What's your take on the Amazon vs Hachette battle?

[ElNono]

Amazon (a company that had it's humble beginnings selling mostly books online) basically wielding their market dominance to force the publisher to sell ebooks for less or face punitive actions. Hachette found guilty of colluding to drive up prices a year ago or so.

Where's the free market in all this? Sure Hachette did collude with other publishers and was found guilty of that, but in this particular case, it's selling in an open market, competing against other publishers.

Why should Hachette be punished for setting the price of their own products? If the books are priced incorrectly, as Amazon argues, wouldn't the market deal with that?

[boutons_deux]

Amazon is what is called "dominant buyer", having enough buying power to screw suppliers out of profit, while Amazon itself is mostly unprofitable:

Amazon’s Shrinking Profit Sets Off a Seismic Shock to Its Shares

Walmart’s operating profit margin is 5.6 percent. Amazon’s is a minuscule 0.7 percent. Walmart has been consistently profitable since its earliest days, but for Amazon, bumper profits have always been just beyond the horizon.

http://www.nytimes.com/2014/04/26/business/amazons-shrinking-profit-sets-off-a-seismic-shock-to-its-shares.html?_r=0

What supplier, or any industry, can succeed with 0.7% profit margin?

and of course Amazon has been cheating, UNFAIRLY competing, long and wide, by not paying state, local sales taxes that other sellers must collect (and pay the overhead of collecting, accounting, forwarding those taxes).

btw, several recent analyses show that Amazon is often not the lowest-priced online seller.

Is Amazon Prime a scam? Shoppers asking tough questions as prices go higher

http://www.geekwire.com/2014/amazon-shoppers-question-whether-prime-membership-scam/

Amazon's dominant, near monopolistic, buying power is obviously not "free market", in the sense of "If Hachette won't sell to Amazon at Amazon's set price, Hachette is seriously hurt"

Hachette isn't competing for writers, competing with books against other publishers, writers. Hachette is competing with a dominant wholesaler.

[cheguevara]

the Amazon shop is great, probably the best shop in the world in terms of overall experience. Their online video store is also top notch.

I remember when Amazon first came online. It was after a unprecedented investment and I believe they were plannned to lose money for their first 5 or so years of service. I am actually surprised they were able to maneuver that beheamoth for so many years and turned a profit.

props to amazon

[CosmicCowboy]

Amazon is playing the same game with Disney on their new movie releases.

[CosmicCowboy]

I use Amazon on almost a daily basis. Heck, I order a lot of tools and shop supplies there. Free two day shipping with prime beats the hell out of sending a guy I'm paying $30 an hour to go shopping. Returns? a snap. No questions asked. Don't even have to talk to anyone. Print the prepaid shipping label and you are done. Amazon rocks.

[boutons_deux]

I use Amazon on almost a daily basis. Heck, I order a lot of tools and shop supplies there. Free two day shipping with prime beats the hell out of sending a guy I'm paying $30 an hour to go shopping. Returns? a snap. No questions asked. Don't even have to talk to anyone. Print the prepaid shipping label and you are done. Amazon rocks.

yep, that's the attraction of Amazon, wonderful convenience, plus product reviews by 100s or 1000s of other purchasers (which are often not helpful with 500 5-stars vs 150 1-stars).

But I expect Amazon's unrelenting, increasing market power will be abused, such power ALWAYS is (eg, Microsoft), as we see with Amazon screwing Hachette, etc.

[baseline bum]

I use Amazon on almost a daily basis. Heck, I order a lot of tools and shop supplies there. Free two day shipping with prime beats the hell out of sending a guy I'm paying $30 an hour to go shopping. Returns? a snap. No questions asked. Don't even have to talk to anyone. Print the prepaid shipping label and you are done. Amazon rocks.

I fucking love Amazon. I like buying used books off their marketplace since for all but cutting edge stuff scientific books from the 60s and 70s were so much better than they are now. I'm shocked their prices are so good after they have driven Borders out of business and brought Barnes & Nobles' to their knees.

Still, for new books I like ebay since I can get legal Indian editions (all written in English) of $100-$200 American books for $20-$25. E.g.

$135 on Amazon for US hardcover edition
http://i.imgur.com/j7fvz47.jpg

$22.90 on Ebay for Indian paperback
http://i.imgur.com/RH3Gxzv.jpg

I bought that Indian paperback and it's a hell of a lot nicer than for example, Dover paperbacks printed here.

[velik_m]

Amazon should be able to set whatever price it wants i nthe shop and hatchette should be able to set whatever price they want to sell at to Amazon. I don't see the problem if Hatchette sells it's book at 20$, why do they care at what price Amazon sells them?

[ElNono]

Amazon and Hachette Resolve Dispute

Amazon and Hachette announced Thursday that they had resolved their differences and signed a new multiyear contract, bringing an official end to a publishing dispute that blossomed into a major cultural and business brawl.

Neither side gave details of the deal, but both pronounced themselves happy with the terms. Hachette, the fourth largest publisher, won the ability to set the prices for its e-books, which was a major contention in the fight.

“This is great news for writers,” Michael Pietsch, Hachette’s chief executive, said in a statement. An Amazon executive, David Naggar, said Amazon was “pleased with this new agreement as it includes specific financial incentives for Hachette to deliver lower prices.”

The agreement broadly follows a deal Amazon recently worked out with Simon & Schuster, which the publisher said it was pleased with.

http://www.nytimes.com/2014/11/14/technology/amazon-hachette-ebook-dispute.html?_r=0