BusinessWeek: Behind the Toys 'R' Us-Amazon Spat
Toys 'R' Us sued Amazon to prevent it from continuing to let other retailers sell toys on its ecommerce site. The toy giant secured a long-term exclusivity for that privilege a few years ago, paying Amazon.com $50 million per year for it to handle its online toy sales. But as Amazon stretched to try to include eBay-like functionality and make more perfect markets for new and used products, it slowly started to let toys leak into the fray.
The spat - unlikely to dislodge Toys 'R' Us from Amazon, but more likely to enable it to get off the $50 million hook - may show that market demands for a fluid market and comprehensiveness of offerings may prevent exclusivities from seeming like a smart idea in the future, as well as retrospectively.