The news article titled “Amazon Used Secret ‘Project Nessie’ Algorithm to Raise Prices” published in The Wall Street Journal discusses the use of a secretive algorithm called ‘Project Nessie’ by Amazon to increase prices of products. The algorithm, which was reportedly developed by Amazon’s retail team, analyzes customer data and predicts their willingness to pay more. This algorithm is believed to have been in use since 2017 and has led to higher prices for certain goods on the platform.
The article highlights that this practice raises concerns about Amazon’s dominance in the e-commerce market and its potential impact on competition. Critics argue that the use of such algorithms can harm consumers by limiting their choices and forcing them to pay higher prices. Additionally, the article mentions that the Federal Trade Commission (FTC) is investigating Amazon’s antitrust practices, including the use of algorithms like ‘Project Nessie,’ as this could be seen as a violation of fair competition laws.
In conclusion, Amazon’s secret ‘Project Nessie’ algorithm has come to the forefront, raising questions about its impact on competition and consumer welfare. The algorithm’s ability to increase prices based on customer data has raised concerns about Amazon’s dominance in the market and potential harm to customers. The scrutiny by the FTC suggests that there may be legal implications for Amazon if its practices are found to be in violation of antitrust laws.