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Bezos’ Amazon reportedly using third-party sellers’ data to develop its own private-label products: Report

Third party sellers stock their products at Amazon warehouses and in some cases, they even sell directly.

SNS | New Delhi |

Amazon has constantly maintained, even to US Congress, that it does not use third-party sellers’ data to help develop its own private-label competing products. But according to a report from The Wall Street Journal, which conducted a series of interviews with various former employees and analysis of documents, the reality is contradictory to what company has been claiming.

“Amazon.com Inc. employees have used data about independent sellers on the company’s platform to develop competing products, a practice at odds with the company’s stated policies,” the WSJ report said on Thursday.

Amazon’s business is dependent on the third party sellers, who use its platform to reach out larger customer base. These third party sellers stock their products at Amazon warehouses and in some cases, they even sell directly.

There have been several instances in which Amazon has created its own version of a product that is being sold by a third party seller. But the company has long asserted that when it makes and sells its own products and it doesn’t use the information it collects from the site’s individual third-party sellers.

The WSJ report prompted US Senators to reiterate that giant tech companies have too much power.

Earlier, the WSJ report probe found that some Amazon executives had access to seller data that was then used to discover bestselling items they might want to compete against. Amazon has long maintained that it’s against company policy to use such data to build products for itself.

In the latest WSJ report, one former employee told they knew they were violating company’s policies.

“We knew we shouldn’t,” said one former employee who accessed the data and described a pattern of using it to launch and benefit Amazon products. “But at the same time, we are making Amazon-branded products, and we want them to sell.”

In a statement, Amazon spokesperson said in a statement that the company, “strictly prohibit our employees from using non-public, seller-specific data to determine which private label products to launch. While we don’t believe these claims are accurate, we take these allegations very seriously and have launched an internal investigation.”