Fraser Newman: Amazon and Hachette battle shapes up to be a blockbuster

Fraser Newman (left).

Most people wouldn't recognise the name Hachette. It isn't a household name. But it is one of the world's largest publishing companies.

On the other hand everyone knows its authors _ JK Rowling, Stephen King, Diana Gabaldon and Stephen Colbert.

Whether you know the company or not, there is a battle going on with Hachette that affects everyone. Amazon, the major online internet retailer, is in a bitter dispute with the publisher.

Amazon wants better terms in order to boost its margins and cut its prices on e-books. Sounds innocent? The outcome will affect book (or e-book) prices worldwide.

While this goes on, Amazon is delaying Hachette orders by up to six weeks and not taking pre-orders. Coming from the world's largest retailer, this seriously hurts the publisher.

The book industry in general is lining up behind Hachette. This, they say, is a battle between a "defender of literature" and an internet behemoth set on raising profits at the expense of everyone else. Literature and good books depend upon Hachette winning the battle.

This, however, is not true. While Amazon is certainly a big company flexing its muscles, it isn't like other companies wouldn't do the same. Everyone is out to make a profit.
But this is about more than that. This is about the book industry trying to protect itself. No one wants anyone to rock the boat. Competition, for much of the book industry, is a bad word.

This is a shame, since we all know that competition leads to better outcomes for consumers.

Instead, the big five publishers all seem to have about the same prices, the same marketing drives, the same contracts and the same terms to retailers.

Everyone uses Recommended Retail Prices, which in legal terms are just "recommendations" but in reality people are frowned upon if they don't use them.

Insiders use pejorative terms like "discounters" to label retailers who don't follow the cosy little bunch of rules set out by the industry. This fixes the price of books and stifles competition.

In France, lobbyists have even succeeded in making this law, keeping the price of books high in order to "protect" French culture.

This is a real shame. Amazon's only crime in this case is doing its best. Everyone should be doing this. The price of books has been too high for too long and the comfy alliance between publishers and retails has to be broken up.

In this regard, Amazon should be praised for rocking the boat. After all, competition is good for everyone.

- Fraser Newman is the co-owner of Rotorua's Atlantis Books.