Amazon’s meteoric rise to online publishing and distribution in the print and digital media markets presents huge challenges for the state of late capitalism in global markets. Because of the World Wide Web as the distribution highway of content, the legislative challenges world wide to regulate markets are fraught with the inability to regulate from single nations. With no uniformity of legal regulations to prohibit a media giant such as Amazon from completely dictating the market, the state of democracy becomes a "balloon in a needle factory."
The recent decision by the largest online distributor, Amazon, to back down from threatening to undercut MacMillan’s profit by having Amazon lower it’s digital price to $9.99 for e-books would cut sharply into the profit margin of what MacMillan had in mind to sell their books, especially front lists. Since the arrival of the iPad by Apple, Amazon’s Kindle has seen the rise of a content exhibitor and competitor for digital publishing. The biggest differences between the two business models however vary greatly which may have led Amazon to back down. Steve Jobs announced with the iPad that Apple would only function as a digital distributor for a publisher and not the wholesaler. This would give the publisher that much more control over the pricing of their products, both digital and print. More publishers would be much more inclined to have the iPad as a digital exhibitor than the Kindle due to the overwhelming power that Amazon presents as a publisher, distributor, and wholesaler if digital and print media.
The rise of the internet as a world wide distribution marketplace has made doing business that much more complicated in terms of intellectual property rights, distribution rights, taxes, tariffs, etc. As Amazon is currently the largest player in its industry and has a monopolistic stranglehold in terms of its vertical integration as publisher, wholesaler, distributor, and exhibitioner of their line of products, the ability to regulate the market away from monopolistic practices becomes that much more difficult. Bob McChesney and John Nichols of The Nation magazine write about the corporate business structure just in terms of stranglehold on markets, ideas, and democracy in bringing more diverse players to free enterprise. In their new book, The Death and Life of American Journalism they speak about what happens when media ownership gets in fewer and fewer hands and how price fixing, collusion, propaganda, and anti-democratic values are eschewed upon the American people. If Amazon to some degree were to get into the broadcast ownership business, just as Comcast is seeking to acquire NBC, we would see a much more narrower field of players and points of view that don’t reflect the overall sentiment of what it means to live in a democracy with access to divergent points of view.
The founding fathers saw the threat of the early corporation known as the British East Indian Tea company and vowed to fight entrenched power to save the republic. Since Amazon’s overwhelming growth and vertical integration in the online publishing industry, I think it is time for the government of the people to regulate the industry and break up this disproportionate amount of power from the hands of one company. President Jimmy Carter saw the threat with AT&T and used the Sherman Anti-Trust Act to break up the monopolistic practices the telecom giant had on the American people. It’s time for Obama to use the Sherman Anti-trust act and break up these monopolistic companies like Amazon, Comcast, Qwest, etc. in order to save the republic from the tentacles of transnational corporations.
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