Kudos to the Canadian government for allowing U.S. bookseller Amazon.com to set up a distribution centre in Canada. We should expect to see Amazon's shipping costs fall as a result of this decision. Since shipping costs are marginal costs, we can hope that the price premium on books in Canada disappears.
No one should be surprised at Heather Reisman's response. Ms. Reisman is the CEO of Indigo Books Music Inc., operators of the Indigo, Chapters, Coles and World's Biggest Bookstore. Allowing competition will reduce prices and thus the monopoly profits earned by Indigo. With the advent of the Kindle, Sony Bookreader and iPad, more books will be delivered electronically at a lower marginal cost. Firms that concentrate on brick and mortar delivery are not likely to survive. Borders and Blockbuster are excellent examples of this.
We have to disagree with the assertion that this restructuring of the bookselling industry will hurt Canadian authors. If anything it will likely help them. Currently a Canadian author must pursuade a publisher to print their manuscript and sell it to Indigo. Under the emerging system, an author need only produce the book in a format compatible with one of the readers, advertise it by Facebook, Twitter or some other social media site and deliver it directly to a willing purchaser. The market will decide which books get read and which ones don't. What a novel concept (pun intended).
Links:
The Globe and Mail article on the government's decision.
Brand Channel's article on Borders (and Blockbuster)
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