Is Amazon evil or just good at business? We’ve carried a couple of articles lately whose authors believe the latter, but it’s never been a mystery what side the Authors Guild comes down on. The Guild has just posted a lengthy essay to its blog laying out what it sees as Amazon’s predatory pricing and anticompetitive business practices.

While admitting Amazon has innovated with the creation of the Kindle, the Guild holds that Amazon used its pre-existing position as the world’s leading print book vendor to leverage its e-book position into a near-monopoly. It cites Amazon’s removal of the “Buy” button from Macmillan works as a typical anticompetitive move (which in this case backfired as it brought Amazon more negative publicity than it did the publishers). It also calls out Amazon for selling e-books at a loss, and for locking users into a proprietary e-book format.

A truly competitive, open market has no indispensable player that can call the shots. The book publishing industry has such a player, and Amazon is poised and by all appearances eager to use its muscle to rip up the remaining physical infrastructure of book retailing and the vital book-browsing ecosystem it supports.

Reader comments seem to run mostly toward skepticism with the Authors Guild’s position. Mike Cane complains:

What anonymous coward writes these laughable screeds?  Where is your bleating about B&N removing DC Comics from its shelves in retaliation for DC being on the Kindle Fire?  Where have you been when Apple ejected eBooks from the iBookstore, which included one political satire digital book from some who had won the Pulizer?  Suddenly you have a stake in all of this?  Why should you?  You tried to give away every orphan work to Google!

Neil Myers suggests a fairly draconian solution: publishers should simply go cold-turkey and stop selling to Amazon altogether, and establish their own alternative market and universal format for e-books.

Publishers should be more careful as to who they allow to sell their product. No law forces them to sell to distributors who have no regard for their product or business. If the big publishing houses just refused to sell to Amazon, then this would end their dominance. Period. The Kindle would be a useless piece of plastic if you could not download the books.

I’m not exactly going to hold my breath waiting for that. From publishers’ perspective, cutting off their biggest single sales channel could be a cure that is worse than the disease.

Regardless of whether it’s Amazon’s or the publishers’ practices at fault, it seems pretty clear that Amazon is rapidly becoming the biggest fish in a small e-book and print book pond. And much as I like buying cheap stuff from Amazon, I have to wonder what will happen if it ever does succeed in killing off the rest of its competitors.


  1. I happen to agree with Myers: If they don’t like Amazon’s business practices, they should pull their books from Amazon. Complaining about them while still selling through them is simply being hypocritical. And Amazon will have no reason to change unless it has to negotiate for the properties it wants.

    Besides, it’s not as if it’s impossible to sell ebooks through other sites, either owned by the publishers, or directly by the authors. Amazon takes the trouble out of the publisher/author’s hands… at a price. You can opt to do it yourself, and not pay that price… or shut up, pay up, and let Amazon do it for you. That’s business. That’s what Amazon is about.

  2. As if the legacy publishing biz was a truly open, competitive free market? Their’s was one of the most exclusionary, locked down, monopolistic industries out there. Give me a break! The Author’s Guild has the same problem publishers have, technology and Amazon have brought a ton of previously ignored players to the field totally outside of their controlling, gatekeeper positions.

  3. Felix – they appear to be locked in a quaint old socialist style mode of thinking. They cannot cope with someone being too successful. They want everyone to play nice and share the market nicely, and of course do what the AG and the publishers tell them to do and keep prices nice and high so that they all continue to make lots and lots of money.

  4. “A truly competitive, open market has no indispensable player that can call the shots.”

    This is a basic understanding of a free market. In a free market, a seller makes a transaction with a buyer who wants the seller’s product at the agreed upon price. A good seller (Amazon) provides services and features, including lower prices, economy of scale, that attract more buyers.

    If another entity wants to compete, they need to provide services and/or products that buyers prefer over Amazon’s.

    “It also calls out Amazon for selling e-books at a loss, and for locking users into a proprietary e-book format.”

    The standard retail model has been for retailers to purchase products at a wholesale cost, then sell them for whatever price they want to. That includes loss leaders and sales. Amazon did nothing different and, in fact, did the correct thing in order to build up a new business line, that of ebooks.

    As for the format, it’s perfectly legitimate to have a proprietary formatm regardless of the reason. Apple, Microsoft, and thousands of other tech companies have done the same thing. They either do it to retain customers, or think that their way is better, or a myriad of other reasons. Again, if you don’t like it, shop somewhere else, buy a different product, or create your own.

    There’s way too much carping and whining about Amazon’s success rather than being innovative and coming up with services and products that customers want.

  5. Prorprietary format? It’s all fine and good to say Epub is an “open Format”, but from a practical point, I completely fail to see any difference between an Amazon file and an Adobe Encrypted ‘epub’, or better yet, crap like Kobo special format files.

  6. “It also calls out Amazon for selling e-books at a loss, and for locking users into a proprietary e-book format.”

    The proprietary format wouldn’t be an issue if there wasn’t any Digital Rights Management (DRM). Without DRM, ebook buyers would be free to convert their files form one format to another, depending on the reading device they own, and therefore not locked into one type of device or format. The Authors Guild could best serve its members by advocating for DRM-free ebooks. It does little good to bash Amazon, who first came up with the most convenient ebook/device ecosystem, and whose market strength has been aided and abetted by publishers’ insistence on having their ebooks hand-cuffed with DRM.

  7. Instead of calling out Amazon, they would be better served by going after the agency 5 for creating a cartel based pricing model, not to mention regioning of ebooks so that they’re only available in certain parts of the world at higher prices, and thus promoting piracy.

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