Online bookseller acquires UK rival, prompting worries about domination of trade
Amazon ... a runaway hit. Photograph: Frank Baron for the Guardian
Amazon acquired its rival The Book Depository yesterday in a move that industry experts warned could tighten the American company's "stranglehold" over the online book trade in the UK.
Amazon acquired the Gloucester firm, which claims to be the fastest-growing bookseller in Europe, for an undisclosed sum. With books dispatched to more than 100 countries, The Book Depository made an operating profit of £2.3m last year on sales of £69m in the year to June 2010. Turnover is thought to have nearly doubled to £120m in the last financial year, with just a quarter of its sales in the UK.
The company was founded in 2004 by the Irish entrepreneur Andrew Crawford with the mantra of "selling 'less of more' rather than 'more of less'". It aimed to sell 6m titles covering anything from flower arranging to aircraft piston engines differentiating itself from rival retailers that increasingly focused on bestsellers.
In a statement, Amazon's vice-president of European retail, Greg Greeley, said he looked forward to "welcoming them to the Amazon family" but added the deal would be "subject to customary closing conditions, including regulatory approvals".
Crawford, who was involved in Amazon's UK launch, said: "With the support of Amazon, we look forward to continuing our growth and providing an ever-improving service for readers globally."
Amazon is estimated to account for 70% of UK internet book sales with The Book Depository and Play.com its largest rivals. Neill Denny, editor of the Bookseller magazine, said: "The publishing industry will be worried about the concentration of power in Amazon's hands. They don't like the stranglehold it has over online bookselling as it is." The Office of Fair Trading said it was "too early" to say whether it would launch an inquiry into the deal.
The Book Depository said on Twitter it would "continue to operate independently". On its website, it also asked: "How does the Amazon acquisition affect The Book Depository customers?" with the reply: "The Book Depository and Amazon are aligned in wanting to ensure the best possible experience for customers ... we will look to continue to increase our vast selection of great titles and provide even better customer experience."
Worried customers speculated on Twitter that the deal would result in price rises and the end of free shipping.
The publishing industry is going through unprecedented upheaval as sales shift to the internet but also as digital books are bought in rising numbers. Seattle-based Amazon, which made profits of $1.15bn (£715m) on sales of $34.2bn last year, said sales of Kindle books had overtaken print. The firm said it was now selling 115 Kindle books to every 100 paperbacks.
Amazon acquired the Gloucester firm, which claims to be the fastest-growing bookseller in Europe, for an undisclosed sum. With books dispatched to more than 100 countries, The Book Depository made an operating profit of £2.3m last year on sales of £69m in the year to June 2010. Turnover is thought to have nearly doubled to £120m in the last financial year, with just a quarter of its sales in the UK.
The company was founded in 2004 by the Irish entrepreneur Andrew Crawford with the mantra of "selling 'less of more' rather than 'more of less'". It aimed to sell 6m titles covering anything from flower arranging to aircraft piston engines differentiating itself from rival retailers that increasingly focused on bestsellers.
In a statement, Amazon's vice-president of European retail, Greg Greeley, said he looked forward to "welcoming them to the Amazon family" but added the deal would be "subject to customary closing conditions, including regulatory approvals".
Crawford, who was involved in Amazon's UK launch, said: "With the support of Amazon, we look forward to continuing our growth and providing an ever-improving service for readers globally."
Amazon is estimated to account for 70% of UK internet book sales with The Book Depository and Play.com its largest rivals. Neill Denny, editor of the Bookseller magazine, said: "The publishing industry will be worried about the concentration of power in Amazon's hands. They don't like the stranglehold it has over online bookselling as it is." The Office of Fair Trading said it was "too early" to say whether it would launch an inquiry into the deal.
The Book Depository said on Twitter it would "continue to operate independently". On its website, it also asked: "How does the Amazon acquisition affect The Book Depository customers?" with the reply: "The Book Depository and Amazon are aligned in wanting to ensure the best possible experience for customers ... we will look to continue to increase our vast selection of great titles and provide even better customer experience."
Worried customers speculated on Twitter that the deal would result in price rises and the end of free shipping.
The publishing industry is going through unprecedented upheaval as sales shift to the internet but also as digital books are bought in rising numbers. Seattle-based Amazon, which made profits of $1.15bn (£715m) on sales of $34.2bn last year, said sales of Kindle books had overtaken print. The firm said it was now selling 115 Kindle books to every 100 paperbacks.
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