On the heels of the BEA (Book Expo America) convention, the New York Times' Bob Kohn published an editorial exposing AMAZON.
The image in the paper is vivid.
Thanks, Bob, for at least stating facts in the face of book holocaust deniers.
The book industry has been hurt by Amazon.
Bookstores have been destroyed by Amazon.
Amazon's Kindle, the fiendish promotion of Jeff Nazi Bastard Bezos, has led to painful levels of piracy.
Below is what Bob had to say.
AMAZON has caused no small controversy of late by refusing to accept presale orders on books to be released by the publisher Hachette and by understocking Hachette’s titles. These punitive maneuvers, which follow a dispute between Amazon and Hachette about e-book contracts, have led to significant delays in shipments of Hachette’s books to Amazon’s customers.
If you are wondering why Amazon would subject its customers to this inconvenience and wish to understand what’s really happening between Amazon and Hachette — and, indeed, all the major book publishers — you need to know the meaning of the word monopsony.
The Supreme Court justice Sonia Sotomayor, when sitting on a lower court, once described monopsony as the “mirror image” of monopoly. Unlike a monopoly, which occurs when a seller of goods has the power to unlawfully raise prices of what it sells, a monopsony occurs when a buyer of goods has the power to unlawfully lower the prices of what it buys. Each violates antitrust laws: As the Supreme Court has long recognized, they both result in a misallocation of resources that harms consumers and distorts markets.
Take the e-book market, dominated by Amazon, which buys what a federal court once found to be 90 percent of all e-books sold in the United States. The monopsony power of Amazon, which has a current market share of 65 percent of all online book units, digital and print, is not just theoretical; it’s real and formidable. When Macmillan, the fifth largest book publisher, displeased Amazon in 2010 by proposing certain changes in business terms, Amazon exercised what has been described as its “nuclear option”: It promptly deleted the “buy” buttons in the Amazon online store for all of Macmillan’s books. In an instant, Macmillan’s entire business was in jeopardy.
The nuclear option was exercised for only a few days, a mere flexing of Amazon’s muscles. But imagine what would have happened if it had continued. With a major publisher out of the market for new manuscripts, authors would receive less money. And less money would mean fewer authors, and fewer books. (Nor are self-published authors safe from the power of a monopsony: While a traditional publisher like Macmillan needs an author’s consent to change the terms of his or her publishing agreement, Amazon reserves the right to change any provision of its agreement with any author at any time for any reason.)
How did Amazon attain such monopsony power? By providing valuable services? Perhaps, to some extent. But consider that from the moment it introduced its Kindle product, Amazon sold e-books at prices far below what it was buying them for. If Amazon bought an e-book from Hachette for $13, it resold it to a consumer for $9.99, losing $3.01 per e-book. It should come as no surprise that under these circumstances, e-book buyers flocked to Amazon.
But there was a problem. When a company has dominant market power and sells goods for below marginal cost, it is engaging in predatory pricing, a violation of federal antitrust laws.
What was to be done? Fortunately, in early 2010, a natural market solution presented itself: the introduction of the iPad and Apple’s entry into the e-book market. At Apple’s suggestion, the major book publishers were persuaded to change their e-book business model to reflect how Apple had been selling its popular apps for the iPhone. Under the app model, the publisher sets the price, not Apple or Amazon — with the e-retailer keeping a 30 percent commission. Here, price competition does not go away; it just moves from the e-retailer to the app developers, book publishers and authors.
As a result, Amazon found itself no longer selling e-books at below cost, and its rivals began competing on service, spurring new entrants to the market and the release of innovative e-book devices.
All was well until the Justice Department, supported by a white paper supplied to it by Amazon, filed an ill-advised lawsuit against Apple and five of the major book publishers for antitrust violations. The publishers were charged with “price fixing” — but not for fixing prices: Not a single e-book price was fixed by the conspiracy contrived by the government. All the publishers did, as I argued in a friend-of-the-court brief at the time, was to move to the lawful app store model, which eliminated Amazon’s self-serving distortion of the e-book market.
Unfortunately, the publishers never had their day in court. Buckling under the expense and risk of antitrust litigation, they settled and agreed to restrictions enabling Amazon to resume many of its practices. With these restrictions set to expire, a new round of negotiations between Amazon and the publishers have ensued. Amazon is now wielding its monopsony power, beginning with Hachette, to drastically lower what it pays for e-books. A 30 percent take off the top, it seems, is not high enough.
So far, Hachette, to its credit, has been unbending. But Amazon still has its nuclear option. It would appear that unless Amazon backs down — through public pressure or government intervention — publishers will have no choice but to employ their own nuclear option: pull all their books from Amazon and throw their weight behind a law-abiding alternative. Perhaps the best solution would be an online marketplace controlled by the publishers — with the 30 percent commission being split 50-50 with the authors in addition to the author’s royalty.
If consumers are inconvenienced by the switch, once again they will have only Amazon to blame.
My take?
Bob's solution is not going to happen.
It's like calmly telling the Jews in 1940, "What you should do is organize, get your own uniforms, your own guns, and stand up and tell Hitler he better back down or else."
Meanwhile Hitler has amassed an Army so big it can knock over and annex entire countries without a fight. Hitler's done a great job of scapegoating the Jews to the point where public opinion is on his side! Hitler's taken Jewish-owned businesses and handed it all to greedy pigs. Hitler's pulled Jewish doctors and lawyers from their offices, which gives more business to the deserving Aryan Master Race doctors and laweyrs. Hitler's propagnda has worked so well, Germans (and a lot of people in other nations) simply wave bye-bye as the Jews are pushed into cattle cars and trucks and sent to the gas chambers.
Hitler's a role model for Jeff Bezos.
He has public opinion on his side. His publicity machine presents him as a charming workaholic always trying to find better ways to make products cheaper. Why, just as Mussolini made the trains run, wonderful Jeff made packages arrive in only a few days and with no shipping charge! (Heh heh, forget that Amazon just raised the free shipping option from $25 in purchases to $35).
Amazon, like Google, built an empire by seeming to be consumer-friendly, and only interested in giving people bargains. At the expense of others, of course. Like copyright owners. Or in Amazon's case, brick and mortar neighborhood shops.
I overheard a bookstore owner at BEA mention how she saw a guy with a bar-code device prowling her store. Any book he browsed, and got all gummy with his fingerprints, he'd scan. She went over and said, "So you come here, check what you want, and then go to Amazon because you can get it a few dollars less? How cheap and thoughtless are you? I have rent to pay. I break my back stocking and sorting books onto shelves. And a few dollars less means so much to you? What happens when I have to shut down?"
The Times' solution is for publishers to form their own website and stop feeding Amazon. But...
Amazon spent years in the red as they coaxed people aboard with easy returns, lowest prices, and loss-leader bargains. Publishers can't possibly get together and refuse to sell to Amazon while building their own site and having grumpy customers rage over having to pay a decent price.
We've seen the morons of the world scream at the music and movie industry: "We think piracy is GOOD because YOU charge too much. Don't bitch about what WE do for a living or how much WE charge...WE bitch about what YOU charge and WE decide what's fair...and what's fair is not paying anything! IF we like it maybe...(ha ha ho ho hee hee) we'll buy it. But we won't. We've taken away your property, taken away your dignity, and Piracy is OK. Shoplifting in stores WE own, not so much. That's stealing! We have a right to haul shoplifters to jail, but you have no right to do that if we "share" all your movies and music! Telling us what to charge for making a pizza, pushing papers around all day or cleaning a drain out...no. WE will charge what WE want!"
So ultimately the Times can be applauded for at least pointing out the truth...but where's the solution? And let's not forget the deniers who'll just say "oh, book publishers are all right, authors are all rich, and the Times IS a publisher so they're writing this and slanting it. We love FREE downloads for our KINDLE!"
Ultimately, no, publishers will NOT pull their books off Amazon and risk going bankrupt via a Bezos lawsuit, and will NOT be able to persuade Amazon to be nice and negotiate a fair deal.
The bottom line is that Bezos is Hitler. He put Kindle on the opening page of his site and brainwashed the world into buying it (and not Nook or any competing machine). He dominated eBooks and his evil "Creative Space" company makes a fortune off would-be authors who pay vanity prices to get a book on their site.
He's such a fucking Hitler that John Donahoe, the Hirohito who runs Ebay, has begun to emulate him, demanding that sellers buy wholesale shit and sell it as "buy it now," and stop with the attic bric-a-brac auctions. Donahoe even gives a break (on insertion fees per item) to sellers who put up BOOKS and CDS and DVDS at "Fixed Price" like Amazon used sellers do, with no auction alternative. Yes, Donahoe and his ho's have changed eBay and out-Nazi Bezos! How? Hirohito Donahoe denies FREE SPEECH and will NOT let sellers leave negatives on bidders! What an American Jerky Joe is...NOT.
Let me replay that one for you. DONAOE DENIES FREE SPEECH BY REFUSING TO LET HIS SELLERS LEAVE NEGATIVES ON BAD BIDDERS.
Does that bother you? Or is your definition of "Freedom of Speech" downloading the latest Neil Young album free off Zinfuck? Or Avax Me Hearties? Or Swedish Meatball-brain Bay?
Sellers also can't block bidders who have a history of returning items, and there's no APP to let them check through bidder feedback and then BLOCK the troublemakers who leave nasty negatives or extort sellers by demanding refunds. Hitler was racist against Jews. Donahoe Hirohito? He's made Ebay seller the Nigger of the world.
It's all good as far as the customer is concerned. The customer is always right, the customer always get the lowest prices, and the customer can even get pirated stuff FREE. How lovely! Nevermind that there are less authors, less advances, and less books that are well-researched and well-written. We do, after all, live in a world where the shittiest and most inept purple prose ("50 Shades of Shit") can become a best seller because the average dunce doesn't recognize bad writing.
Amazon is the smiling piranha. It eats anything and everything and doesn't care or understand that the source of its food might no longer exist. It's a mindless killer.
