Online bookstores oppose discount ban

Customers look at books displayed in the bestseller corner of a large bookstore chain in central Seoul, Friday. A revised bill on a fixed price system, meant to strictly regulate book prices, was submitted to the National Assembly earlier this month. If the bill is passed, discounts on books will be restricted to 10 percent. / Korea Times file

Publishing firms and online book stores are pitched against each other over a revised bill recently submitted to the National Assembly that is designed to stop excessive discounts on book prices.

Publishers and major bookstores that support the bill claim that online bookstores are not only taking away their share of sales but are also boosting the sales of cheap, low quality books.

Opponents, however, argue that if the fixed price system is put into place, there will be fewer consumers buying books because they will be burdened by the book prices which won’t be discounted.

Choi Jae-cheon, a lawmaker from the main opposition Democratic United Party, presented the revised bill on Jan. 9 to the Assembly, claiming that the current law is not serving its original purpose of regulating the book prices and preventing the monopolization of sales.

The problem of free competition in the publication and sales industry is quite serious. Stores offer discounts up to 50 percent.

Sales of the “Complete Series of World Literature” illustrate the issue. After Minumsa Publishing Group and Penguin Classics Korea started discounting the series by up to 40 percent, Eulyoo Publishing Company followed the move and offered discounts of up to 50 percent.

The current law on the fixed book price system, legislated in 2003, was meant to regulate book prices but was implemented rather loosely.

According to the law, books with less than 18 months since their publication can be discounted by up to 19 percent and those available longer than this can be discounted arbitrarily by book stores because they are considered “old” books.

The revised bill will change the current rule to allow only 10 percent discounts on all books and get rid of the new book-old book distinction.

“As only books with major discounts were being sold, the ‘new releases’ market is dwindling and the publishers are facing severe economic difficulties. This limits the diversity of publications and reduces the accessibility of books to only cheap, popular books,” said Choi. “We need to revise the bill to invigorate the publication industry.”

Han Ki-ho, head of the Korean Publishing Marketing Research Institute said in a radio interview Thursday that the fixed price system will lower the book prices eventually.

“It the fixed price system is in place, it will give autonomy to the publishers to distinguish their prices. If the publishers decide prices, they cannot ignore competitors who publish the same types of books,” Han said. “There’s a huge influx of new books every year into the market. Then naturally, book prices will be reduced.”

Publishers and offline book stores are welcoming the move but online book stores are fiercely protesting against the passing of the revised bill.

Recently, a popular online book store, Aladdin, started gathering signatures online from its customers to submit it to the National Assembly in the form of a petition. Aladdin claims the bill will result in fewer people buying books.

“We demand that the lawmakers don’t pass the bill. The reduced discounts will not only decrease the number of books sold but also reduce royalties given to authors,” said Aladdin in a statement. “There’s no proof that the revised bill will benefit smaller book stores and publishers.”

Consumers show mixed reactions.

Some oppose the fixed price system complaining that they won’t be able to buy books at cheaper prices. They also doubt whether the system will actually encourage people to use offline stores.

“The reason we buy books online is not just because the titles are cheaper there. Of course, that could be the main reason, but another big reason is because it’s so much more convenient. We don’t have to carry heavy books home,” said Park Min-woo, a consumer.

“I don’t think the fixed price system will really help boost the industry. The market is already monopolized by the big companies and people will still buy online.”

Others welcomed the move saying it will diversify the market.

“I think the move is necessary. It will be helpful in reducing the price of books altogether because at the moment, books are priced in consideration of the discounts that will be made afterwards. That’s why the books are priced so expensively,” said Lee Jee-hae, an avid reader and online bookstore user.

“If books have been sold at 15,000 won, they will now be sold at 10,000 won. Publishers can also find alternatives to make a profit margin. For instance, cheaper paperback books can be released. These will definitely diversity the type of books as well as the market.” <The Korea Times/Yun Suh-young>