This latest problem came from a vendor called Appeagle, and it all involved a single line of problematic code, according to this wonderful piece on ECommerceBytes.com. "Appeagle was pushing an update to Amazon in order to conform to the marketplace's new requirements for repricing software when it noticed a problem in one line of code. It affected all listings in which sellers had left the 'minimum price' field blank, dropping prices for those listings to a penny," the story said. It cited some merchants who, after being told by Appeagle that they had assumed full responsibility, found themselves suspended by Amazon after canceling the one-penny orders.
A lot of Amazon sellers will have a lot of cleanup to do, but there's a bigger issue here. Customers who go to Amazon had their orders canceled and, third party or not, that's going to undermine their faith in Amazon. Buying from a third party on Amazon's site is supposed to be the best of both worlds: a chance to give business to small players while enjoying the security and reliability of the Amazon environment.
In April, Amazon got burned by an image that third parties posted, a problem similar to one that hit Sears two months earlier. Amazon has other third-party pricing entertainment, too, (got to love a $3 billion Win98 CD). Other sites have had similar issues, with Tesco running into price glitches this year and Zappos spending $1.6 million on its price glitch.
The problem is not compensating customers and third parties. It's how to prevent others from screwing up your systems, in front of your customers. Paraphrasing the old E.F. Hutton commercials, "In big league E-Commerce, we do price glitches the old-fashioned way: We screw them up ourselves."