11th
Amazon.ca vs the Canadian Bookseller’s Association
The Canadian Bookseller’s Association is pushing the Canadian government to block an application by Amazon to open a “fulfillment centre” here in Canada. In this letter (pdf), the CBA requested the government preserve the current marketplace.
“Letting foreign retail giants into local Canadian markets under the false guise of Canadian partnership would be devastating to an important Canadian industry employing real book lovers in every community across Canada.”
I am by no means a publishing industry or a Canadian Content legal expert but this didn’t make sense, we already have Amazon.ca in the market. It wouldn’t make any difference for consumers if there was a “fulfillment centre” located within the country. After some reading (see here) it turns out that Amazon.ca operation are outsourced to Canada Post and Assured Logistics. This diagram shows how it functions:
This would also explain the lack of merchandise available on Amazon.ca vs Amazon.com. Canada Post probably doesn’t have the resources or technology to deal with large item shipping and the costs related to it.
I don’t know all the legal requirements Amazon would have to meet in order to open a physical operation here. The CBA says Amazon would violate The Investment Canada Act which states that compatible with national cultural policies and be of net benefit to Canada and to the Canadian-controlled sector”. Seems fuzzy to me. However, the government seems to be willing to grant companies more leeway when it comes to foreign investment recently.
For consumers, allowing Amazon.ca to actually be operated completely by Amazon would be a plus. It could mean cheaper prices, wider range of products and more features like Amazon Prime and subscriptions in Canada. The current Amazon.ca is seriously hobbled compared to its American counterpart, not offering much other than books, music and DVDs.
There has been a lot of huffing and puffing by the CBA arguing that Amazon will destroy the Canadian book market and the “independent Canadian voice”. In a live chat on GlobeandMail.com today, Mark Lefebvre, VP of the CBA and former Indigo/Chapters Database Manager, said,
“…it’s not the warehouse we’re worried about, it’s what the next steps might mean…next steps (in a nutshell) are all about the infiltration of a giant entity with endless cash flow and the ability to stamp out all competition from Canada, effectively creating a monopoly.”
The problem is that Amazon is already here. They’re back end operations don’t really affect how Canadians purchase books. Amazon is a big player in the market but they are the only ones who can really compete Chapters/Indigo on size.
I think Amazon.ca does a decent job of highlighting Canadian authors and content, there’s demand for CanCon so Amazon meets it. Having a warehouse here in Canada would put them under more regulation to have Canadian content rather then being able to operate under US law and regulation.
The more I learn about this the more it smells like the CBA trying to protect dying business models and existing stores (*cough* Chapters Indigo *cough*) more then protecting the “Canadian voice”. Here are some more quotes from Mike Lefebvre:
“if a large foreign company with endless pockets and a business model of pricing items below cost to squish out all competition is allowed to prosper and then gain a monopoly, what choice will consumers be left with then?”
“I’m fearful of a large entity pushing their way in is how that Canadian voice might be lost.”
Sounds like fear mongering and “think of the children (or small independent Canadian bookstore)!” speak. I love a good small independent bookstore but if it’s not a sustainable business with a unique offering, I’m sorry, but you probably won’t survive. Libraries are great too! There are a plethora of new digital distribution channels out there for upcoming authors that they need to learn to take advantage of to survive in the future
It seems like Amazon is the CBA’s scapegoat for their lack of foresight in the changing market. I doubt consumer’s will take kindly to this approach with the Amazon brand being near and dear to people’s hearts.
