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A quick google search doesn't turn up many good sources on that allegation. The best I could find says that they do make a small profit but at a much lower mar

A quick google search doesn't turn up many good sources on that allegation. The best I could find says that they do make a small profit but at a much lower margin than bookstores, which makes sense given Amazon's business model. https://www.washingtonpost.com/news/the-switch/wp/2015/07/13/the-book-h-is-for-hawk-lists-for-26-amazon-sells-it-for-40-less-is-that-a-problem/ https://www.washingtonpost.com/news/the-switch/wp/2015/07/13...

stetrain 3y ago
That article lists one example which "likely still turns a small profit", and contains allegations from other groups that Amazon is selling some books below cost. That small margin above wholesale in the article's example is probably still effectively selling at a loss when you account for overhead of running the store, shipping, etc. It certainly would be for a smaller competitor. Either of those represents a price that a competitor whose only business is selling books cannot compete with. Amazon can offer these prices as a loss leader because of their position in other markets, not because it has found a more optimal way to run the business of selling books.
- fallingknife 3y ago
  News articles are for clicks. If they could find an example of selling at a loss, they would have used that because it would get more clicks. The fact that they couldn't find one tells me that the allegations are likely to be false. The fact that googling "Amazon selling books at a loss" didn't turn up massive amounts of articles from anti-tech media companies also tells me that. The fact that selling books at a loss to drive out competition (which is, in fact, illegal) is not even mentioned in the anti-trust complaint against Amazon tells me that the allegations are false.
rickdeckard 3y ago
It's mentioned in the lawsuit which described how Apple orchestrated the publishing industry to raise its prices for Apple to have room to mandate a 30% share [1] Amazon was selling eBooks at $9.99, for Apple it was an issue because they couldn't ask a 30% share from publishers AND compete at $9.99 because Amazon achieved that price due to wholesale volume-deals, and likely not with a 30%+ margin. Publishers wanted Amazon to increase sales-prices from $9.99, but due to their wholesale model they couldn't dictate that. Even when they increased wholesale prices, Amazon kept their sales-price of many NYT bestsellers at $9.99 making a loss (probably to drive eReader growth). Quote: "Amazon continued to sell books at $9.99, losing money, even when publishers increased the wholesale price of books they were giving the online giant." [1] https://www.businessinsider.com/how-steve-jobs-and-apple-fixed-ebook-prices-2013-7#amazon-continued-to-sell-books-at-999-losing-money-even-when-publishers-increased-the-wholesale-price-of-books-they-were-giving-the-online-giant-5 https://www.businessinsider.com/how-steve-jobs-and-apple-fix...

stetrain 3y ago

That article lists one example which "likely still turns a small profit", and contains allegations from other groups that Amazon is selling some books below cost. That small margin above wholesale in the article's example is probably still effectively selling at a loss when you account for overhead of running the store, shipping, etc. It certainly would be for a smaller competitor. Either of those represents a price that a competitor whose only business is selling books cannot compete with. Amazon can offer these prices as a loss leader because of their position in other markets, not because it has found a more optimal way to run the business of selling books.

fallingknife 3y ago
News articles are for clicks. If they could find an example of selling at a loss, they would have used that because it would get more clicks. The fact that they couldn't find one tells me that the allegations are likely to be false. The fact that googling "Amazon selling books at a loss" didn't turn up massive amounts of articles from anti-tech media companies also tells me that. The fact that selling books at a loss to drive out competition (which is, in fact, illegal) is not even mentioned in the anti-trust complaint against Amazon tells me that the allegations are false.

rickdeckard 3y ago

It's mentioned in the lawsuit which described how Apple orchestrated the publishing industry to raise its prices for Apple to have room to mandate a 30% share [1] Amazon was selling eBooks at $9.99, for Apple it was an issue because they couldn't ask a 30% share from publishers AND compete at $9.99 because Amazon achieved that price due to wholesale volume-deals, and likely not with a 30%+ margin. Publishers wanted Amazon to increase sales-prices from $9.99, but due to their wholesale model they couldn't dictate that. Even when they increased wholesale prices, Amazon kept their sales-price of many NYT bestsellers at $9.99 making a loss (probably to drive eReader growth). Quote: "Amazon continued to sell books at $9.99, losing money, even when publishers increased the wholesale price of books they were giving the online giant." [1] https://www.businessinsider.com/how-steve-jobs-and-apple-fixed-ebook-prices-2013-7#amazon-continued-to-sell-books-at-999-losing-money-even-when-publishers-increased-the-wholesale-price-of-books-they-were-giving-the-online-giant-5 https://www.businessinsider.com/how-steve-jobs-and-apple-fix...