(2011-12-19) Amazon Monopoly Demands

*What has publishers riled, behind the scenes, is aggressive moves the retailer (Amazon) is making in its demands on co-op and discounts. A number of sources in the industry, all of whom spoke to PW on the condition of anonymity, said the retailer is, in certain cases, threatening to stop selling titles from companies who won't pay up... The demands regarding co-op have some particularly on edge. Not only are many publishers frustrated about being asked to pay more money for content they are providing, but the whole notion of co-op at the online retailer is unsettling. While the case can be made that co-op in a bricks-and -mortar store is a worthwhile investment--money is spent on getting books to physical areas of the store, such as front tables, where consumers will see those books first--it's much less logical on a Web site. Does having a video or an author Q&A on a book's page on Amazon really encourage a customer who has already clicked on that book to make a purchase?

More problematically, for many in the industry, the latest talks with Amazon are being described as less of a dialogue than a dictation of terms. As one source explained, the talks have boiled down to "what publishers can do for Amazon, and not what Amazon can do for publishers." Most ironically, the new terms would allow Amazon to continue to gain market share as it always has: driving book prices down.* (Monopoly)