Casualties in the "Book War"

Independent Booksellers Worry They Can't Compete, Say Major Retailers Use "Predatory Pricing"

(CBS)  You might be happy when you walk into a store and see a potential Christmas gift at a deep discount. But the American Booksellers Association is not, accusing three giant retailers of "predatory pricing." They've asked the Justice Department to investigate.

The group fears these "book wars" could close the book on many small, independent stores, reports CBS News correspondent Hari Sreenivasan.

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Book store owner Bob Kutik fears his 60-year-old family business in New Jersey could be a casualty of a price war.

"The Dan Brown book is $30. It probably cost me about $18," Kutik said. "No way I could sell it for $9."

That is exactly what Wal-Mart, Target and Amazom.com are doing. Wal-Mart fired first. It announced that 10 expected bestsellers, which normally sell for around $30 would sell for just $10 if customers order them online and before the books arrive in stores. Internet retailer Amazon.com retaliated, saying it would sell the same books, by authors such as Stephen King and John Grisham, for $9. Then Target jumped in, saying the books would be available for its Web site, for a penny less.

"The objective of Wal-Mart and Target are to turn these books into loss leaders and hope that you fill up your shopping carts with socks, underwear, children's toys, sweatshirts," said Michael Norris, a senior analyst with Simba Information.

Publishers like Simon & Schuster - a division of the CBS Corporation - fear that driving down the retail price of bestsellers, which support thousands of lesser-known titles each year, could devalue the entire business.

"If the consumer starts to perceive that the value of a book is that much lower than the price at we believe it needs to be sold to support all the actors in the publishing industry, beginning with the author, then we're going to have difficulty," said Carolyn Reidy, the president and CEO of Simon & Schuster.

Publishers and book store owners worry that a small group of powerful retailers dominating the market could mean an unhappy ending for readers.

"So if you have only two or three major channels, you're going to have a lot less books, a lot less ideas, and a lot less choices for people," Kutik said.

"And what happens to book stores like yours in the process?" Sreenivasan asked.

"We turn into nail salons," Kutik said.

Kutik hopes the book price was doesn't bring the final chapter - for him.

[MARYWILMA]

WAL-MART IS A PREDATORY BUSINESS.. IT DRIVES MANY A SMALL MOM AND POPS MOSTLY TO THE BANKRUPT COURT... WE USE TO HAVE SEVERAL HARDWARE AND APPLIANCE STORES HERE IN MY TOWN.. ALONG WITH TARGET, HOME DEPOT, LOWES AND WHAT EVER BIG BOX STORES. THAT SELL ALMOST ALL FOREIGN PRODUCTS. NOW WE HAVE ONE....AND ONE SO CALLED FIVE AND DIME.. THAT IS IT..SEARS IS PRACTICALLY OUT OF BUSINESS. WESTERN AUTO IS GONE.. WE USE TO HAVE SEVERAL TIRE STORES AND OIL CHANGE PLACES THEY ARE GONE OR WILL BE SHORTLY.. GROCERY STORES HAVE BEEN HIT HARD ALSO, WINN DIXIE GONE A&P GONE. I SHOP AS MUCH AS I CAN AT OTHER THAN WAL-MART.. SOME TIMES WHAT I WANT OR NEED IS JUST NOT AVAILABLE ANY PLACE ELSE.. THE NEAREST LARGER CITY IS 20 MILES AWAY AND THAT TAKES ABOUT 2-1/2 GALLONS OF GAS TO MAKE A ROUND TRIP. AT CLOSE TO 3 DOLLARS A GALLON WE DON'T GO A LOT..OLD SAM DID TRY TO KEEP AMERICAN PRODUCTS IN HIS STORES, NOW THE CURRENT CEO JUST SEES HOW CHEAP HE CAN GET IT FROM CHINA OR WHEREVER . WE JUST LOST A HUGE APPLIANCE MAKER THEY ARE MOVING TO MEXICO PUTTING 1100 WORKERS ON THE STREET...WHIRLPOOL WILL INVEST 55 MILLION DOLLARS IN MEXICO TO DO THIS. WE GET TO KEEP THE ENGINEERING AND DESIGN PART HERE WITH THREE HUNDRED EMPLOYEES, IN OTHER WORDS THE BRAINS...

[MARYWILMA]

WAL-MART IS A PREDATORY BUSINESS.. IT DRIVES MANY A SMALL MOM AND POPS MOSTLY TO THE BANKRUPT COURT... WE USE TO HAVE SEVERAL HARDWARE AND APPLIANCE STORES HERE IN MY TOWN.. ALONG WITH TARGET, HOME DEPOT, LOWES AND WHAT EVER BIG BOX STORES. THAT SELL ALMOST ALL FOREIGN PRODUCTS. NOW WE HAVE ONE....AND ONE SO CALLED FIVE AND DIME.. THAT IS IT..SEARS IS PRACTICALLY OUT OF BUSINESS. WESTERN AUTO IS GONE.. WE USE TO HAVE SEVERAL TIRE STORES AND OIL CHANGE PLACES THEY ARE GONE OR WILL BE SHORTLY.. GROCERY STORES HAVE BEEN HIT HARD ALSO, WINN DIXIE GONE A&P GONE. I SHOP AS MUCH AS I CAN AT OTHER THAN WAL-MART.. SOME TIMES WHAT I WANT OR NEED IS JUST NOT AVAILABLE ANY PLACE ELSE.. THE NEAREST LARGER CITY IS 20 MILES AWAY AND THAT TAKES ABOUT 2-1/2 GALLONS OF GAS TO MAKE A ROUND TRIP. AT CLOSE TO 3 DOLLARS A GALLON WE DON'T GO A LOT..OLD SAM DID TRY TO KEEP AMERICAN PRODUCTS IN HIS STORES, NOW THE CURRENT CEO JUST SEES HOW CHEAP HE CAN GET IT FROM CHINA OR WHEREVER . WE JUST LOST A HUGE APPLIANCE MAKER THEY ARE MOVING TO MEXICO PUTTING 1100 WORKERS ON THE STREET...WHIRLPOOL WILL INVEST 55 MILLION DOLLARS IN MEXICO TO DO THIS. WE GET TO KEEP THE ENGINEERING AND DESIGN PART HERE WITH THREE HUNDRED EMPLOYEES, IN OTHER WORDS THE BRAINS...

[Void_Master]

Book sellers have been acting toward the end of eliminating the independents for many years. This is nothing new. It's also why ebooks are taking off like wild fire. If you know what you're doing, you can literally publish your own works and eliminate ALL the middle-men.

[mnbrant]

I buy my books at goodwill

[cidaia]

Forget "the means of production" - set up a toll booth between "the means of production" and the end consumer. If there's no way a supplier can reach a customer without going through your store, you're going to get rich-rich-rich. It's clearly turning into yet another winner-take-all setup here - the only problem is that the winner seems to be the ONLY one who benefits by the arrangement :(

[solothruhike]

Companies like Walmart, Amazon, Target and the wholesale warehouses operate in violation of anti-trust laws. Enforce the law and break these companies up, the same way we broke up AT&T, and the people will ultimately be better off. Although these companies, especially Walmart, howl to the moon about what good deeds they do for people and how they are so persecuted, they are predatory public corporations, not people. They artificially suppress prices and wages, communalize (that's communism)small towns and neighborhoods, and export vast amounts of our national wealth to the nation that created North Korea by killing our soldiers during the Korean War.

[volkswagen6]

Wal-Mart is one of the best things that has happened to this country. I see nothing artificial or bad about their "suppression" of prices. They have done what capitalism is supposed to do. They have created market efficiencies that have enabled them to lower prices on a wide set of products and over an extended period of time. These low prices are of tremendous benefit to the millions of young people in America who are just starting out, to still others who are on the lower end of the income scale, and to anyone who is trying to manage their money. It?s also good for all those who need a one stop shopping experience to help manage their time and gasoline consumption. I remember waiting in lines 50 feet long at the local K-mart, and searching futilely for the products I needed there. Then Wal-Mart came with numerous registers, and with the products I was looking for. When I needed my first microwave oven, Wal-Mart sold me one for $100 when everyone else was selling them for $300. For me that was the difference between having a microwave and not having one. Thank-you Wal-Mart.

[solothruhike]

To Volkswagen, I can understand the allure of the cheap, foreign-built products that Walmart carries. When my wife and I were first starting out in the 70s, we had to save for months in order to be able to afford the appliances for our home. Our savings helped community development through local loans; our purchases helped provide good-paying jobs at our independent appliance store as well as jobs at the manufacturer (Wisconsin, I think). If Walmart had been around then, hawking cheaply produced goods, we probably would have bought them through a lack a patience if nothing else, we would have accepted the bribe, if you will. Fortunately, though, Walmart was not around for us then. And those appliances we purchased are still in the house and they still work fine. I really don't know what else to say to you folks about this Walmart business. Some things are self evident.