Last week, the U.S. Federal Trade Commission (FTC) filed a lawsuit against Amazon, accusing the online retailer of unlawfully maintaining a monopoly. While much of the FTC's complaints against Amazon were initially undisclosed, "The Wall Street Journal" revealed key details about the seller's secret algorithm. According to the FTC, Amazon used this algorithm to raise prices and suppress competition on popular online shopping platforms.

Insiders familiar with the FTC's allegations told the Journal that it all began when Amazon developed an algorithm codenamed "Project Nessie." Allegedly, it manipulated competitors' pricing vulnerabilities, causing them to charge higher prices. As a result, price reductions by competitors did not contribute to gaining a larger market share but instead led to losses.

The FTC complaint states: "Amazon leverages its vast surveillance network to block price competition by detecting and restraining price cuts, artificially inflating prices on and off Amazon, and depriving competitors of the ability to scale through offering lower prices."

Sources claim that Amazon generated over $1 billion in revenue through "Project Nessie." Amazon ceased the use of the algorithm in 2019 for unclear reasons. FTC spokesperson Douglas Farrar told WSJ that the agency aims to provide the public with greater access to information hidden in the complaint. The FTC continues to call on Amazon to grant access to data, allowing Americans to fully understand what the agency deems the company's illegal monopolistic practices.

Amazon's Public Relations specialist, Tim Doyle, stated that the FTC's allegations are false and that the algorithm was used for other entities. He mentioned that Project Nessie aims to prevent prices from falling to an unsustainable low level.