AmazonFail, Part 2?

[lagilman]

EtA:2: the discussion here really isn't about "how much should e-books cost?" That battle is ongoing and I suspect will work the way most things do -- by what people are willing to pay for the desired resource. Let's not get sidetracked....


The news broke on Twitter late last night -- Amazon had pulled first all Macmillan ebooks, and later all Macmillan books (incl Tor) from their site. You could buy them via 2nd party sellers, but not directly from Amazon. The assumption is being made that this related directly to Macmillan's agreement regarding the iPad.

This all happened at the start of the weekend -- interestingly, the same time as Amazon's "glitch" that deleted all links to gay-themed books a while back -- so there hasn't been any official word from anyone. But I'm inclined to be of the "fool me once" philosophy when it comes to Amazon's weekend glitches, myself.

Something to definitely keep an eye on, especially if you a) have books out from one of the publishers involved with Apple, or b) you're a reader who dislikes the idea of one retailer dictating what will/won't be made available to you-the-consumer.

This isn't about pricing; it's about control. Amazon isn't doing this to keep prices down for the readers, it's fighting to the death for its majority market share. Once they have it -- they will have readers over the barrel even more than before.


NYT linkage: http://bits.blogs.nytimes.com/2010/01/29/amazon-pulls-macmillan-books-over-e-book-price-disagreement/

BoingBoing coverage: http://www.boingboing.net/2010/01/29/amazon-and-macmillan.html

EtA: There's now a squib on the front page of BookView Cafe with appropriate links and graphics that says: Book View Cafe Ebooks: All our titles available 24/7/365...unlike some places.. I <3 my publishing co-op, I really do.

Comments

[scbutler.livejournal.com]

Wha' fu'?

[severedscythe.livejournal.com]

Oh, bugger you amazon.

[chickwriter.livejournal.com]

Bah humbug. Who loses? The authors and the readers.

I'm with you on the "fool me once" - I could buy a data glitch that last time, since I work with data in my day job, but this? Nope, not buying a glitch or anything else than pricing wars.

I vote we all go buy Macmillan/Tor books from our local indy bookstores, or at our favorite indy bookstores. Most stores have online purchasing, after all.

[sinboy.livejournal.com]

Oh they really screwed the pooch on this one. Authors have lots of social cred, and this is a really good reason to stick it to Amazon.

Also, Oh hai, gym buddy.

[lagilman]

*waves from the sofa, being a slug*

Authors don't have as much cred as we like to think we do. But hopefully this thread will get people to think. That's all I ask, really...

Amazon is totally right and MacMillan is totally wrong

[(Anonymous)]

MacMillan gets to set its wholesale price. Amazon gets to set the retail price. That's how it works. MacMillan wants to change that, in order to screw consumers and for no other reason. They think they can do so now because Apple will give them another venue - one with a price floor they've been allowed to dictate. Oh, and apparently the price floor on the ibookstore will apply to ALL sellers. So tell me how MacMillan is fighting for the consumer here?

Re: Amazon is totally right and MacMillan is totally wrong

[lagilman]

1. why did you not see fit to sign your name to your post? I find it very difficult to take nameless blustering posts seriously, which is why Suri's First Law about identifying yourself stands. You're being incredibly rude.

2. This fight has nothing whatsoever to do with Macmillan. Please look at the facts.
a) Amazon sets their prices, and tried to bully publishers into agreeing that this should be the ONLY price, no matter their initial costs to produce the book.
b) Apple comes along and says "we have this hardware that's new and nifty and we'll work with you on the pricing."
c) Two days later, Amazon pulls all the books belonging to a company that signs with Apple, meaning that no consumer has access to those books until everyone kowtows to Amazon

As I said, this is not about "fighting for the consumer." This is about fighting for market share. History does not say good things about what happens to the consumer, once a monopoly in anything has been achieved.

[mtlawson.livejournal.com]

Interesting that a not insignificant number of commenters on the NYT blog are lining up to say that books are too expensive as it is. I expected people to be heavily anti-Amazon on this, but so far that's not the case.

[chaoticgoodnik.livejournal.com]

If you're not a re-reader, you probably do think that $9.99 for something that you'll use once is too expensive.

I am a re-reader and I kind of grumble at paying $7.99 or $8.99 for a mass market paperback.

[lagilman]

They're thinking short term "hey, Amazon's cheaper!" rather than looking at what's really going on.

[6-penny.livejournal.com]

Interesting that no one in Justice thinks that books are sufficiently important for antitrust investigation.

[lagilman]

There already has been a DoJ intervention regarding the Google Settlement, which is part of why there was a second Settlement offering. They're watching.

[joycemocha.livejournal.com]

May I put in a word for Powell's online book services? Besides being an indy, they do a very good job of carrying stuff--and since they're tied in to a bricks and mortar store, I'd think they'd be less likely to pull an entire publisher's set of books.

[jhetley.livejournal.com]

As if we needed a reminder of the arbitrary and implacable Fates that rule a writer's life . . .

[black13.livejournal.com]

What do you expect of a company that only "leases" e-books to the customer (remember the Orwell Kindle Fail?) when someone threatens their almost monopoly?

This is really a war between Amazon and Apple, and Macmillan got caught in the middle.

I'll read up on this and blog about it tomorrow.

[blitheringpooks.livejournal.com]

And a tweet from smart bitches that is retweeted by dear author, proposing that the readers be represented by a skull and crossbones, as pirating now seems the way to go?

Frosting on the steaming pile of shite.

[lagilman]

niiice. *facepalm* "Dear Author" likes to fling poo as a primary source of recreation, but I had thought there was more understanding of the situation at Smart Bitches.

People, all I'm asking is that you know WHO is manipulating you and WHY. Then go make your own decisions, yes. But don't be manipulated blindly okey doke whatever you say, George to save a dollar in the short run.

[roseaponi.livejournal.com]

Considering Amazon just lost an antitrust lawsuit to some mom & pop POD self-publishing companies, it's slightly bizarre that Amazon is now slamming a regular publisher. See: http://www.writersweekly.com/the_latest_from_angelahoycom/005832_01202010.html if you're interested in what Amazon tried to pull in order to force everybody but their own POD division out of business - or at least out of the Amazon database. Apparently it's company policy to attempt to roll right over everybody else.

[lagilman]

Apparently it's company policy to attempt to roll right over everybody else.

It always has been. That's their business model, and it's been successful. And they use that market share to demand favored terms from their suppliers. This is why it frustrates me that people think they're somehow "pro-consumer." No, they want you to have no teat other than their own. And then...

well, odds are they'll roll right over consumers, too.

[jslinder.livejournal.com]

The logic of this escapes me, and I am calling fail on both sides.

Amazon has the right to choose not to buy items above a certain wholesale price and to set the retail price. That's well established, be it an e-tailer or retailer.

MacMillan has the right to refuse to sell below a certain wholesale price, and has no influence on the retail price other than through wholesaler funded promotions. Also well settled.

That's a price dispute, it happens all the time, and does result in products being pulled from shelves. Fine.

The issue here is how its being handled. If Amazon stepped up and said 'look - we can't agree with them on pricing right now so sales are on hold' people would have been pissed, but probably understood. Ditto if McMillan did the same. Instead, this stealth tactic just makes everyone look petty. It reminds me of contentious union negotiations here in Philly area, minus the arrogant sound bites.

Yes, there are meta issues here, dominance in the e-book market, pricing of different versions, but those can all be worked out over time, and if the parties involved decide to behave like adults, this will probably end well. (Also in the meta-ebook-world, if they could decide on a common format, even with DRMS then the companies could compete on device features, price, and service, as they really should)

BTW, they did NOT pull existing titles from the Kindle if already purchased...Many McMillan titles were not Kindle avail before anyway,

[lagilman]

If it had stayed where it was -- in the ongoing negotiation phase -- none of us would be yowling right now, agreed. Many of us would be deeply nervous, but we've been nervous for years now, watching the already slender margins in publishing get sliced to the bone.

Ditto if McMillan did the same. Instead, this stealth tactic just makes everyone look petty.

I'm not sure how Macmillan is looking petty, as it's possible, yes, but highly unlikely Macmillan was the one who pulled their books from the shelves and went home without warning...

[ex-fashioni.livejournal.com]

This isn't about pricing; it's about control. Amazon isn't doing this to keep prices down for the readers, it's fighting to the death for its majority market share. Once they have it -- they will have readers over the barrel even more than before.

This is so freakin' brilliant and to the point and frankly, obvious, that I just can't see why others don't see it this way. (And can I quote you on this?)

What's interesting about Sarah (at Smart Bitches) is she said on Twitter that while she owns a Kindle, she buys her e-product elsewhere, cracks the DRM, and downloads it onto the Kindle. I doubt there are a majority of consumers who go to such effort, but it does provide an interesting spin on things.

[lagilman]

quote away.

I admit, I'm wearing my businessperson-editor hat here rather than my writer-hat. If I start thinking about the crap royalties being paid out via most "consumer acceptable" pricing on e-editions, I'll cry. Just have to hope that publishing et al manages to adjust so's not to starve their golden geese to death...

[kriz1818.livejournal.com]

Ya know, continuing to buy from Amazon just because I'm used to them is beginning to seem downright foolish. It's not like there aren't other online sources of books now. I just bookmarked three of them.

[jslinder.livejournal.com]

Amazon's big draw for me (besides my Kindle) is the Prime shipping option. I can order a lot of stuff, not just books, with free shipping, no tax, and no trip to the store (and in the world of a consultant, time is money) with my total shipping cost being $79 per year. As an example, 90% of the xmas shopping for nieces and nephews was done on-line in 20 mins, because we have them do Amazon wish lists over the year.

And what about us?

[otterdance.livejournal.com]

I knew I'd find a lively, informed conversation here. :-) I'm not as erudite as some here, so please forgive me if I babble, but these are the thoughts running around my head this morning.

This certainly is a clash of the Titans situation and one in which we writers find ourselves caught in the middle. This is a power struggle between them right now, but the fallout lands on us. What IS content worth? When you take out paper, trucking, warehousing and the like, how much does it cost to make a book? Not much, especially since writers are delivering manuscripts already in electronic format. At least I am. So the publishers don't need to factor in those costs. That leaves the labor-- editing at various levels, art (if books are still going to have covers), promo (yes, I'm laughing, too), and creating the actual file that gets downloaded. That HAS to be significantly cheaper than producing a material book.

So shouldn't e books be cheaper? Why charge hardcover prices for a file that contains no more content than a paperback? One you can't display proudly on a shelf with your Niven and Bradbury first editions, one you can't get signed? And one that's difficult, if not impossible, to share with friend, donate to a library or nursing home, or sell at a yard sale when you're done with it?

If the publishers are going to reap a higher profit on ebooks, with lower production costs, then some of that damn well should trickle down to writers, and it's time we get our act together, herd the cats, and organize. Eight percent? Ten percent? Suddenly it doesn't make much sense, does it?

For the first time, I can actually see self e publishing on the horizon as a real possibility, even with all the poorly written, badly edited crap that will probably flood the market.

Re: And what about us?

[jslinder.livejournal.com]

The meme that e-books are vastly cheaper to produce is not as true as some might think. Yes, the physical production and delivery costs are lower, but that's actually a relatively small part of the cost when it comes down to it. Overhead, marketing, acquisition, editing, pre-production costs all are effectively the same on an electronic and paper version..

Cnet has a decent breakdown..

http://news.cnet.com/8301-13556_3-10250017-61.html

[otterdance.livejournal.com]

OK, so I'm just another whiney little author. But I still say it's unfair to play the bestseller card as the example. It's a different ball game.

[lagilman]

Oh, I totally agree. The not-untrue joke is that "bestsellers" is as much a specific category as anything else, and different rules apply, same as mainstream doesn't work the way genre does and vice versa. Using bestseller stats to discuss publishing overall is a flawed argument from the start.

[jslinder.livejournal.com]

You could make the case that 'bestsellers' benefit from an inherit marketing advantage, but I don't think that significantly skews the overall numbers to make them an outlier. The per-book profit overall may be a tad higher (based on sheer volume over fixed costs) but I suspect additional royalties, marketing expenses, etc eat into that.

[lagilman]

I don't think that significantly skews the overall numbers to make them an outlier


Okay, at this point I need you to trot out your bonafides/experience for the discussion, so people know what you're basing this on. Many thanks.

Scalzi's post on 'Amazon Hijinx'

[(Anonymous)]

http://whatever.scalzi.com/2010/01/30/a-quick-note-on-ebook-pricing/

I was just on Amazon and d**n there are a lot of books I've read or purchased (usually not on Amazon) there are currently unavailable.

If the used sellers are smart they could make a killing in sales this weekend.

[jslinder.livejournal.com]

This is an update on the NYT article (linked above), looks like posted about an hour ago - still unconfirmed other than 'anonymous source' but points the finger squarely at Amazon:

"Motoko Rich, my colleague, spoke with a person who had a direct conversation with a person at Macmillan familiar with the conversations with Amazon. Macmillan offered Amazon the opportunity to buy Kindle editions on the same “agency” model as it will sell e-books to Apple for the iPad. Under this model, the publisher sets the consumer book price and takes 70 percent of each sale, leaving 30 percent to the retailer. Macmillan said Amazon could continue to buy e-books under its current wholesale model, paying the publisher 50 percent of the hardcover list price while pricing the e-book at any level Amazon chooses, but that Macmillan would delay those e-book editions by seven months after hardcover release. Amazon’s removal of Macmillan titles on Friday appears to be a direct reaction to that."

The comments on that article are very enlightening as to people's perception of the relative costs of e-books (which of course we have already discussed)

additional fodder for ths discussion

[lagilman]

It's been pointed out elsewhere that Amazon pulled this crap once before, about two years ago, with a UK publisher who wouldn't agree to their sales terms. That, from what i recall, was done within the context of an ongoing negotiation, which does not appear to be the case here [somebody would have commented on it by now: publishing gossip wouldn't know a gag order if it came with an actual ball and gag].

However, that does establish this as a tactic in Amazon's arsenal.