New US Suit Claims Apple, Amazon Colluded To Raise Prices

Apple and Amazon were accused in an antitrust lawsuit on Wednesday of conspiring to drive up the prices of iPhones and iPads. The lawsuit claims that Amazon and Apple colluded to eliminate third-party sellers on Amazon who offered these products at a lower price. 

The lawsuit was filed by law firm Hagens Berman in Washington. It alleged that the companies had an ‘unlawful horizontal agreement’ to reduce the ‘competitive threat posed by third-party merchants’, thus violating the US antitrust laws that prohibit such coordination, especially when it leads to higher prices or other harms to consumers, such as loss of quality or access.

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The lawsuit claimed that Amazon expelled third-party sellers after it signed a deal with Apple in 2019. The number of Apple resellers on Amazon fell to around 20 per country, according to reports. Apple, in return, gave Amazon up to a 10 percent discount on its products. Based on a MacRumors report, there were about 600 third-party sellers of Apple devices on Amazon, but only seven were left following the 2019 agreement.  

The change transformed Amazon into the dominant reseller of new iPhones and iPads. According to a Reuters report on the lawsuit by plaintiff Steven Floyd of Williamsport, Pennsylvania, prices rose more than 10 per cent, while Apple stabilised the prices it charged in retail stores.