Amazon attacks authors, readers and publishers

The New York Times reports:

Seeking ever-higher payments from publishers to bolster its anemic bottom line, Amazon is holding books and authors hostage on two continents by delaying shipments and raising prices. The literary community is fearful and outraged — and practically begging for government intervention.

“How is this not extortion? You know, the thing that is illegal when the Mafia does it,” asked Dennis Loy Johnson of Melville House, echoing remarks being made across social media.

Does Amazon practice extortion? FindLaw defines

…extortion as the gaining of property or money by almost any kind of force, or threat of 1) violence, 2) property damage, 3) harm to reputation, or 4) unfavorable government action. While usually viewed as a form of theft/larceny, extortion differs from robbery in that the threat in question does not pose an imminent physical danger to the victim.

Extortion is a felony in all states….

Extortion can take place over the telephone, via mail, text, email or other computer or wireless communication. If any method of interstate commerce is used in the extortion, it can be a federal crime.

In this instance, it is extortion as practiced by a coercive monopoly, and likely puts Amazon in violation of the Sherman Antitrust Act, according to Jan Constantine the General Counsel of the Author’s Guild. Amazon is thus seeking to extort money by using its superior market position as a source of leverage from which to extract monopoly rents from various publishers and to secure that monopoly position.

It is Hachette that most offends Amazon.

So, what mechanism does Amazon use to coerce some of the publishers it distributes? According to CNBC:

The retailer began refusing orders late Thursday for coming Hachette books, including J.K. Rowling’s new novel. The paperback edition of Brad Stone’s “The Everything Store: Jeff Bezos and the Age of Amazon” — a book Amazon disliked so much it denounced it — is suddenly listed as “unavailable.”

So, we can add censorship to extortion.

Small is beautiful….


Wednesday was a very bad day for Mary Tolan and the company she runs, Accretive Health. Not only had the State of Minnesota taken action against Accretive Health, but:

Shares of Accretive Health plunged 42 percent, or $7.74, Wednesday to close at $10.75, as the scope and detail of the allegations became clear, a day after [Minnesota Attorney General Lori] Swanson’s office released a six-volume report on her investigation.

The Wall Street Journal reported that “An Accretive spokeswoman declined to comment on the company’s share price but said the company has ‘a great track record of helping hospitals enhance their quality of care.'” Only in a bizarro world would patient harassment count as an enhancement of care quality.

Accretive’s stock price trend is ominous:

Going down

The expectation driving this trend issues from the belief that litigation will compel Accretive Health to change its dubious business practices.