Friday, December 13, 2013

Amazon as Shakedown Artist?


Shelf Awareness

In a review of Brad Stone's book The Everything Store: Jeff Bezos and the Age of Amazon in the December issue of Harper's, deputy editor James Marcus reported on what he labeled "Amazon's newest shakedown
A former employee, who asked not to be identified, recently told me that some publishers are now being pressured to pay the equivalent of 1% of their annual net sales to Amazon--levied on top of any existing fees--simply for the privilege of presenting their lists to the marketing team and buyers. In the case of the larger houses, this sum could run between $500,000 and $1 million--and failure to pay will make it awfully hard to get an Amazon buyer on the phone."

In a footnote, Marcus wrote that an Amazon spokesperson "denies this latest practice, and several publishers, when contacted by Harper's magazine, were understandably leery of revealing the specifics of their own agreements with the company. What came through clearly was a general repugnance toward Bezos' tactics. Describing Amazon's appetite for 'creative destruction' as 'somewhere between scary and disgusting,' one New York publishing executive told Harper's: 'When you go to work each morning with a battle-ax, everything looks like a head to be chopped off.' "

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