Victoria Strauss -- Amazon Flexes UK Muscle

Over the past few months, the blogosphere has been abuzz over Amazon's recent policy change requiring POD-based publishers and self-publishing services to either use its BookSurge subsidiary for printing if they want their books to be orderable from Amazon's US website, or, as a less convenient alternative, to sell their books via Amazon's Advantage program. I blogged about the policy change in March.

To date, the change affects only Amazon USA. BookSurge isn't available in the UK, and Amazon UK hasn't implemented any similar policy. Amazon UK has, however, been flexing its muscle in other ways--and in the preoccupation with BookSurge, these have so far gotten little blogger attention.

In late March and early April, Publishing News and the Times reported a possible Amazon UK move against UK publishers selling books directly on their websites. Apparently angry over the fact that some of the publishers were attempting to undercut Amazon by offering discounts, Amazon threatened to retaliate by deeming the discounted price to be the actual retail price, and applying its trading terms to that. As explained by Publishing News, "...if Amazon receives a 50% discount from Penguin, for example, but Penguin is selling a £20 book for £15 on its website, Amazon will only give Penguin £7.50, rather than £10."

An Amazon spokesman, quoted in the Times, dismissed these reports as "speculation." But a number of publishers confirmed the threats, and several publishers' and writers' groups weighed in. (While this story was correctly reported on a few blogs, among them O'Reilly Media's TOC and Richard Curtis's Ereads, much of the very minimal blog coverage it received inaccurately suggested that US as well as UK publishers were affected.)

Then, in late May, came news that the Hachette Group, the UK's largest publisher, was locked in battle with Amazon over a different discount issue. According to the Bookseller, the "Buy New" buttons on a selection of Hachette's frontlist and backlist books had been disabled, in apparent retaliation for Hachette's refusal to agree to Amazon's demand for deeper discounts. (A similar dispute with Bloomsbury in January apparently was resolved, though I could find no details as to how.) Amazon, once again, refused to confirm the dispute. Hachette would only say that "there is a negotiation that needs to take place."

This week, Hachette took a more aggressive stance. Both the Bookseller and Richard Curtis report that they have seen letters sent to major Hachette authors from Hachette CEO Tim Hely Hutchinson. The letter describes Amazon's recent pressure tactics, and affirms Hachette's determination not to yield to the demand for deeper discounts.

Meanwhile, concern about Amazon's retail dominance is growing, as evidenced by recent spate of articles and reports. Among fears cited by publishers: that Amazon will use the popularity of the Kindle to force further reductions in retail prices, and that its growing involvement with original content makes it inevitable that it will eventually bypass publishers entirely, and sign major authors directly. Publishers may have good reason to be nervous: according to PW, "in Amazon's 10-k filing with the Securities and Exchange Commission, the company lists among its many competitors not just bookstores but also publishers."