That seems like a bit of an overreaction to me. Amazon isn’t going to corner any markets with this move, even if it wins ICANN’s approval. It is just competing in the digital land grab along with many other major companies. Google Inc. (NASDAQ:GOOG), for example, is targeting several domain names for itself, including the “.blog” tag. Apple Inc. (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) have requests in with ICANN for a number of domains as well. Maybe Amazon is pushing the envelope with more everyday terms, but web domains just don’t convey much market power.
And while it might be nice to own generic terms such as “book” and “author,” Amazon clearly doesn’t need them to build awareness around its products and services. Its “Kindle” brand name didn’t rely on an everyday term as it grew into lead e-reader status. And don’t forget that there used to be a time when “Amazon” was just a long river in South America.
The downside
But the biggest risk I see to Amazon here is in harming its relationship with authors. As part of the company’s core mission, it lists content creators (along with consumers, sellers, and enterprises) as one of the key groups that it aims to please.
You could argue that’s been going extremely well lately — for the creators of digital video content. Amazon’s battle against Netflix, Inc. (NASDAQ:NFLX) has sent the price of online video skyrocketing. As it shells out more than $1 billion annually, Amazon has quickly grown into Netflix, Inc. (NASDAQ:NFLX)’s biggest bidding rival for streaming video. And the owners of that content, such as Dreamworks Animation Skg Inc (NASDAQ:DWA) and The Walt Disney Company (NYSE:DIS), have to be enjoying all the extra attention. Prices for original series have climbed into the millions of dollars per episode.
Book authors haven’t seen anything close to the same jump as their content gets digitized. Sure, the market has grown larger with the explosion in sales of e-readers and tablets. But the potential for falling prices is the main concern for writers. Scott Turow, president of the Authors Guild, has said that lower e-book prices will be good for consumers, “until there [are] no authors anymore.”
Bottom line
That’s probably an overreaction, too. But as Amazon’s corporate mission spells out, the company needs content creators to be on board with its digital strategy. And that’s just not the case right now for a lot of the book author community.
The article 1 More Reason to Fear Amazon? originally appeared on Fool.com.
Fool contributor Demitrios Kalogeropoulos owns shares of Apple and Netflix. The Motley Fool recommends and owns shares of Amazon.com, Apple, and Netflix.
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