Apple and Amazon Face Antitrust Scrutiny in Germany Over 'Brandgating'

[MacRumors]

Apple and Amazon are set to face antitrust scrutiny in Germany over a policy that forbids independent sellers from retailing Apple products on Amazon, Bloomberg reports.

Germany's antitrust regulator, the Federal Cartel Office, has launched a probe into Apple and Amazon over the policy of "brandgating." The policy allows the makers of branded products, such as the iPhone, to have independent sellers removed from the retail platform, providing Amazon can sell the items instead.

"Brandgating agreements can help to protect against product piracy," the Cartel Office said in a statement. "But such measures must be proportionate to be in line with antitrust rules and may not result in eliminating competition."

Amazon responded, saying it never removes the sales permissions of sellers without sound reasons, and it invests heavily to protect customers from the illegal distribution of goods. The company has agreed to cooperate with the investigation.

The Cartel Office said that Apple is a "prominent" example of how Amazon conducts brandgating, which can purportedly take various forms. Amazon has only permitted Apple authorized vendors to sell Apple products on its platform since 2019. Amazon simultaneously became an Apple authorized vendor.

"The safety of our customers is our first priority, and our teams are constantly working with law enforcement, resellers, and e-commerce sites around the world to remove counterfeit products from the market," Apple said in a statement. "We work with Amazon to protect our customers from counterfeit products and provide confidence they are receiving a genuine Apple product out of the box."

The two companies have been investigated for similar accusations in the past, such as allegedly blocking the sale of Apple and Beats devices from resellers in order to stifle competition and fix prices.

Apple and Amazon are among the big tech companies under scrutiny around the world, particularly in the European Union, where a new Digital Services Act is poised to hit big tech with wide-reaching regulations.

Note: Due to the political or social nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Article Link: Apple and Amazon Face Antitrust Scrutiny in Germany Over 'Brandgating'

 

[Peepo]

Why can’t Apple choose who it wants to sell their products and also control retail price? If this changes then coiuld see lots of sellers offering “branded” Apple accessories which are really fake knockoffs, and maybe even scalping hard to find Apple products eg. New iPhones that are hard to get.

 

[dwaltwhit]

I have to plead ignorance here: I read this article twice and I still don’t understand what brandgating is.

 

[centauratlas]

Why can’t Apple choose who it wants to sell their products and also control retail price? If this changes then coiuld see lots of sellers offering “branded” Apple accessories which are really fake knockoffs, and maybe even scalping hard to find Apple products eg. New iPhones that are hard to get.

Exactly. What you will see next from the Germany government (as somewhat referenced in the article) is:

"why isn't Amazon doing more to stop counterfeit products? The people of Germany are purchasing what they think are iPhones (or whatever) and getting non-Apple pseudo clones."

 

[macduke]

Amazon was notorious for years for selling fake Apple products. People were even getting injured by fake chargers that were catching on fire! And now they want to reverse that? Amazon still has problems with tons of fake products, fake reviews, existing product pages being purchased and swapped out for a completely different product to inflate reviews, etc. It's a mess. This was the one good thing they've done in recent years, probably because Apple was threatening to sue them because it makes them look terrible, and Germany wants to ruin it? Also not sure why Apple can't have authorized resellers. Lots of companies do this. I can't even get service on a camera unless I buy it from an authorized reseller most of the time.

 

[HiVolt]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

 

[MauiPa]

So are they challenging the concept of authorized sellers? Sounds like a company has a vested right to ensure that it’s products are sold by authorized retailers. I don’t suppose that applies to used products - caveat emptor, but certainly new products

 

[SirithX]

I have to plead ignorance here: I read this article twice and I still don’t understand what brandgating is.

Know how you can go on Amazon and look up products and multiple 3rd party resellers are selling that product, but a lot of the time it's a knock off instead of the real thing? That's basically what they're trying to protect against, by stopping resellers in the event that the actual first party is able to sell the product to you directly.

 

[anthogag]

It is looking like the big tech companies are forming cozy relationships left and right. The solution is simple...right in front of your nose...make Amazon go back to selling only books.

 

[MauiPa]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

But not necessarily by authorized repair shops. Is an iPhone with an off- brand display really an iPhone?

 

[imnotthewalrus]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

the problem with “refurbished” are what 3rd party components may be present, i.e. battery, memory, HD etc. on computers, displays on phones. eBay is there for anyone who wants to take those chances.

 

[Speedy2]

Why can’t Apple choose who it wants to sell their products and also control retail price? If this changes then coiuld see lots of sellers offering “branded” Apple accessories which are really fake knockoffs, and maybe even scalping hard to find Apple products eg. New iPhones that are hard to get.

Did you even read the article?

"The policy allows the makers of branded products, such as the iPhone, to have independent sellers removed from the retail platform, providing Amazon can sell the items instead."

That means you can buy iPhones (new or refurbished) ONLY from Amazon directly.
Are we such little babies that we need so much protection from evil sellers that not even big, respected sellers can sell the product?

Your concerns are even directly addressed by the German authorities.

 

[Skika]

Federal cartel. At least they are honest with their names.

 

[Speedy2]

the problem with “refurbished” are what 3rd party components may be present, i.e. battery, memory, HD etc. on computers, displays on phones. eBay is there for anyone who wants to take those chances.

This doesn't justify banning the sale of new iPhones.

 

[cocky jeremy]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

Maybe Amazon isn't in the business of selling used products.

 

[Speedy2]

But not necessarily by authorized repair shops. Is an iPhone with an off- brand display really an iPhone?

This is a strawmen argument. You won't find "off-brand" displays that would work in an newer iPhone. Only big brands can manufacture these displays.

The argument would be more honest if you said "battery" or "lightning connector" instead.
And then I give you the question back.
Is an iPhone with a 3rd party battery still an iPhone?
Of course it is.

And if the repair shop clearly says the battery is 3rd party, do we need to be "protected"?
Of course not.

 

[Brian Y]

I can honestly see both sides here.

Amazon and Apple are both known for their anti-competitive behaviours. Stopping smaller sellers from selling products they sell does indeed look, and probably is, bad.

On the other hand, there are so many counterfeit Apple accessories out there (nature of the beast, you charge £15 for a £2 cable and you're going to get knock offs), that it's hard for them to verify who is actually selling genuine items (same for Beats, etc).

 

[jarman92]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

Yeah, we know. The problem is that it’s very difficult to differentiate between genuine used Apple products and knockoff crap, particularly on Amazon who already sucks at policing their platform. Apple doesn’t want internet scammers tarnishing their brand.

 

[jonblatho]

the problem with “refurbished” are what 3rd party components may be present, i.e. battery, memory, HD etc. on computers, displays on phones. eBay is there for anyone who wants to take those chances.

Huh. If only there were a way to make first-party parts available for third-party service.

 

[Maconplasma]

I can't stand those 3rd party sellers on Amazon selling the exact same products for much higher than the manufacturer themselves retails it for. I only buy "Ships from Amazon, Sold by Amazon". Those 3rd party sellers are rip off artists and it would be terrible if they sell Apple products because they will inflate prices and I don't trust them.

 

[Speedy2]

I can honestly see both sides here.

Amazon and Apple are both known for their anti-competitive behaviours. Stopping smaller sellers from selling products they sell does indeed look, and probably is, bad.

On the other hand, there are so many counterfeit Apple accessories out there (nature of the beast, you charge £15 for a £2 cable and you're going to get knock offs), that it's hard for them to verify who is actually selling genuine items (same for Beats, etc).

And yet the sale of accessories, whose design can be easily copied, is allowed.
While the sale of iPhones that can hardly be copied equally easily is banned.
So the whole knock-off argument really doesn't hold.

In the end, anyone with a credit card should be able to realize that a purchase over several hundreds of $$ requires a little care. Amazon has a rating system for that, and special warranties that help you to get your money back.
If you're not smart enough for that, tough luck.

Personally, I find it highly questionable when big tech companies climb into the same bed and make up rules that benefit only them, but not the customer.

 

[az431]

But people can't even sell genuine used Apple phones or laptops, ones that have been refurbished for example with new battery, fixed screens, etc.

We're not just talking about counterfit chargers and crappy cables. They are banning sales of used devices.

This a flat out lie. Anyone who owns an iPhone, iPad, or any other Apple product can freely resell it to anyone. Apple does not ban reselling your iOS device.

Apple does prohibit its authorized resellers from selling allegedly refurbished devices unless Apple refurbished the device. Not the same as "banning sales of used devices."

This is because most of these allegedly "refurbished" devices are not in fact refurbished, but are being falsely represented as refurbished by unethical third-party sellers on Amazon and other platforms. A lot of these allegedly refurbished devices are actually counterfeits, stolen, or repaired with garbage parts.

 

[Speedy2]

I can't stand those 3rd party sellers on Amazon selling the exact same products for much higher than the manufacturer themselves retails it for. I only buy "Ships from Amazon, Sold by Amazon". Those 3rd party sellers are rip off artists and it would be terrible if they sell Apple products because they will inflate prices and I don't trust them.

I can't stand them either.
No reason to justify a ban though.
It's anti competitive, because it hurts legitimate sellers that have every reason to exist. The free market collapses without them.

 

[Speedy2]

This a flat out lie. Anyone who owns an iPhone, iPad, or any other Apple product can freely resell it to anyone. Apple does not ban reselling your iOS device.

Pretty tough to accuse others of a lie and entirely misrepresenting the whole situation.

This is about Amazon + Apple.

 

[WiseAJ]

Sounds like a country making something that isn’t an issue into an issue just to go after big tech