An investigation is under way to determine whether publishers are illegally selling textbooks to Internet booksellers at prices cheaper than those they offer to college bookstores. Internet book providers often sell books at prices lower than those at college bookstores, and illegal pricing practices by publishers may allow the Internet companies to lower their prices.
Arent, Fox, Kintner, Plotkin and Kahn in Washington, D.C., legal counsel of the National Association of College Stores, is conducting the investigation.
"Our legal counsel surveyed 700 publishers asking about whether they had different pricing policies for Internet booksellers," NACS Spokesperson Jerry Buchs said. "They received 200 responses from publishers, and a handful said that they do have different pricing structures. We believe that this is price discrimination versus the college bookstore. We believe when a business has different pricing structures for different customers this violates the Robinson-Patman Act which basically states that that they are dual pricing their products."
University Bookstore Director Jonathan Kates said if price discrimination is occurring, the Bookstore may not be able to compete with Internet retailers.
"All of us who are competing for any market like to do so on a level playing field," Kates said. "What the investigation suggests is that the playing field may not be level. This is important for anyone who is trying to offer customers the best price and is trying to remain competitive."
Whether it is illegal or not, Assoc. Commerce Prof. William Wilkerson said it may not be smart to offer different rates to different retailers.
"Generally, if you're a publisher, you need to keep good will with all your markets," Wilkerson said. "If I were college bookstores, I would be pretty upset."
Internet retailers pose further threats to college bookstores because they receive support from large venture capitalists.
Internet retailers "are well capitalized because they have very strong investors," Kates said.
However, Law Prof. Charles Goetz said the Robinson-Patman Act was designed to protect the interests of the smaller companies that do not have the capital or support of large investors.
"The Robinson-Patman Act was passed in the 1930s at a time when supermarkets started putting the 'ma and pop' grocery stores out of business," Goetz said. "They bought in tremendous volume and would be able to strike better deals with food vendors," decreasing the overall cost.
He said the 'ma and pop' stores could not compete, and the Robinson-Patman Act was created to protect their interests.
While the investigation of publishers' selling practices continues, Internet book providers remain selling textbooks to students at low prices.
"Wherever you get the better deal is where you want to go," fourth-year College student Amee Patel said.
Still, Kates said he is confident that Internet book companies will not defeat the Bookstore.
"Thus far, we are competing successfully with Internet providers," he said. "Over the years we have developed a relationship of trust. Customers like to do business with people instead of with an ethernet cable."
Buchs also stressed the advantages of shopping at a college bookstore.
"They can answer questions about classes and faculty and help students in a way that national sites cannot," he said. "They have everything on the first day as opposed to a home delivery delay"