Monday, 7 April 2008

Amazon – The Great Dictator. Is Robert Mugabe in charge at Amazon?

What is going on at Amazon? The Internet behemoth suddenly seems to be turning the screw on publishers. Last week it was Print-On-Demand publishers whose turn it was to feel its wrath, with its outrageous behaviour demanding that POD publishers use only Amazon's 'Book Surge' POD service or face putative measures. This week it is the publishing world in general. Amazon is turning its attention to publishers who sell their books cheaper on their own sites than at Amazon. Amazon say they will assume that the price on the publishers website will be the new rrp. An example of this is if a book is sold on Amazon for £20 and £10 on my website, then Amazon will only return £5 for a sale on their site after they take their 50% mark up. Surely it is the prerogative of the publisher to sell at whatever price they are comfortable with on their own site. After all they are not sacrificing at least 50% to Amazon and can afford to pass on a little more discount to the customer. Where does Amazon stop with this line of thinking? I can't help but think though that in both cases it is the small publisher that will feel the brunt of Amazon's bullying.

It seems that Amazon has woken up to the fact that it is the dominant retailer and holds an extraordinary position of power on the Internet. It is now beginning to flex its muscles and see how far it can go in intimidating the book world. Publishers, especially small publishers are resorting to all means to stay in business and if Amazon has a problem with them selling a very small amount of titles through their own websites to help balance the books (no pun intended) then it is a very sad day. So why is Amazon behaving this way? Does it foresee a threat coming that we do not know about. Is its margins being eroded by new online retailers or is it just greed, power and a failure to accept that there is a democratic world out there...oops sorry back to Robert Mugabe. Maybe Mr Mugabe is at the helm having negotiated a way out of one jungle into another.

Amazon's behaviour of late, should in all rights be a public relations nightmare for its PR team, or is its arrogance such that it blithely ignores such matters, much the same way it appears to be treating the book industry. The publishing world has enough problems facing it and everyday is seeing an erosion of profits and margins. One can only wonder what Amazon has up their sleeves for next week.

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