24 May

Amazon: it’s not being a detractor to point out a pattern of repeated behaviour

Damien G. Walter cuts to the heart of it:

“The battle between Hachette and Amazon, and the wider conflict between publishers and Amazon, is a conflict between sellers and the marketplace. Neither side is good or evil. They are business entities, which do what business entities do, which is to act selfishly in their own interests at all times and in all things. The competition between publishers and Amazon is actually very good for writers – it is raising advances and adding new income sources for writers as the sellers and the marketplace compete for the goods they supply. In the conflict between publishers and Amazon the question is not which side to take, but how to keep Godzilla and Gojira fighting as long as possible. At the point one side wins, writers will face harder days again.”

(Via Amazon is not a bookseller, and why that matters for writers | Damien G. Walter.)

We don’t need any one side to ‘win.’ Damien is right. We need a healthy, varied marketplace.

Another good point someone made is that Hachette is the smallest of the big publishers left. This is a test.

Lastly, Amazon has done this before. I’m rather surprised at the number of journalists and internet types who are acting shocked, shocked, that Amazon is doing this.

Take for example Farhad Manjoo:

Just wait, the company’s critics have always shot back. Wait till Amazon controls the whole market — then see how well it treats authors, publishers and customers.

Now Amazon is walking right into its detractors’ predictions. There are a couple obvious reasons this is a bad strategy. It’s bad public relations — if it doesn’t already, Amazon may soon control a monopolistic stake of the e-book market and its tactics are sure to invite not only scorn from the book industry but also increased regulatory oversight.

See, if you have been silly enough to buy into the argument that this is a two-sides battle, with anti-Amazon people on one side (detractors) and pro-whatever (disintermediation, pro-independent author, pro-self pub, etc) then this may come as a shock. Much like people were totally stunned when Amazon’s subsidiary Audible’s ACX (the audio direct self publish concept) lowered author royalty rates.

However, all you have to do is actually look at a couple things.

1) How large companies behave once they have a monopoly. Wal-mart, after lowering prices to drive out competition, has been shown in studies to have prices *higher* than in the same market when there was competition. It has the whole market, it can then set any price it wants. But… people say Amazon is different. It loves readers.

2) But all you have to do is look at Amazon’s past actions to see it behaves like any other corporate entity. In 2010 it yanked Macmillan’s buy buttons in the bookstore over negotiations. It has pulled down books, delayed shipments in European markets for bargaining, and basically used its position quite handily.

Hey, if you have the whole market, it’s easy policy.

If you think corporations should, de facto, be able to use any power they have gained in any way they wish, that’s fine. Many people have held pro-monopoly positions throughout history. Brand identification often leads to loyalty of group identification over all else.

I just think historically that leads to uneven markets.

And historically, that will end up backfiring.

Maybe I’m wrong, maybe Amazon wants to drop puppies from drones for all of us. But historically speaking, that’s never happened when a company gains control of an entire marketplace.

Maybe people should be less worried about the awkward feeling of ‘shit, Amazon’s detractors are right’ and maybe start thinking of this as more: people who say ‘hey, historically a single company owning an entire marketplace leads to an abuse keep calling this’ is worth paying attention to.

i.e.: we’re not so much “Amazon-detractors” as much as just people who are able to take a trend that pretty much always happens when one single company gets in this sort of spot, and can do some very basic extrapolation. It has done this to Penguin. To Macmillan. To Orbit Uk. And more.

Again and again, I’ve pointed out that I use Amazon’s Prime (not right now while this is going on, and I will cancel if it gets worse) and their self publish system (same as before) and am pretty agnostic about them (I do work with their audio wing and love the sub company Audible and buy a lot of audiobooks). Again and again people think I have a vendetta.

No. It’s just simple extrapolation. We have a problem. It’s easy to call. Amazon is large enough it cannot help itself. It’s doing what ever single other company that large has done when it has the whole buffet to itself. And in the past, it has taken outcry, pushback or legal change to stop companies in their position.

So I’m shouting back. Because an unhealthy marketplace is unhealthy for us all.