Living in the World of Amazon

amazon

In 1995, Amazon was launched by Jeff Bezos and in 17 years it has grown to become the biggest online retailer in the world with over 65000 employees and $48bn in revenue. The company is a great success story but its effect on the publishing world has had far reaching consequences.

Before Amazon was launched, books were a big business. In 1994 alone, Americans spent $19bn on books. Independent stores were being muscled out of the sector by massive chain stores, Barnes & Noble and the Borders Group. These companies were expanding their empires and offered discounted prices that the independent bookstores couldn’t hope to match.

Less than two decades later and karma seemed to kick in. Borders declared bankruptcy in 2011 and Barnes & Noble are desperately trying to figure out how to keep over 1000 stores across America open. Recently they even managed to secure an investment injection of $605 million into their digital-book business from Microsoft to challenge Amazon; however, things are still proving difficult for them.

The Dominance of Amazon

While the very concept of bookstores disappearing seems impossible for those who weren’t born in the digital age, it may be unstoppable.

Millions of people now own e-readers, much of that market being dominated by Amazon’s Kindle. These e-readers allow people to take hundreds of books wherever they go, but take up minimal space. E-books are cheaper and considered to be great for the environment – how many trees are saved when a bestselling book is published digitally instead of on paper?

Amazon has grown at such a rate that it is now considered by some to be a monopoly, threatening the publishing sector itself. As technology has progressed enough to bring about the demise of the bookstore, publishing is also becoming increasingly virtual and allowing for easier means of both production and distribution, a fact which certainly has traditional publishers on edge.

At the beginning of this year, 28% of Americans own an e-reader or tablet and Amazon is keen to capitalise on this growing trend. Amazon’s own publishing house is hitting the traditional publishing world hard and it’s easy to understand why. Writers are able to release their work through Amazon without the traditional run-around that publishers may give them. While these writers are foregoing possibly huge advance cheques, they are getting monthly royalty cheques as they earn approximately 70 percent on every sale. These writers also have access to information they couldn’t dream of before – direct feedback in the form of customer comments and exact sale numbers which they can check at any time.

Basically, Amazon has become a titan in the business and has used some heavy-handed and aggressive tactics to force small publishers to agree to their terms. They are now in control of vast sections of the industry and some are concerned about the effect this could have.

Is there a need to be worried though? Amazon is a giant business, but as the saying goes, ‘the bigger they are, the harder they fall.” Amazon may be perceived as doing damage to the publishing industry right now, but it is possible they may adapt and find a way to come through it in the end, better than they were before.  And don’t forget, everyone knows at least one person who still prefers to hold a book in their hands, feel the texture of the paper and inhale that distinctive book smell.

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