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Dispatches from the Digital Revolution

What goes around, comes around, Amazon

Call it karma or call it coincidence, but it seems to me all we’ve been hearing in the news lately are disparaging reports about Amazon. Some would argue that Amazon was asking for a backlash when it introduced the Christmas-time price-check app, which allowed consumers to receive a five-dollar credit toward purchasing an item on Amazon.com, just for scanning it first in a brick-and-mortor store.

Well, here it comes.

Source: Bullworthy.wordpress.com

First, on the last day of January, Amazon surprised investors with disappointing earnings for fourth quarter 2011. The Washington Post reported “the company’s revenue fell nearly $1 billion short of Wall Street’s expectations, even as it grew 35 percent from a year earlier.” This is particularly unexpected, the Post added, since the reported period included last year’s busier than ever holiday season as well as the debut of Amazon’s tablet, Kindle Fire. Amazon’s stock price suffered in the hours after the announcement, falling 10 percent in after hours trading.

Source: Sfgate.com

Second, several major retailers made declarations in the weeks following the earnings results that they would refuse to stock Amazon Publishing titles in their physical stores, given the continuous efforts on the part of Amazon.com to secure exclusive sales rights to many publishers’ ebooks. (In example, last October Amazon announced an exclusive contract with DC Comics, after which many retailers—including Barnes & Noble—retaliated by pulling all DC Comics titles from their physical stores.) It all began with Barnes & Noble on February 1; the Wall Street Journal reported Barnes & Noble to have said, “the Web retailing giant had ‘undermined the industry’ by trying to sign exclusive agreements with publishers, agents and authors.” Next came Books-A-Million and the Canadian chain, Indigo Books and Music, on February 3, followed by the American Booksellers Association’s (ABA) non-profit subsidiary, IndieCommerce, on February 8.

Could all this recent publicity mean that consumers and competitors have finally had enough of Amazon’s predatory sales initiatives? With Amazon’s sliding net income last quarter, coupled with strong protests from the book-selling community, it would appear consumers are finally realizing that the impact of five dollars saved doesn’t end at their own wallets.

I’ve been Amazon-free for the last 93 days: how about you?

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This entry was posted on February 14, 2012 by in Business, Opinion and tagged .

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