Saturday, July 23, 2011

Will Amazon be allowed to swallow the Book Depository?


Not being overburdened with funds, I haven't been ordering many books in recent years - but I am appalled at this 'news' which I just read at the PN Review website http://www.pnreview.co.uk/np64.shtml :

[PN REVIEW]Friday, 15 Jul 2011

Amazon's merger with the Book Depository has been referred to the OFT. The Publishers Association and the Independent Publishers Guild for the first time join voices to oppose the merger, while calling for a wider investigation into competition between the online and the bricks and mortar bookselling market.

This report is from The Bookseller, 15 July 2011.

The merger was announced on 4 July. Almost immediately the OFT had asked for submissions from the public and other parties concerning "any competition or public interest issues". Its stance reflects the seriousness with which the PA and IPG members are treating the proposed merger.

In a statement, Richard Mollet, c.e.o. of the PA, said: "The Publishers Association will be making a joint submission with the IPG; the first time that our two organisations have collaborated in this way. This reflects the strength of feeling among publishing companies that the OFT should block this merger."

Going further, Mollet said more should be done to investigate the fairness of the market share internet-only retailers have in comparison to physical bookshops. He said: "Whatever the decision in this particular case, we feel it is high time that competition authorities took a closer interest in the developments of the book retail market—especially given that data from BML shows that internet-only retailers have 31% of the retail market by value, and growing."

The OFT does have the power to investigate markets that do not appear to be meeting the needs of consumers, with possible outcomes including taking competition or consumer enforcement action, encouraging businesses in the market to self-regulate, making recommendations to government to change regulations or public policy, making a market investigation reference to the Competition Commission and improving the quality and accessibility of information for consumers. The OFT could not comment on whether it would look into the bookselling market as a whole while it is still investigating the merger of Amazon and TBD.

Last week, the Booksellers Association announced it would formally oppose the merger, describing Amazon as already having a "de facto monopoly".

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