Amazon filed a lawsuit against Perplexity AI in early November, challenging the startup’s shopping agent, Comet, which automates purchases on e-commerce sites, including Amazon. This legal battle, which centers on the implications of AI in online shopping, could significantly impact the advertising sector, ad sellers, and retailers at large.
In its lawsuit, Amazon contends that Comet AI presents security risks and accuses Perplexity of misrepresenting the tool’s automated browsing as human activity, which it claims amounts to fraud. Perplexity’s legal team countered in a subsequent filing that Amazon’s true concern lies in its advertising revenue. They argued that AI agents, lacking human perception, do not engage with the extensive advertising that Amazon employs on its platform.
The counter-argument from Amazon’s legal team acknowledged this point, but argued that the issue is not solely about advertising visibility. They posited that Amazon’s reputation could suffer if customers miss out on potentially cheaper products and quicker delivery options when using Perplexity’s tool. Furthermore, Amazon expressed skepticism regarding how the court could quantify the loss of sales resulting from diminished goodwill, as suggested by Perplexity.
When approached for comment, both companies directed inquiries to their public statements. Analysts are closely monitoring the lawsuit, as Andrew Frank, VP and distinguished analyst at Gartner, emphasized that the outcome could hold significant ramifications for any publisher or retailer with direct consumer relationships. He noted that agentic shopping could jeopardize advertising revenue and erode the direct connections between consumers and shopping platforms.
The concerns surrounding the Amazon-Perplexity case reflect broader trends in the digital marketplace. Tyler Murray, chief enterprise solutions officer for VML in North America, highlighted that agentic AI shopping tools may not only threaten retail media, but could also pose an existential challenge to the industry.
Similar dynamics have been observed in the rivalry between search engines and publishers, particularly with the rise of platforms like Google, which have siphoned traffic and advertising revenue from news sites. Frank warned that this trend could further alter the economic framework of the publishing industry, shifting from traditional advertising and subscriptions to licensing fees extracted from search engines that utilize their content without transparency.
Despite its legal actions against Perplexity, Amazon has not shunned AI technology. The company recently announced partnerships with various AI firms, including a collaboration with OpenAI disclosed in November, just prior to initiating its lawsuit. During Amazon’s earnings call for Q3 at the end of October, CEO Andy Jassy indicated that while the company is developing its own agentic commerce platform, known as Rufus, it is also exploring potential partnerships with third-party agents.
Looking ahead, Frank suggested the possibility of an alternative method to engage with agents akin to advertising specifically designed for machines, which could compensate for potential losses in digital advertising revenues. However, he acknowledged the complexities at the heart of the Amazon-Perplexity dispute. “On the one hand, Perplexity can argue that these agents are authorized by the users who provide their credentials. On the other hand, Amazon claims this constitutes fraud, as their terms of service are intended for human users,” he stated. The resolution of this case could set significant precedents in the evolving landscape of AI-powered commerce.
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