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Book buyers like to shop Amazon.Com. You could even go so far as to say they love it. Consumers don’t know much about Amazon’s top man, Jeff Bezos, but they do know that Amazon is the world’s largest bookstore. Best of all, you can buy a book with a few clocks of your computer mouse. And if you don’t want to buy it at full price, you can see right there beside it some second hand copies for sale at a lower price. (That might be hard on the writer but, hey, we’re poor readers, not starving writers.)
Furthermore, the book will arrive at your home the very next day, or in a few days if you’re not in a rush. And if you’re in a big hurry and want something right now you can download a book to your Amazon Kindle reader. But maybe you don’t want a book. Maybe you’d like a movie. Amazon has lots of those. And lots of music, too. As Amazon says: “20 million movies, TV shows, songs, magazines, and books.” And dresses. And shoes. And crockpots and shovels and tomato sauce and banjos. Amazon is amazing!
So it’s interesting that writers and publishers loath Amazon, the world’s largest bookstore. How can that be? (OK, we’ve already given you a hint. But please keep reading anyway.) Publishers don’t sell books to directly readers, they sell them to booksellers who then sell them to readers. Now online shoppers in the United States will spend $327 billion in 2016, up 45% from $226 billion this year and 62% from $202 billion in 2011, according to a projection by Forrester Research, Inc. And Amazon dominates the online book selling world.
Here’s what you do when you dominate the market, if you’re Jeff Bezos. A couple of years ago Amazon decided to sell MacMillan’s e-books, and e-book of every publisher, for $9.99 or less. (Great for customers, right?) That meant Amazon would lose money on every sale, but Jeff Bezos has money to burn and selling at a loss would knock out other e-book sellers, such as Barnes & Noble, whereupon Jeff and Amazon could monopolize the market.
But MacMillan objected to Amazon’s pricing and said that only MacMillan had the right to determine pricing for MacMillan’s books. So Amazon simply turned off the little buttons that permit you to buy MacMillan books at Amazon, thereby shutting the publisher out of the biggest online market. (more…)