Monday, August 11, 2014

When Distribution And Content Can't Work Together

It has become fairly typical to see a content network and cable operator fight over license fees with drops of service and consumer pr to drive a settlement.  It is less so in the world of retail.  A product can't negotiate shelf space in a brick and mortar store and ends up off the rack but the consumer rarely comes between such negotiations.  But in the world of digital and the convergence of retail and content, the consumer is actively included once again.

I speak of the public negotiation going on between Amazon and Hachette, a book publishing company, and a second one now emerging between Amazon and Disney over DVD content.  Amazon is not new to this strategy.  Per the Wall Street Journal, "Amazon briefly cut off pre-orders of physical versions of movies from Time Warner Inc.'s Warner Bros. studio earlier this year before reaching an accord. During contract talks several years ago, Amazon halted customers' ability to buy books from publisher Macmillan."  It is simply unusual to see such negotiations in the retail world being so public.

And while this is playing out in the press, with letters from authors and articles daily, I am most surprised how quiet Amazon's competitors have been.  Where is the marketing and public relations arms from Barnes & Noble, Target, Walmart, and others touting that they indeed carry all these items and at great prices, too.  Certainly, timing is everything and sometimes it makes sense to kick them when they are down.  And lastly, its much easier to find another retailer carrying a DVD or book than it is to switch cable providers.  Just a couple months ago, that is exactly what Stephen Colbert told consumers to do.   While consumers have gotten involved in retailer quarrels, mostly to boycott products, it is a new world when consumers are being involved in retailer and content negotiation issues. 

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