This week's one-page announcement by the federal government allowing the world's largest online retailer, U.S.-based Amazon.com, to wholly own and operate a distribution centre in Canada represents the sort of hair-splitting, ultra-nuanced issue beloved by culture vultures, policy wonks and fans of medieval Scholasticism.
But for the rest of us? Perhaps not so much.
Still, the decision, announced Monday, is important, momentous even. It may be the case that the Conservatives were bowing to the reality that Amazon was already in Canada as an e-tailer (albeit working through a subsidiary of Canada Post, a Crown agency, rather than a retailer with hundreds of physical locations). But some are arguing the decision is nothing less than a reversal of the cultural protection policy that's been in place since the Trudeau era. For Heather Reisman, CEO of Indigo Books & Music, the situation is pretty clear. This week's decision "signals . . . a policy change," she said in an e-mail. "[It confirms]that a company no longer need to be Canadian-owned to sell books in Canada."
A change in culture policy?
She's not so much complaining or wrapping herself in the flag as insisting that the government own up to what it's done and get real about the consequences. Perhaps Reisman herself, whose company is Amazon's main competitor, will be among the first to test this new world, by seeking a buyer or accepting an offer from a foreign firm for all or parts of Indigo. Indigo, ironically, was the end result of the Chrétien Liberal government nixing Reisman's plan to partner with Borders USA back in 1996.
Tim Warmington, communications adviser for Canadian Heritage, insisted in an e-mail this week that the Amazon decision "is not a change in policy" because "the overarching objective of the book policy, and of all policies in the cultural industries, is to ensure Canadians have access to Canadian cultural products." Amazon, he noted, "has made commitments that support this objective," among them "an investment of more than $20-million, including $1.5-million in culture events and awards in Canada" and the creation of a "dedicated staff" to help Canadian publishers and "other suppliers of cultural products."
The government also says it followed the "net-benefit-to-Canada" concept introduced more than 35 years ago to handle foreign investment and ownership. Currently six net benefit "factors" are supposedly considered in any review. But the wording of these factors is vague and broad . Moreover, what is unclear is whether the book policy stating "foreign investment in new business enterprises is limited to Canadian-controlled joint ventures" will be affected.
Earth's biggest selection coming to Canada?
From a consumer point of view, the decision represents "no big change," at least for the time being, acknowledges Reisman. After all, for the last six years, Seattle-based Amazon.com has been operating in Canada as Amazon.ca, fulfilling orders from a warehouse in Mississauga west of Toronto owned by SCI Group, an entity 98.34 per cent owned by Canada Post.
Just how that deal is structured or how the operation works, neither SCI nor Amazon is willing to explain. (It's a "fascinating story," an SCI representative admitted the other day, but "there are confidentiality issues.")
Amazon declined this week to say if it wanted to buy this facility from SCI or if it preferred to start from scratch. About all that Canadian Heritage Minister James Moore would allow, during Question Period in the House of Commons, was: "We will create new Canadian jobs in Mississauga." The same went for Paul Misener, Amazon's vice-president for global public policy: "We believe that a local fulfilment center will enable us to even better serve our customers in Canada as well as our customers in other countries who seek Canadian books and other cultural products," he told The Globe and Mail in a statement.
Could there even be more than one facility? In the United States, books are only a small part of Amazon's retail offerings (a low-margin one at that) - and you don't earn gross annual revenues of $25.3-billion, as Amazon did last year, by selling Dan Brown's The Lost Symbol at a 42 per cent discount.
Over the years, Amazon has steadily increased its choice of wares to American consumers to the point that there's pretty much nothing they can't order - baby food, toilets, musical instruments, faucets, beauty aids, power drills and, of course, the Kindle e-reader. Asked about future plans to expand their offerings in Canada, an Amazon spokesperson would only say: "We don't have anything to add at the moment - I'll let you know should that change."
Changes might not be too long in coming. Last December, when The New York Times asked Amazon.com chief executive Jeffrey Bezos, "What is your goal, exactly?", he replied: "We want to have Earth's biggest selection."
Consumer rights or national identity?
Indeed, supporters of the Amazon deal see the government's move as one that provides "product innovation and variety" - one of the six net benefit factors considered in a government review - while dispensing with outdated restrictions that no longer make sense in the e-commerce landscape.
What hasn't been bandied about very much are terms such as "cultural sovereignty" and "national identity" - political vocabulary that to some ears sounds anathematic in 2010. Yet now might be exactly the time for that discussion. As historian Tony Judt laments, "we have made a virtue out of the pursuit of material self-interest: Indeed, this very pursuit now constitutes whatever remains of our sense of collective purpose."
But material self-interest is not what is embedded in Canada's key cultural statutes. Instead, the Broadcasting Act, for example, states that the foremost duty of public and private broadcasters is to work in concert to establish "a public service essential to the maintenance and enhancement of national identity and cultural sovereignty." In 1985, Brian Mulroney's minister of communications called book publishing and distribution a "critical sector" as "essential to our identity and our cultural sovereignty" as the press and broadcasting. But as the Amazon kerfuffle devolves into a debate over where to buy cheap books, that language and the more substantive conversation it demands, stay swept under the rug.