I told you so, but most of you would not listen. Amazon has tossed an entire publishing company off its site (hat tip: H.G.) because that company would not comply with Amazon’s universally imposed Kindle edition pricing strategy. That places Amazon at the decision making table where the publishers and the market (the buyers of books) usually sits, and not just as a stakeholder but as the holder of everyone else’s nuts. (And when I say nuts, I’m talking chestnuts, so don’t get any ideas.) Amazon is not a book store. It is a public utility that delivers a wide range of products (including books) between a wide range of retailers to a wide range of customers.
I hold no truck for the publishers, and there are plenty of things I like about Amazon. But this latest dispute is clearly evidence that something I blogged about in April but that many of my dear readers thought absurd is in fact coming to pass. ( I was right about Amazon.com, just like I’ll be proven right about the super bowl!!! You’ll see soon enough!!!)
So, to set things straight, I’ll repost the original, with minor revisions:
It is a ground breaking company, it is a bookstore that is mega mega like few other companies are. It is a bookstore that is a huge corporation. Think about that for a second. Think about bookstores in the old days then think about this thing, Amazon Dot Com. A bookstore that is leading the way in mega cloud computing. It has one of the most effective ways ever of interfacing with its customers. It has become the go to place for many people for the purchase of almost anything one can imagine being delivered by mail. Amazon Dot Com is a thing the likes of which we have not seen before.
An increasingly small percentage of what they sell is books. An increasingly small percentage of what people buy off the Amazon.com site is sold by Amazon.com. Amazon dot com is not a bookstore. Google them. Read up a bit. Yes, they sell books and your local bank will open a savings account for you too, but that is a small part of what they do. If everyone stopped buying books at amazon it would not shut them down, and if they did shut down you might be quite surprised as to what else shuts down.
You all know about the #AmazonFail maneno1. I suspect that most of what you know is slightly incorrect. I have read three or four blog posts about it, and not long ago I listened to a current NPR report. They neither jibe nor jive. I suspect as more details come out this will be a two part story: A serious socio-political screwup followed by a “glitch” of very significant proportions. I could be wrong about that, but we shall see.
(Here is a very insightful commentary on the situation giving details and links.)
What is important here is this: Whatever rules you were thinking may apply to the conduct of a large corporation and how they must interface with the rest of society do not apply here. Amazon is not a private corporation that can do whatever it wants. It is actually a utility, a public good, part of our economic commons. It is like Google in this respect.
I know, I know, Amazon and Google are private corporations yada yada yada. You can think that if you want, but you’d be ignoring the important reality that all of our public goods and utilities, including the police, the fire companies, the energy suppliers, even the road building agencies of city, county, state and federal governments (in the US) have transited between private and public and sometimes back (or to some combination). What our society needs to get it’s pin-headed collective brain around is the nature of this thing, this Amazon and Google (and whatever) thing. And to recognize that it is very real and not just a dot com that will go away when everyone realizes they don’t need it or the loans come due. Which will bring us, ultimately, to the question of OpenAccess and OpenSource. And who owns The Internet. And a few other issues.
1 = big problem.
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Toby Buckell has a long but excellent post on the current situation. It’s also worth noting that I was wrong when I wrote the post you link to here.
Toby’s post is somehow not on line right now. I linked to your post because I remembered a major discussion during which quite a few perceptions changed (or didn’t). I might be interesting to revive some of those. Perhaps you’ll be writing a new post?
Did you really imply in the super bowl post that Brett Favre is a better QB than Peyton Manning?
Cause…. he isn’t.
Well, they have played against each other, right? Which one won when that happened?
Comment moved to here:
http://scienceblogs.com/gregladen/2010/01/the_true_meaning_of_the_super.php#c2240258
I still disagree with your original post. Amazon is not a public utility. It is not indispensable. Every Macmillan book is still for sale at other retailers. A $12 trillion economy does not depend on a $20 billion company. It is in Amazon’s best interest to be perceived that way, because otherwise their stock price couldn’t support the PE ratio of 70 or so. In case you hadn’t noticed, Amazon decides what the price it sells books at will be, and always has. Every bookstore does this. A book ships to the store with a price marked on it; the bookstore is under no obligation to actually sell the book at that price. The manufacturer can’t actually force the issue because of the Consumer Goods Pricing Act of 1975.
Are you arguing that it is not possible for any other retailer to compete with Amazon, that no one will make a device to compete with Kindle? If you say that they are a “utility” that means not just regulated, but also protected. Do you really want that? I certainly don’t.
What does Amazon do that was not also done by the Sears Roebuck Co. 100 years ago? Or by Wal-Mart today?
Bookstores do not determine the price of books. They set the price they sell a book for in relation to the wholesale price. There is a huge difference …. huge! … between what is going on with Amazon and e-books and what has ever happened before in retail book sales. They are different beasts. And perhaps that is appropriate. The publishers are not providing squat in the areas they usually do in production, and they also provide squat to the writers. In fact, the publishers could be totally cut out of the process.
None of which is really arguable. My point here is that Amazon is a bookstore at the table in ways bookstores have never been before. Seriously, no kidding.
Amazon is not a utility in any way that anything we think today of as being a utility is. But neither are any of the utilities.
I’ve worked in publishing for 20 years, and you clearly do not have a good grasp of how the business works.
#8:
Be sure to bring an actual argument in your next comment.
Moo: I’ve been in publishing for 30 years and I think that was a pretty good point. Book stores do not set the price of books any more than gasoline stations set the price of gas.
Charlie Stross:
http://www.antipope.org/charlie/blog-static/2010/01/amazon-macmillan-an-outsiders.html
For those who are slow.
Amazon has caved, and will allow Macmillan to sell their e-books at the prices Macmillan want:
http://www.amazon.com/tag/kindle/forum/ref=cm_cd_tfp_ef_tft_tp?_encoding=UTF8&cdForum=Fx1D7SY3BVSESG&cdThread=Tx2MEGQWTNGIMHV&displayType=tagsDetail
But of course they’re all whiny and good-bye-cruel-worldish about it. I love how they say that they suspended Macmillan’s sales for “expressing the seriousness of our disagreement” – I can’t help but imagine that line read by Marlon Brando in his Don Corleone voice.
I don’t know much about this football thing. I wouldn’t even recognize that Bret Favre guy if I bumped into him at Sears. But isn’t it a team game? And even head to head, wouldn’t measuring one person’s ability in a multi faceted skill set be kind of like measuring their intelligence? Don’t they have a single number kinda like IQ to tell us how good a QB is? And if so, why the argument? And if not, why not?
And can we link average racial cranial capacity to QB skill?
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