Hachette/Amazon Business Interruption

http://www.amazon.com/forum/kindle/ref=cm_cd_tfp_ef_tft_tp?_encoding=UTF8&cdForum=Fx1D7SY3BVSESG&cdThread=Tx1UO5T446WM5YY

by Rylinks • 12 years ago

115 96 12 years ago

amazon.com

001sky4• 12 years ago

Confirms what has otherwise been in the press for 2 weeks. However, it's helpful to hear it from Amazon directly. Sidesteps the need to "shoot the messenger"--An unfortunate direction of earlier discussions on HN.

eugenez2• 12 years ago

The 1.1% of Amazon sales (by item count) for Hachette is an interesting metric if only to determine overall sales volume for Amazon should someone happen to have the approximate Hachette numbers.

ben336• 12 years ago

they made it clear that was "weighted demand" though, so items sold, not items provided. You'd need "Hachette sales through Amazon", a number unlikely to be available beyond Amazon/Hachette employees/execs.

eugenez2• 12 years ago

I wonder if the combination of total Hachette sales weighted by the portion of overall book sales via Amazon would be a reasonable approximation.

qq66• 12 years ago

Isn't overall sales for Amazon published in their annual report?

joshreads• 12 years ago

“A word about proportion: this business interruption affects a small percentage of Amazon’s demand-weighted units.” -a normal thing a human would say

cperciva2• 12 years ago

We also take seriously the impact it has when, however infrequently, such a business interruption affects authors. We've offered to Hachette to fund 50% of an author pool - to be allocated by Hachette - to mitigate the impact of this dispute on author royalties, if Hachette funds the other 50%. We did this with the publisher Macmillan some years ago. We hope Hachette takes us up on it.

I have to say, this is a classy move on Amazon's part.

neil1• 12 years ago

I wouldn't call it "classy", it's a public relations ploy, meant to turn public opinion in Amazon's favor.

pooper6• 12 years ago

It is sad that hachette is getting authors to write badly about amazon on blogs and on facebook. It is evident that Amazon.com is right and hachette is wrong.

Why do we need these scummy publishers anyways? Good riddance.

cperciva2• 12 years ago

Sure, it's a public relations ploy. But it's a public relations ploy which helps out the group which is most negatively impacted by the current situation.

They may be doing it for cynical reasons, but I still like it.

incision• 12 years ago

'We also take seriously the impact it has when, however infrequently, such a business interruption affects authors. We've offered to Hachette to fund 50% of an author pool - to be allocated by Hachette - to mitigate the impact of this dispute on author royalties, if Hachette funds the other 50%. We did this with the publisher Macmillan some years ago. We hope Hachette takes us up on it.'

Wonderfully slick move.

It makes Amazon look good, Hachette look bad and builds good will with the authors and spectators while turning the screws on the economic pressure that Hachette is already facing.

conanbatt• 12 years ago

Does it? For me its a strong-armed position (my 50% hurts less than your 50%), which is why they are in this battle to begin with.

pooper6• 12 years ago

Hachette [...] is part of a $10 billion media conglomerate. I think it is Hachette which is trying to strong arm the up and coming Amazon.com

mcphage5• 12 years ago

Hachette look bad

How does it make them look bad? If they had said "Hachette chose not to take us up on this", then sure, but as it stands, Amazon made the offer, and Hachette is deciding what to do with it. That's entirely reasonable.

scott_w• 12 years ago

Because sometimes "We offered x and they refused" looks like a he-said-she-said scenario. Amazon are demonstrating that the offer is still on the table, and the ball is entirely in Hachette's court.

ternaryoperator• 12 years ago

I'm an Amazon Prime subscriber, and have been for years. For most of that time, I've automatically bought stuff from Amazon, aware that occasionally I'm paying more than elsewhere. The reason is convenience. Order almost anything, get it fast, with no extra shipping cost.

This spat has forced me to occasionally shop at Barnes & Noble. And I gotta say, if I have to go to two stores to get items, Amazon's convenience edge is much smaller. Just the other day, since I was on B&N I bought things there that I would normally have gone to Amazon for. Again, it's the pure convenience.

I have no idea whether I'm typical or not, but if I am, then I think this will hurt Amazon more than Hachette.

bigtones• 12 years ago

I agree, this saga is hurting Amazon a lot. From a PR perspective at a time when American citizens are worried about monopolies and the implications of technology conglomerates, this very public spat seems ill timed. The New York Times has had five articles negative of Amazon on this issue in the past two weeks alone.

akiselev• 12 years ago

Even if you are a typical user, how much would it possibly hurt Amazon? If this becomes a regular occurrence I can see Amazon's leverage eroding but the company regularly goes toe to toe with many different industries and holds it own against half trillion dollar a year giants like Walmart. Amazon's core competencies are growing and the network effects are difficult to quantify.

I suspect encroaching on Amazon's market dominance would be a hard task even for Google, let alone B&N

wmeredith• 12 years ago

If the typical behavior of their current multi-year Prime subscribers is to shop around because they no longer like the company that is a BIG problem for Amazon.

mwsherman• 12 years ago

Anyone know what an author pool is, how it functions? A bit of Googling didn’t reveal anything.

paulhauggis• 12 years ago

I will never do business with Amazon again.

As a book seller:

1) Customers aren't mine. I'm not allowed to send any of the people that buy from me a link to my website or collect any of their data. This means that this income channel can be taken away at the whim of Amazon.

2) Amazon regularly uses your sell data to undercut you and put you out of business. I regularly would sell rare books with no other listings. As soon as I had any sales, Amazon would popup with their own listing at half price. My sales would go down when this happened.

3) Strange things would go on with their listings. I was in business for 5 years. I saw patterns and know when my sales would be up and down.

None of these rules applied on Amazon. I would be going strong for weeks at a time. One day, I would have no sales and this might last for a month. From 100 sales/day to 0 just seems to be a bit funny to me.

Customer support would of course deny everything. However, after running my own tests, I could see that from certain IP addresses and on some Amazon servers, I would get random errors on checkout of my own listings.

Amazon eventually banned me. I had near 100% feedback and 1 complaint from a user that I sold them the wrong book. Before the user complained, I even paid to have it shipped back to me. This wasn't good enough. The customer wanted to keep the >$200 book and not send it back. I nearly went broke because I couldn't access my money for 3 months.

It took me a year to get my business back to where it was, but I am now in a better place (with many sales channels).

Amazon is an evil company and anyone that does business with them is risking everything for short-term gains. It's the destroyer of small businesses.

msh• 12 years ago

As a customer I see it as a feature that Amazon don't allow people to to collect my data, I bought the book at Amazon, nobody else should know the details.

That does not change that Amazon is scummy but that they don't allow you data is actually a customer protection feature.

mcphage5• 12 years ago

As a customer I see it as a feature that Amazon don't allow people to to collect my data, I bought the book at Amazon, nobody else should know the details.

I'm not sure the situation is that simple. You bought the book through Amazon, but (in this case), you bought the book from the other poster. Putting them closer to, say, a shopping mall. As a shopper, who's has a stronger relationship to you—the store you bought something from, or the mall you bought it in?

And for the seller, it means that your only "customer" is Amazon. Who doesn't really care about you at all. If I were a seller, I'd rather have my customers be the people who are actually interested in the product I'm selling.

When commerce goes well, the buyer and seller create a relationship that benefits both of them. With Amazon being a strict gatekeeper, there's no way for that relationship to form, and the seller ends up being an interchangeable name on a screen.

cageface• 12 years ago

I feel exactly the same way about the app business. I don't want an arbitrary and disinterested third party in between me and my customers because I believe very strongly that in the long run a strong and direct relationship with my customers is the key to a sustainable business. The iOS app store is particularly egregious in this respect because I can't even contact users that report problems. The Google Play store is slightly better in this respect but I'm still not comfortable with the idea that my entire online presence can be switched off at will by some overzealous algorithm.

camus2• 12 years ago

Yeah but what's left for you?write a web app for firefox os maybe.

Apple created Ios,Google Android.While Android is more open(you dont have to sell your app through Play),both vendors own their respective plateform,even Microsoft wants to adopt that model.Things will not get more open in the future,definetly less and less open.It always works like that.

leorocky3• 12 years ago

I will never do business with Amazon again.

Every other day it's someone saying they'll never use Facebook again, they'll never use Amazon again, they've quit Dropbox, they'll never use Google again. People in HN are quitting startups, quitting established companies, forswearing this and that, and getting angry at all kinds of shit day in and day out, and to be honest, I'm not sure it's ever made any bit of difference ever.

Even GoDaddy is still alive and strong and not one of these other companies has a founder go and shoot elephants and post about it on their official blog with pictures, after supporting SOPA and demeaning women on national television. Boycotting does nothing, and crying about it even less.

EC1• 12 years ago

Yeah just like that whole Dropbox x Condoleezza Rice thing went.

joallard• 12 years ago

What about Paypal? I've heard complaints against them time and time again, and alternatives have popped up in competition because they sucked too much. Stripe, Square?

sillysaurus32• 12 years ago

Trivializing someone's experiences by dismissing them as crying might not be the way to go. It doesn't seem like you're arguing against anything at all. Comments like the one you responded to are some of the most important, because (a) they're from direct experience, (b) people rarely talk about the topic, (c) they're thorough and substantive and present their opinion well.

The last thing the world needs is to mock people for speaking up.

mehwoot• 12 years ago

Well he didn't say it would make a difference, he just said he isn't dealing with Amazon.

georgemcbay2• 12 years ago

"Boycotting does nothing"

Actually for-real boycotting and similar types of actions like calls for coordinated divestiture do often cause changes, sometimes very big ones; but a few people posting on some internet forums is by no means a real boycott.

Personally I also have a number of issues with Amazon but none of them are serious enough to overcome the fact that they do retail sales on the Internet about a billion times better than anyone else (only Newegg comes close, and only in the narrow band of computers/electronics).

danmaz742• 12 years ago

Other times it's about boycotting, but this comment isn't. It's about "doing business", and it is a very relevant warning to other entrepreneurs who need to choose if they should bet on Amazon as a distribution platform.

Turing_Machine3• 12 years ago

"Customers aren't mine. I'm not allowed to send any of the people that buy from me a link to my website or collect any of their data"

I'm curious: which bookseller does let you do this? Barnes & Noble? Your neighborhood bookstore?

einrealist• 12 years ago

Thanks, thats why I stopped buying on Amazon.

chaostheory• 12 years ago

This is a just a possible outcome (or maybe inevitable if you look at history) when you build a business on someone else's platform. Whenever humanly possible, try to have a more direct path to your customers. Of course, I realize that's easier said than done.

brisance• 12 years ago

Amazon conveniently sidesteps the fact that eBooks from Hachette are not subject to supply chain constraints.

Or that deliveries were purposely delayed due to contract negotatiations, which Amazon itself admitted.

Citation: http://bits.blogs.nytimes.com/2014/05/23/amazon-escalates-it...

jpatokal2• 12 years ago

"But with such an online structure as pursued by Amazon, a book market is being destroyed that has been nurtured over decades and centuries."

Yes, that's called "disruption". Adapt or die.

http://gyrovague.com/2012/06/18/eat-yourself-or-be-eaten-a-t...

patio11• 12 years ago

Hachette: "They're using leverage on us in a negotiation to get us to agree to terms!"

Amazon: "Well, yeah."

001sky4• 12 years ago

This trivializes everything interesting about this case. Because this argument was previously had with Microsoft & Netscape. And Comcast and Netflix. And Amazon has a huge stake in two major policy issues upon which this touches:

(1) Monopolistic collusion in e-books; and

(2) Net neutrality

pooper6• 12 years ago

Can you force Walmart to put your products on shelves? How is it OK for Hachette to force Amazon.com to put the physical books on shelves?

One easy way to fight Amazon would be to include a DRM-free digital copy download for free with every physical book purchase. Of course, the scummy publishers won't do that.

yaur• 12 years ago

To play the devil's advocate... couldn't Hatchet just pull out of selling ebooks through Amazon and roll their own and/or start an distribution platform for ebooks structured like Hulu? If the rest of the big 6 publishers got on board that would be pretty catastrophic for Amazon and they wouldn't be able effectively retaliate without crippling themselves.

AnthonyMouse4• 12 years ago

And Amazon has a huge stake in two major policy issues upon which this touches: (1) Monopolistic collusion in e-books; and

Pray tell who is Amazon colluding with?

(2) Net neutrality

Amazon doesn't offer last mile internet service as far as I'm aware. Are you alluding to some neutrality violation in their role as ISP for AWS customers or ...?

jpatokal2• 12 years ago

Charlie Stross (cstross here on HN) has an interesting post on this:

By driving down the unit revenue, Amazon makes it really hard for publishers—who are a proxy for authors—to turn a profit. Eventually they go out of business, leaving just Amazon as a monopoly distribution channel retailing the output of an atomized cloud of highly vulnerable self-employed piece-workers like myself. At which point the screws can be tightened indefinitely.

http://www.antipope.org/charlie/blog-static/2014/05/amazon-m...

dublinben2• 12 years ago

I would happily buy a DRM free copy of his books directly, but I can't.

tygorius• 12 years ago

Well, by that logic the record studios were proxies for musicians. Sorry, not buying that argument.

If I were Stross I'd certainly be peeved at the loss of access to customers and, by extension, income. Especially if I were obligated by contract to stay with a publisher on the outs with Amazon. But arguing that Amazon's endgame is to put him out of business seems a stretch. We're still in the early stages of the ebook publishing disruption and I suspect that as with music, direct commercial channels between producers and consumers is the future.

tptacek• 12 years ago

This topic has generated a variety of coverage, presumably in part because the negotiation is with a book publisher instead of a supplier of a different type of product. Some of the coverage has expressed a relatively narrow point of view. Here is one post that offers a wider perspective.

http://www.thecockeyedpessimist.blogspot.com/2014/05/whos-af...

Apart from the amusing optics of "this topic has generated a lot of coverage, but here's a blog post that sees our side of the story", it's worth knowing that this "wider perspective" is that of a very small literary indie publisher that basically says two things:

* Hachette is gigantic

* Selling books online is great for indies

Neither of those points has much to do with the issue at hand, and, in particular, I'd suggest that selling books online is great for indies so long as Amazon sees the dollars involves as a tiny rounding error.

bowlofpetunias• 12 years ago

The day publishers like Hachette start selling their publications directly and unencumbered by DRM is the day Amazon will slowly start losing their leverage. (And get me as a customer.)

Sure, it will take a while, but that's only because these publishers have spent the last two decades sitting on their asses counting their money whilst Amazon ate their lunch.

I don't subscribe to the doctrine "disruption = good", but publishers are part of the fat and lazy copyright exploitation industry that truly deserved to be disrupted.

If Amazon tried to stop Hachette from competing that would be a different matter. But they are handing Amazon this leverage simply because they still can't be arsed to innovate themselves.

pkaye2• 12 years ago

Amazon already allows DRM free publications to be emailed into Kindle devices.

dublinben2• 12 years ago

That doesn't help much when only a handful of smaller publishers sell their books in DRM-free formats. I read a lot, and really like e-books. I don't buy very many e-books though, because the condition in which they're sold is so hostile to the consumer.

werid• 12 years ago

This is a lengthy piece that makes the point that these publishers aren't entirely innocent (there's delays on both sides, and the publishers are owned by some pretty big companies themselves)

http://davidgaughran.wordpress.com/2014/05/26/amazon-v-hache...

Hachette/Amazon Business Interruption

Related Stories