online platform, and indicates Amazon is engaging in a much broader deception of consumers by representing these pages as 'search results' at all," it adds.

What they're saying: "Amazon customers should be very conscious and examine closely when they do a search on Amazon whether they’re getting an advertisement or an organic search result," Marka Peterson, SOC's legal director, told the Post.

  • "They should be very aware of the different methods that Amazon uses to obscure its advertising."
  • The SOC did not immediately respond to Axios' request for comment.

"We design our store to help customers discover products we think may best meet their needs — sponsored ads is one of the ways to help them find products they may be interested in. This report is incorrect and misstates FTC guidance — ads in Amazon’s store always include a clear and prominent 'sponsored' label, implemented in accordance with FTC guidelines," Amazon spokesperson Tina Pelkey told Axios.

Editor's note: This story has been updated with comment from Amazon.

Go deeper

Jan 11, 2022 - Technology

Meta loses bid to dismiss FTC antitrust case

Illustration: Annelise Capossela/Axios

The Federal Trade Commission's antitrust suit against Meta, formerly Facebook, can move forward, a federal court ruled Tuesday.

The big picture: The same judge who dismissed an earlier version of the agency's lawsuit, filed under the Trump administration, says this time the government's case — as rewritten by the agency now led by chair Lina Khan — is good enough to try.

Updated 20 mins ago - Economy & Business

Tax season nightmare ahead for understaffed IRS

Illustration: Shoshana Gordon/Axios

The IRS will start accepting 2021 tax returns in less than a week, and the filing delays and administrative headaches to come might eclipse last year — which was “one of the worst filing seasons," according to an independent advocacy agency within the IRS.

Why it matters: For taxpayers, especially with complex or paper filings, this means headaches, delayed refunds, and mistakes.

China builds its own movie empire

Expand chart
Data: Gower Street citing Comscore; Chart: Kavya Beheraj/Axios

China blocked all four of Disney's Marvel movies from being released in its theaters last year, a grim sign for U.S. film giants being squeezed out of the world's fastest-growing box office.

Why it matters: The Chinese Communist Party is using domestic films as a key conduit for mass messaging aimed at achieving political goals, leaving little room for foreign views.