Antitrust

From time to time we’ve opposed Amazon’s more ruthless tactics, not because we’re anti-Amazon, but because we believe the company has threatened the publishing ecosystem in ways that jeopardize both our individual livelihoods and the future of authorship itself.

Most recently, the decision in the e-book price-fixing case United States v. Apple reminded us of Amazon’s dominance of the publishing markets. The Second Circuit Court of Appeals upheld a lower court decision that Apple violated antitrust law by cooperating with publishers to establish agency pricing for e-books (which allows publishers to set their own prices). Apple’s actions, however, actually helped to open the e-book market, reducing Amazons market share from nearly 90% in 2010 to around 67% today.

In the wake of that decision we repeated our call for the Department of Justice to apply antitrust scrutiny to Amazon, whose anticompetitive behavior, we said, is “a far more dangerous variant than Apple’s.”

Amazon, for instance, trotted out some of its most ruthless tactics in recent memory from May–November 2014 during its dispute with Hachette Book Group. To show the publisher just how much it relied on Amazon sales, the e-tailer removed pre-order buttons from soon-to-be-released Hachette books and delayed the shipment of already-released books. While Hachette’s deep coffers somewhat insulated the publisher from the blow, its authors bore the brunt; their Amazon sales—which amount to 64% of online sales of physical books—were slashed in half or, in some cases, by as much as 90%.

While the dispute dragged on and public outcry mounted, we prepared a series of white papers—a previous call for antitrust scrutiny of Amazon’s behavior in the publishing markets. We circulated these to the Department of Justice, among other federal and state government entities. This effort culminated in an August 1, 2014 meeting in our offices between a handful of authors and two DOJ representatives, who heard firsthand the effect Amazon’s ruthlessness can have on authors’ livelihoods and on free expression itself.

It is to protect this value of books that we have spoken out against Amazon’s tactics against publishers, its monopoly in the book market and its unfair treatment of independent authors. At the same time, we have also challenged the major publishing houses to revisit the parsimonious stance they’ve taken on authors’ e-book royalties. Though the Amazon-Hachette dispute was resolved in November 2014, the issue of fair compensation for authors remains a central concern.