Amazon, the world’s largest online retailer, has blocked the pre-order option for Walt Disney’s “Captain America: The Winter Soldier” as well as other titles in disk form. It is repeating a tactic which was used in other disputes with publisher Hachette and Warner Bros. Another hit-movie which isn’t available for DVD pre-order on Amazon is ‘Maleficent”. However, even if the movies are not available in the digital store, they can be pre-ordered from the online streaming service.
At the moment, Amazon is having disputes with several media companies. These clashes have intensified over the past months because the company is trying to use its heft in the online market (especially for books and home video) to obtain better terms from vendors. It seems that the dispute with Time Warner Inc.’s Warner Bros. is being resolved, but the one with Hachette Book Group is far from being resolved.
“They are squeezing studios on DVD pricing, understandable given their market position. (…) Disney can’t cut them off, and Amazon can cut Disney off, so I would say Amazon has the leverage.” – Michael Patcher, Wedbush Securities analyst.
Reports from Home Media Magazine say that several pre-order options for Disney DVDs disappeared. They included “Million Dollar Arm” and “Muppets Most Wanted”. It is not the first time that Amazon uses this tactic. It removed pre-orders for Warner Bros. titles from mid-May to late June. It is the same strategy used in the past. Disney and Amazon did not comment on this. Nevertheless, the reality is that studios rely on the home-entertainment market (which includes DVD sales on Amazon) to obtain profits. As a matter of fact, several movies reached profitability in theaters because studios split ticket sales with exhibitors.
At the moment, “Captain America” is the top-grossing movie in Canadian and United States theaters (this year). It reached ticket sales of 295.5 million dollars. “Maleficent” is the fourth highest-grossing film.
Currently, Amazon dominates with a 60% share of the market, says Forrester Research. Amazon also helped pioneer the E-Book market with the introduction of its Kindle device back in 2007. Earlier last week, Amazon made a case for lower book prices in its conflict with Hachette. It said that sales of titles would go up when prices are cut (for every copy of an E-Book worth 14.99$, Amazon would sell 74% more E-Books priced at 9.99$).
“Just as paperbacks did not destroy book culture despite being ten times cheaper, neither will E-Books. (…) We will never give up our fight for reasonable E-Book prices.”
Several hundred authors signed a letter that urged readers to tell Jeff Bezos, Amazon Chief Executive Officer, what they think about E-Book prices. As a response, Amazon asked its readers to contact Hachette CEO Michael Pietsch.