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TCTI: Too Crazy To Ignore

Dave Ross

Publisher: Obama should be prosecuting Amazon instead of endorsing it

While President Barack Obama was speaking at an Amazon warehouse in Chattanooga, Tenn. Tuesday, an independent publisher was asking for an antitrust investigation of the company, which he thinks uses predatory pricing to create a monopoly. (AP Photo/Susan Walsh)
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While President Barack Obama was speaking at an Amazon warehouse in Chattanooga, Tenn. Tuesday, an independent publisher was asking for an antitrust investigation of the company, which he thinks uses predatory pricing to create a monopoly.

"The war seems to be over and the good guys have lost," says Dennis Johnson, founder of Melville House Publishing. "It's hard to imagine the DOJ opening a proper antitrust investigation of a company that has the President of the United States dropping by to spend some time in one of its warehouses."

Johnson says Amazon is driving out all the competition by severely underpricing products.

"In quarter after quarter, Amazon posts rising sales and simultaneously rising losses. It's kind of remarkable. They're just making so much money now. They have such terrific cash flow that they're always going to be able to pay this month's bills and also get money from the banks because when you're generating $15.7 billion a quarter, as they did in the last quarter, no bank is going to turn you down for funding."

This sounds almost like a pyramid scheme then.

"Yeah, it kind of feels like it," says Johnson.

As Johnson understands it, the reason they're able to sell the stuff at a loss is because of what he would consider to be the phantom value of their stock, which is a darling on Wall Street, but there's no there, there.

"They are just able to really absorb terrific losses and no smaller competitor can really do that," says Johnson.

Is there any way small, independent publishers could band together?

"It's very complicated. Amazon is probably every publisher's biggest account. My God, they're a terrific bookseller. I think they could sell a stone if you asked them to. But that said, what we would like to see is a marketplace that makes sense and isn't controlled by a monopoly," says Johnson.

By the way, I'm pretty sure Amazon does sell rocks and they're beautifully gift wrapped and delivered in 24 hours.

Thinking about Obama's visit to Amazon, I asked Johnson what he should he be doing instead?

"Business-wise, and I own a business and I look at this as a business person as well with interest, they're not high-wage jobs. This is a company with a really kind of treacherous and reprehensible labor history. There were the incidents in the Allentown, Pa. warehouse where instead of installing air conditioning, they preferred to hospitalize their fainting workforce by stationing ambulances at the back door."

Sounds like Johnson thinks Obama ought to be prosecuting Amazon instead of endorsing them.

"I absolutely feel that there's just cause for an antitrust investigation of Amazon," says Johnson.

Dave Ross on KIRO Radio 97.3 FM

Tune in to KIRO Radio weekdays at 5am for Dave Ross on Seattle's Morning News.

Dave Ross on KIRO Radio 97.3 FM

  • Dave Ross on KIRO Radio 97.3 FMTune in to KIRO Radio weekdays at 5am for Dave Ross on Seattle's Morning News.

About the Author


Dave Ross hosts the Morning News on KIRO Radio weekdays from 5-9 a.m. Dave has won the national Edward R. Murrow Award for writing five times since he started at KIRO Radio in 1978.

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