Amazonopoly!

Amazon 's control of the print and e-book market is raising concern.

Amazon ‘s control of the print and e-book market is raising concern.

The New America Foundation held another excellent program yesterday titled “Amazon’s Book Monopoly: A Threat to Freedom of Expression?” Particularly relevant — this summer the Author’s Guild and the American Booksellers Association filed an appeal to the Department of Justice, asking for an investigation in Amazon’s alleged anti-trust activities. An archived copy of the program can be viewed here.

What’s the problem? Sure, we understand that Amazon dominates the online retailer space but we love Amazon because we can buy just about anything, at a good price with prompt delivery, right? The speakers agreed with that assessment but are concerned with Amazon’s control of “the culture market.” The dominance of Amazon’s book retail division is trampling on the free flow of books and information to the detriment of American democracy. And the evidence is awfully convincing.

Similar to Standard Oil of the 1900s in market domination, Amazon controls 75% of the print book market and 65% of the ebook market. It is known to undercut book prices at a financial loss to capture more and more of the market. The problem is vertical integration – Amazon owns its own publishing company (among other things) —and competes with its own customers who rely on its platform. If you are an author, you want your books sold on Amazon, but Amazon undercuts traditional retail prices of books leading to less revenue for the author. Recently the big five publishers negotiated agency pricing with Amazon pumping book prices up to a more profitable level. But when books priced at 19.95 are listed next to books priced at 99 cents, what will customers choose? And what will they think? Do customers believe this is the going rate for books these days?

Amazon is known to manipulate search results placing its published books at a higher ranking than other books. Amazon had a well-publicized fight with Hachette over prices last year. For the 11 months of the dispute, Amazon refused to sell Hachette books. One Hachette author described searching Amazon for his own book and finding it not available. Instead a pop up box appeared with the suggestion that buyers read an alternate author’s —in this case, Lee Child’s books–  instead, suggesting they are “just as good.” (Lee Child is published by Penguin Random House.)

Speakers also expressed dissatisfaction with the Obama administration and its unwillingness to address online retail monopolies. The Justice Department has shied away from bringing anti-trust suits of this kind—the solutions are difficult and their impact would be extensive. A speaker also noted that The Washington Post did not send a reporter to cover the event. (Jeff Bezos, the head of Amazon owns The Washington Post). There was a great sense of concern, fear and even suspicion throughout the meeting. Apparently other speakers were invited to the event but were afraid of retaliation.

Putting aside conspiracy theories, this is an important information policy issue for libraries to monitor. We need to consider what information is becoming less available, and what speech is effectively quashed when the public is unable to find content. Moreover if certain genres are favored over others because of higher sales numbers, will authorship change and will people be less willing to write what they want? Will there be a book market for libraries?

This, and a lot more, was discussed at this fascinating program, which leaves much food for thought.

I encourage people to watch the archived video.

About Carrie Russell

Carrie Russell is the Director of the Program on Public Access to Information in the Office for Information Technology Policy. Her portfolio includes copyright, international copyright, accessibility, e-books and other public policy issues. She has a MLIS from the University of Wisconsin-Milwaukee and a MA in media arts from the University of Arizona. She can be reached via e-mail at crussell@alawash.org.

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