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Monday, April 2, 2012

Amazon Screwing With Publishers Again --- So, What's New? Don't Say You Weren't Warned

Karl-Heinz Roseman says Amazon
demanding steep discounts from
 McFarland & Co. Months later,
he still has not been able to
 talk to a live Amazon employee.

I have previously posted numerous times RE Amazon's ever increasing dictatorial business practices. See relevant posts on this blog and on my Publishing/Writing: Insights, News, Intrigue Blog.

Amazon is trying to extort deeper discounts from publishers who have grown their business (and by extension Amazon's business) using Amazon as chief retailer.

Again, Amazon is trying to re-write the rules of publishing --- at the expense and utter destruction of publishers whose books helped Amazon to fulfill its mission of 'Earth's Biggest Selection.'

Amy Martinez of The Seattle Times reports:

Amazon.com trying to wring deep discounts from publishers

Amazon.com, the company that changed the way people buy books more than a decade ago, now appears poised to rewrite the rules of publishing.

The bad news came to McFarland & Co. in an email from Amazon.com. The world's largest Internet retailer wanted better wholesale terms for the small publisher's books. Starting Jan. 1, 2012 — then only 19 days away — Amazon would buy the publisher's books at 45 percent off the cover price, roughly double its current price break.

For McFarland, an independent publisher of scholarly books situated in the mountains of North Carolina, Amazon's email presented a money-losing proposition.

"It was the apocalypse," said Karl-Heinz Roseman, director of sales and marketing at McFarland, which has a long track record of giving all its retail partners the same discount.

McFarland and Amazon have shared a mutually beneficial relationship for more than a decade. A well-regarded source of books on baseball and chess, McFarland helped Amazon fulfill its mission of offering "Earth's biggest selection." And Amazon — in contrast to traditional bookstores — listed all of McFarland's titles, no matter how arcane.

Last year, Amazon generated nearly 70 percent of McFarland's retail sales and 15 percent of its entire business.

"If we made a change for Amazon, we'd have to do it for everyone, and that would jeopardize our business," Roseman said. "We couldn't exist like that."

Now, McFarland and others in the book world worry that Amazon will use its pricing pressure to crush publishers. They say Amazon's demands for deeper discounts threaten already-thin profit margins, and some warn about an Amazon monopoly.

Amazon, which declined to answer questions or discuss its relations with publishers for this story, dominates the U.S. market for print books sold online and also leads the market for electronic books. At the same time, it's working to become a big-name publisher in its own right.

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