US Senator Warren presses Amazon on contracting, pricing practices for local governments and schools

By Arriana McLymore

March 12 (Reuters) – U.S Senator Elizabeth Warren of Massachusetts is asking Amazon CEO Andy Jazzy to provide details on its algorithmic pricing and contracting practices for the company’s procurement platform after an advocacy group said some schools and local governments paid more for office supplies compared to others in nearby locations, according to a letter seen by Reuters.

* “Instead of offering fixed prices for all buyers, whichare typical in the procurement space, Amazon Business subjectsbuyers to algorithm-driven dynamic pricing that forces schooldistricts and local governments to pay ever-changing, ofteninflated costs for essential goods,” Sen. Warren said in theletter.  * States including California and New York, along with theU.S. Federal Trade Commission, have raised concerns about thecollection and use of personal data to determine prices * Advocacy group Institute for Local Self-Reliance inDecember released a report saying algorithmic pricing by AmazonBusiness lets the company covertly raise prices.   * One city paid three times as much for a pack of Sharpiesas another nearby school district, according to the ILSRreport.   * Warren asked Amazon a dozen questions about how itdetermines prices for local governments and school districts,and its use of personal consumer data to set prices. * Warren in February sent a letter to Amazon on behalf ofthe Committee on Banking, Housing, and Urban Affairs requestinginformation about tariff-induced price increases on itse-commerce marketplace and if the company plans to decreaseprices if it receives refunds for tariff payments recentlydeemed illegal by the US Supreme Court.

(Reporting by Arriana McLymore in New York; Editing by David Gaffen)