Key trade bodies in the US – the Association of American Publishers, the Authors Guild and the American Booksellers Association – have sent a letter to Capitol Hill to protest against "anti-competitive tactics" which they say give Amazon "extraordinary" market dominance in the digital books market.
The letter follows an anti-trust hearing, “Online Platforms and Market Power, Part 6: Examining the Dominance of Amazon, Apple, Facebook, and Google,” in which the House Judiciary Antitrust Subcommittee is investigating whether the named firms have participated in anti-competitive business practices, excluding smaller rivals from the market where they maintain a monopoly. The companies' c.e.o.s attended the hearing virtually on 29th July.
Amazon c.e.o. Jeff Bezos said in his opening statement: "The retail market we participate in is extraordinarily large and competitive. Amazon accounts for less than 1% of the $25 trillion global retail market and less than 4% of US retail. There’s room in retail for multiple winners."
However the three US trade membership bodies, which represent thousands of authors, publishers and booksellers in the US, have sent a joint letter to subcommittee chairman David Cicilline to claim a series of anti-competitive tactics help Amazon to exercise market dominance over the advertising and sale of books in digital markets. The AAP said: "Its practices against both book suppliers and book customers have threatened the vitality of the American publishing industry and rendered any meaningful competition from other publishers, booksellers or emerging platforms impossible."
The letter, dated 17th August, stresses members of the AAP, AG and ABA rely on "a level playing field in the marketplace of ideas to reach, inform, and transact with customers for the delivery of books, whether in physical or digital form". But it said "the competitive framework of the publishing industry has been fundamentally altered in recent years—and remains at serious risk of further diminishment—because of the concentrated power and influence of one company in particular: Amazon".
Among its recommendations, it requests that Amazon is prohibited from: "leveraging data from the operation of its online platform to compete with and disadvantage the suppliers doing business there"; from "tying distribution services to the purchase of advertising services"; from "imposing MFNs [most-favoured nation clauses] and other parity provisions"; and from "using loss-leader pricing to harm competition".
It also says: "The subcommittee’s work has shown that Amazon holds an outsized position of power and control in our country, giving it the ability to interfere with the free flow of information, ideas and literature on a large scale.
"With great appreciation for your leadership, we note that the American book publishing industry is and always has been uniquely intertwined with our democracy. Many authors, publishers, and booksellers along the way have contributed to the marketplace of ideas, and we hope that many more will emerge and thrive to the benefit of the public. This will not happen, however, unless government officials step in decisively to exercise appropriate governance of Amazon."
The letter can be read in full on the AAP's website.