Will Amazon’s contract negotiations with the last of the “Big Five” consumer book publisher be its toughest?
Amazon’s U.K. Contract With Top Book Publisher Penguin Random House Set to Expire
If no agreement is reached by the deadline, Amazon could pull all Penguin Random House print and e-books from its U.K. online store.
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Jason Del Rey has been a business journalist for 15 years and has covered Amazon, Walmart, and the e-commerce industry for the last decade. He was a senior correspondent at Vox.
The e-commerce giant’s deal to sell books on its U.K. website published by Penguin Random House, the world’s largest book publisher, is set to expire by the end of the month, according to an Amazon source. If the two sides don’t come to a new agreement by the deadline, Amazon could pull all Penguin Random House print and e-books from its U.K. online store, Amazon.co.uk.
Such a move would be costly to both sides. The publishing house accounts for about 40 percent of all consumer book titles sold worldwide, according to industry experts. Amazon’s book selection in the U.K. would look a lot thinner if it pulled all of those titles.
At the same time, Amazon is by far the biggest sales channel for e-books for the “Big Five” book publishers, so a ban in the U.K. of Penguin Random House books by the Seattle retailer would inflict pain. The contract between the two sides related to Amazon sales in the U.S. is set to expire later this year, the source said.
Penguin Random House spokeswoman Claire Von Schilling declined to comment on the timing of the expiration of the contracts. In an email, she said, “We are in continuous conversation with Amazon with whom we have an ongoing business relationship. We have no intention whatsoever of ceasing to sell our print or digital titles on Amazon. We want our books to be accessible and available everywhere.”
Amazon spokesman Tarek El-Hawary declined in an email to comment on the contract deadline, but said, “I can say that we have long-term deals in place already with the other four major publishers and we would accept any similar deal with Penguin Random House U.K.”
The showdown between the book industry giants comes in the wake of a year of contentious deal-making between Amazon and the other four major book publishers. The string of deals began with a very public battle between Hachette and Amazon that festered for months before the two sides reached an accord in November. E-book pricing was at the center of dispute, with Amazon pushing for lower prices.
The agreement they reached in November allowed Hachette to set prices for its electronic books, though Amazon promised “financial incentives for Hachette to deliver lower prices.” In the months since, three of the four remaining book publishers announced new deals with Amazon, though not all happily.
Now, the biggest one of them all, is left.
This article originally appeared on Recode.net.
