Monday, September 21, 2009

Amazon the Big Hypocritical Bully on the Block.

Amazon recently filed in opposition to Google’s landmark settlement with publishers and authors stating, "the settlement would violate antitrust laws by giving Google a monopoly over millions of so-called orphan works and create a cartel controlled by authors and publishers for setting prices for e-books". The Author's Guild fired back with the following statement.

Keep in mind, Amazon requires all websites, as a condition of getting any data from them, to have the primary page link to Amazon alone, prohibiting links to other booksellers, eliminating any type of competition, it seems their filing against Google is the epitome of hypocrisy as it monopolizes online bookselling and the e-book industry. If this seems unbelievable, ask Library Thing., amongst the multitude of victims of Amazon's bullying tactics.

Here's an article by Angela Hoy about the Amazon bullying:

Amazon Tightens Grip on Long Tail

Last week Amazon announced that it would be requiring that all books that it sells that are produced through on-demand means be printed by BookSurge, their in-house on-demand printer/publisher. Amazon pitched this as a customer service matter, a means for more speedily delivering print-on-demand books and allowing for the bundling of shipments with other items purchased at the same time from Amazon. It also put a bit of an environmental spin on the move -- claiming less transportation fuel is used (this is unlikely, but that's another story) when all items are shipped directly from Amazon.

We, and many others, think something else is afoot. Ingram Industries' Lightning Source is currently the dominant printer for on-demand titles, and they appear to be quite efficient at their task. They ship on-demand titles shortly after they are ordered through Amazon directly to the customer. It's a nice business for Ingram, since they get a percentage of the sales and a printing fee for every on-demand book they ship. Amazon would be foolish not to covet that business.

What's the rub? Once Amazon owns the supply chain, it has effective control of much of the "long tail" of publishing -- the enormous number of titles that sell in low volumes but which, in aggregate, make a lot of money for the aggregator. Since Amazon has a firm grip on the retailing of these books (it's uneconomic for physical book stores to stock many of these titles), owning the supply chain would allow it to easily increase its profit margins on these books: it need only insist on buying at a deeper discount -- or it can choose to charge more for its printing of the books -- to increase its profits. Most publishers could do little but grumble and comply.

We suspect this maneuver by Amazon is far more about profit margin than it is about customer service or fossil fuels. The potential big losers (other than Ingram) if Amazon does impose greater discounts on the industry, are authors -- since many are paid for on-demand sales based on the publisher's gross revenues -- and publishers.

We're reviewing the antitrust and other legal implications of Amazon's bold move. If you have any information on this matter that you think could be helpful to us, please call us at (212) 563-5904 and ask for the legal services department, or send an e-mail to staff@authorsguild.org.

Feel free to post or forward this message in its entirety.

Copyright 2008, The Authors Guild is the nation's largest society of published book authors.
Google's intentions should be scrutinized, as I'm sure their intentions are not pure, therefore it's not out of the question to suspect they too, are trying to establish a monopoly in the book world.

In the view of its critics, which includes the Justice Department:
"gives Google far too much of a role in determining the digital fate of an enormous trove of books; in effect, an immediate virtual monopoly and too much of an advantage going forward."
So, on October 7, 2009, a hearing will be held to consider objections to Google, the Authors Guild, and the Association of American Publishers in the matter of the "the accord reached a year ago that gave Google vast rights to scan books and devised a system for paying authors and publishers for the right to do so. The pact--actually the settlement of a suit filed by the authors and publishers to stop Google from what they saw as uncontrolled digitizing of their work--is a fundamental step in the world of letters' adjustment to all the new ways literature and information are distributed."

This determination will profoundly affect the digital future of books.

Amazon's BookSurge Information Clearinghouse

Judgment Day for the Google Book Pact

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