AMAZON THREAT ON DIRECT SELLING

AMAZON HAS THREATENED publishers who sell direct at discount on their own websites with punitive action. PN understands that it has said that if the publisher continues, Amazon will take the selling price as the RRP and apply its terms of trading to that price. In other words, if Amazon receives a 50% discount from Penguin, for example, but Penguin is selling a £20 book for £15 on its website, Amazon will only give Penguin £7.50, rather than £10.

One publisher told PN: “This has been around for a while. There have been discussions going on since Frankfurt. Essentially, they're not happy when the manufacturer, as they call us, sets the price of a book. The threat is that they will apply the agreed terms of trading to our web price. But they are on very shaky legal ground. After all, they've been invoiced at an RRP less their discount, so if they refused to pay that amount, they would be in breach of contract.” Another publisher was more forthright. “Nobody can tell somebody else what price to sell a book at. Publishers will resist this. We're talking about very few titles and we are very confident of our position.” Although the number of titles being sold direct by publishers is very few, some observers believe Amazon sees it as the thin end of the wedge and wants to fire a warning shot. The move is being driven by Amazon's UK Head of Books, Christopher North, and comes as a blog storm has erupted over Amazon.com's announcement concerning its print-on-demand operation BookSurge.

Independent publishers are angered by the US company's decision to economically favour those companies that switch their printing to BookSurge. The row forced Amazon to release an open letter clarifying its position. Amazon.com will sell titles from other PoD providers it said, but the publishers would have to join Amazon's Advantage Program, which has a fee. Amazon UK said that are no plans to introduce the service here, but one publisher is taking legal advice. “They're abusing their monopoly position. Once they've got you, they'll start increasing the terms.”

In the background to the moves may be Amazon's realisation that it has effectively dominated online bookselling for some years. Its figures with publishers grow faster than any other retailer (hence publishers' reluctance to anger it), but with other players establishing their online operations - Waterstones.com and, shortly, Borders as well as increasing noise from Play.com and publishers' own sites - it realises that this soon might change.