Amazon.com and the anti-trust suit

I have seen many, many, many articles accusing Amazon.com of "ruining" the publishing industry and implying that the Justice Department is after them in an anti-trust lawsuit that is making on-going news.

Recently the NY TIMES (who should know better) posted yet another such inaccurate article. Someone with actual knowledge of the e-book industry dissected it and if you want to see what they said, click here: http://mikecanex.wordpress.com/2012/04/16/the-worst-article-about-the-ebooks-anti-trust-suit/


For those who want to know the facts:

1. Nobody is suing Amazon.com! Anti-trust means the company is cheating their customers.

2. The Justice Department filed the price-fixing anti-trust lawsuit against the Big 6 paper publishers and the Apple computer corporation, not against Amazon.com.

3. Amazon sets prices on the books that they sell. This is Big News?  Every retailer in the country sets prices on the goods they sell. Some offer discounts. :) Customers like discounts.

4. Amazon sold books from the Big six at $9.99 instead of the $15.99 the paper publishers set as their LIST price.  Okay, they discounted the suggested retail price. Nobody gets sued for giving the customer a price break. This means they will clear less money per copy on the discounted books, but that they will likely sell more copies. THIS MEANS THE PUBLISHERS WILL SELL MORE COPIES AND MAKE MORE MONEY. High sales and benefit to the consumer are, and always have been, an Amazon business policy.

5. Each e-book sales site pays the publisher and author whatever percentage of the list price they choose. Some pay as little as 15%. Publishers and authors can decide whether they want to sell through sites like that and take that company's price or not. NOBODY forces them to sell for lower profits. They can CHOOSE NOT to sell there. The choice is theirs, but they should also remember that selling more books is a desirable outcome for publishers and if the percentage is less, the remuneration from those low-percentage sales will still be more than zero.

6. Before Kindle was ever released --we know because at that time we were selling books on Mobipocket.com, an Amazon company -- Amazon learned that another sales site was paying publishers 70% while they paid 35%. Publishers were linking to the other sales site and sending customers there to buy, and why not? They would make double the earnings per sale if customers went to the higher paying site to buy instead of one that paid less.  Amazon's response to this little-known-fact was to immediately raise their royalty percentage to 70% to meet the competition.

Bottom line: Amazon pays more per sale to publishers and authors. Amazon sets prices that give their customers a price break.  HOW DOES THAT MAKE THEM THE BAD GUY???