Iron fist in a velvet glove?

Posted on December 1, 2008 in Uncategorized

 10 years of Amazon.co.uk ‡ Amazon’s labour relations ‡ Amazon’s relationship with publishers

According to November’s edition of the Ethical Consumer, Amazon sold 16% of all books sold in 2007 in the UK, compared to Waterstone’s 20%.  Indeed, as The Bookseller has noted, Amazon already had 5% of British book sales after only two years of operations.  Although Amazon has rapidly expanded into other businesses, it proved very much that it could still be innovative in its original business by launching the Kindle.  The device has not yet been launched in the UK, as we do not have the integrated network required for one of the e-reader’s selling-points: the wireless downloading of e-books.  Earlier this year, Amazon purchased Audible.com, which could lead to the company disseminating audiobooks as well as e-books via the Kindle. Yet there are now those in publishing who fear that Amazon, rather than being good for competition, could be turning into a monopoly.
This year, Amazon appeared to be in dispute with Hachette, and was alleged to have removed the “Buy” buttons from some of the publisher’s mainstream titles.  Amazon had also apparently had a similar dispute over terms with Bloomsbury.  It seemed that Amazon’s goal of producing the lowest prices for their customers had clashed with the publishing industry’s traditional low margins.  The huge discounting of book titles is nothing new, and predates Amazon’s arrival in the British marketplace.  Amazon has been able to take it to new levels, however, as there are huge benefits of scale to be had from operating from a handful of locations rather than 500 shops dotted all over the country.  It was often demonstrated to Amazon staff how much more quickly a book would be dispatched from Amazon’s shelves than that of a high street bookshop, which is probably why Amazon feels justified in asking for better terms from publishers.  However, the accusation that Amazon has been removing the “Buy” buttons is disturbing, as is the allegation that Amazon.com has been forcing print-on-demand publishers in the US to switch to their own POD company, Booksurge, which has been asking for discounts as high as 52% of the retail price of such products.  In its 13th year, Amazon.com is in danger of being seen as an unruly teenager that is all too aware of its potency.  It’s not just the book market that is in thrall to Amazon: when the Guardian carried out its annual survey of the lowest priced best-selling toys and presents this year, “seven out of ten of them could not be found cheaper than at Amazon”.  Amazon.co.uk would do well to remember its own infancy, and its previous dependency on wholesalers such as Gardners, in its dealings with suppliers, and be more diplomatic when negotiating terms, since it would be better for PR at least to present the velvet glove rather than the iron fist.
I had both good times and bad times at Amazon, and when it came time for me to leave, I was happy enough to make a recruitment video for the company (the source of the photos illustrating this article).  Amazon.co.uk’s tenth anniversary presented me with the opportunity of meeting up with some of my ex-colleagues in Windsor.  I was surprised to hear some of those present say that working at Amazon had been the pinnacle of their career.  I could see what they were saying:  we were all so young, and were on this huge big adventure together, to which we all contributed greatly, utilising our youthful energy to the full.  However, for me, despite the current economic gloom, I feel that there are more exciting times to be had ahead in publishing.