Authors and Booksellers Urge Justice Dept. to Investigate Amazon

With mounting signs that the Federal Trade Commission is preparing to file a lawsuit against Amazon for violating antitrust laws, a group of booksellers, authors and antitrust activists are urging the government to investigate the company’s domination of the book market.

On Wednesday, the Open Markets Institute, an antitrust think tank, along with the Authors Guild and the American Booksellers Association, sent a letter to the Justice Department and the Federal Trade Commission, calling on the government to curb Amazon’s “monopoly in its role as a seller of books to the public.”

The groups are pressing the Justice Department to investigate not only Amazon’s size as a bookseller, but also its sway over the book market — especially its ability to promote certain titles on its site and bury others, said Barry Lynn, the executive director of the Open Markets Institute, a research and advocacy group focused on strengthening anti-monopoly policies.

“What we have is a situation in which the power of a single dominant corporation is warping, in the aggregate, the type of books that we’re reading,” Lynn said in an interview. “This kind of power concentrated in a democracy is not acceptable.”

The letter, addressed to Lina Khan, the chair of the Federal Trade Commission, and Jonathan Kanter, who leads the Justice Department’s Antitrust Division, comes as the FTC appears to be closing in on its decision to bring an antitrust case against Amazon. Amazon representatives are expected to meet this week with members of the commission to discuss the possible suit, a sign that legal action may be imminent.

Amazon did not immediately respond to a request for comment.

It is still unclear whether the government’s case will scrutinize Amazon’s role as a bookseller as part of its investigation of the company. While Amazon got its start nearly 30 years ago as a scrappy online bookstore, it has since mushroomed into a retail giant that has gained a foothold in other industries, with its expansion into cloud computing and its purchase of the grocery chain Whole Foods and the movie studio Metro-Goldwyn-Mayer.

Even as books have become a smaller slice of the company, Amazon has become an overwhelming force in the book market. It accounts for at least 40% of physical books sold in the U.S., and more than 80% of e-books sold, according to an analysis released by WordsRated, a research data and analytics group. With its purchase of Audible in 2008, Amazon has also become one of the largest audiobook producers and retailers.

The effects of the site’s rise have been profound, Open Markets Institute and the other groups argued, contributing to a steep decline in the number of physical bookstores across the United States, and leaving publishers and authors beholden to the site.

Amazon also has influenced which books readers are exposed to and buy, and has made it more challenging for lesser-known authors to gain exposure on the site, while blockbuster authors and celebrities whose books are likely to sell well are prominently featured.

Some antitrust experts are skeptical that Amazon’s role as a bookseller merits government scrutiny. Erik Gordon, a professor of business at the University of Michigan who studies antitrust, said that while the company’s dominance in the book world might be an element of an overall antitrust suit, the FTC will likely focus elsewhere.

“There’s not a great case against Amazon with respect to their book-selling practices,” he said. “Many publishers and authors are making more money than they would have without Amazon.”

Amazon has already been a target of the Biden administration’s stringent regulatory efforts, as it has sought to rein in tech giants like Amazon, Google and Meta.

In June, the FTC brought a separate case against Amazon that argued the company had manipulated users into signing up for its Prime membership program and made it hard for them to get out of it.

The Justice Department has also shown an interest in preventing the consolidation in the book market. Last year, a judge sided with the Biden administration in an antitrust case and blocked Penguin Random House from acquiring its smaller rival Simon & Schuster.

After the deal collapsed, some in the industry saw Amazon as the next logical antitrust target.

Allison Hill, chief executive of the American Booksellers Association, said that she was hopeful that the government was taking a serious look at Amazon’s role in the book world.

“Amazon has been unchecked for so long that our fight for a level playing field has become moot,” she said. “Amazon owns the playing field.”

This article originally appeared in <a href="https://www.nytimes.com/2023/08/16/books/amazon-books-justice-department.html">The New York Times</a>.