Amazon opens another DC in Texas, eBay accused of Racketeering & Amazon might have a "book monopoly"

A summary of the most important 3P Third Party Marketplace news for the week ending 23 August 2015.
24
Aug

Third Party Marketplace News – Amazon opens another DC in Texas, eBay accused of Racketeering & Amazon might have a “book monopoly”

Every week, Hendrik Laubscher will be providing third party sellers with a selection of news stories that they need to be aware of. As a Prosper Show participant we strive to ensure that you can focus on your business while we handle all the industry news. It has been a busy week with regards to 3P marketplaces. It has been a rough few week for Amazon after the business deals with the repercussions of a scathing attack on its corporate culture. However this is not the first nor last time that Amazon will have to deal with criticism. eBay is also facing serious legal issues over a claim of racketeering was leveled against the California based marketplace.

Amazon.com, is opening an 855,000-square-foot fulfillment center in San Marcos, Texas. Once completed, the facility will employ more than 1,000 full-time employees and be the e-retailer’s fifth fulfillment center in Texas. Orders fulfilled at the center will consist primarily of books, electronics and toys. Amazon says it is investing more resources in Texas because of its track record there. “We have found a dedicated and enthusiastic workforce in Texas that has supported our growth throughout the state,” said Mike Roth, Amazon’s vice president of North American operations. Amazon likes Texas alot due to the workforce seen there but one should not forget the central location of the Lone Star State. Read more here.

eBay spokesperson Ryan Moore responded on Friday with the following statement: “We have received a copy of the complaint and are reviewing it. That said, counterfeits are not welcome on eBay and we have a number of sophisticated tools, policies and other measures in place to keep them off our site. We will vigorously defend our practices in court.” In addition to harshly criticizing eBay’s actions when it comes to how it handles complaints about alleged counterfeits for sale on its marketplace, the plaintiff noted that Amazon has been responsive to its reports about violations on its marketplace. This is an ever increasing situation that impacts sellers, brands and marketplace platforms. I suspect many brands will be keeping an eye on this and potentially thinking about either joining this case or file their own. This is also interesting as between the lines the brand mentions that Amazon is doing a better job of combating counterfeit products. Read more here.

A group of more than 500 prominent authors says Amazon.com Inc. has “unprecedented power” over the book publishing market and wants the U.S. Department of Justice to begin an investigation of what it claims is a monopoly. It is the latest headache for chief Jeff Bezos who last week  strongly  defended  a New York Times article critical of the company’s work practices, said to reduce some employees to tears. This week the Authors United group submitted a formal request to the DOJ’s top antitrust official. The group was formed last year in response to Amazon’s bruising negotiations with publisher Hachette Book Group, primarily over pricing. If Amazon is investigated for antitrust violations it could have impact for sellers which sell books via Amazon. This will be something to keep an eye on. Read more here.

Till next week. Onwards.