Amazon Strong-arms Small Businesses to Share User Data

Amazon reportedly pressured smart-thermostat maker Ecobee to fork over data from its voice-enabled devices even when customers weren’t actively using them. When Ecobee pushed back, the e-commerce giant threatened to box the company out of high-profile selling events like Prime Day or refuse Alexa certification for future devices, according to a Wall Street Journal report this week.

Last year, Amazon approached Ecobee among other Alexa-enabled device sellers about sharing “proactive state” data from customers, several company executives confirmed to the Journal. With this data, Amazon would receive updates about the device’s status at all times even when customers weren’t using them, such as the temperature of their home or whether their doors are locked, among other examples.


However, when Ecobee initially refused to provide users’ proactive state data, Amazon warned that a refusal might bar the company from major selling events like Prime Day or prevent its future devices from receiving Alexa certification, said one of the people the Journal spoke with. Given that Amazon controls a huge chunk of the global e-commerce market (nearly 40% in the U.S. alone), that kind of move can bankrupt smaller companies like Ecobee.


In addition to stealing designs from other companies for its AmazonBasics line, Amazon also purportedly pressures industry partners to use its logistics arm, Fulfillment by Amazon, by threatening to make it more difficult to sell products on its marketplace, according to the Journal. Amazon even reportedly competes with the companies it invests in, of which Ecobee is one, using its position as a shareholder to access confidential information and develop similar products.

Last October, a House Judiciary antitrust subcommittee concluded what we all already knew: That Amazon and other tech giants have “monopoly power” in their respective markets and “abuse their power by charging exorbitant fees, imposing oppressive contract terms, and extracting valuable data from the people who rely on them.”

Source: Amazon Strong-arms Small Businesses to Share User Data

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