Huffpost Business
The Blog

Featuring fresh takes and real-time analysis from HuffPost's signature lineup of contributors

Clay Calvert Headshot

Amazon, Bezos and Book Publishers: Can One Reconcile the Cognitive Dissonance?

Posted: Updated:
Print Article
JEFF BEZOS
Bloomberg via Getty Images

For readers and free expression lovers, here's a new one for the cognitive dissonance file: simultaneously holding optimistic feelings about Jeff Bezos, the owner of a major newspaper, with pessimistic ones about Amazon.com, the company for which Bezos serves as president, chief executive officer and chairman of the board.

In October 2013, billionaire Bezos took over the ownership reins of the Washington Post. He told employees of the paper that "the values of The Post do not need changing. The paper's duty will remain to its readers and not to the private interests of its owners." Bezos added that "journalism plays a critical role in a free society." With those twin statements, Bezos appeared to be just the kind of savior for press freedom that many longed for during a time of financially hard straits for the journalism business in the United States.

Bezos may yet prove to be a journalistic champion, but it now seems as if his own personal interest in serving readers of the Washington Post is markedly different from his company Amazon's interest in serving the potential readers of books published by companies like Hachette Book Group that seemingly do not serve the private interests of Amazon.

As the New York Times reported on May 9, Amazon has been operating a "secret campaign to discourage customers from buying books by Hachette." Some of what the Times called "scorched-earth tactics" include Amazon charging more for books published by Hachette, suggesting to potential buyers of Hachette tomes alternative books from different publishers and, finally, delaying or slowing deliveries to potential customers of Hachette volumes.

Why the moves against Hachette? According to the New York Times article, they may have arisen "out of failed contract negotiations. Amazon was seeking better terms, Hachette was balking, so Amazon began cutting it off." Hachette, according to a Wall Street Journal article, "declined to identify the cause of the dispute, saying only that the two sides are in negotiations." A publicist for Hachette added in an official statement that "we have been asked legitimate questions about why many of our books are at present marked out of stock with relatively long estimated shipping times on the Amazon website, in contrast to immediate availability on other websites and in stores."

The New York Times article quoted Andrew Rhomberg, founder of Jellybooks, which describes itself as "like a candy store, where you can sample everything for free, except all the treats are ebooks," for the proposition that Amazon's actions were somewhat akin to "Vladimir Putin mobilizing his troops along the Ukrainian border."

According to the Guardian, Amazon "has a history of adopting tough tactics during negotiations with the books industry. In 2010, Amazon removed the 'buy new' buttons from Macmillan titles as the duo wrangled over terms for the price of ebooks. In 2012, it clashed with independent publishers over terms and removed thousands of independently published ebooks from sale."

Amazon clearly has clout here. As CNN Money reports, "Amazon is the biggest name in book selling and sets the tone for book sales and publishers. Since Amazon is so powerful, publishers often have little choice but to accept Amazon's terms." The book publishing industry in the United States, in contrast, is now down to only five major publishing houses -- Hachette, HarperCollins, Macmillan, Penguin Random House and Simon & Schuster -- with the latest merger between Penguin Random House.

So now back to the cognitive dissonance. How is one to reconcile two conflicting views about Bezos -- one as protector of journalism who puts readers' interests above corporate ones, one as head of an immensely powerful distributor of books that sometimes seems to play financial hardball at the expense of some readers, authors and publishers -- or at least find some way to relieve the mental disharmony? Four possible ways come to mind, each of which I'll gladly leave it up to readers to dissect and shred or, at least, debate.

First and foremost, Amazon does not own the Washington Post. Bezos is the owner or, more accurately, Nash Holdings LLC, which is his "personal investment firm." So one must recognize the fact the Bezos' personal financial interests in the Washington Post are not necessarily concomitant with Amazon's interests in dealing with book publishers.

Second, Bezos' personal net worth is reportedly upwards of $25 billion today. The price he paid for the Washington Post was a relative drop in the bucket -- $250 million. Therefore, Bezos can treat the newspaper very differently from a major asset in his own financial portfolio and, in turn, he really can afford to spend money on it to put the best interests of its readers above those of his own bottom line.

Third, there are no First Amendment interests at stake. That provision protects speech only against government censorship, not the type of corporate forces Amazon supposedly is exerting against Hachette. In other words, this is just a business matter -- business as usual, in fact -- and not a constitutional one.

Fourth and finally, one can attempt to relieve the dissonance by believing that the Federal Trade Commission or Department of Justice will eventually step in if Amazon's tactics prove somehow unlawful or if Amazon reaches a point where antitrust intervention is necessary to pull in its power.

Now, let the nay-saying dissonance seekers dissect as only too much wishful thinking.