Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Will Amazon's Fights with Hachette and Time Warner Affect its Business?

Amazon's  (NASDAQ: AMZN  ) dispute with book publisher Hachette has led to popular titles not being available for pre-order, shipping delays on some books, and questions as to whether the company will face more pushback from its suppliers over terms. That appears to be happening as some product distributed by Time Warner  (NYSE: TWX  ) , including the popular Lego Movie, are either not available on Amazon or have shipping times that are longer than the retailer's two-day standard.

"Amazon has been bulletproof. They can do whatever it is they want and their user base doesn't care," panelist Daniel Kline said on Business Take, the show that gives you the Foolish perspective on the most important business stories of the week. "The question is, what's the tipping point?"

The Time Warner dispute may get more attention than the Hachette battle because The Lego Movie is highly anticipated by families with young children. If it's not available, people might shop elsewhere. If customers register on another website to make the purchase, that could cause Amazon problems down the line since the fact that 244 million people already have credit cards on file with the online giant is one of its main competitive advantages.

"The timing is horrible for Amazon," panelist Jake Mann said. "In the current market what's to stop customers from fearing that Amazon won't have other titles in the future?"

"It's a matter of trust," Kline said. "If you start going to stores that have empty shelves you go to other stores."

To compound Amazon's problems Wal-Mart  (NYSE: WMT  )  and Barnes & Noble (NYSE: BKS  ) have been selling the items Amazon has availability problems with at large discounts to lure in customers.

"Amazon has to do this," host Jason Hellmann said. "They have to take a hard line with their vendors."

Hellmann explained that Amazon operates on razor-thin margins due to its low prices. Part of the way the company maintains those prices is being strict with vendors and demanding favorable terms. In the past Amazon -- due to its size -- has been able to do that pretty much across the board. These vendor problems suggest that the company may have pushed so hard that certain vendors may be willing to forego the opportunity to reach Amazon's customer base if it means accepting unfavorable terms.

Will these disputes cause Amazon to lose customers? Should the company hold the line or give in to its vendors? Watch the video below for the whole story then share your thoughts and comments below.  

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 3001628, ~/Articles/ArticleHandler.aspx, 9/4/2015 3:51:57 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Daniel B. Kline

Daniel B. Kline is an accomplished writer and editor who has worked for the Microsoft's Finance app and The Boston Globe, where he wrote for the paper and ran the business desk. His latest book "Worst Ideas Ever" (Skyhorse) can be purchased at bookstores everywhere.

Today's Market

updated 6 hours ago Sponsored by:
DOW 16,374.76 23.38 0.14%
S&P 500 1,951.13 2.27 0.12%
NASD 4,733.50 -16.48 -0.35%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/3/2015 3:59 PM
AMZN $504.72 Down -5.83 -1.14% CAPS Rating: ***
BKS $15.85 Up +0.11 +0.70%
Barnes & Noble CAPS Rating: *
TWX $70.70 Up +0.21 +0.30%
Time Warner CAPS Rating: ***
WMT $64.86 Up +0.42 +0.65%
Wal-Mart Stores CAPS Rating: ***