Amazon hears from hometown critics

A four-part series in the Seattle Times charges Amazon with aggressive business practices and a lack of philanthropy.

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    Amazon CEO and founder Jeff Bezos told the Seattle Times in a previous interview, 'Our core business activities are probably the most important thing we do to contribute, as well as our employment in the area.'
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Whether it's Apple’s Cupertino headquarters, Target’s Minneapolis home base, or General MotorsDetroit, hometowns are usually supportive of their local businesses.

Unfortunately for Amazon, the relationship with its hometown – Seattle – isn’t quite so rosy. In a string of blistering articles written over the past several days, the Seattle Times has portrayed local powerhouse company, Amazon, as an aggressive, self-interested market dominator that has done little for its home city.

“From the moment Jeff Bezos launched Amazon.com in a small Bellevue house in 1994, it has cultivated a reputation as the consumer’s friend,” begins the introduction to the Seattle Times’s four-part series on Amazon. “But as Amazon prepares to turn 18 this summer, its practices are drawing increasing scrutiny, from civic leaders in its hometown to lawmakers around the country, from business partners to labor activists.”

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The article then proceeded to list Amazon’s apparent offenses in detail.

“We found that the company is a virtual no-show in the civic life of Seattle, contributing to nonprofits and charities a tiny fraction of what other big corporations give. In the political world, the company's hardball efforts to fend off collecting sales taxes – a key advantage over brick-and-mortar stores – has ignited a backlash in several states. In the publishing world, smaller companies have begun to publicly criticize Amazon's bullying tactics. And in some of its warehouses around the country, Amazon is drawing fire for harsh conditions endured by workers.”

One story in the series, entitled “Amazon.com trying to wring deep discounts from publishers,” outlines the company’s efforts to bully publishers into selling books at drastically low rates. In one example, Amazon sent publisher McFarland & Co. an email saying it would buy its books at a 45 percent discount, “roughly double its current price break.” Although Amazon represented nearly 70 percent of McFarland’s retail sales (and 15 percent of its overall business), the publisher held its ground. 

In another example, Amazon demanded a similar discount from Berkshire Publishing Group. That company also declined the demand and Amazon stopped ordering from it.

Of course, the Seattle Times has acknowledged that many industry players have a bone to pick with Amazon and that’s why many are stepping forward to speak out against it.

“Although publishers rarely criticize companies they do business with, some say they're speaking out against Amazon partly because they're offended by its tactics,” writes the Times’s Amy Martinez. “They describe Amazon's demands – made in email, with no personal-contact information provided – as overly aggressive and leaving almost no room for discussion.” 

In another article entitled “Amazon a virtual no-show in hometown philanthropy,” “the Seattle Times outlines the company’s somewhat meager participation in civic life in the city where its headquarters are, a major contrast to other large corporations in the area such as Microsoft,” writes publishing trade newsletter Shelf Awareness

According to the paper, Amazon contributed nothing last year to United Way of King County and is “not a major donor” to other local charities or civic groups. 

Nonetheless, Amazon has been “taking some steps toward greater involvement in its hometown,” write the Times’s reporters, Kristi Heim and Martinez. It pledged to establish two $1-million endowed professorships at the University of Washington and offered volunteer help and in-kind donations to more than 30 local nonprofits.

There may be a reason for Amazon’s relatively less active role in local philanthropic causes, muses Shelf Awareness.

“For his part, Amazon's Bezos has questioned the value of traditional philanthropy. In 2010, he told Charlie Rose: "I'm convinced that in many cases, for-profit models improve the world more than philanthropy models, if they can be made to work." And last year he told the Times: ‘Our core business activities are probably the most important thing we do to contribute, as well as our employment in the area.’”

Still, the Seattle Times’s reporting – and its bruising revelations – will continue to chip away at Amazon’s reputation.

Husna Haq is a Monitor correspondent.

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