Amazon has launched its long-rumored wine marketplace, offering just more than a thousand wines from several dozen wineries across the United States. That may be a modest start, but wine consumers and industry members are very curious about how the Internet retail giant's effort will fare and whether it will have a long-term impact on selling wine. The new Amazon Wine portal allows consumers to sidestep the wholesale middleman by buying wine directly from wineries. Producers already available on the site include Gloria Ferrer, Margerum, Francis Ford Coppola and Flora Springs from California and Fox Run from New York’s Finger Lakes. While Amazon draws more than 100 million unique visitors a year, before winemakers and consumers get too excited, it’s important to note that orders placed through Amazon face the same well-established interstate shipping limitations. If a state doesn’t allow outside wine shipments or a winery doesn't ship to that particular state, Amazon can’t fix that.

For consumers, the online experience is no different than buying a book or laptop. Amazon processes the order, calculates the cost, shipping and other fees and then bills your credit card. The difference with the new portal is that the winery takes it from there, packing and shipping the wine and ensuring that all laws are complied with. The program is different from wine that is already being sold through Amazon by third-party wine retailers. One of the main benefactors of the Amazon deal could be small wineries that have little to no distribution around the nation. It could also help more established wineries looking for more visibility. “The ability to reach the consumer directly is the wave of the future,” said Stacy Bennett, vice president of digital marketing at J Vineyards in Sonoma County and a former Amazon executive. “Sales are not really our primary goal. It’s more about brand awareness.” Mike Reynolds, president of Kathryn Hall winery in Napa Valley, shared a similar view.

“This is about reaching a customer base we haven’t reached before. There’s a group of consumers out there who buy most of their stuff from Amazon.” is based in Northern California and already ships about 2.5 million bottles a year to 40 states, either directly or through wholesaler partners. The new site will let them also sell directly from wineries to consumers in 20 states. CEO Rich Bergsund said one of the goals is to focus on small producers with limited distribution, large-format bottles and wines sold only in winery tasting rooms. also works with importers that have California wholesale licenses. “For us, imports are already half of what we sell online,” Bergsund said. handles all of the shipping, logistics and legal compliance for wineries. —but the cost to wineries is more complicated. , according to Bergsund, charges producers a typical retailer markup of about one third. While Amazon officials declined comment, company documents obtained by Wine Spectator break winery costs down: a $40 monthly subscription fee, a fee of $49 for every $350 in sales, plus a 15 percent commission or referral fee.

Not exactly a bargain, but as Reynolds put it, “We felt it made sense for us.” , clearly vintners are curious and keeping an eye on the future. After all, this isn’t the first time Amazon made a big move into wine. , which did not survive the dot-com bust. glass of wine cupIn 2009, Amazon pulled the plug on plans to launch a new website devoted exclusively to wine, concerned that the regulatory barriers against shipping alcoholic beverages within the United States were too prohibitive.one hope wine party The third time might be the charm.best wine glasses manufacturersProhibition — the constitutional amendment that made it illegal to manufacture or sell alcohol in the U.S. — ended 76 years ago. best red wine for halloween

But its legacy is still with us. has killed its plan to sell wine through a business called AmazonWine (which it brought back in another form three years later). It has been running a pilot program for about a year, testing the incredibly complicated logistics involved in selling wine to 50 different states. best white wine under 10 dollarsLast week, though, it said enough was enough. lowest price built in wine coolerThe company didn’t give a reason, but most people who are supposed to understand these things say Amazon couldn’t solve the distribution problems.cost to open a beer and wine store Or, as industry consultant Jon Fredrickson, who knows as much about this stuff as anyone, put it: “People have no idea how complex this is, dealing with 50 different [state] governments. basic red wine varieties

You wonder if a company like Amazon, which is well organized to sell just about anything, can’t pull it off. But wine is different from anything else they are selling.” And those distribution problems are a result of Prohibition. buy new zealand wine in usaThe political compromise that ended Prohibition allowed each state to regulate alcohol in its own way, and they have — in ways that are completely unimaginable. New Yorkers can’t buy wine in grocery stores. Montgomery County, Maryland, residents can’t buy wine at retailers like Cost Plus World Market, but residents of adjacent Prince George’s County can. There are not just 50 laws for 50 states, but laws that vary from county to county within states, and even — get ready for this — different laws within the same city. In Dallas, for example, I live in a wet area. Go a mile or so north, where Dallas is dry, and ordering wine on-line (to say nothing of buying it in person) is a completely different legal proposition.

It’s no wonder then, that Amazon gave up. I have been writing about on-line wine sales for as long as there has been such a thing, and no one has succeeded. (which Amazon invested in) failed. has limited reach, with wine sales to just three dozen or so states. So why are we still hampered by a ban that ended almost eight decades ago? Because the system of 50 laws for 50 states works best for those who have the greatest financial stake in it — independent retailers, the distributors who sell wine to all retailers, and the legislators who write the laws and get campaign contributions from the first two groups. It’s called the the three-tier system, and it’s the law in every state. Consumers, with some exceptions, must buy wine from retailers, which must buy from distributors, which buy from the wineries. Retailers can’t buy direct from the winery (which drove warehouse giant Costco to unsuccessfully sue Washingon state) and consumers mostly can’t either. The three-tier system almost makes it unwieldy at best, and impossible at worst, for on-line retailers to do business.

I don’t want to get into an argument about whether the three-tier system is good or bad — there are arguments to be made on both sides. I will note, however, that wine, beer, and spirits are about the only industries that have their distribution systems mandated by law. If I want to buy a TV, I can buy it from an independent retailer, a national chain, on-line or direct from the manufacturer. So why should wine be any different from buying a TV? The other thing to note is that distributors and independent retailers do their utmost to keep the system in place. I understand this — retailers are terrified of competing with national chains that can underprice them by buying direct, and distributors are even more terrified of losing gigantic accounts like Costco and Walmart, which would buy directly from the wineries and bypass distributors if the three-tier system didn’t exist. But I’d also argue, and I have said this to retailers and distributors, that the three-tier system is not forever.