It must be a sign of success—Amazon is being accused of monopoly behavior by its industry partners, in this case groups representing authors, agents and booksellers.
As with other one-time high-tech leaders (IBM, Microsoft, Google) Amazon’s dominant market share suddenly seems too much. In letters to the Justice Department, the authors’ and retailers’ groups claim that Amazon is squeezing publishers, punishing writers, driving bookstores out of business—and violating antitrust laws. They want Justice to investigate. Is there anything to their arguments?
. . . .
Isn’t that what business is supposed to do—compete to lower prices? Not necessarily, according to the Authors Guild, the American Booksellers Association, and several other groups. In multiple letters, the complainants contend that Amazon is “generating fear among many authors,” and that it has used its marketplace clout to “harm the interests of America’s readers, impoverish the book industry as a whole, and impede the free flow of ideas in our society.”
We’ll let the last bit pass; the fear that media concentration would shackle free expression was rife when the nightly news was controlled by the three television networks (remember them?) and it has been hurled at every big information distributor since. Digital communications, of which Amazon is a subset, may be accused of many things, but impeding the flow of ideas isn’t one of them.
As for sowing fear among authors, this is palpably true. I earn my living primarily from selling books, and I much preferred the landscape as it existed earlier in my career, when bookstores were (or seemed to be) healthier and more numerous. Although the casual impression that bookstores are disappearing en masse is incorrect – there are 2,227 bookstores in the U.S., more than at the end of the 2009 recession, and their share of the printed book market has held steady, according to the American Booksellers Association – the total is down from the 1990s. And Amazon, which sells more than a third of new physical books and an estimated two-thirds of e-books, dominates the market.
. . . .
Also, I would prefer that not so many people shopped at Walmart; come to think of it, I would prefer that the Internet shut down for two hours every evening during which interlude people’s only diversion would be listening to Mozart and reading books. Popular tastes, we’ll admit, are gauche. James Patterson will sell more volumes than James Baldwin. That said, publication of traditional books is close to an all-time high, and an awful lot of good ones find their way to readers.
We can argue about Amazon’s merits, but antitrust is not intended to protect some people’s cultural preferences, much less the lifestyles and professional habits of publishers and writers. Culture may be created in the loft, but it is underwritten in the marketplace. Antitrust answers to the welfare of consumers in that marketplace.
. . . .
The more intriguing case against Amazon concerns its behavior not as a seller but as a buyer, specifically in the e-book market. Amazon has driven very hard bargains with e-book publishers, mainly with the aim of depressing prices. During a long-running battle with Hachette, Amazon made it difficult for consumers to buy Hachette books. E-books of other publishers (including, for a while, mine) have also been blocked from Amazon’s site. The books were available on other venues, of course. Amazon’s position, in effect, is that just as a big retailer (say, a supermarket) is entitled to bargain hard with suppliers, so is Amazon. And just as the supermarket doesn’t have to carry goods it considers over-priced (or unappealing for any reason), Amazon is free to offer, or not, products as it chooses.
Link to the rest at Fortune and thanks to Dave for the tip.
PG notes how many people who are connected to the traditional book business have become experts on antitrust law lately.
Most are prime examples of the logical fallacy that expertise in one area does not automatically confer expertise in another. Understanding the book business does not mean that one understands the application of antitrust law to the book business.
PG suggests this is a legal veneer for I’m afraid and I want the government to protect me.
And people who hadn’t the slightest idea what monopsony meant a couple of years ago are suddenly certain it’s a horrible thing and the government should keep Amazon from committing monopsony or being monopsonious. Or something.