In new research, Muxin Li and Ksenia Shakhgildyan examine the 2018 “brand gating” agreement between Apple and Amazon and how it impacted competition and consumer welfare on Amazon’s platform.

When Apple granted Amazon privileged access to its full product line—iPhones, iPads, and Beats headphones—on October 31, 2018, thousands of small merchants were suddenly locked out of Amazon’s marketplace in several countries. The change followed an agreement between the two companies known as “brand gating.” The deal limited the sale of Apple products on Amazon to a small group of authorized resellers, reshaping the online Apple retail landscape overnight on January 4, 2019, the implementation deadline.

Apple justified the agreement as a means to improve brand control and reduce counterfeiting. Amazon, meanwhile, secured privileged access to Apple’s products while reducing intra-brand price competition from resellers. Regulators soon began asking if two of the world’s largest technology companies struck a deal that effectively raised prices and reduced competition.

The agreement drew competition authorities’ scrutiny on several continents but did not lead to lasting sanctions. In Italy, the competition authority (Autorità Garante della Concorrenza e del Mercato) fined Apple and Amazon a combined 203 million euros in 2021 for restricting reseller access, though the fine was later annulled on procedural grounds. In Spain, the Comisión Nacional de los Mercados y la Competencia imposed a record 194 million euro fine in 2023 for similar restrictions, but the Spanish High Court suspended enforcement pending appeal in early 2024. In the United Kingdom, a proposed 494 million pound collective action alleging collusion to foreclose resellers and inflate prices was dismissed by the Competition Appeal Tribunal, which denied certification. Finally, in the United States, parallel private antitrust litigation alleging horizontal collusion and group boycott under the Sherman Act was dismissed in May 2025 when the sole plaintiff failed to show cause.

Even though both companies have since been formally designated as gatekeepers under the European Union’s Digital Markets Act(DMA), which prohibits self-preferencing and requires fair platform access, DMA has not yet been used to target the brand gating agreement. Despite this wave of attention from competition authorities, there remains surprisingly little economic evidence on how such brand-gating agreements actually affect digital markets. The 2018 Apple–Amazon agreement provides a rare natural experiment for studying the complex relationship between dominant firms. The deal was implemented abruptly, on a known date, and applied only in certain countries—allowing clear before-and-after comparisons across affected and unaffected markets.

Our new paper, “‘Frenemy’ of Two Giants: Amazon and Apple,” provides novel empirical evidence on the effects of this brand gating agreement on the tablet market. The findings are striking: 

1.) Brand gating sharply reduced the number of sellers of Apple products on Amazon;

2.) even more importantly and surprisingly, brand gating considerably reduced the diversity of Apple products on Amazon; 

3.) it significantly increased Amazon’s share as the default seller for Apple products in the “Buy Box,” the section for each product where consumers can “buy now” and where over 90% of Amazon transactions occur;

4.) Buy Box prices rose substantially; and 

5.) there was no measurable improvement in product quality or counterfeit reduction.

How we measured the impact

First, we compiled daily data on Amazon’s tablet listings, including seller information, prices, offer details, and “Buy Box” allocations across marketplaces in the U.S., the U.K., France, Germany, Italy, Spain, Japan, Canada, and Mexico several months before and after the agreement. To complement these data, we used the Amazon Reviews 2023 database, which includes millions of customer ratings and review texts. 

Next, we compared the iPad market in countries affected by the agreement (the “treated” group) to those in unaffected countries (the “control” group) in terms of number of sellers, products, Buy Box winners, prices, and product quality. Moreover, we also benchmarked Apple against Samsung tablets, its main competitor in the tablet market. This allowed us to filter out changes driven by broader market trends, such as shifts in demand or global supply conditions. Put simply, we asked: Did something unusual happen to Apple’s marketplace outcomes in the countries where the brand gating deal took effect, relative to both unaffected countries and to Samsung tablets’ market? Moreover, we assessed whether the products that disappeared after the agreement implementation differed in quality or consumer satisfaction from those that remained.

Key findings

Fewer sellers: The first effect of the agreement was immediate and visible. After January 2019, the number of third-party sellers offering Apple tablets on Amazon fell sharply. The average number of daily sellers per iPad dropped by 60–75 percent in Europe, and by 50 percent in the U.S. In Japan, the decline was even steeper, exceeding 70 percent. By contrast, Canada and Mexico—where the agreement did not apply—showed no comparable change. Whether this contraction represents efficiency or exclusion is a central policy question.

Fewer choices: Product variety declined in parallel. The number of distinct iPad listings on Amazon fell by about half across treated countries. In Germany, France, Italy, and Spain, the average daily number of listings dropped from over 400 to fewer than 200. The U.S. also experienced a large decline in Apple tablet availability, but the drop was less abrupt than in Europe. From a pre-agreement peak of nearly 480 daily products, the number of listed tablets fell to around 360 shortly after January 2019—a decline of roughly 25 percent. Japan experienced a 70 percent reduction while the control markets again remained stable or saw modest growth.

Amazon’s Buy Box dominance: The contraction in seller participation was accompanied by a dramatic shift in who controlled the Buy Box, as only one seller can appear in the Buy Box at a time. Ninety percent of transactions occur through the Buy Box, and firms are defaulted to the Buy Box option based on the quality and price of their services. Before the brand-gating agreement, Amazon itself rarely appeared as the Buy Box seller for Apple products. Afterward, its share surged—from near zero to more than 20 percent in the U.S., more than 50 percent in Europe, and almost 100 percent in Japan. This increase was not observed for Samsung tablets or in control countries. While the algorithm determining Buy Box placement is proprietary, the timing and magnitude of the shift strongly suggest that Amazon’s new role as an authorized Apple reseller changed competitive dynamics on its own platform.

Price increase: Changes in seller participation and Buy Box allocation translated into noticeable price effects. In the months following the agreement, Buy Box prices for Apple tablets rose by almost 30 percent relative to control markets. Because most consumers buy through the Buy Box, these figures correspond to the effective price paid by shoppers. No similar pattern appeared for Samsung products, suggesting that the price increase was specific to Apple in the countries covered by the agreement. This does not imply that Amazon or Apple explicitly coordinated prices. Rather, it shows how restricting reseller competition can raise average prices even without direct price manipulation.

No quality and counterfeit effects: Apple defended brand gating as a way to curb counterfeits and ensure consistent quality. If true, we would expect higher ratings or more positive consumer sentiment after the change. Yet, we found little evidence of such improvements. Average star ratings for Apple tablets remained stable across all regions, typically around 4.2 out of 5. Moreover, products that disappeared from the marketplace after January 2019 had nearly identical ratings to those that remained. Additionally, using text-based sentiment analysis on tens of thousands of Amazon reviews, we found no meaningful differences between products that exited and those that stayed, nor any notable shift in overall sentiment post-agreement.

Taken together, these findings suggest that the agreement did not lead to measurable gains in product quality or counterfeit reduction, at least along dimensions visible to consumers.

Policy lessons

The Apple–Amazon case highlights how vertical agreements in digital markets can have horizontal competitive effects. When a dominant platform also acts as a retailer, any restriction on who can sell can alter competition within the marketplace itself. It illustrates the complexity of competition in the platform economy. The evidence to date indicates that brand gating tightened Apple’s control over its products and reduced competitive pressure on both firms, with tangible costs for consumers in terms of variety and price. But it also underscores the importance of data-driven analysis in policy debates. With better evidence and careful design, economists can distinguish legitimate brand protection from conduct that undermines market competition. As digital platforms continue to shape how products reach consumers, the lessons from this episode are clear: even well-intentioned partnerships between powerful firms can leave lasting marks on how markets function.

For regulators, this means that policies focused narrowly on exclusivity or pricing may overlook important mechanisms of market control. Visibility algorithms, reseller authorization rules, and access conditions can all serve as subtle but powerful tools of exclusion. Recognizing this broader set of practices is precisely what the EU’s DMA attempts to do: it requires gatekeepers to ensure neutrality in ranking and access. Whether similar principles will be applied in the U.S. remains uncertain.

Author Disclosure: The author reports no conflicts of interest. You can read our disclosure policy here.

Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.

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