Tuesday, March 30, 2010

Amazon UK Staking Out Its Territory

April 3 is the launch date of Apple's iPad. Apple seems to be going for a $12.99 price point on e-books. The question is whether Amazon will follow suit, raising their famous $9.99 price to meet Apple's.

Meanwhile, on the other side of the pond, Amazon UK is raising eyebrows. On Thursday, the UK's The Bookseller reported here:
Amazon.co.uk is bringing in new rules to ensure Marketplace sellers are offering their goods at the same price or lower than on other "non-physical sales channels."
I wandered over to Amazon UK's site to find the following here:
Price is one of the most important factors customers use when making buying decisions. And customers trust that prices and other terms on Amazon.co.uk are as good as (or better than) those found on other shopping channels. In order to offer customers the best possible experience on Amazon.co.uk, beginning 31st March, Amazon will require price parity for all sellers selling under the Amazon.co.uk marketplace Participation Agreement. Price parity for these sellers means that the item price and total price (total amount payable, excluding taxes) of each product a seller offers on Amazon.co.uk must generally be the same or lower than on the seller's other non-physical sales channels. We believe this practice will preserve our customer's trust in the Amazon.co.uk marketplace, which in turn increases the value of the Amazon.co.uk marketplace to sellers like you. Although the Participation Agreement will reflect this change on 31st March, sellers will have until 1st May to make the necessary price parity changes.
I was interested in what Amazon UK considered "other non-physical sales channels." The Q-and-A section that followed the announcement answered my question:
Non-physical sales channels specifically include any online channels, mobile device applications, catalogues, third party platforms or marketplaces (e.g., ebay.co.uk), and other electronically-enabled channels or other means through which products are offered or sold by you or your affiliates, other than physical stores.
Note that Amazon specifies only eBay.co.uk, not eBay.com. The announcement also indicates that this policy will only apply to "Amazon.co.uk, Amazon.de, and Amazon.fr marketplaces." Amazon UK assures readers: "We are not rolling-out these requirements to other Amazon marketplaces outside of the EU at this time."

In a follow-up article yesterday here, The Bookseller reported:
The Booksellers Association has said it "encourage[s]" the Office of Fair Trading to look into complaints about Amazon, after it demanded that all Marketplace retailers offer their goods at the same price or lower than on other "non-physical sales channels".
The blog Bookthink.com here says "The irony is that a similar provision already exists in the Amazon Terms of Service; there is nothing new here ..."

She's right. Amazon UK has bullied its partners before. In June, 2008, I reported here that, during annual contract negotiations with Hachette Livre (one of the Big Six of publishing), Amazon had taken the audacious step of removing the "sale" buttons for HL titles on Amazon.uk.com in order to increase pressure on the publisher.

Amazon UK seems to be staking out its territory as the European Union etailer with the lowest-prices. Does that signal that Amazon.com won't raise its e-book prices to $12.99 to match Apple?