Amazon backtracks on costly mistake

E-commerce giant Amazon has refused to honour orders from thousands of bargain hunters who snapped up handheld computers worth hundreds of pounds that were erroneously placed on sale for less than £10.

Two Hewlett-Packard iPaq handheld pocket PCs were listed on the Amazon site this morning with hundreds of pounds knocked off their value after a mistake priced one of the models, which usually retails at around £500, for just £23. A cheaper model, normally £192, was on sale for £7.

The site was deluged with orders after the mistake was posted on message boards such as Popbitch and spread like wildfire in offices around the country as customers emailed their friends.

Amazon, Europe's most popular e-commerce site, finally took its site down altogether at lunchtime. Visitors were redirected to its US site for 50 minutes while the items were removed.

Some customers were attempting to buy upwards of 50 hand held computers at a time as they cashed in on the mistake.

However, the deal is likely to turn out to be too good to be true after Amazon admitted the mistake and said according to its terms and conditions, it was not bound to honour orders until it had confirmed them by email.

"As the conditions of use clearly state, there is no contract between Amazon.co.uk and the customer for an item until Amazon.co.uk accepts the customer order by e-mail, confirming that it has dispatched the item. Until that time, Amazon.co.uk is within its rights to not accept any customer order," it said in a statement.

While Amazon's stance is likely to be accepted by the courts, it could lose it thousands of disgruntled customers.

In similar cases in the past, high street store Argos had to disappoint thousands of customers who ordered a television priced at just three pounds on its website. And Kodak eventually agreed to honour orders from customers who ordered a £399 digital camera accidentally offered for sale online for £100.

"No customer credit card has been charged for orders made this morning at the incorrect price, as we do not charge a customer's credit card until the order has entered the dispatch process," added the Amazon statement.