retail news in context, analysis with attitude

The New York Times reports that Amazon is being accused by some authors of being an "oppressive regime" and a "bully" and running a "near monopoly," as it continues to discourage customers from buying books published by Hachette and some of its imprints, allegedly because Hachette was no knuckling under to its demands for better prices and/or higher margins.

Hachette has said that it is keeping Amazon supplied with books in a timely fashion, but the accusation stands that Amazon is delaying shipment of its books and suggesting that shoppers buy other books instead.

"On both sides, the stakes are high," the Times writes. "Amazon controls about a third of the book business, which means big publishers cannot live without it. But Amazon risks alienating readers as well as authors."

The Times goes on to say that "for at least a decade, Amazon has been very aggressive toward publishers. One publisher, who declined to be identified because of fear of Amazon, said negotiations with the company resembled a chef deboning a chicken — by the end, everything of value had been sliced off."

And: "One reason for Amazon to pursue Hachette and other suppliers is that the mood on Wall Street is changing. For years, Amazon’s program of investing all its profits in new businesses was applauded. Revenue soared, and so did the stock. But shares are down sharply this year and analysts are cutting earnings forecasts. The pending stock exchange debut of Alibaba, the highly profitable Chinese e-commerce company, has underlined the notion that Internet retail does not have to be a break-even game."
KC's View:
Here's the line from the Times story that resonated with me…

If Amazon needs to improve its bottom line, it is a dangerous game to make things harder for its customers.

You got that right.

I got a number of emails after we had this story on Friday, saying that Amazon is simply doing what every other big retailer does - exert pressure and throw its weight around. But Amazon is not supposed to be like other retailers … and these efforts seem specifically anti-consumer to me.