Leaving the high moral ground issues and marketing matters
aside for a moment, the book battle between Amazon and several major publishers
is initially about the use of different business models, especially as it
relates to the burgeoning e-book phenomenon.
Amazon embraces what we have come to know as a wholesale model. That is, the bookseller pays so much for each
book and they may sell it for whatever they want — even use it as a loss leader
if they choose. Most major publishing
houses wanted what’s called the agency model — that is they set the cost to the
bookseller and also set the price for the purchase. In other words if the publisher wants the
book sold at $12.99, booksellers must do that.
Of course, in both cases, the publishers and booksellers would make a
profit, but in the agency model, there wouldn’t be any pricing flexibility for
the retailers. No special sales or discounts, unless the publisher approves it.
Legally, the publishing houses might very well have won the
day when the dispute went to the court because, while it may not afford the
public or in some cases the writer the best possible deal, agency pricing is
not illegal. Many companies in many businesses that have strong brand
recognition and customer loyalty can and do demand that of their retailers. But there was something else that the judge
didn’t like about the situation. The
publishers, it is alleged, got together with each other and with Apple to set
prices and policies. If it's true, it is
collusion and that is illegal.
As of today, three of the world’s largest publishers have
settled with the U.S. District Judge, agreeing to end their current agency
agreements — for the time being.
MacMillan and Penguin plan to fight the suit with the continued support
of the highly respected Authors Guild, an association of published writers, and
the American Booksellers Association, whose noble cause it is to support
independent bookstores. They have a counter accusation. They believe
that Amazon is guilty of predatory pricing.
And certainly a case may be made for that. Nonetheless most folks,
whether they liked the judge’s decision or not, seem to think Amazon won this
round big time.
This is generally regarded as a win for readers who will
likely benefit from lower prices on reading material. But there is an argument that it will hurt
the quality of the work in the long run because publishers won’t nurture and
support their writers if they can’t ask for higher prices on e-books. And there is also an argument that if Amazon
(and perhaps Barnes & Noble) has this advantage, the result will further
damage independent bookstores because of these lower prices.
As a writer, surviving as such by the skin of his teeth, I
have divided loyalties. As an older
human, a veteran of the print media in many of its forms, a devoted library fan
and a more than frequent visitor to bookstores, where I buy books on paper, I
want very much to see the sacredness of the book in its traditional form be
eternal.
Amazon CEO and Founder Jeff Bezo |
As a midlist writer, likely approaching the end of his
career, there is a flicker of hope that e-books and booksellers like Amazon
will be entirely more friendly to my aspirations than traditional publishers
have been. Publishers, despite arguments
to the contrary, are and probably must be dismissive of writers who haven’t
achieved a brand name level of recognition. Unless a writer is a big name or can become one quickly,
you are not a product that publishers can promote or big booksellers can sell,
save Amazon or-late-to-the-game Barnes & Noble. I say this as a member of
the Guild, as a writer recently published by Penguin and, again, as a person
who buys his books from independent bookstores.
And I say that as someone who has never read a complete book — other
than my own during the editing process — on anything battery operated.
However, I like to think of myself as a realist. While the specific direction of publishing
and all its possibilities cannot be foretold, the general direction is
clear. What we are witnessing is an
adjustment in keeping with all the adjustments we humans are making in all
areas in an increasingly inter-connected world.
Just as third world countries jumped from having no telephones to
suddenly having smart ones, just as we are now downloading movies on Wi-Fi,
getting our news on i-pads, covering wars with twitter and getting our maps
without unfolding that giant piece of paper over the steering wheel, we will
eventually get most of our books on a device or on multiple devices. The transition may not be absolutely total,
but it is inevitable.
The battle that we are witnessing has nothing to do with
serving you the reader or, frankly me, the writer. The battle is about who owns the business. It’s
a battle waged by CEOs and boards of directors, shareholders and public
relations firms. It was truly difficult
to feel the pain of Borders as a corporation in a capitalist society when they
ran aground, when only a short time earlier they cleverly and coldly defeated
their competition. They were responsible for shuttering the doors of who knows
how many small book businesses, just as Starbucks brought an end to a zillion
mom and pop corner coffee shops.
But consumers embraced the huge bookstores for awhile. Read a book, have a scone, pick up a date. Some writers thrived, especially the best
selling ones. On the other hand, many of
us, writers with a modest but loyal following, suffered from brand-name
dominance the big box bookstores provided. Many of us, successful in the
previous book world populated by independent bookstores and libraries, where we
could get some attention, were tossed out of our comfy nest by the success of
Borders and its big box cousins who lusted after the best selling brands.*
Scott Turow, President, Authors Guild |
Then Amazon happened. Live by the sword, die by it. The big stores were victims of changing times,
new technology and, apparently, smarter competition. When the e-book revolution
began, Amazon led it. Now Amazon is
threatening to blow the lid off the publishing establishment, not just in the
pricing of e-books, but as publishers themselves. What we are witnessing with these lawsuits is
the ugly grappling among corporations, all of them — Apple, Amazon, and half a
dozen conglomerate publishers not to mention other vested interests — all larger
than you and I — as they play king of the hill.
As an old-fashioned consumer and a writer in need of
occasional inspiration, I am not happy about this. I love walking into bookstores. It’s inspiring in a way that searching the
pages on Amazon’s web site isn’t. But as
a writer, who likes to write and wants to be read, I have to either give up the
idea of being published — or adapt. And
there are some advantages to the average writer when some of the old-fashioned
limitations are lifted. One of them is
that we don’t have to sell 100,000 copies to succeed.
In the end, I think, we all have to understand, there are
fewer and fewer video stores, very few public telephones, almost no yellow
pages and fewer and fewer watches. The
time, like everything else, is on the smart phone. When travelers pack for a long trip, they
don’t have to have an extra bag for their books. When they drive, they can have their device
read to them. If they are in a strange
place with nothing to read and no place to buy a book, they can download one,
instantly and for less. What do we think
is going to happen?
I repeat, the battle isn’t about you and me. It’s about who owns the business. There is the old guard and the new one. And as it is in any other business, there
might very well be some bright exceptions to the trends — maybe some exciting
niche publishers. Maybe there will be
new ways writers can (successfully) get into the marketplace on their own — and
it is far more difficult that some would lead you to believe. But I’m not sure the future of publishing is
in the court system or in trying to circumvent the future. It will come through smart ideas, through
innovation.
The times, someone once said, they are a changin’.
*Post script: Nothing
wrong with best selling authors. I am a
fan and regular reader of several of them.
My point is only that when big box bookstores ruled, many midlist
writers were dropped because of economies of purchase and difficulties of
distribution. The rise of Amazon, while
it doesn’t diminish the sales of the great brand names, allows greater potential
for writers with smaller followings to publish as well and continue to gain
notice if the work warrants it.
1 comment:
What a concise and thorough assessment! Well said.
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