Bookstores Take on Amazon and Publishers Over Ebook DRMs

March 13, 2013

Oh, the joys of the free market. PaidContent announces, “Indie Bookstores Sue Amazon, Big-6 Publishers for Using DRM to Create Monopoly on Ebooks.” Three brick-and-mortar bookstores seek to represent similarly positioned stores with their class-action suit filed in New York’s Southern District Court. This is the same court that oversaw the Department of Justice‘s antitrust suit over ebook pricing.

These stores assert that deals between the big publishers and Amazon, combined with the Amazon-specific reader, the Kindle, form a closed loop designed to shut out the competition. Digital rights management (DRM)software is the mechanism the mammoth online bookseller uses to enforce this exclusivity. Writer Laura Hazard Owen explains:

“The filing takes issue with Amazon’s proprietary DRM, AZW: ‘Ebooks with the AZW DRM can only be read on a Kindle device or on another device enabled with a Kindle application. . . . The Kindle app works solely with ebooks sold by Amazon.’ While the case names only the big-six publishers as defendants, Amazon places its DRM on nearly all of its ebooks from all publishers.

“The filing says that big-six publishers, through their contracts with Amazon that allow for Amazon’s proprietary DRM on their ebooks, ‘unreasonably restrain trade and commerce in the market for ebooks in violation of the Sherman Act.'”

The filing acknowledges the Nook as a Kindle competitor, with 25 percent of the market to Kindle’s more than 60 percent, but notes that Barnes & Noble is not exactly in a strong financial position at the moment. The plaintiffs hope the court will issue an injunction prohibiting Amazon and the large publishers from selling ebooks with device- and app-specific DRMs. They also call for those six publishers to let independent stores directly sell their ebooks with “open-source DRM,” though what they mean by that term is unclear.

Cynthia Murrell, March 13, 2013

Sponsored by ArnoldIT.com, developer of Augmentext

Written by Stephen E. Arnold · Filed Under News, Publishing

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Stephen E. Arnold monitors search, content processing, text mining and related topics from his high-tech nerve center in rural Kentucky. He tries to winnow the goose feathers from the giblets. He works with colleagues worldwide to make this Web log useful to those who want to go "beyond search". Contact him at sa [at] arnoldit.com. His Web site with additional information about search is arnoldit.com.