With multinational companies chipping away at the edges of honesty, it’s easy to forget the simple things sometimes.
Make no mistake – anti-competitive (aka “Agency”) pricing is illegal in Australia.
Darryl Adams recently pointed this out on his blog Oz-e-Books – and it’s a timely reminder. In the face of large companies sending press releases “announcing” changes to their business practices to reinforce their “rights to set prices” across all retailers, sometimes we forget to question that.
Do they have that right? Do book publishers have the right to dictate the retail price of their products, when sold by third party retailers? Not the prices of some retailers – all retailers. The answer to that is no.
One of the jobs of Australia’s ACCC (our consumer watchdog, similar to the FTC in the US) is to ensure open price competition by retailers.
From Oz-e-Books:
With Random House entering the Agency Price Model with the rest of the 5 big publishers (Hatchet, Harper Collins, Random House, McMillan, Penguin and Simon & Schuster), there has been a lot of discussion about the practice.
Firstly, to be clear, Agency Pricing is illegal in Australia. As a form of Price Maintenance, the practice is specifically barred under the Consumer and Competition Act of 2010.
As per the ACCC: http://www.accc.gov.au/content/index.phtml/itemId/322982
Suppliers may try to impose a resale price to maintain brand positioning or to give resellers attractive profit margins.
Any arrangement between a supplier and a reseller that means the reseller will not advertise, display or sell the goods the supplier supplies below a specified price is illegal.
I’d say that’s pretty damn specific. So which publishers are breaking the law here?
Let’s investigate, shall we?
Method
1. I searched the Australian site for each publisher and picked titles at random, usually from their bestseller lists. Keep in mind some titles may be published under an imprint of the major publisher, but pricing rules (or lack thereof) still apply.
2. I went to the largest international ebookstore that has ties to Australia – and therefore stocks a decent number of titles that are available to locals here – Kobo.
3. I made sure the address set on my Kobo account was an Australian one – this was confirmed with prices at checkout appearing in AUD. Therefore the site recognised that I was “shopping” from Australia.
4. I went shopping – gathering price information on three books published by the local arm of each of the “Big Six” publishers, plus the largest independent Aussie publisher Allen & Unwin.
Criteria
- If there is a list price AND a sale price in the ebookstore, the publisher is not following “Agency” pricing, as no discount is allowed.
- The prices are usually higher with “Agency” pricing as no discount can be applied.
- Prices not affected by a discount – ie original (“Agency”) prices will generally end in .99 (as in $x.99)
Result
It’s obvious from these figures that Hachette Australia are following the “Agency” model of pricing for books sold to Australians. All three titles I looked at satisfy all three criteria (above) for agency pricing. The prices were higher, anded in .99 and Kobo had not applied any “our price” discount, as they had done with every other book from the other publishers. Why not – because they are not allowed to by the publisher. Therefore, as the ACC states here, Hachette Australia are acting illegally.
What you can do
If you too disagree with agency pricing, please pass this data around. Blog about it, share this post, Tweet it or spread it around Facebook. The more noise we can make about this, the more chance that the ACCC will take notice and investigate. Let’s put an end to anti-competitive pricing like this. Isn’t open competition the best situation for the consumer?
Here is the raw data from the ebooks I checked:
Macmillan
Jwoww and Jenni “Jwoww” Farley
List price: $16.19
Our price: $9.39
By Joy Dettman
List price: $17.99
Our price: $12.49
By Stieg Larsson
List price: $13.49
Our price: $7.99
HarperCollins
By Josephine Cox
List price: $26.39
Our price: $9.99
By Russell Brand
List price: $28.00
Our price: $14.75
By Annie Proulx
List price: $22.39
Our price: $15.49
Random House
The Little Coffee Shop Of Kabul
By Deborah Rodriguez
List price: $32.95
Our price: $16.34
By Carmen Reid
List price: $9.89
Our price: $7.69
List price: $26.79
Our price: $14.19
Simon & Schuster
By Rhonda Byrne
List price: $14.19
Our price: $9.39
By Nicole “Snooki” Polizzi
List price: $24.39
Our price: $14.19
By Kevin J. Anderson Brian Herbert
List price: $20.29
Our price: $11.79
Penguin
By Pittacus Lore
List price: $10.89
Our price: $8.49
By Marian Keyes
List price: $13.19
Our price: $9.19
By Kim Edwards
List price: $25.89
Our price: $11.89
Hachette
By Deborah Harkness
Price: $16.99
By Alan Bissett
Price: $12.99
By Emma Darwin
Price: $12.99
Allen & Unwin
By Craig Silvey
List price: $23.99
Our price: $9.99
By Katherine Rundell
List price: $6.69
Our price: $5.29
By Christos Tsiolkas
List price: $22.72
Our price: $8.90
Action
I hereby call on the ACCC to follow the lead of consumer watchdogs in the US and Europe and investigate Hachette Australia’s business practices – specifically anti-competitive pricing – in retailing to those in Australia. If you work for the ACCC and you’re reading this, don’t bother taking notes – it’s all coming in an email.
Why not get an online petition going? Might be a good way to get your web address emailed around, too? I’d sign the petition. Bloody arseholes, Hachette (whoever you are).
Flick
Yes – think I will, and mobilise the millions…
So, get a dozen people to write to the ACCC and ask them what the story is – see if everyone gets the same answer?
bt
Good idea. The count is at one.