The other day at the subway station, a Frenchman asked me if I could spare him a dime so he could buy a bottle of pop. Soda. Whatever you call it from wherever you are right now. Anyway, I didn’t have any cash on me so I couldn’t help him out.
But it got me to thinking. This guy probably would have had that dime if he didn’t have to pay full price for books all the time because of some silly protectionist law passed by his country’s government.
See, selling books for below cost in France is illegal. And Amazon.com isn’t allowed to offer free shipping on books either because that’s seen as a discount and a potential threat to small, independent book stores.
You don’t have to be an economics expert to realize that price fixing is inefficient in that it reduces competition and innovation and ultimately hurts consumers and even decreases total sales. So Amazon will need to decide if it wants to even bother selling books in France or start charging delivery fees. If it doesn’t, it’ll have to pay a $1,470 daily fine plus a one-time $147,000 fine to the booksellers’ union.
Who knows? Maybe it can sell enough books with free shipping to cover those fines. That’d be kind of interesting to watch.
Amazon Ordered to End Free Delivery on Books in France [New York Times]
It is because of this silly law that independent bookshops still exists in France.
Yes, it is so easy to critic French laws and find perfectly acceptable that all Apple products are sold at the exactly same price up to the cent in any given country.
Yes it is perfectly normal that the US price is generally half the UK price.
Yes it is perfectly normal the European citizen have to wait months to get gadgets like iphone, Wii and years for a downgraded $ony game cell computer.
Yes it is perfectly normal that an US law is imposed on foreign travellers that will never go to US (e.g. airline record, like credit card details and probably pin, passed to US if travelling in Canada).
I appreciate the comments but believe it or not, there are still independent bookstores here in the US and while many of them can’t compete with big bookstores on price, their ability to specialize and provide superior service are a couple of examples of what keeps them in business.
Some of them have even started selling their books online, just like the big boys do. They sell more books to a broader audience and make more money. All because they’re forced to innovate.
And Apple’s pricing mechanism isn’t a result of government involvement. It’s Apple being Apple and setting the prices on their own goods, prices that Apple feels are what people are willing to pay. If people don’t buy the products at a certain price, it’ll probably be lowered.
The difference is that another company could come along and make a better player for less and Apple would be forced to compete by working harder, lowering its own price, or making an even better player, not insisting that the superior product be priced higher than Apple’s product in order to protect it from going out of business.
Look, this is just not true. Without wanting to sound condescending, this is economics 101, and it doesn’t work. Within Europe there are several countries that have a similar policy, Germany for one. Switzerland until recently and England until a couple of years ago. There are always forces trying to get rid of laws like that in the name of free markets. The opponents of this kind of liberalism hold against it, that it would reduce the number of stores, books and that prices on average would go up as a result.
England managed to prove that quite impressively. Within a very short time after these laws were abolished, bookstores in areas below a certain population density were gone, including the expert knowledge they provided to these communities. Book prices on average went up, all over Britain. Yes, Harry Potter became cheaper, but books that were only interesting to a smaller number of people became significantly more expansive or were not published any more. Especially where science books were concerned prices sky rocketed. The number of published books went down too, because the smaller publishers were pushed out of business by the big ones.
Blunt market forces are not always for the best, especially when it comes to what kind of a culture one wants to live in.
In that regard Germany is a pretty good example. A large variety of books are still published by a variety of publishers and sold by different vendors. This adds a certain quality to public discourse. Not everywhere, but it is noticable. By and large Germany is still a country were books are read – different kinds of books. This is not necessarily something one could state of the US.
These points are even upheld in economic theory. There are different classes of goods, and some of them would be undersupplied from the point of view of society, if the state would not step up, vaccinations being the textbook example.
Here’s some more information and data on the subject if anyone’s interested…
http://www.publishingtrends.com/copy/00/09/0900discounts.htm
‘In 1995, British publishers abandoned their hundred-year-old price-fixing scheme, known as the “net book agreement.” But thus far, the predicted demise of small booksellers has not come to pass. “We were anticipating a very detrimental effect on the independents,” says Ian Taylor, director of international and trade services for the Publishers Association. “But it hasn’t been as damaging as we expected.” Independents who decline to discount titles such as Harry Potter are still “doing very well,” and a growth of wholesalers in the UK has had a cushioning effect, as discounts from publishers are passed on to accounts. Indeed, only about 900 titles were discounted out of the 150,000 published in Britain last year, according to Frank Fishwick, economic adviser to the Publishers Association, who adds that book prices have risen much more than general inflation. The country has also seen stronger sales of hardcovers, as consumers seem prepared to buy a discounted hardcover rather than wait for the paperback (which is the same phenomenon that killed the mass market biz in the US). Other evidence shows that the number of new titles has been growing at about 5% per year. And how do publishers feel about the end of price maintenance? “Most publishers in this country don’t have an opinion,” Taylor says. “They’ve simply moved on.”
Booksellers apparently feel much the same. “It’s over, dead, and buried as far as we’re concerned,” says Sydney Davies, trade and industry manager for the Booksellers Association. “The whole trade has changed since it was outlawed. Booksellers now see their competition more from the Internet and from American chain booksellers opening in the UK.” He says the number of bookshops has decreased only marginally since the end of price maintenance, while chains have opened more branches and nontraditional outlets are selling more books.’
I appreciate the comment to Z0rr0 – les juges se sont en fait appuyés sur la “loi Lang de 1981″ qui fixe un prix unique sur les livres (moins 5% de rabais autorisé). Ils ont estimé que la livraison gratuite était en fait une promotion tarifaire déguisée, ils offraient gratuitement un service avec un achat, qui n’est possible que sous l’impulsion de l’éditeur, ce qui impliquait donc une vente à perte et une concurrence déloyale vis à vis des librairies classiques.
L’attaque n’était pas tournée contre Amazon seulement, puisque le français Alapage (France Télécom) en à fait les frais en mai dernier.
En fait le New York Times relève une fois de plus le protectionnisme étroit du président Nicolas Sarkozy. Il souligne son esprit d’ouverture avec les Etats-Unis, il critique sa “vision protectionniste étroite” concernant l’Europe.
La France est un pays qui perd sa production, ou les dépenses contraintes aux ménages (nourriture, logement, transports) représentent plus de 70 % du revenu moyen. Les Français ont le sentiment, de gagner moins et de payer plus.
Nous ne sommes plus, un pays d’entreprises, lorsque qu’un anglais vient créer sa société en France, on lui demande de payer avant même d’avoir commencé, nous avons le système fiscale le plus compliqué au monde…
Alors oui ! La France est très hermétique au monde environnant, nous sommes dans une impasse, souvent perçue comme un paradis (respect des personnes, aide sociale, …) la France est actuellement en panne, alors je pense que nos syndicats, notre gouvernement, continueront a prendre ce genre de décisions et c’est bien dommage pour le consommateur…
D’un autre côté il est vrai que nous sommes souvent les derniers, que ce soit en France ou en Europe, pour la diffusion de films, la sortie de gadgets électroniques, en matière de téléphonie mobile etc… et que le prix de vente est toujours plus cher.