Friend of the blog David Gaughran eviscerates the Authors Guild and its letter to the DoJ about the ebook price-fixing lawsuit:
It’s official: the Authors Guild has lost the plot. In their (seemingly endless) quest to smear Amazon, they don’t care who they wheel out as an injured party. Spoiler alert: it’s PublishAmerica. Yep, you read that right.
Unsurprisingly, the Authors Guild’s letter barely mentions the voluminous (actual) evidence that the Department of Justice have compiled in relation to the price-fixing allegations, but instead focuses on a company not named as a defendant in this case: Amazon.
How Amazon Captured 90% of the Market
From the AG’s letter:
It was precisely this practice – selling frontlist e-books at below cost to discourage and destroy competition – that helped Amazon capture a commanding 90% of the U.S. e-book market.
Completely untrue. When Amazon released the first Kindle in November 2007, there was no real e-book market to speak of. According to the American Association of Publishers, e-books were only responsible for 0.6% of trade book sales at the time. The market was tiny and Amazon’s only competition was a half-hearted offering from Sony, which was plagued with supply problems and limited title selection.
Amazon essentially created the e-book market in America. By the time Apple and Barnes & Noble had woken up to the fact that there was real money to be made in e-books, the market had grown by 600% (to 3.2% of all trade books sold) – with most of those new customers buying Kindles.
In short, Amazon got to (an estimated) 90% of the market because they were the only ones really playing the game, and the market was so small that a focused offering could make serious inroads.
The Authors Guild & PublishAmerica
The rest of the letter is just as bad, and I’m not going to waste time going through it all. …
Instead, I want to focus on one particular section – the Authors Guild’s summary of the tactics Amazon used to establish CreateSpace (formerly known as BookSurge, who Amazon purchased in 2005).
Quoting from the original letter:
More importantly and profitably to Amazon, by forcing iUniverse and other author centered on-demand service providers to use BookSurge, Amazon severely constrained effective competition for its own author centered on-demand service provider, which became known as CreateSpace in 2009. Amazon’s vertical integration of on-demand printing eliminated the ability of iUniverse, PublishAmerica, XLibris and others to offer authors better royalties when selling through Amazon. CreateSpace appears to have thrived ever since.[Emphasis mine]
The first time I read that, I was in shock. The Authors Guild are so desperate to tar Amazon that they are willing to roll out PublishAmerica as a victim. And the more I think about it, the more mad I get. Really? PublishAmerica? Are you serious?
For those unaware of the checkered history of PublishAmerica, a quick summary:
1. They are one of only two organizations to earn the dubious honor of having their own sub-forum on Absolute Write’s Bewares & Background Checks (the other being Robert Fletcher’s infamous web of companies).
2. Preditors and Editors have a lengthy entry warning writers away.
3. The Better Business Bureau rates PublishAmerica as an “F”.
4. The leading industry watchdog – Writer Beware – regularly cover PublishAmerica’s various attempts to squeeze money out of their writers (e.g. here, here, here, here, here, and here – and that’s just the tip of the iceberg).
In short, PublishAmerica is probably the last place I would recommend to a writer.
However, the Authors Guild feels that PublishAmerica’s rights have been trampled upon. If Amazon hadn’t been such a bully, PublishAmerica could have gained more customers. Will Amazon stop at nothing in their evil quest to take over the world?
The Authors Guild should be ashamed of themselves.
There is much more in David’s post on his blog: The Authors Guild Doesn’t Serve Writers. In particular, I clipped David’s excellent summary of the events leading up to this latest nonsense from the Authors Guild and his exposé of the cozy relationship between the Guild and iUniverse, both of which are essential background for fully appreciating the game the Guild is playing.
I want to call attention to David’s point about how Amazon achieved its position in the ebook industry because the publishing industry and its sycophants continually try to elide that bit of knowledge from the history. And, of course, David has done yeoman’s work in rounding up the links necessary to get a feel for the nature of PublishAmerica, the victim in the Guild’s alternate reality.
-Guest post by William Ockham