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Amazon Confirms Hachette Spat Is To "Get a Better Deal" 211

tlhIngan (30335) writes "Last week we heard that Amazon was withdrawing Hachette books from its virtual shelves including allowing preorders of the new JK Rowling book. Amazon has responded to these allegations, and confirms that yes, they are purposefully preventing pre-orders and lowering stock in order to get a better deal from Hachette. Amazon recommends that in the meantime, customers either buy a used or new copy from their zShops or buy from a competitor. Amazon admits there is nothing wrong with Hachette's business dealings and that they are a generally good supplier." Here's Hachette's response to the Amazon statement.
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Amazon Confirms Hachette Spat Is To "Get a Better Deal"

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  • by Enigma2175 ( 179646 ) on Wednesday May 28, 2014 @08:30PM (#47115317) Homepage Journal


    Amazon indicates that it considers books to be like any other consumer good. They are not.

    My rebuttal: Yes they are.

  • by Koby77 ( 992785 ) on Wednesday May 28, 2014 @08:40PM (#47115379)
    It's good to see a big company actually fight for better prices for customers. I wish my cable company was like that. And before anyone gets me started, remember that monopolies are only abusive if they use their power to screw over the consumers; there is no antitrust protection for businesses to profit.
  • by manu0601 ( 2221348 ) on Wednesday May 28, 2014 @08:44PM (#47115419)
    Shouldn't this fuel an antitrust investigation? The mere fact they can pressure a publisher by not listing their books means free market failed.
  • by Anonymous Coward on Wednesday May 28, 2014 @08:58PM (#47115517)

    no, being able to put preassure on someone by deciding to buy from someone else is not showing that the free market failed, it is the free market in operation.

  • by Frosty Piss ( 770223 ) * on Wednesday May 28, 2014 @09:02PM (#47115551)

    See, I'm not necessarily upset at Amazon for doing this, as they're being seemingly open and honest about it.

    Sure they are. But that doesn't make it right.

    Cheap books now, but in the long run, fewer choices.

  • by Anonymous Coward on Wednesday May 28, 2014 @09:05PM (#47115581)
    Hachette's response was no more elaborate. Why do you hold him to a higher standard then the publisher? That indicates you aren't interested in the answer, but are just trolling.
  • by Frosty Piss ( 770223 ) * on Wednesday May 28, 2014 @09:05PM (#47115589)

    It's good to see a big company actually fight for better prices for customers.

    No, that's not the Amazon plan. In fact, they are trying to drive publishers out of business and force authors to deal directly with them, as the only choice. As the de facto monopoly, they can dictate to the authors what they will pay, and it ain't going to be pretty.

  • by fuzzyfuzzyfungus ( 1223518 ) on Wednesday May 28, 2014 @09:17PM (#47115677) Journal
    Arguably they aren't like any other consumer good: they share a pretty easily identified, and salient, set of characteristics with certain other 'culture products', music, movies, and similar: marginal cost of production is essentially zero, different ones are partial substitutes for one another; but rather weakly compared to other consumer goods, 'brand' affinity follows individual producers (or nominal producers, as in the case of certain heavily-managed tween-pop-to-order acts) rather than companies, and so forth.

    Books aren't some Unique And Sacred Category Unto Themselves; but the characteristics listed above are pretty significantly unlike those of, say, consumer appliances(where marginal cost of production is comparatively high, different ones are nearly perfect substitutes, brand affinity, if any, follows companies while individual designers are unknown, etc.)

    What isn't clear to me (any authors in the house?) is whether the traditional big publishers are, by reason of a certain gentlemanly ossification, allies to the otherwise scattered and helotized writers, or whether this is basically a spat between two would-be-exploiters of authors over who gets the profits.

    Amazon sure as hell isn't in this out of the goodness of their hearts; but they are also not going to waste a penny more than necessary on quaint traditional supply chains, 'remaindered' or 'stripped' books, and anything of the like; but they also aren't going to let any mere customs hold them back when it comes to contractual matters.

    The incumbent publishers are definitely more tradition-bound; but I don't know how much this just makes them inefficient, and how much it makes them act more nicely than good old sociopathic 'homo economicus' would.
  • by Arker ( 91948 ) on Wednesday May 28, 2014 @09:44PM (#47115837) Homepage
    "it is the free market in operation"

    Except the only free market in books tolerated is in reprints of books originally published in prior millenia. This is not a free market on either end or in any way.
  • by Anonymous Coward on Wednesday May 28, 2014 @09:47PM (#47115847)

    Your argument is that books aren't like other consumer goods because they're not fungible. Your debate partner pointed out that other items which are generally considered consumer goods are also not fungible. This implies that whether or not an item is fungible isn't sufficient for defining whether or not an item is a consumer good. Generally, this is the point were you would offer up another criteria to distinguish between non-fungible consumer goods and books.

  • Punish Apple! (Score:4, Insightful)

    by SuperKendall ( 25149 ) on Wednesday May 28, 2014 @10:04PM (#47115951)

    Amazon behaving badly in a market where they have a monopoly? Time to get out the Apple Beatin' Stick again! Got to keep down those competitors with government sanctioned punishments for even trying.

  • by Anonymous Coward on Wednesday May 28, 2014 @10:06PM (#47115959)

    WTF are you talking about? Amazon has like 90% market share in the ebook market. Not to mention that they have their own arm that handles physical books for pretty much the entire process from editing, to publishing to distribution and sales.

  • by danheskett ( 178529 ) <> on Wednesday May 28, 2014 @10:22PM (#47116067)

    Face it: hatred for Wal-Mart is a tribal identification thing, not a rational economic argument.

    I almost agree with, the only real problem with Wal-Mart, from an economics stand-point, is that they externalize costs to the broader economy that they should be induced to bear. Three examples:

    1. In many areas, Wal-Mart pays a wage that qualifies workers for government subsidy, in the form of reduced cost medical care, food stamps, general assistance, etc. This is not directly Wal-Mart's fault because the policy options permit this, but it is still an economic problem which they are responsible for. The lack of labor demand is a huge contributing factor which is mostly out of Wal-Mart's responsibility. Nonetheless, every Wal-Mart store receives an effective government subsidy for each hour worked, and this is both an unfair competitive advantage and a drain on the larger economy. In effect, competitors who pay a higher wage are subsiding their competition, via taxes they pay. Fundamentally unfair. The economic alternative is for other companies to race to the bottom to compete, or to pay above market rate wages, both of which are overall unhealthy to the broader economy.

    2. Wal-mart, through it's market power, pushes costs that the retailer would traditionally bear, onto suppliers. This isn't fundamentally bad, but it can have many bad side effects economically. For one, small suppliers take excess risk, and when the risk goes against them, they fail, and the broader economy has to absorb the failed business. This is a repetitive pattern, with suppliers who try to operate to close to margin make bad decisions or even a single bad decision. Wal-mart can leverage it's substantial volume to get margins that leave their suppliers very close to insolvency. Inevitably some of these suppliers will fail, and those failures induce costs across the broader economy.

    3. In 2011, Wal-Mart committed to only supplying fish that were responsibly harvested. This was in response to data that showed that it's suppliers were doing ecologically unsustainable harm in industrial fish farming. This is a great step, but it's just one of the thousands of product lines that Wal-Mart has. By doing business with many suppliers who have no long-term footprint, and operate in regulatory environments where the full economic impacts of unsustainable practices are not known, Wal-Mart induces suppliers to take risks and use businesses practices which would be illegal or unsupportable in the United States and it's other primary retail markets. In the fish example, suppliers were overfishing and wiping out the feed fish in order to produce economically profitable industrially farmed fish for sale in the US. When the feed fish species were wiped out, they moved onto other species and then finally onto other areas. In the long-term of course that is unsustainable. What other products and suppliers operate in this same way, in various countries who are willing to trade long-term damage for short-term jobs and economic activity? Wal-mart is working on this, but their entire supply chain needs to be examined and steps taken to make sure that the suppliers they use, and the down-level suppliers, are operating in an ethical manner. Somewhere at sometime, the costs of ecological damage have to be paid by the broader world economy, and they should be reflected in the prices of goods sold on the shelves at Wal-Mart, as they are for most (but not all) of their competition.

    All three of these issues are not the "fault" of Wal-Mart, in that as a country we allow Wal-Mart to go down these roads. But it's still an ethical problem with shopping at Wal-Mart, and those problems should weigh, in my opinion, on the minds of those who routinely shop there. As the shopping destination of choice for a huge swath of America, Wal-Mart is positioned to make small changes to their business that will inevitably reduce their bottom line and drive up costs, but will level out the damage done, especially to overseas suppliers and their workers.

  • by phantomfive ( 622387 ) on Wednesday May 28, 2014 @11:23PM (#47116397) Journal

    Amazon sure as hell isn't in this out of the goodness of their hearts;

    And lets be honest, neither are publishers. And if we really dig deep, we might find that authors sometimes write mainly for profit as well.

  • by Accordion Noir ( 1256202 ) on Wednesday May 28, 2014 @11:35PM (#47116445) Homepage

    I'd say that WalMart is getting close to a monopoly in towns I've visited where a few years before there were hardware stores, grocery stores, fabric stores etc, and a somewhat functional downtown, and now there is ... Walmart. It's not the only place you can buy things in the country, but it has pretty much driven some whole towns out of business.

    There's anecdotal evidence for you.

  • by LocalH ( 28506 ) on Thursday May 29, 2014 @12:38AM (#47116711) Homepage

    Spot on. I take issue with Amazon's handling of this not because of anything to do with whether books are a "consumer good" or not, which they clearly are in the first place (they're sold at retail, buyer gains first sale rights concerning the physical object, sounds pretty much like a good to me). It's because it's anti-consumer. It punishes people who dare to buy from vendors or publishers which the marketplace provider has some sort of issue with. It's exactly like the fights between cable/satellite providers and distributors. The only thing they do is punish the people who enjoy the things they air. Exactly like those situations, we have public communication from each entity blaming the other and confusing the average person. I half-expect Amazon to start putting a little ad-size box on pages for Hachette books "explaining" to the potential buyer why they shouldn't even buy the book in the first place, and Hachette adding extra pages into Amazon-destined copies explaining how shitty Amazon is.

    It's all a big dick-waving contest and doesn't help anyone but the one with the biggest dick.

  • by bdam ( 1774922 ) on Thursday May 29, 2014 @08:26AM (#47118157)
    Full Disclosure: I work for a small publisher. In terms of actual stores dedicated to selling books, there are fewer and fewer of them as time goes by. And it's not just the small guys, Borders got taken out too. To be clear, there's an economic argument to be made that this is a good thing but let's at least be clear about one thing: Amazon has a very real monopoly on print and electronic books. While publishers will come and go over time the idea that authors will publish their own books shows a lack of experience actually dealing with real authors. Sure, some have the talent, desire, and resources to do so. However, that vast majority of authors we deal with do not want to prepare their books for market and then have to deal with retailers. Further, publishers are partially in the business of risk taking by offering up payment upfront to authors for works they haven't completed yet. Authors tend to be comforted knowing that they'll get $X now for signing the contracts and $Y later when they deliver the manuscript regardless of actually making a single sale. Again, some authors are willing to take that risk and it will pay off but not many. So sure, Amazon could take on those roles but that doesn't just magically remove teat suckers. Unless you want unedited and un-styled walls of text someone's going to have to edit the damn thing and someone with an eye for a design needs to make it look half-way appealing. Those people aren't likely to do so for free. I'm sure Amazon could come into the market though and push those costs down and economically that'd be great. However, speaking long term, how long is that going to last? If Amazon has a monopoly on publishing in addition to distribution then what makes you think they'll continue with razor-thin margins?
  • by ranton ( 36917 ) on Thursday May 29, 2014 @11:00AM (#47119459)

    They were more elaborate. Here's the entire paragraph ouf of which' context the sensence was taken

    Authors, with whom we at Hachette have been partners for nearly two centuries, engage in a complex and difficult mission to communicate with readers. In addition to royalties, they are concerned with audience, career, culture, education, art, entertainment, and connection. By preventing its customers from connecting with these authors’ books, Amazon indicates that it considers books to be like any other consumer good. They are not.

    You may agree of disagree, but do not hide behind lies.

    You could come up with any number of reasons why a certain consumer good is unique. Take this for example:

    Microwave oven manufacturers, with whom we at [generic distribution company] have been partners for nearly 60 years, engage in a complex and difficult mission to provide food to humanity. They provide a way to reuse food in a way that helps cut down on food waste, thus reducing the amount of land that is necessary to feed to world. By preventing its customers from purchasing these microwaves, Amazon indicates that it considers microwaves to be like any other consumer good. They are not.

    Nothing they said backs up their claim that books are not just another consumer good. They are just explaining why this particular consumer good exists.

Thus spake the master programmer: "When a program is being tested, it is too late to make design changes." -- Geoffrey James, "The Tao of Programming"