4 ms·

If you ask, "cui bono?", the decision on who to side with is pretty obvious, at least for the average consumer. Amazon has for decades been one of the most pro

If you ask, "cui bono?", the decision on who to side with is pretty obvious, at least for the average consumer. Amazon has for decades been one of the most pro-consumer companies out there. The publishers have been slapped in court for trying to collude to raise prices. In fact, the whole source of this dispute is that Hachette wants the option to charge more for its books on Amazon. So on the one hand, we have a company that wants us to pay more for the same product. And on the other hand we have a company that, while large in the ecosystem, is by no means a monopoly (maybe it is a monopsony, but even that is someone questionable considering they only have a 65% share of the market), and wants to charge us less. You can always buy the publishers' books from a different store if Amazon won't sell them. Well, if it weren't for the DRM the publishers originally insisted on, you could. Hrm. Well, I know where I stand on this.

rtpg 12y ago
> (maybe it is a monopsony, but even that is someone questionable considering they only have a 65% share of the market) 65% of distribution volume is more than enough to practice monopolistic practices, especially if the industry is hurting. I'm not necessarily against traditional publishers disappearing, but it would be nice to have a more diversified spread when it comes to the surviving distribution channels
- jamesaguilar 12y ago
  I don't know how true that really is Everything I've read suggests that exercising monopoly power requires very high market shares when it comes to fungible products with low marginal cost, like delivery of e-books. Example citation: section A.2. of http://www.justice.gov/atr/public/reports/236681_chapter2.htm http://www.justice.gov/atr/public/reports/236681_chapter2.ht...
  - ewzimm 12y ago
    I think monopoly power is especially difficult with digital distribution because the company is using technology that everyone else has access to. If Amazon suddenly started overcharging, it would not be difficult for Barnes and Noble or someone else to take over their business. This is why free software like Apache and Linux is so important. However big Amazon gets, as long as other companies, however small, have the necessary technology to provide similar services and the option to scale operations with increased business, Amazon has to offer superior services and prices to stay competitive. Book publishers, on the other hand, use specialized factories and distribution networks to throw their power around. With commoditized servers, free software, and an open Internet, Amazon can't leverage those same unique advantages.
    - shykes 12y ago
      I disagree, the technology is necessary but not sufficient. To compete as a distributor of mass consumer goods, you need a distribution infrastructure (warehouses, trucks, servers and the logistics operation to run them). The technology that makes up trucks, warehouses and servers may be commoditized, but the ability to own and operate hundreds of millions of dollars worth of them, with enough profit to keep growing the fleet every year - that's a very real barrier to entry because customers like getting their purchases the next day or even the same day, and doing that consistently for many customers requires that kind of a fleet. On top of that, you need a way to reach customers online. The brand is sticky enough that many people start their book search directly on Amazon. To get a chance to compete for that search (presumably on Google) you'll need to hope that they find the price outrageous enough to overcome the promise of a convenient and reliable next-day delivery, pre-configured shipping and billing, etc. Lastly Amazon is working hard to move the battle away from the open web: once a customer has a Kindle, the bar is even higher to compete for their future purchases.
      - ewzimm 12y ago
        I agree with what you are saying, but I was talking specifically about digital distribution. Closed platforms like Kindle definitely cause some lockdown, but Kindles are relatively cheap and replaced as often as yearly. If Amazon did start gouging on prices, a lot of people would switch to Kobo or Nook. With digital distribution, you can guarantee that everything you're selling is always available for free (with the risk of legal fines) from other channels. Companies like Spotify, Netflix, and Amazon's digital distribution are aware that they are competing with free and tailor their services to be worth the cost. Physical goods that require factories and distribution centers will be a barrier to entry for a long time, at least until commodity 3d printers can compete with large-scale factories, which will take some time.
colechristensen 12y ago
I see a future where hyper-low-volume printers paired with warehousing and delivery logistics providers (Amazon) and crowd-funded _investing_ for advances replace and eliminate the rent extraction of the big publishers in film, print, and music. I want to live in a world where the creators set their own prices and reap the most benefits.
- walterbell 12y ago
  Are you referring to Espresso book printers or another type of print technology?
  - colechristensen 12y ago
    I'm thinking something like an Espresso book printer scaled up to a small (mostly) automated factory serving logistics companies (shippers and warehousers like Amazon) and local book shops. The key being the possibility of producing a large volume of books per day but down to ones of copies per title eliminating the up front cost of 10,000 units (or whatever a reasonable industry standard is).
    - walterbell 12y ago
      Doesn't Amazon already run their own POD press? One of the rumored disputes with Hachette is that Amazon wants access to digital masters so they can print books on demand, if the publisher is unable to supply physical copies for any logistical reason. That's like demanding access to software source code.
      - colechristensen 12y ago
        I believe Amazon already does, but the future isn't an Amazon monolith controlling the entire vertical infrastructure. The correct future is many printing businesses competing with each other, many logistics and shipping companies competing with each other, all separate and competing amongst themselves for the business of both content creators and content consumers. It doesn't work right if authors are 'vendor locked' into Amazon's printing and distribution network, it needs to be a many-to-many printers-to-distributors network with healthy competition for the "right future".

rtpg 12y ago

> (maybe it is a monopsony, but even that is someone questionable considering they only have a 65% share of the market) 65% of distribution volume is more than enough to practice monopolistic practices, especially if the industry is hurting. I'm not necessarily against traditional publishers disappearing, but it would be nice to have a more diversified spread when it comes to the surviving distribution channels

jamesaguilar 12y ago
I don't know how true that really is Everything I've read suggests that exercising monopoly power requires very high market shares when it comes to fungible products with low marginal cost, like delivery of e-books. Example citation: section A.2. of http://www.justice.gov/atr/public/reports/236681_chapter2.htm http://www.justice.gov/atr/public/reports/236681_chapter2.ht...
- ewzimm 12y ago
  I think monopoly power is especially difficult with digital distribution because the company is using technology that everyone else has access to. If Amazon suddenly started overcharging, it would not be difficult for Barnes and Noble or someone else to take over their business. This is why free software like Apache and Linux is so important. However big Amazon gets, as long as other companies, however small, have the necessary technology to provide similar services and the option to scale operations with increased business, Amazon has to offer superior services and prices to stay competitive. Book publishers, on the other hand, use specialized factories and distribution networks to throw their power around. With commoditized servers, free software, and an open Internet, Amazon can't leverage those same unique advantages.
  - shykes 12y ago
    I disagree, the technology is necessary but not sufficient. To compete as a distributor of mass consumer goods, you need a distribution infrastructure (warehouses, trucks, servers and the logistics operation to run them). The technology that makes up trucks, warehouses and servers may be commoditized, but the ability to own and operate hundreds of millions of dollars worth of them, with enough profit to keep growing the fleet every year - that's a very real barrier to entry because customers like getting their purchases the next day or even the same day, and doing that consistently for many customers requires that kind of a fleet. On top of that, you need a way to reach customers online. The brand is sticky enough that many people start their book search directly on Amazon. To get a chance to compete for that search (presumably on Google) you'll need to hope that they find the price outrageous enough to overcome the promise of a convenient and reliable next-day delivery, pre-configured shipping and billing, etc. Lastly Amazon is working hard to move the battle away from the open web: once a customer has a Kindle, the bar is even higher to compete for their future purchases.
    - ewzimm 12y ago
      I agree with what you are saying, but I was talking specifically about digital distribution. Closed platforms like Kindle definitely cause some lockdown, but Kindles are relatively cheap and replaced as often as yearly. If Amazon did start gouging on prices, a lot of people would switch to Kobo or Nook. With digital distribution, you can guarantee that everything you're selling is always available for free (with the risk of legal fines) from other channels. Companies like Spotify, Netflix, and Amazon's digital distribution are aware that they are competing with free and tailor their services to be worth the cost. Physical goods that require factories and distribution centers will be a barrier to entry for a long time, at least until commodity 3d printers can compete with large-scale factories, which will take some time.

colechristensen 12y ago

I see a future where hyper-low-volume printers paired with warehousing and delivery logistics providers (Amazon) and crowd-funded _investing_ for advances replace and eliminate the rent extraction of the big publishers in film, print, and music. I want to live in a world where the creators set their own prices and reap the most benefits.

walterbell 12y ago
Are you referring to Espresso book printers or another type of print technology?
- colechristensen 12y ago
  I'm thinking something like an Espresso book printer scaled up to a small (mostly) automated factory serving logistics companies (shippers and warehousers like Amazon) and local book shops. The key being the possibility of producing a large volume of books per day but down to ones of copies per title eliminating the up front cost of 10,000 units (or whatever a reasonable industry standard is).
  - walterbell 12y ago
    Doesn't Amazon already run their own POD press? One of the rumored disputes with Hachette is that Amazon wants access to digital masters so they can print books on demand, if the publisher is unable to supply physical copies for any logistical reason. That's like demanding access to software source code.
    - colechristensen 12y ago
      I believe Amazon already does, but the future isn't an Amazon monolith controlling the entire vertical infrastructure. The correct future is many printing businesses competing with each other, many logistics and shipping companies competing with each other, all separate and competing amongst themselves for the business of both content creators and content consumers. It doesn't work right if authors are 'vendor locked' into Amazon's printing and distribution network, it needs to be a many-to-many printers-to-distributors network with healthy competition for the "right future".