The dispute between Amazon.com Inc., the biggest online retailer in the world, and Hachette Book Group is becoming fiercer than ever. Amazon.com Inc. has been blamed by Hachette that it is motivated by profits and market share at the expense of authors and bookstores.
The Chief Executive Officer of Hachette Book Group – Mr. Michael Pietsch said in the companys statement, which was cited by the Wall Street Journal: “Amazon is seeking a lot more profit and even more market share, at the expense of authors, bricks and mortar bookstores, and ourselves. We call on Amazon to withdraw the sanctions.”
The dispute between the two companies started earlier this year and was provoked by the fact that Amazon.com Inc. banned pre-orders of some Hachette books, delayed shipments or pared discounts on others. The situation escalated when more than 900 autors signed a letter published in the New York Times, asking readers to get in contact with Amazon.com Inc.s Chief Executive Officer Mr. Jeff Bezos and share what they think of the argument between the companies over the digital books prices.
Last week, Amazon revealed that the sales of titles are to go up when prices are reduced and cited some of the data gathered on its website. For every copy of an e-book that it sells for $14.99, Amazon.com Inc. would sell 74% more e-books if priced at $9.99, the retailer giant said in a letter, that was cited by Bloomberg.
Hachette Book Group claims that the preferred price of Amazon of $9.99 for e-books is not enough to adequately reflect the producing costs of titles, which also include marketing, royalties and other expenses. Still, the company made a statement announcing that more than 80% of its e-books are already being sold by Amazon for $9.99 apiece.
It also became clear that the U.S.-based publisher Hachette Book Group has abandoned its plan to acquire Perseus Books Group. The news was confirmed by the official representatives of both companies. As reported by Reuters. One of the spokeswomen of Hachette commented on the situation: “Despite great effort from all three parties, they could not reach agreement on all of the issues necessary to close the transaction.”
Amazon.com Inc. was 1.72% up to close at $316.80 per share on Friday, marking a one-year change of +6.57%. According to the information published on CNN Money, the 36 analysts offering 12-month price forecasts for Amazon.com Inc. have a median target of $392.50, with a high estimate of $460.00 and a low estimate of $325.00. The median estimate represents a +23.90% increase from the last price of $316.80.
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