In a tussle with suppliers, online retailer Amazon Inc. (NASDAQ:AMZN) is refusing to sell what may be the biggest new releases of the summer: J.K. Rowling’s latest novel “The Silkworm” from Hachette Book Group and “The Lego Movie” DVD from Warner Home Video.
Amazon’s disputes with vendors are not new, but suppliers’ refusal to budge on their terms could change how Amazon conducts business. Amazon reportedly wants Hachette to let it lower prices for e-books, but Hachette has resisted. Neither Amazon nor Warner has released details about their dispute.
A Warner spokesman said it’s the company’s policy “not to comment on contract terms or any other proprietary information having to do with our partners.”
Amazon did not immediately return a request for comment.
Preorders for several Warner Home Video DVDs, including “300: Rise of an Empire” and “Winter’s Tale,” haven’t been available on Amazon since mid-May, though customers may sign up to be notified by email if and when the movies become available.
“Something weird seems to be going on with Warner Bros. pre-orders,” one commenter on Amazon.com posted May 20. “Loads of them are not available anymore, and all of them were removed pretty much at the same time … All of them Warner releases, some of them pretty big.”
“The Lego Movie” is scheduled for release June 17 in stores, including Target Corporation (NYSE:TGT) and Best Buy Co Inc. (NYSE:BBY).
"This has got to be the most eagerly awaited 2014 movie being released so far -- kids movie, adults like it too, the first good 2014 film," another commenter posted. "Oh well, Amazon may be digging their own grave if they keep this up."
In the standoff with Hachette, Amazon is refusing to take advance orders and delaying shipments.
That means the “preorder” button on some book titles has vanished, leaving both authors and customers asking why.
Both companies are bound by a nondisclosure agreement not to discuss specifics of the dispute, but it is widely believed that the publisher and retailer are in disagreement about how much freedom Amazon will have to discount e-books.
“We have been asked legitimate questions about why many of our books are at present marked out of stock with relatively long estimated shipping times on the Amazon website,” Hachette said in a statement to CNN. “For reasons of their own,” Amazon is holding minimal stock of the books and restocking some books slowly, causing “available in 2-4 weeks” messages to appear when customers try to order,” the book publisher said.
The Amazon Books team posted a statement on the dispute at the end of May, saying: “Unfortunately, despite much work from both sides, we have been unable to reach mutually-acceptable agreement on terms … we are not optimistic that this will be resolved soon.”
Many authors depend on book sales through Amazon for about 40 percent of their revenue, according to industry researcher Codex Group. First-time authors like fashion blogger Shauna Miller could be especially hard hit. Her book, “Penny Chic: How to be Stylish on a Real Girl’s Budget,” due out in September, is no longer available for preorder on Amazon. Other authors affected include Stephen Colbert and Malcolm Gladwell.
Amazon said it takes “seriously the impact it has when” business interruptions affect authors and said it has offered a deal to Hachette to fund half of an author pool that would mitigate the impact of the dispute on authors’ royalties. It’s not clear whether Hachette has taken up that offer yet. Hachette did not immediately return a request for comment.