Original URL: http://www.theregister.co.uk/2008/05/22/amazon_sued_over_book_surge/

Print-on-demand crusader tags Amazon with anti-trust suit

'Unlock my BookLocker'

By Cade Metz

Posted in Media, 22nd May 2008 20:13 GMT

After threatening to limit print-on-demand sales to books printed by its very own print-on-demand printer, Amazon is facing an anti-trust lawsuit.

Earlier this year, as we reported here at The Reg, the world's largest e-tailer told many print-on-demand publishers it would destroy their Amazon "Buy" buttons if they didn't start using BookSurge, the POD printer it purchased back in 2005.

Amazon says it's merely trying to streamline the POD process. But some publishers don't see it that way. That includes Angela Hoy of BookLocker.com, who filed suit against the online giant Monday in the great state of Maine.

"Amazon is improperly tying printing services to its sales services," Hoy's lawyer, Seth Klein, told us. "Amazon has significant power in the sale of books online, and it's using that market power to improperly try to increase its market share in the printing of books, where it does not currently have a lot of business."

It was Angela Hoy who first leaked word of Amazon's policy change on her e-zine, WritersWeekly, sparking a piece in The Wall Street Journal. Hoy does her print-on-demand printing through Lightning Source, BookSurge's biggest competitor, and in late March, a BookSurge sales rep phoned her with a new sales pitch.

Hoy was told that Amazon would switch off the Buy buttons for any POD titles not printed through BookSurge. In other words, her company's books would be listed on Amazon.com, but customers would have to go elsewhere to actually purchase them. Hoy estimates she now has about 1200 books listed with the mega e-tailer.

The same sales pitch was made to countless other POD publishers, and some told us that BookSurge laid down deadlines for making the switch. Willem Meiners - the co-owner of PublishAmerica, a publisher offering over 30,000 book titles - told us that at least some of his buttons were actually turned off. And though Meiners declined another interview, it appears they're still off.

After The Journal's story, Amazon posted an open letter letter to POD publishers confirming its new BookSurge policy - and seeking to explain it. "Simply put, we can provide a better, more timely customer experience if the POD titles are printed inside our own fulfillment centers," the letter says.

Hoy points out that her POD publisher can drop-ship Amazon-purchased items directly to buyers. But Amazon argues there are cases where books must travel through fulfillment centers first:

If a customer orders a POD item together with an item that we're holding in inventory - a common case - we can quickly print and bind the POD item, pick the inventoried item, and ship the two together in one box, and we can do so quickly. If the POD item were to be printed at a third party, we'd have to wait for it to be transhipped to our fulfillment center before it could be married together with the inventoried item.

Amazon also says that publishers can keep their Buy buttons if they pre-ship several copies of each book to its fulfillment centers. But Hoy says this option isn't an option. "The terms of participating in the Amazon Advantage program are so onerous, it's not economically viable for POD publishers to participate in it," Klein told us.

If you pre-ship books, it's no longer print-on-demand.

Meanwhile, two separate publishers, including Hoy, tell us that their Amazon Buy buttons are still on. Amazon declined to speak with us, but it seems that - even before Hoy's suit - the company was rethinking its new policy.

Countless publishers complained to the attorney general in Washington State, where Amazon is headquartered, and though the AG declined to take action, it would appear that the Federal Trade Commission (FTC) by be looking into the matter. Seth Klein told us that an official FTC asked him for a copy of Hoy's suit - and that he sent it on.

"I can shroud the subject in unsatisfactory obscurity: We have a policy where we don;t confirm or deny the receipt of complains," Neil Averitt, a lawyer with the FTC, told us. "We can neither confirm nor deny an investigation." ®