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US Booksellers & Antitrust Advocates Call for DOJ Probe of Amazon’s Alledged Book Monopoly

 |  August 16, 2023

US booksellers, authors, and antitrust advocates joined forces on Wednesday to urge the Federal Trade Commission (FTC) and Department of Justice (DOJ) to investigate Amazon over its alleged monopoly in the book market.

The American Booksellers Association, Open Markets Institute, and the Authors Guild voiced their concerns in a joint letter to the FTC and DOJ, arguing that Amazon’s dominant position in the book market was distorting the free flow of ideas and limiting access to information. Amazon’s monopoly status over the book market has been allowed to go unchecked for too long, they said.

“What we have is a situation in which the power of a single dominant corporation is warping, in the aggregate, the type of books that we’re reading,” said Barry Lynn, Executive Director of the Open Markets Institute. “This kind of power concentrated in a democracy is not acceptable.”

The groups cited Amazon’s sales dominance within the US publishing industry. The e-commerce giant purportedly sells more than 50% of all physical books in the retail marketplace, as well as 90% of physical books that are sold online and more than 80% of e-books. The letter to the FTC accused Amazon of using “manipulative” practices to promote certain titles at the expense of others, in a bid to maximize profit, as well as “strong-arm tactics to force traditional publishers to agree to onerous contract terms and conditions”.

The groups further argued in their letter that Amazon’s unchecked power was responsible for the steep decline of physical bookstores in the US. Between 1998 and 2019, the number of brick-and-mortar bookstores in the US has plunged from about 12,000 to “little more than 6,000”.

Related: What’s Going On Between The FTC And Amazon?

“Amazon has been unchecked for so long that our fight for a level playing field has become moot,” said Allison Hill, Chief Executive of the American Booksellers Association. “Amazon owns the playing field.”

The potential antitrust suit against Amazon would center around Amazon Prime’s bundling of TV, book, subscription and shipping services, and third-party sellers’ reliance on Amazon’s logistic services to deliver their goods to consumers. The e-commerce giant has been hiring a number of ex-FTC officials to help with its defense in anticipation of the legal battle. Amazon has also been actively lobbying against proposed legislation targeting Big Tech firms, such as the American Innovation and Choice Online Act, which would block companies from boosting their own products and services in search results.

However, not everyone is supportive of the FTC’s potential investigation into Amazon’s monopolistic practices. Erik Gordon, Professor of Business at the University of Michigan, stated, “There’s not a great case against Amazon with respect to their book-selling practices. Many publishers and authors are making more money than they would have without Amazon.”

The FTC’s looming lawsuit against Amazon is not the first time the company has faced legal action. In 2021 the regulator filed a lawsuit accusing Amazon of using deceptive business practices to “dupe” millions of customers into enrolling in Amazon Prime. The company has also been targeted for alleged privacy breaches, and was forced to pay $30 million to settle claims its Ring cameras were used to spy on women and that Alexa devices stored kids’ data.

According to the Post Amazon’s alleged monopolistic grip over the US book market is a clear danger to this freedom, and the FTC must take any action necessary to protect it. Stefan Jeremiah, Amazon critic, stated, “Critics say Amazon has a monopoly over the bookselling industry.” It is now up to regulatory bodies such as the FTC and DOJ to decide whether Amazon will be allowed to continue its unchecked power or if it will face the legal repercussions resulting from its monopolistic practices.

Source: NY Post