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Amazon Is Not a Monopoly

In: Business and Management

Submitted By wretchkid
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Amazon Is Not A Monopoly and Should Not be Regulated

Business Writing and Research
Rensi Zhang
July 28, 2014

Amazon Is Not A Monopoly and Should Not be Regulated Recently, Amazon has been widely criticized by the media for "abusing" its "monopolistic" power to control the book market. Since February this year, Amazon has been using certain strategies against Hachette, one of the five biggest publishers. The "war" between Amazon and Hachette is simple as pie: Amazon wants to get a bigger share of e-book market, while Hachette holds its ground, stating that Amazon is trying to take away too much of its profits. Authors involved also complain that certain strategies used by Amazon, such as raising prices, lengthening shipping time, and removing buy buttons, make it more difficult for customers to order Hachette titles, thus leading to a decrease in its book sales. If you search "Amazon" and "monopolistic" on the internet, you'll find countless articles. Charlie Stross (2014) writes on his blog that "Amazon very nearly gained a monopoly of e-book sales; they're still around the 85-90% mark in the UK, and peaked at over 80% in the USA." Concerned that Amazon may become a monopoly in the future, Rod Dreher (2014) writes that "once they've driven everybody else out of business, there will be nothing to stop Amazon from raising its prices without fear of competition" (p.15). Some authors go even further to push for government regulation. Frankly speaking, I think these authors are worrying too much and if they had googled "monopoly" before they wrote these articles, they would find that "monopoly is a situation in which a single company owns all or nearly all of the market for a given type of product". In addition, it would only happen in the case that "there is a barrier to entry into the industry" and "there are no close...

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