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Books Businesses The Almighty Buck

Author Charles Stross: Is Amazon a Malignant Monopoly, Or Just Plain Evil? 405

An anonymous reader writes "Sci-fi author Charles Stross has a post providing insight into Amazon's recent bullying tactics against a major book publishing group. He puts the fight into perspective for the two most important parts of the book market: author and reader. He says: 'Amazon's strategy (as I noted in 2012) is to squat on the distribution channel, artificially subsidize the price of ebooks ("dumping" or predatory pricing) to get consumers hooked, rely on DRM on the walled garden of the Kindle store to lock consumers onto their platform, and then to use their monopsony buying power to grab the publishers' share of the profits. If you're a consumer, in the short term this is good news: it means you get cheap books. But if you're a reader, you probably like to read new books. By driving down the unit revenue, Amazon makes it really hard for publishers—who are a proxy for authors—to turn a profit. Eventually they go out of business, leaving just Amazon as a monopoly distribution channel retailing the output of an atomized cloud of highly vulnerable self-employed piece-workers like myself. At which point the screws can be tightened indefinitely. And after a while, there will be no more Charlie Stross novels because I will be unable to earn a living and will have to go find a paying job. TL:DR; Amazon's strategy against Hachette is that of a bullying combine the size of WalMart leaning on a much smaller supplier. And the smaller supplier in turn relies on really small suppliers like me. It's anti-author, and in the long term it will deprive you of the books you want to read.'"
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Author Charles Stross: Is Amazon a Malignant Monopoly, Or Just Plain Evil?

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  • by Anonymous Coward on Monday May 26, 2014 @12:33PM (#47093355)

    The cancer analogies are VERY apt.

    • Metastasized.
      Fixed that for 'ya.

      Other than that -- Amazon, they sell MTB tires, I discovered today,
      by way of a Google link.
      Still trying to figure out why that gave me an uneasy feeling.

      I may in fact concur.

  • by PReDiToR ( 687141 ) on Monday May 26, 2014 @12:34PM (#47093359) Homepage Journal
    Go to the store and buy them! They're ace! And you can give them to your friends afterwards.

    I downloaded a crapload of them, he's really good.

    Am I making it harder or easier for him to make a living?
    • He's full of it. Charles Stross is an excellent writer, whom I will seek out and read. If he's not on Kindle/Amazon at some reasonable price THEN I WON'T BUY FROM AMAZON. Its just like you say here with buying a paperback, I will buy an iPad or whatever the heck it takes to get Charlie's books.

      The TRUE analogy here would be ESPN and Comcast. Every so often ESPN TELLS COMCAST how much they're paying for their channel, AND COMCAST PAYS IT. So, Charles, this is what you do, you tell Amazon what you ARE GOING T

  • Re: (Score:2, Interesting)

    Comment removed based on user account deletion
    • by Jeremy Erwin ( 2054 ) on Monday May 26, 2014 @12:59PM (#47093517) Journal

      Stross's novels are an extrapolation of contemporary science and culture into various futures. As a geek, you should be able to recognize the beginnings of Stross's fantasies--crypto currencies, IT culture, malware, MMORPGs, maker culture, -- and laugh as these trends are taken to their logical conclusion in the various universes he has devised.

      Now, I seek out and read hard SF. The trouble with classic works of this subgenre, (the vast bulk of which is still under copyright protection) is that it becomes obsolete. For instance, take the Bussard Ramjet-- a relativistic spaceship that was (at least for the time)theoretically possible without breaking physical laws. The Bussard Ramjet enabled a host of authors, most notably Poul Anderson, to write stories about Relativistic Time (twin paradoxes, and the like) But IIRC, the fuel density in the interstellar medium is insufficient for the Bussard scheme to work. So all those stories suffer from a patina of obsolescence.

      To avoid this, it's necessary to acquaint yourself with the writers of the here and now. Stross is one such writer.

      • He is not that good of a writer. He is ok but he is no Frank Herbert or even William Gibson.

    • I don't read much, except technical documents, so I'll move the argument to movies. I know the list of movies is much shorter than books, older special effects didn't age too well, etc. But nonetheless...

      I'm in my 40's, so I can appreciate movies from the 1970's and up, but about once or twice a month I like to browse in the "Movie Trailers" channel of my Apple TV to see what's new. And I always find at least half a dozen titles that I'd like to see, but for that half dozen list there's all the rest that re

    • Re: (Score:2, Informative)

      by Anonymous Coward

      So you're essentially saying that anyone interested in publishing shouldn't, because there's "enough books already"? Does someone SERIOUSLY have to point out what's wrong with this line of thinking?

    • by dreamchaser ( 49529 ) on Monday May 26, 2014 @01:08PM (#47093599) Homepage Journal

      I can't believe this was modded up. Just because there are plenty of good old titles doesn't mean one shouldn't read new titles. Following your logic nobody should bother writing at all. Let's just give it all up.

      Talk about drivel. Your post has it in spades.

    • Yes. We'll always need new books. Because human beings will always have new things to say in a new way. Because even if what you do might have been done before you never did it. And now that you have you join those that came before.

      We must never stop writing. Never stop thinking. Never stop making things.

    • The flaw in your argument is clear in that you are pirating books to read. The argument should work the same if you limit it to works on Project Gutenberg, which are available legally. There are more books written before 1900 than I will ever read. But I want to read books written after that, because the world has changed. You do want to read recent books by pirating them. But if there are no new books, then in some number of years all the books will be about a distant and foreign world without the same rel
    • by Frosty Piss ( 770223 ) * on Monday May 26, 2014 @01:43PM (#47093835)

      CR, you've turned this into a "paper vs ebook" argument, but I think you miss Strosss point: Amazon's monopolistic stranglehold on distribution forces the price down which puts publishers out of business. This results in Amazon being the dominant publisher, working directly with authors. But it also allows Amazon to dictate to authors what they will pay, just as they did with the traditional publishers. This is not "free market", it is a monopoly no less than Microsoft was, and it's not good for consumer choice.

      Second point: It may not seem like it here at Slashdot, but the desire to have and to hold and to read "real" books is not dead. Certain segments of the current generation might feel that way, but I don't see it. The bookstores in my town are always busy, the library in my town is always busy, and many of the books (of the so-called "dead tree" variety) are often on hold by several library patrons before I get to check them out. I suppose you're going to say "What a quaint idea! To check out a book!", but many people still enjoy the experience of turning pages...

      I know I'm probably the minority, but when I buy a technical book in electronic form, I immediately print it out and put it in a three-ring binder, much easier to locate what I'm interested and flip back and forth between sections... And here's the high-tech sacrilege: I print them out single-sided with wide margins. I use the blank side for notes...

      Now get off my lawn.

      • by Zalbik ( 308903 )

        Amazon's monopolistic stranglehold on distribution forces the price down which puts publishers out of business. This results in Amazon being the dominant publisher, working directly with authors. But it also allows Amazon to dictate to authors what they will pay, just as they did with the traditional publishers. This is not "free market", it is a monopoly no less than Microsoft was, and it's not good for consumer choice.

        There significant problems with this comparison:

        1) There is almost no barrier to entry

    • A question I have been asking myself, too.

      There are already far more books "out there" than one person could ever read. Adding to that pile is more of a marketing feat than it is filling a need (apart from the author's need to make money).

      The same applies to TV programmes. We have many more channels broadcasting repeats than we get new material. In percentage terms most programmes have been broadcast before - either a day or two before, or months / year before (and in the case of Friends or some other "c

  • by Actually, I do RTFA ( 1058596 ) on Monday May 26, 2014 @12:42PM (#47093373)

    Yes, Amazon wants no more publishers to get a cut, just them and the author. And yes, they will want to lower the author's incentive to the minimum necessary for them to write., But not lower than that.

    The publisher's aren't just representing the author. They are middle men.

    Amazon will simply replace them with one vertically integrated company.

    Worse for authors, maybe, but it owuld be beyond stupid for them to make it worse than the alternative.

    • Comment removed (Score:5, Interesting)

      by account_deleted ( 4530225 ) on Monday May 26, 2014 @12:48PM (#47093417)
      Comment removed based on user account deletion
      • The problem is as follow:
        1. Editors weed out bad titles, correct spelling, etc. so if Amazon wants to replace them, they should to do the same job as editors.
        2. Doing that, however, means there would be more costs involved and would reduce the number of titles available.
        3. Less titles available means a smaller library and less profits for Amazon.

        So, why would Amazon want to increase costs and decrease profits?

        Even if they don't care about the quality, point #3 still applies.

        • by 0123456 ( 636235 )

          1. Editors weed out bad titles, correct spelling, etc. so if Amazon wants to replace them, they should to do the same job as editors.

          That's why, last time I went to a book store, the horror shelves were full of Twilight clones and 'Steve Jobs, Vampire Hunter', novels. And why everyone I know who read '50 Shades Of Grey' gave up by half-way through. And why multiple editors rejected 'Harry Potter' before one took the clearly absurd step of asking a kid to read it and give their opinion.

      • Maybe you are looking at this wrong -- start a side-line business being an editor for these people. Are there places that will proofread a book by email for $250? Maybe $1000 to do major editing on it?

      • by tlhIngan ( 30335 ) <slashdot@worf.ERDOSnet minus math_god> on Monday May 26, 2014 @03:04PM (#47094471)

        While publishers are middlemen, at least they are at least some level of quality control. As an Amazon top reviewer, I get several times a week solicitations to review a book self-published through Amazon, and the vast majority of these are appallingly bad -- mispellings and grammatical errors abound, the typesetting is goofy, and in terms of style these authors could not write themselves out of a paper bag. An established publisher would reject the majority of these, saving consumers the time spent finding out that they are dreck, and for the small minority of authors with fledgling talent, there would be an editor who could propose changes for the better.

        Publishers do a lot, actually. All the author has to do is dump the publisher a block of text. That's it.

        The publisher's job is to wrangle up an editor to punch that text into something readable (while trying to maintain the author's vision), then wrangle a typesetter to put that text into blocks - properly formatted chapters, section headings, images with captions (and the odd forgotten image that needs to be retrieved).

        Then there are the extra matter - table of contents, indices, "about the author" bios and other matter that gets added (copyrights, ISBNs, etc). And then cover art needs to be produced by an artist. And try to catch things like low-resolution images that haven't been replaced which come out as pixelated crap in the final output.

        All that is then taken and the book is typeset - laying the tables and text in the proper styles and everything. Even ebooks are typeset to ensure that the text generally flows correctly, images line up, etc.

        Publishers do a lot. Self-publishers have to do the rest, but in general, an author is responsible for just producing the text, the publisher does everything to beat that text into something readable and wrapping it up as necessary.

        And authors can produce some strange text - some use plain old ASCII and do oddball markups, Others just bold/italic/change font sizes (it's the editor's job to figure out if that's a chapter break for the typesetter to properly format), etc.

        Printing is such a small part of books that most of the cost is everything else, hence why most ebooks actually aren't that much cheaper in the end - all that work still exists on the ebook as well - you just save on the printing/warehousing/shipping which at most is 10%.

      • I'd challenge your perceptions there, because most self published ebooks on Amazon sell for 1/10th the cost of a publisher produced eBook. Yet there is a hungry market for books that they are serving, regardless of their warts and grammatical errors. Publishers, as they currently do business, are standing in the way of that market, in fact blatantly ignoring it for their own higher profit "established" authors.
    • Amazon will simply replace them with one vertically integrated company.

      So, both malignant monopoly and just plain evil then?

    • by jonsmirl ( 114798 ) on Monday May 26, 2014 @12:50PM (#47093437) Homepage

      I have to agree with this, the need for a publisher is disappearing just like the need for a recording label. Stross should self publish and then cut a direct deal with Amazon. He'd probably end up with more money that way.

      Since he's a well know author, maybe try putting his self-published books up on Indiegogo first. He might net enough off from doing that for each book that the later revenue from Amazon is just gravy.

      • by Crispy Critters ( 226798 ) on Monday May 26, 2014 @01:45PM (#47093859)
        People who are not involved in the publishing industry think it would be great for authors to self publish. Interestingly, authors seem to think almost uniformly that it is a terrible idea. The authors, who have a very good idea just what publishers can add to the book, mostly really really like what publishers do for them.

        The authors also don't think that they will make more money by self publishing either, because they know how much less they will be writing because of the time spent on other tasks currently handled by the publisher.

  • by ustolemyname ( 1301665 ) on Monday May 26, 2014 @12:43PM (#47093387)

    The author's intentions could be summarized as, "Does this false dichotomy make me look smart?"

  • by Anonymous Coward on Monday May 26, 2014 @12:45PM (#47093401)

    Hachette has been around for quite some time. Their entry to the US market was by way of buying Time Warner books. They've bought Hyperion books too.

    So it's probably not a struggle between the big mean web store and the innocent niche publisher. I don't think either of them are even slightly concerned with your interests.

  • Squeezing your suppliers' profit margins is never a good long-term strategy. Amazon is not yet powerful enough to completely dictate to publishers; if they band together and reject Amazon, Amazon will soon be left with no worthwhile content.

    If Amazon needs more money, it can raise its prices slightly. There are effectively no viable competitors in the online book market and Amazon's prices are very low, so it does have some room to move without annoying its suppliers.

    Yes, that's too bad if you buy boo

    • by 0123456 ( 636235 ) on Monday May 26, 2014 @01:00PM (#47093531)

      Squeezing your suppliers' profit margins is never a good long-term strategy.

      Publishers aren't Amazon's suppliers: writers are. Publishers are just middle-men who get in the way.

      And, oddly enough, those writers only get about 15% royalties if their ebooks are sold through a Big Five publisher, whereas they get 70% if they sell direct through Amazon.

      Maybe you're telling the wrong organization to give everyone a fair share of the profits.

      • by turgid ( 580780 )

        Publishers aren't Amazon's suppliers: writers are. Publishers are just middle-men who get in the way.

        Amazon is a middle-man. It just gets in the way between the creators and consumers.

        • by 0123456 ( 636235 )

          Amazon is a middle-man. It just gets in the way between the creators and consumers.

          Absolutely. As I said above, writers would be better off if they could sell direct to readers.

          But that's no reason to put two middle-men in the way.

      • by Richard_at_work ( 517087 ) on Monday May 26, 2014 @01:52PM (#47093913)

        And out of that 70%, the writer now has to supply their own editors, artwork, proof readers and layout specialists. And yes, it does indeed show when many of those professions have been involved and when they haven't (I read several major published authors such as Neal Asher, Peter F Hamilton, Alastair Reynolds et al, but also read a heck of a lot of the free or cheap stuff from the Kindle store - there can be a huge difference in quality even when you aren't talking about overall story lines etc).

  • and the musican for that matter create their own distribution websites. Seriously there's power in numbers especailly with the connection and access to instant customers they already have. They just need to accept the fact that people will pirate like people will shoplift. Make the products price reflect the production/distrubution costs and don't treat you customers as criminal and they will buy.

    Even though I don't read books that much these days I do watch lots of movies/shows and if I could "buy to own"

    • by jader3rd ( 2222716 ) on Monday May 26, 2014 @03:02PM (#47094453)

      create their own distribution websites?

      In the days before iTunes that's what we had. You could browse for different stores in Windows Media Player, and pick from a variety of distributors. You could always go to different websites to find songs and books. But only the really dedicated did this. Then iTunes and the iPod came out with one place to purchase content. The existing market didn't like it because it limited choices, but it spread like wildfire to the majority of the population; finally they didn't need to make decisions on where to get content from, there was only one place to get it from. The same is happening with websites, if an app doesn't exist in Apples app store, then the company doesn't exist to most people. Browsers are feeling too nerdy, and technical for most people, and they prefer their appliance like apps.
      So the reasons why authors don't create their own distribution channels is that the majority of the population doesn't think outside of the box.

  • Amazon is grabbing publishers share of the profits? Why do we care? Publishers are just middlemen leaches. They used to add value because publishing used to be expensive. Now people could easily publish their own given a marketplace which wasn't controlled by publishers (like... amazon?).

    Amazon might drive the publishers out of business, or cut into their profits? Good.

  • by CurryCamel ( 2265886 ) on Monday May 26, 2014 @12:52PM (#47093453) Journal

    Should not the analogy continue a bit further with:
    and when there are no more Charlie Stross novels, the customers can not buy them, making Amazon's incomes diminish. At which time they have to pay more to the Charlie Strosses out there.

    Is this not just precise how capitalism is supposed to work?

    • by vux984 ( 928602 ) on Monday May 26, 2014 @02:13PM (#47094079)

      Is this not just precise how capitalism is supposed to work?

      Actually no. Not even close. This is how its supposed to work: the Charlie Strosses would just sell through different channels. The customers would buy through the other channels. Amazon would miss the income, and would pay what it took to get the novels (and customers) back.

      But that requires a competitive marketplace with multiple competing channels. If amazon owns enough of the market, then the Charlie Strosses can't stay solvent just selling through other channels. This gives amazon more power to DICTATE pricing than a functioning market would normally allow.

  • by brunes69 ( 86786 ) <slashdot@[ ]rstead.org ['kei' in gap]> on Monday May 26, 2014 @12:54PM (#47093475)

    Publishers are not "proxys for authors". They are another obsolete industry group fighting the inevitable for their survival, no different than the RIAA.

    Assume there is a world where I as an author can contract with a third party for proofreading and editing at a fixed cost, and then "self publish" to Amazon and other eBook providers, without a man in the middle publisher eating up my profits, I can sell the books far cheaper and interact directly with my audience. Many authors are flocking to self-publish nowadays and the number is just going to keep growing.

    • Comment removed based on user account deletion
      • by 0123456 ( 636235 )

        You can do that, but as an Amazon top reviewer that often gets solicitations for a review, I find that few self-published authors are doing so. With very little money to invest -- these people are often working-class dreamers -- they often have to spend what little they have on marketing, and there's just nothing left for proofreading and editing (and the result is embarassing). At least a traditional publishing house covers those costs for you.

        Publishers have been slashing the amount they spend on editing, to the point where, last time I was in a book store, one of the trade-published books I picked up off the shelf even had typos in the back cover blurb.

        Oh, and the publisher doesn't 'cover those costs for you'. They pay for them out of the 75% of the ebook royalties that they pocket before they hand the writer their measly 25%.

    • by Crispy Critters ( 226798 ) on Monday May 26, 2014 @01:56PM (#47093943)
      Many authors would rather write than worry about finding and paying for editing, proof reading, cover art, advertising, promotional travel, etc. They are capable of it, but would rather spend their time doing what they do best, which is write. Also, they would rather work under contract with some guaranteed income rather than shoulder all the risk themselves.
    • You're right that they are not proxies, and you're also right that they are obsolete. Even so, not all of the services they provide are obsolete.

      For instance, you cite editing, which is indeed one valuable service that they provide. In addition to editing, I'd also add filtering, marketing, and employing authors. The fact is, 99% of self-published stuff is utter and complete crap, a marginal step up from the entry-level stuff you'd find on a fanfiction site. Publishers perform a valuable service when they p

  • by argStyopa ( 232550 ) on Monday May 26, 2014 @12:55PM (#47093479) Journal

    Any organism will try to dominate its environment.
    Corporations are the same; they will work to optimize the merger for themselves. Then either they will dominate, or someone will come along and outcompete them, and they adapt or die.

    Let's remember that publishers Mr Stross is bemoaning have themselves acted as plutocratic gatekeepers to the public reading markets for a century or more themselves.

    Amazon's just doing it better now.

    I'm sorry if an author feels he can no longer make a living being a writer, but he isn't entitled to that occupation. He can either keep doing it because he loves it, it he can, as he said, get a real job. Sorry if capitalism is painful that way.

  • by Rix ( 54095 ) on Monday May 26, 2014 @12:56PM (#47093483)

    Amazon isn't forcing DRM on the publishers. They would be quite happy to let them sell ebooks without it.

    That and the publishers "share" of profits is exactly zero. Anything above that is a market inefficiency.

  • It hasn't been that long since publishers formed a cartel with Apple and tried to stick it to Amazon.
  • by 0123456 ( 636235 ) on Monday May 26, 2014 @12:58PM (#47093499)

    Publishers demanded that Amazon use DRM... and now whine that readers are locked in to Kindle because that DRM prevents them from moving those books to a different ebook reader.

    Any publisher who wants to can upload DRM-free ebooks to Amazon.

    • Any publisher who wants to can upload DRM-free ebooks to Amazon.

      And yet somehow even books from Baen and Tor (who don't DRM their books) end up on Amazon indistinguishable from those from other publishers.

      • by 0123456 ( 636235 ) on Monday May 26, 2014 @01:42PM (#47093817)

        And yet somehow even books from Baen and Tor (who don't DRM their books) end up on Amazon indistinguishable from those from other publishers.

        Maybe they should stop enabling DRM on their Kindle books, then.

        When you upload a Kindle book to Amazon, there's a checkbox to enable DRM. Just don't check it. Job done.

  • Amazon is just your standard psychopathic corporation.
    It has no "conscience" and it focused only on making more money. At times this is good or bad for consumers and suppliers.
    It exploits workers (good for consumers, bad for workers, good for profits).
    It (mostly) exploits suppliers (good for consumers, bad for suppliers, good for profits).
    It exploits government tax rules (sales tax, corporate tax, etc.)... (bad for tax revenue, good for consumers in the short term, good for profits)

  • by Solandri ( 704621 ) on Monday May 26, 2014 @01:06PM (#47093581)

    rely on DRM on the walled garden of the Kindle store to lock consumers onto their platform

    It's a bit duplicitous to criticize Amazon for using DRM, when the primary reason you wish to sell your book on Amazon is to take advantage of their DRM for your ebook. Non-DRMed books from any source can be converted to work on the Kindles just fine. Set up your own website, sell ebooks there, and retain 100% of the profit. Yeah a lot of people shop on Amazon, but they search with Google, BIng, and Yahoo. If your website is the primary source for your ebooks, it's almost guaranteed to rank in the top 3 search results and people will find it.

    Oh, but you want DRM on your ebooks when people read them on a Kindle? Well, just as you have the right to use DRM to restrict what readers do with your ebooks, Amazon has the right to use DRM to restrict how authors sell their books if they want to be readable on a Kindle. Sorry, them's the breaks. Live by DRM, die by DRM. Don't expect me to shed a tear because someone is arbitrarily restricting your options, when that's exactly what you're doing to me.

    • by Luthair ( 847766 )
      Amazon also allows DRM free books, its the publisher requiring DRM....
      • by 0123456 ( 636235 )

        It's a shame they don't explicitly tell you which books are DRM-free. I believe any ebook that lists 'simultaneous device usage unlimited' on the Amazon page is DRM-free.

  • Tor and Baen don't do DRM. That's a very good start.

    There may be others, too, but it's remarkably hard to find out who they are without buying a book to find out you can't read it. Anyone care to contribute to the list?

    • Re: (Score:2, Insightful)

      by 0123456 ( 636235 )

      Again, it's not 'Amazon DRM'. Amazon don't care whether publishers enable DRM on their ebooks. The publishers enable DRM, then whine that it ties people into Amazon. Well, fscking duh.

  • Publishers, especially Elsevier, deserve a good kicking. They've profited by screwing authors and customers. They've done all in their power to hold back progress, for the sake of their antiquated and extremely inefficient business model. They've crossed the line repeatedly, suing customers, clinging hard to bad logic (copying = stealing, DRM is good and it works). and spewing propaganda based on it.

    Authors, whom one might expect to be just a little wiser, a little more in touch with reality, have, wit

  • Are those my only choices? I mean, Amazon is not a monopoly, because I can buy all that stuff at other places, so that just leaves plain evil. So I guess I am forced in to answering that Amazon is just plain evil?
  • This is the similar argument made by authors that can't get a manuscript published, by one of the larger houses.

    In the simplest terms, markets (in free economic systems) are constantly be reshaped by innovators. The book market is only becoming more efficient and all authors will have to price their wares according to demand, not some artificial pricing structure based on the authors reputation (i.e. I wouldn't value something ghost written for Hillary Clinton or Al Franken as toilet paper).

  • Amazon is not close to being a monopoly; they sell about 30% of all books.

    Another issue is that of course Amazon wants to keep authors writing new books. Without a good flow of new titles Amazon won't sell as much and their business will decline.

    What Amazon does want is a larger share of the profits in the book market. A good part of this is Kindle of course. Getting customers hooked on Kindle vs physical books is a big deal.

  • by edibobb ( 113989 ) on Monday May 26, 2014 @01:51PM (#47093899) Homepage
    Take a look at Amazon's patent history. First, they kill Barnes and Noble with one of the most obvious and trivial patents ever issued, the infamous 1-click patent, and now they've patented a photo on a white background. Very nice. https://www.eff.org/deeplinks/... [eff.org]
  • Comment removed (Score:5, Informative)

    by account_deleted ( 4530225 ) on Monday May 26, 2014 @02:12PM (#47094069)
    Comment removed based on user account deletion

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