Amazon Echo smart speakers go off the shelves as the revised FDI policy kicks in [Update]

“The Echo speakers and AmazonBasics lineup of products are currently unavailable on Amazon’s website”

[Update] February 1st: Amazon Echo speakers lineup is now back up on the website under a different seller. However, the delivery timeline is showing 2-4 weeks for these products and it’s likely due to logistical reasons.

The Commerce and Industry Ministry of India issued a revised FDI policy on December 26th, 2018. The new FDI policy had several ramifications for e-commerce companies like Amazon India and Flipkart, among others. The policy was scheduled to come into effect starting February 1st and as the day is finally here, Amazon India has taken measures to adhere to the new regulation. 

Amazon Echo Cloudtail

Notably, the e-commerce giant has taken its Amazon Echo series of smart speakers as well as AmazonBasics series of products off the shelves. These products are shown as “currently unavailable” on the website as of writing this news. Worth noting that these products were being sold by Cloudtail, in which Amazon India had over 25 percent stake and Amazon Basics was owned by the parent website itself. The Amazon Fire Stick and Kindle products continue to be sold on the website as they are shipped by a different seller. The FDI Policy was very clear in stating that the e-tailers can’t sell products on their platform products of brands they directly or indirectly own. The policy also dictated that not more than 25 percent of sales should come from private labels, barring e-commerce giants from exercising ownership or control over the inventory.

The new FDI policy was imposed so that retail websites can’t undercut small vendors in India by offering products at a severely discounted price and thus harming them. The Central Government intends to allow foreign direct investment only in genuine marketplace models and draw a clear line between the marketplace and inventory-based models. The FDI policy also dictates that the e-commerce websites won’t be able to run exclusive deals with smartphone makers or other brands and neither will they be able to offer cashbacks to lure customers.

When the new FDI Policy was first announced, Amazon India had stated that they are evaluating the new circular. It seems that the brand has done that and is taking steps to ensure that it sticks to the regulation. It’s expected that Amazon will ramp up third-party sellers on the website to bring the Echo and other products back on sale. 

Abhiman is obsessed with all things tech. His hobbies include reading on his Kindle and clicking random pictures on his phone. His secret superpowers happen to be mixing great cocktails and lip reading. In his spare time, you are likely to find him with a spinner in one hand, and indulging in his love for food with the other.
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