Amazon FTC lawsuit spotlights inconsistent auction disclosure across its ads business

September 14, 2026 · AdExchanger

Twenty billion dollars is the amount the FTC says Amazon collected from advertisers since 2019 by misrepresenting how its ad auctions price impressions. The agency's lawsuit, filed last week, alleges Amazon told advertisers they were bidding in second-price auctions, where the winner pays a cent above the next-highest bid, then charged near-full bid amounts 80% of the time on Sponsored Products, Sponsored Brands and Display. Amazon disputes the allegations. The case leaves out Amazon's DSP, Prime Video, CTV and streaming audio inventory. AdExchanger columnist Sarah Caputo used that gap to examine Amazon's own DSP disclosures and found conflicting descriptions of how its Private Auction product prices Prime Video inventory: one Amazon guide calls it second-price, DSP help documentation describes a variable CPM set through optimization, and the training webinar she reviewed showed no visible floor price or clearing formula.

Verifying what an auction actually charges becomes difficult when a platform describes the same product as second-price in one document and an optimization-driven variable CPM in another. Caputo points out that Amazon Publisher Services states its third-party marketplace runs a 'unified, first-price auction in which the highest bid always wins,' a clarity it withholds from its own DSP inventory. Her advice is to ask DSPs in writing which auction methodology applies to any inventory being bought and whether log-level data exists to verify it. Where answers stay vague, buyers are already shifting spend toward direct, PMP and PG deals tied to specific deal IDs, a trend that pressures platforms whose margins depend on auction rules nobody outside the platform can check.