The Amazon tax

1266 points · 646 comments on HN · read original →

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Amazon's search ads function as a hidden tax that makes products worse and more expensive.

Seth Godin argues Amazon's $50 billion-plus annual search ad revenue is 'legal theft,' not a tax. Ads distort search results, forcing even top-rated product makers to bid for clicks to protect sales. A study suggests ecommerce sites with search ads sell fewer items than those without. The system ultimately makes products more expensive and incentivizes shoddy goods, as brands shift budgets from quality to ads. Godin claims Amazon is no longer customer-centric.

What commenters are saying

Commenters largely agree, seeing the ad system as a predictable result of monopoly and capitalism. Several suggest avoiding Amazon and buying directly from manufacturers or niche retailers. Some counter that Amazon is not a true monopoly, pointing to Walmart.com as a viable alternative. Others criticize Amazon's search and review quality: one notes 3/4 of results are sponsored ads, another found product search so poor they use Google instead. One commenter praises TikTok Shop's recommendation algorithm as a superior shopping experience.