Amazon pushes up prices across the Internet

Charting the age of uncertainty.

October 14, 2026 | By Amanda Shendruk | Not-Ship turns one next week!!

Note to readers: I won't spam you; free subscribers will only get three extra emails on top of the weekly edition.

Last week, I explored how Amazon's search interface is engineered to deceive users—specifically through the "top row trap," the "swamp of ads," and the practice of "discount-washing."

Today, we are looking under the hood. I want to explain the internal mechanisms Amazon uses to ensure that prices remain elevated—not just on their own platform, but across the entire digital shopping landscape.

The Core Issue

This isn't merely a personal theory; it is the central pillar of the US Federal Trade Commission's (FTC) upcoming antitrust litigation against the giant.

• Amazon relies on third-party sellers to fill its catalog.
• Amazon charges these sellers significant fees to access the platform.
• Many sellers now surrender nearly 50% of every sale to Amazon.

While the base commission (roughly 15% for most categories) is comparable to Walmart or eBay, the "hidden" costs are what drive the total cut upward.

The Breakdown of a Sale

For an apparel seller utilizing Amazon's full suite of services (fulfillment, storage, returns, and ads), the costs are layered:

1. Referral Fee: The standard commission on every transaction.
2. Fulfillment Fee: The cost for Amazon to pick, pack, and ship from their warehouses.
3. Advertising: Paying for those "sponsored" top-row placements.

Sellers are told they have "options"—they can ship items themselves or skip the ads. However, the reality looks like this:

The choice is whether to pay for extras. The real choice is between making sales or not making sales. The FTC describes Prime eligibility (which requires Amazon fulfillment) and advertising as a "virtual necessity for doing business on Amazon."

The Price Ripple Effect

When a seller loses half their revenue to fees, they cannot simply absorb that cost. They must cover production, logistics, and labor. Therefore, the cost is passed to the consumer.

Mathematically, the price you pay can be viewed as: $\text{Final Price} = \text{Production Cost} + \text{Operating Expenses} + \text{Amazon Fees} + \text{Seller Profit}$

Because the referral fee is a percentage of the final price, any increase in fees necessitates an increase in the price.

The "Fair Pricing" Trap

This is where the system becomes truly predatory. Amazon employs a Fair Pricing Policy. If Amazon detects that a seller is offering a product for a lower price on another site, they can:

• Remove the Buy Box (the essential "Add to Cart" button).
• Suspend the seller's account entirely.

Consequently, if a seller raises their price on Amazon to cover those heavy fees, they must raise the price on their own website and other platforms to avoid punishment.

Real-world examples of this in action:

• 2024: CNBC reported sellers losing their Buy Box because Target put items on sale.
• Legal Action: California's attorney general alleges Amazon pressured brands to force Target and Walmart to hike prices.
• Extreme Cases: More Perfect Union found a seller suspended over a mere one-cent price difference compared to Target.

Since Amazon controls roughly 40% of all US online retail sales, there is effectively nowhere cheaper to go.

Legal Battles and Global Response

In 2023, the FTC and 17 states sued Amazon, claiming it illegally maintains a monopoly by punishing low prices elsewhere and forcing the use of its warehouses. Amazon denies these claims; the trial is set for next year.

Meanwhile, in Europe, Germany recently ordered Amazon to cease controlling seller pricing, though this is not yet a final ruling.

Some readers have noted that "fake discounts" and ads are common across the web. While true, the FTC's argument is that you are paying "Amazon prices" regardless of where you click "buy."

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FULL DISCLOSURE: I spent two years at the Washington Post. Since Jeff Bezos owns the paper and spent that time dismantling the publication, he was not exactly a beloved figure in the newsroom.

CLASSIC ENSHITTIFICATION

This series was inspired by Cory Doctorow's concept of "enshittification"—the cycle where platforms first serve users, then squeeze them to serve shareholders. I highly recommend his book: Enshittification: Why Everything Suddenly Got Worse and What to Do About It. It makes antitrust law actually entertaining!

FROM ELSEWHERE

Things I found interesting or delightful this week:

• Life after death? A fascinating look at global beliefs on the afterlife based on surveys of 130,000 people across 23 countries. (Shoutout to Alvin, a Not-Ship subscriber! 💙)
• Stunning embroidery: Check out the incredible work of Irene Saputra on Instagram.
• The Ars Notoria: A medieval grimoire that promised university-level knowledge through rituals and diagrams.

MORE NOT-SHIP

• Greenwashing Playbooks: How fossil fuel companies use vague future promises in annual reports.
• The Amazon Cycle: How the world's largest company makes you pay more for less.
• Joy Watching: The mental health benefits of birdwatching in a stressful world.