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According to a report from The Wall Street Journal, Meta Platforms' new AI shopping assistant Muse is emerging as a potential threat to Amazon, challenging the e-commerce giant's dominance in online shopping and its advertising business worth nearly $70 billion.
Meta launched Muse in September, letting consumers use AI agents to research products, complete purchases, and handle tasks such as travel bookings and budget management. Meta said that in the first six weeks after Muse's launch, more than 10 million users in the US and Canada had created Muse agents.
For investors, the impact of this competition goes beyond retail sales. Amazon's advertising business relies heavily on sponsored product placements, which influence consumers browsing products on its platform. If AI agents can independently compare prices and choose products, the effectiveness of such ads could be weakened, potentially hitting one of Amazon's most profitable revenue streams.
In response to this trend, Amazon has blocked Muse from completing purchases on its platform, citing safety concerns. Walmart and Shopify have taken the opposite approach, partnering with Meta to embrace AI-driven shopping.
Amazon CEO Andy Jassy downplayed the immediate threat in an earlier earnings call. He argued that third-party shopping agents are still less convenient than buying directly from retailers, and said Amazon's advertising business has not been materially affected. Jassy also highlighted Amazon's own Alexa for Shopping, saying the assistant helps consumers compare products, monitor prices, and receive personalized recommendations, attracting more than 400 million users over the past year.
Nevertheless, industry observers warn that AI agents could weaken Amazon's long-standing position as the default starting point for online shopping. JPMorgan analysts believe Muse has the potential to become a significant consumer AI platform; venture capitalist Paul Graham said Amazon's restrictions could create opportunities for emerging competitors.
Amazon is also developing its own agent-driven commerce capabilities. Its Shop Direct service now covers more than 250 million products from external merchants, while Buy For Me allows customers to purchase some third-party products without leaving Amazon's platform. Analysts note that Amazon's vast fulfillment infrastructure, customer relationships, and delivery capabilities could still provide a significant competitive advantage as it adapts to changing shopping habits. Neuberger analysts remain optimistic about Amazon's ability to adapt.
Jassy also said Amazon may eventually partner with external AI agents. Such partnerships could help it maintain retail dominance, but the company still needs to balance embracing new shopping technologies with protecting advertising revenue, which largely depends on keeping consumers within Amazon's ecosystem.
