Home » Amazon, Big Publishing » Amazon Gets Increasingly Nervous

Amazon Gets Increasingly Nervous

9 August 2014

From John Scalzi:

Amazon is not in the least bit happy about the full-page ad some authors have placed into the New York Times this weekend, complaining about its tactics in its negotiations with Hachette, so it is perhaps not entirely coincidental that this weekend Amazon is trying a new tactic: Trying to convince readers that it is in their best interest to favor Amazon’s business needs and desires.

. . . .

But as a propaganda move, it’s puzzling. A domain like “ReadersUnited” implies, and would be more effective as, a grassroots reader initiative, or at the very least a subtle astroturf campaign meant to look like a grassroots reader initiative, rather than what it is, i.e., a bald attempt by Amazon to sway readers to its own financial benefit. Amazon isn’t trying to hide its association with the domain — it’s got an Amazon icon right up there in tab — so one wonders why Amazon didn’t just simply post it on its own site, to reinforce its own brand identity. The short answer is likely this: It’s just a really clumsy attempt to reinforce the idea that Amazon is doing this for readers, rather than for its own business purposes.

. . . .

3. Amazon’s new(ish) argument appears to be that the eBook is a new and amazing medium (which is in many ways true), and compares it to the paperback disrupting the publishing industry before World War II. Well, let’s talk about that for a second.

Leaving aside that Amazon’s initial phrasing of their argument seems to be largely and clumsily lifted from a Mental Floss article, and that paperback books existed well before the 1930s — see “penny dreadfuls,” “dime novels” and “pulps” (further comment on these and other flubs here) — the central problem with Amazon’s argument is economic, to wit, it’s trying to say that its drive to have all eBooks priced at $9.99 is just like paperbacks being priced ten times cheaper than hardcover books.

Well, except that $9.99 isn’t one tenth of the price of a hardcover book, otherwise hardcover books would regularly cost $100, which admittedly is a bit steep. $9.99 is something like 40% of the cover price of most hardcovers, and since most retailers discount from the cover price of a hardcover, the real-world price differential decreases from there. This is hardly the exponential cost savings that Amazon wishes to embed into the mind of the people to whom it is making its argument.

Link to the rest at John Scalzi and thanks to Ashe for the tip.

Oh, the hardcovers again.

One of the key indicators that Big Publishing is entirely uncomprehending about what this technology disruption is all about is their attempt to prop up their hardcover business by utilizing high ebook prices.

This is small-scale tactical thinking, lets-preserve-next-quarters-earnings-so-we-get-our-bonuses thinking.

Here’s a hint: It’s not going to work.

Ebooks are the future of books. Hardcovers are Pottery Barn merchandise, too expensive for the masses of readers and on their way to becoming fashion accessories. Yes, some people will continue to enjoy and purchase hardcovers, but the prices will go up as the sales volume goes down. And down. And down.

This rear-guard action by Big Publishing and its camp followers reminded PG of an old Bob Dylan song:

You’ve been with the professors
And they’ve all liked your looks
With great lawyers you have
Discussed lepers and crooks
You’ve been through all of
F. Scott Fitzgerald’s books
You’re very well read
It’s well known

Because something is happening here
But you don’t know what it is
Do you, Mister Jones?

 

Amazon, Big Publishing

132 Comments to “Amazon Gets Increasingly Nervous”

  1. Amazon is nervous that readers everywhere will no longer want ebooks and Big Pub will rule the world.

    Heck, I’m worried too.

    And not only that . . . Zon’s Arithmetic is all wrong.

    . . . Well, except that $9.99 isn’t one tenth of the price of a hardcover book, otherwise hardcover books would regularly cost $100, which admittedly is a bit steep.

    So therefore ebooks should indeed be priced at $14.99 and up.

  2. Well, if a hardcover book lists at, say, $30, then a more disruptive book form might sell for… $2.99? or so?

  3. “Well, except that $9.99 isn’t one tenth of the price of a hardcover book”

    John “Statistics” Scalzi.

  4. I used to have a lot of respect for John Scalzi, but his lack of concern for the midlist authors affected by Hachette’s b.s. is really disappointing.

    • I finally had to unfollow him for now on Twitter. It’s one thing to have an opinion, but to keep insisting your opinion isn’t biased when it so obviously is biased- I can’t take it. At least Howey never pretends he isn’t biased. He also makes sense when he talks about numbers, but I can’t figure out what Scalzi is trying to say.

      Plus all the silly fighting with people, I’m too old and too female to be interested in that.

      • He doesn’t just insist he’s not biased, he questions the intelligence of anyone who disagrees with his opinion. As far as I’m concerned that’s unforgivable, and I unfollowed him and his blog feed this morning over this. If he wants to grow up and stop insulting his fellow writers I might, someday, be interested in what he has to say again.

      • I’ve unfollowed him and a few others, or at least removed them from the list I regularly read tweets from. Following them and trying not to get pissed off takes too much energy that I’d rather spend on… well, anything else, really.

        • Granted I’m not up on social networks, but why are you guys following him? Why follow anyone? It seems a tad sheep-like.

          • Following really just means (to me) that a person’s tweets get delivered into your stream, so you don’t have to go to their profile individually and read them. That way you don’t have to see all the partial conversations they’re having with other people, just the tweets they originate. But if someone is aggravating me daily I had to ask myself- what was the point? It’s supposed to be fun.

      • I felt like Scalzi was pretty up front in his bias in this post. He specifically says that no one should rely on his point of view because everyone in this is speaking from their own economic interests and then links to a disclosure of his interests (http://whatever.scalzi.com/2014/06/12/disclosure-statement/) so that people can make up their mind about his bias.

        Of course he thinks he’s right — everyone speaking out thinks they’re right about their position.

      • I unfollowed him today, too. I laughed when I saw that he retweeted someone who said something to the effect of, “Amazon’s getting the serfs and the slaves to raise up with their shovels and attack the kings.” I was like, really? That’s the analogy you’re using to describe this? Way to insult your readers.

    • Wait until he gets dumped by Tor because his sales weren’t high enough. He’ll change his tune then.

      And I bet he won’t be selling his ebooks at $14.99, either.

      • I was at Chicon 7, the WorldCon not long after the release of “Redshirts.” I was waiting in the LONG line to get a reader card of that book and my copy of OMW signed (incidentally Mr. Scalzi was very polite and personable during his signing sessions) and Greg Brin walked by. He saw the line and shouted out, “I WAS THE HOT YOUNG THING ONCE, SCALZI! YOU’LL SEE!”

        The room erupted in laughter (including Scalzi’s) but now I wonder how much of that was HHOS. 😉 I guess we’ll see indeed.

  5. As usual Mr. Scalzi’s third rate fisking (thanks to J.A. Konrath for a great term) amounts to nothing more than picking pepper out of fly s__t.

  6. “It’s just a really clumsy attempt to reinforce the idea that Amazon is doing this for readers, rather than for its own business purposes.”

    Amazon has this weird idea that making customers happy and good business policies are somehow related. Go figure.

  7. I love Scalzi, but he has NO head for business. Seriously none. But neither do most authors. Or most people.

    He thinks Amazon is floundering because he doesn’t know why Amazon does what it does. Consider a couple of things:

    Amazon hasn’t been releasing these to the press. They aren’t interested in the press. They have been releasing these statements to people on their communities and direct to readers. People they know well because they’ve been Big Brother observing for quite a while, and they have a good idea of how they will react. Amazon doesn’t really care what people outside these communities think.

    Every time Amazon releases one of these, what happens? Fans of Amazon go and read the nonsense put out by Hachette apologists (mostly dire imaginings of What Amazon Is Up To), and they start talking about all the wonderful things Amazon has done to improve their lives.

    I don’t think Amazon is doing this to combat Hachette, or to get PR. They don’t need PR for that.

    I think Amazon is doing this to galvanize the faithful. They’re energizing their customer base, and getting them talking. (Especially that “customer” base within KDP and Associates — who are an army that rivals Apple’s Evangalista movement — only more so because they have something at stake.)

    And yeah, it’s working. Oh, not necessarily in getting people to write letters to Hachette or the NYT — but in getting people to talk about how well served they are by Amazon. (Edit to add: and of course, in getting them to buy more stuff.)

  8. Well, I got the usual Scalzi treatment. His article cites the Preston letter and I made a comment on that. Then he dinged me for straying off-topic.

  9. Scalzi has entered Shatzkin territory for me. As in “do not bother to read.”

    He’s just gone ridiculous, but will scream at you if confronted about it.

    • I was basically told that while the article is about Amazon’s response to Preston’s ad, I was not allowed to discuss the merits of Preston’s case.

      • Yes. Any argument he can’t rebut is either declared “off topic” (when it is clearly not) and shut down (i.e., argumentum ad baculum) or met with an insult (i.e., argumentum ad hominem).

        I was taught in freshman logic that these were logical fallacies, but that was at a lowly state school. Perhaps different rules apply in the philosophy department at the University of Chicago. They must be very proud of him.

  10. Amazon’s argument is that authors and publishers would make MORE MONEY with eBooks priced lower (within reason). I repeat: authors and publishers would make MORE MONEY.

    If eBooks at $14.99 can subsidize hardcovers, then publishers could lower the price and MAKE MORE MONEY, and then they could prop up their hardcovers and make extra money on the side. This also means more money for authors, of which Scalzi is one.

    Unless you think Amazon is out and out lying about the numbers, there is no counter to their argument.

    • For some reason it’s not letting me edit my comment. Addendum:

      This is a chance for readers to get lower priced books. It will be good for Amazon, because they’ll make more sales and more money. It’ll also be good for PUBLISHERS, because they’ll make more sales and more money. It’ll also be good for authors, because they’ll make more sales and more money.

      This isn’t just a win-win situation. It’s a win-win-win-win situation. Scalzi, Preston, et al aren’t just looking a gift horse in the mouth–they’re throwing a fit and screaming “HOW DARE YOU TRY TO GIVE ME THIS HORSE, AMAZON?!”

      Everyone who says Amazon’s trying to hurt publishers is arguing that publishers are better off if they make less money.

      • The authors you’re talking about are all probably getting huge advances that never earn out, which is how they get around their low boilerplate royalties. Anything that accelerates ebook sales won’t really put more money in their pockets, but it will reduce the certainty of their future income streams. The midlisters, sitting on small advances and trying to build a following might benefit, but that doesn’t make for a good story…

    • No, the counter argument is that ebooks can’t grow because they aren’t curated by NY editors. It’s all about making sure authors don’t have any alternatives to submitting to publishers.

      The entire point is they want less writers, and only writers they choose, to be read. But that horse is already left the barn.

      Yet somehow they think they can either slow ebook adoption until they leave the game, or possibly stall until they can figure out a new way to control the markets.

    • “Unless you think Amazon is out and out lying about the numbers, there is no counter to their argument.”

      Well… Scalzi, late July:

      “Bear in mind it’s entirely possible that Amazon sells 1.74 times as many books at $9.99 than at $14.99”

      As I said then, “yes, it’s entirely possible that Amazon’s not lying through its teeth”. Then he went on with a “But”.

    • “Unless you think Amazon is out and out lying about the numbers, there is no counter to their argument.”

      And someone who thinks that would then ALSO have to think that Author Earnings, which is not affiliated with Amazon, is lying (or at least mistaken), too, since the data they’re gathering shows that books priced $9.99 generate more gross revenue, due to higher sales, than books priced higher. (Their data from July also shows that $4.99 is the sweet spot for generating the most gross revenue.)

      You’re probably have to ADDITIONALLY think that Digital Book World is also lying (or mistaken). I followed their price-info gathering for a few months last year to write a Nink article about pricing and overhead, and their “sweet spot” for pricing was in the same range. They didn’t estimate revenue, just logged units sales. Like Amazon and AE, their stats showed that sales started dropping off steeply when the price rose above about $9.

      • @ Laura

        “(Their data from July also shows that $4.99 is the sweet spot for generating the most gross revenue.)”

        That number ties right in with what DWS and KKR have been saying for quite some time now about pricing an e-book.

    • I think the publishers’ argument is that if the ebook is priced so much lower than the hardcover, they will lose hardcover sales as more readers opt for the ebook, and this could lead to a cascade of badness for their business model (B&N closing, print distribution declining dramatically, bestselling authors leaving). It’s not a very good argument. But it’s an argument.

      • Not so very much talk about figuring out a way to bring down the price of hardcovers though. Seems to me if you’ve got evidence of a sweet spot in ebook sales just a few dollars under your preferred price but you’re concerned about the gap between eBook and hardcover prices, why wouldn’t trying to make the hardcovers a little cheaper be a serious consideration in addressing that? It really seems to me like there’s a lot of people arguing that the $30 hardcover is essential to the industry’s future and the survival of bookstores so everything else needs to be based on that one element. I wouldn’t want to be those folks financial planner.

    • John, this is the primary claim Scalzi’s argument is against, and I’m seeing at least 3 counters from him to the claim “Authors and publishers will earn more money if they agree to Amazon’s terms.”

      1. This claim is only reliable within the Amazon ecosystem. Yes, in the short term, within Amazon, more people will be buy the ebooks, and more money will be made. But all the other places they’re selling books will be hurt by it. And in the long run, lock-in with Amazon at the expense of other retailers (digital and brick-and-mortar) could hurt both the publishers and the authors very much.

      2. Let’s accept Amazon’s claim that 9.99 is the right price for an ebook. Scalzi demonstrates (anecdotally, but with some I-haz-prestige context) that current ebook prices are near that anyway. So Amazon’s saying “Ebooks should cost 9.99, therefore support us vs. Hatchette,” and Scalzi’s pointing out that this particular conclusion really doesn’t follow.

      3. Again, let’s accept Amazon’s claim that 9.99 is the right price for an ebook. Fine. But why should authors or publishers be contractually obligated to that price point? Shouldn’t publishers, authors, and authors’ agents be able to act in their own self-interest, according to their own best judgement? Heck, one of the principles of indie publishing is that you get control over how your work is sold. So how is Amazon saying “trust us, 9.99 is good for you” any better than publishers saying “trust us, a $25 hardback is good for you”? If Amazon really has persuasive data that 9.99 is the best for Hatchette’s business, well then they should be capable of persuading Hatchette of that – not locking them into “you need to do what we tell you because our classified research is better than yours.”

      So, yes, I’d say there are counters to the argument, and Scalzi’s done a decent job explaining them. (Not saying you need to agree with the counters, or that they can’t be countered themeselves – but they seem like legitimate points to me.)

      • Refinement of point #3 above: Obviously, Amazon is within its rights to say “I’ll only retail your book if it’s below price X,” or “I’m going to need a higher cut if you insist on pricing ebooks at Y or higher.” Sure. But equally, the publisher (or an individual author) is equally within its rights to say “Yeah, I don’t trust your analysis, and that’s a deal I’m not willing to accept.” That’s just simple negotiation, and there’s nothing wrong with Hatchette (or an individual author) choosing that stance.

        Yes, Amazon has a lot more pricing and retail expertise than Hatchette does. But at the same time, Amazon is a lot more interested in Amazon’s profits than in Hatchette’s, so the expertise they choose to share is hardly reliable.

        • OK, correct me if I’m wrong, but I seem to recall that Amazon wanted higher share of above 9.99, not a “contractually obligated” price.

          Which, as it happens, is what indies have already.

          So, either this has gone beyond what I knew or the point has been misshapen somewhere. Surprised, any?

          Take care.

          • Hey Ferran,

            My understanding is that Scalzi’s post was responding to Amazon’s “Important Kindle Request” at http://www.readersunited.com . AFAIK the precise details of the Amazon-Hatchette agreements aren’t publicly known, but this is a letter saying:

            Amazon and Hachette — a big US publisher and part of a $10 billion media conglomerate — are in the middle of a business dispute about e-books. We want lower e-book prices. Hachette does not.

            The letter goes on to give $14.99 as a poorer price point, and $9.99 as a better one.

            So to me, “we’re in a business dispute” + “ebooks should be $9.99” would add up to “we want our contract to favor cheaper ebooks.” If this is the primary point Amazon is spotlighting, and the dispute has been dragging on and gathering volume – well, then, Hatchette’s certainly seems to be opposing the terms for $10+ ebooks vehemently, whatever those terms may be.

            I hope my clarification to my original post also made clear that “contractually obligated to $9.99” was an exaggeration.

            Does that answer your question?

            • Thanks a lot.

              Still, I’ve seen several posts besides yours that instead of “favoring 9.99 books” claim that amazon ONLY want to sell at that price. And I’ve seen no indication in that regard. Makes me think if I’ve lost some datum.

              Thanks, anyhow. Take care

              • Unsurprisingly, people are simplifying 🙂

                But the horse Amazon’s been using consistently is the $9.99 ebook, so summarizing into “Amazon wants to force Hatchette to sell ebooks for $9.99 and Hatchette doesn’t want to” is not too horrible or unfair a simplification, even if it’s inaccurate.

                • I can understand the simplification. But.

                  a) Don’t put that “force” in there.

                  b) By the same token, you could say “Amazon wants to force Hachette to earn 17% extra”.

                  I wouldn’t mind as much if the discourse didn’t veer as much from reality afterwards, but the simplification is used as an attack point, legitimized and expanded.

                  No.

                  Take care.

                • You’re absolutely right 🙂
                  Thanks for that!

  11. Basically, traditional publishing was a aristocratic feudal system, and electronic self-publishing is a more democratic system. It’s not that feudalism was intrinsically immoral, but a modern democratic system is vastly more efficient and productive, which makes feudalism obsolete.

    What’s happening now is that the old barons are thundering that the peasants still need their firm guidance, even as their actual power becomes increasingly ceremonial.

  12. A full page ad in the NYT!?! Sounds like marketing idea straight from the 1950s or thereabouts. What will they do next? A leaflet drop from an airplane?

  13. I liked Lee Goldberg’s response to Preston, which focused on one major inconsistency in his argument:

    You wrote in your ad: “As writers–most of us not published by Hachette–we feel strongly that no bookseller should block the sale of books or otherwise prevent or discourage customers from ordering or receiving the books they want.”

    Does that same sentiment also apply to the brick-and-mortar bookstores, from big chains to indies, that refuse to stock paperback books from Amazon Publishing’s imprints Thomas & Mercer, 47North, Montlake, etc? If so, why don’t I see the same level of outrage from Authors Unhachette-book-group-logoAmazon-logoited, or the Authors Guild, over this widespread ban, which has been going on for years and harms hundreds of authors?

    Preston and Stross claim that Amazon keeps customers from getting the books they want, but bookstores actually do it.

    • And Preston’s response was??

      LOL, I know, I was just kidding. If you are not press and not licking his boots he does not respond.

    • Not only that, but… WHAT “prevent or discourage” is he talking about.

      EVERY time I have seen someone claim that this or that Hachette author’s books aren’t available on Amazon, I’ve gone and looked. And EVERY SINGLE TIME, they’re right there.

      All the Kindle books are available for immediate download. All the new releases offer 2-day delivery. Some of the backlist books list shipping delays of several weeks, but some have a delivery ETA of 3-5 days.

      There MIGHT be someone who’s telling the truth about their Hachette books being unavailable on Amazon; but in 3 months of following up on every single claim I see, I’ve yet to find anyone telling the truth about it.

      • ^ ditto. And I’ve been doing sporadic “author claim of blacklisting” since this thing was first getting media attention. They lie. Period.

  14. Oh, look, Scalzi opens his mouth again. I guess he didn’t understand the argument last time, and foolishly wishes to talk stupid again.

    Let’s repeat this one more time for those that didn’t read it in the 900 authors thread:

    AMAZON IS NOT SCARED. AMAZON IS NOT WORRIED. AMAZON DOESN’T CARE ABOUT THE PR BEING POSSIBLY NEGATIVE.

    Amazon holds every single card. Every. Single. Card. If Amazon stopped selling Hachette books right this instant, Amazon would move on, barely even noticing the small dent in their sales numbers.

    Hachette, in the meantime, would more than likely end up going bankrupt unless their parent company propped them up (and the parent company wouldn’t bother propping them up if their largest sales source was instantly cut off). Hachette authors and publishers would be in a LOT of trouble.

    If a publisher’s (and who the hell knows the name of any publisher besides those of us in the industry?) books would be no longer sold on Amazon, I am supposed to not shop there anymore? I laugh and order more guitar strings and Alphasmart 3000’s and everything else I need. I still buy books from them. My neighbors and friends and the rest of the world goes on buying from Amazon. No one even notices Hachette books aren’t available, and when they finally do, they go to a B&N or iTunes or a local physical book store and buy that book.

    It’s a slight inconvenience to buy a Hachette book now.

    Meanwhile, over at Hachette, the castle is on fire, execs are being raped and pillaged, everyone is running around with burning clothes and burning hair trying to figure out how the hell they are going to make up 30% of all sales and 80% of ebook sales (I pull numbers out of my a** like Scalzi and everyone else) that they were getting from Amazon. All while the king and his advisers sit in the throne room, begging Merlin to make a hex-curse to destroy Amazon.

    So… let’s quit with the “Amazon is desperate and reaching now!” nonsense. I’m looking at YOU, John Scalzi and anyone else who repeats this nonsense.

    • I had to laugh at that…burning clothes and burning hair. Great description but also apt.

      As to Scalzi, the list of authors I will never, no matter what wonderfulness they write, buy again…grew by another author.

      I hope other prolific readers are taking notes on who the a**hats are.

    • Well, I think Amazon -is- worried, but not about PR. Amazon is facing negotiations over the next year or two with S&S (already started), Macmillan, HarperCollins, and Random Penguin.

      Given that the Hachette “negotiations” are in their 7th or 8th month with no resolution in sight, and that the previous collusion among these companies at least suggests the possibility that several or all of them intend to behave exactly the way that Hachette is behaving…

      Amazon’s looking at a potentially time-consuming, tedious, distracting, and chaotic relationship with its 5 biggest book suppliers for some time to come. I don’t know much about big business, but that doesn’t sound like a great scenario.

      I would think THAT problem, rather than public opinion, would motivate Amazon’s decisions and actions in this situation.

      • Yep. I don’t think we’ve seen anything yet.

        The big 5 were found to have colluded because they had been doing it for decades, to the point where they sincerely did not recognize it as being something illegal and thus did not try to disguise their behavior. Now, after the trial, they understand that if you’re going to collude you have to be quiet about it. They’re certainly not going to STOP.

        S&S, HC and RP can throw plenty more aggrieved authors into the mix, to the point where Amazon is going to have to cave on agency in a very public way. The end game is better retail killing brick and mortar with 70% payouts and lower prices starving publishers. I can’t see this playing out any other way.

      • I would suspect that Amazon will stare them all down, show them their balance sheet, and give them the same deal they’re giving Hatchett. No presale buttons, deliver on order, and no stocking. In other words, treat them exactly like indy authors.

        Because in the end, the Big 4.5 need Amazon way more than Amazon needs the Big 4.5.

    • Agreed. Amazon has a corner on online shopping, period. People are going to continue to buy their books there.

      At this point, I think Amazon should stop selling Hachette’s titles and apologize for not being able to come to terms with one of their suppliers. Move on. I bet Penguin Random House would love to have the other 4 publishers drop out. It’s what they did last time, holding out the longest and enjoying a massive boost to sales (back when it was just Random House).

      • I wonder if Amazon is thinking about it. Although removing all Hachette titles would a bad scenario for Amazon–they lose revenue, writers get hurt (and complain), readers shop for those writers’ books elsewhere (and complain), the media call for Amazon’s head on a platter, James Patterson (AGAIN) demands government intervention, the NYPL claims Amazon has killed all puppies in the land, Douglas Preston gives more interviews bemoaning the destruction of struggling writers from his humble 300-acre summer home on the coast, etc., etc., etc… It seems like it would be better for Amazon than the alternative, which is that this standoff doesn’t get resolved or stop, it just gets bigger and bigger as each of the remaining major houses lined to for negotiations enter the fray.

        I also wonder if Hachette is thinking about this? Do they think it’s a possibility, or not? Have they done a cost analysis of how long they can hold their line if their books are all removed from Amazon? Do they have a plan, if that happens? Do they have information that convinces them it will NOT happen? I’ve no idea, and am curious by now.

        • Yes, I’m very curious about the long-term strategies of both companies as well.

          Does Amazon intend to simply continue selling non-discounted Hachette titles until the next of the Big 5 starts its negotiation phase, and so on? Or will it use its considerable market power to bring Hachette into line as motivation for the next player to be a bit more cooperative?

          What is Hachtte’s plan, if it succeeds in goading Amazon to remove the buy buttons?

          Interesting times!

          • “Does Amazon intend to simply continue selling non-discounted Hachette titles until the next of the Big 5 starts its negotiation phase, and so on? ”

            Well, this is the thing–it was a small news item, but the next phase HAS begun. The next player -is- at the table. Simon&Schuster has entered negotiations. I think it was about 3 weeks ago. We just haven’t seen any leaks about what’s happening there.

            So if there’s going to a domino effect or a pile-on, it’s beginning. In fact, it is SINCE S&S entered negotiations that Amazon has come out with two detailed public statements about the Hachette situation and about why it’s against letting publishers set higher book prices. It makes me wonder what’s going on with S&S.

            • The next player -is- at the table. Simon&Schuster has entered negotiations.

              Ah! I’d been wondering about when the next player would come to the table and what effect it would have. Thanks for the info!

            • At least the head of CBS has actually spoken with Bezo s about their philosophy and are in actual discussions. We haven’t seen any negative actions against Simon and Schuster by Amazon, have we?

      • But why should Amazon drop Hachette titles? right now they’re sitting in the cat bird seat. They serve their customers, they get the revenue from Hachette titles. There is no down side. All it would do is escalate.

        Let Hechette be the fools who escalate.

        • I would think because it may not be about Hachette for much longer. Or not JUST about Hachette. If S&S (which recently entered negotiations) drags its heels, too, then by early 2015, Amazon could be in this situation with THREE of its major suppliers, since it’ll be time by then for the third of the Big 5 to enter. Instead of just with Hachette.

          Big brawly dispute with 3 of a company’s 5 biggest suppliers doesn’t seem like it would be a welcome scenario for Amazon.

          (Or maybe I’m wrong? Maybe once three publishers are all demanding the same terms… Amazon can ask the DoJ if they think this looks like re-collusion? Is that a word?)

          • That’s true — but that’s different from just washing their hands of Hachette for being intractable.

            But here’s the thing: So what if it is three of the big publishers? What if Amazon just treats them all the way they treat Hachette now? Yes, it could be more of a PR nightmare, their stock price could become a little volatile (so what else is new?) but Amazon is known for playing the long game.

            As long as Amazon continues selling the books (even without preorders and fast shipping of paper) they still make money, and it encourages more people to switch to ebook faster.

            If Amazon is going to just ignore them and move on (as Hugh said) then the better path is to leave the books there. It’s only if they don’t want to ignore them, but rather want to increase the pressure, that it’s a good idea to remove them.

          • Something to keep in mind is that Amazon is already a publisher in it’s own right in that people are already giving them money for books that never passed through a traditional publisher. They’re already promoting some books on their own. If they wanted to, they could kick it up a notch, pick out some of the better indy titles that are already going through them, offer the authors a better deal, (Which traditional publishers seem incapable of doing.) promote them more heavily and start making and selling paper books as well, in a move that would let them eat even more of the traditional publishers lunch. If Amazon decided that they wanted to do this, it could be happening by the end of the month.

            It’s not something they need to do since the Big Five can’t stop selling to them, it would be suicide for an individual publisher to give up their Amazon sales…and criminal if they tried to do it in concert with the others. If they all decide to do what Hachette is doing now, it will only hurt them while driving more people to books that Amazon sells that don’t involve the Big Five publishers at all.

            Hmmm…thinking about it, I’m wondering now if Amazon’s comments aren’t about so much about trying to affect people’s attitudes on the fight with Hatchette, but to set the stage for being able to say, “Well, we tried, but the publishers wouldn’t play ball, so we were forced to start sourcing and publishing out own books.” With the arguments on cost they’re making now laying groundwork to make it more acceptable when they undercut the traditional publishers. Just speculation, but it’s an interesting thought, isn’t it?

            • Amazon is already in the traditional publishing business: Thomas & Mercer, 47North, Montlake, and several other imprints.

              Whatever the strategy behind this campaign is, I guarantee you, it is not about getting Amazon into a business that Amazon is already in.

          • If I were a colluding Big Publisher and had finally seen the writing on the wall, I’d be using a delaying tactic with my Four Other Buddies–as well as whipping up even more bad press about Amazon, the worst they’ve ever endured–so that I could yank all my titles and sell them instead on a brand new ecommerce website that I used my millions to build in the meantime, one that might possibly rivals Amazon’s, since I’d have 50%+ of the NYT bestsellers out there and an enormous marketing machine behind it.

            But I have a brain.

            • I’m not all that sure that best sellers, on their own, are profitable with the contracts they imply. I think a lot of their value is advertising.

              It may work, but it would require some rethinking of the whole brand, the shop…

              Take care.

              • It’s a viable idea, but I really only mentioned it tongue in cheek.

                In the real world, I think that the delaying tactics that Laura mentions are an attempt to make Amazon so uncomfortable they’ll acquiesce on at least some of Big Publishing’s demands, but it’s a losing strategy, since they’ll be hemorrhaging money if Amazon decides to just pull the plug on them.

                As Konrath has pointed out countless times, Big P could simply build their own store and bid Amazon adieu. But they won’t (and probably needed to start years ago,anyway).

                • Every one kicks around the idea of Big 5 building their own web site and doing an end around Amazon but even if they did everything absolutely perfect and made it the best shopping experience ever, it’s still got FAIL written across it across it in big letters for one reason alone, prices. They would still price themselves into a corner. I don’t think they can help it.

                • No, they actually can’t. They’re lacking just about everything needed to make their own version of Amazon work in comparison to Amazon itself.

                  Remember the Almighty Zon has hundreds of the best technical minds money can buy, an immensely powerful data infrastructure, years of data on consumer buying habits, and millions spent on analysis and improvements to the online shopping experience.

                  They’re the market leaders for a reason. Ain’t no publishers gonna compete with that unless they’re willing to do what Amazon did and sink an astronomical amount of cash into the venture and throw all their weight behind the online market (which will alienate their offline partners).

                  Basically, trad publishers have neither the will, the resources, or the expertise to compete with Amazon in any meaningful way. And now that Amazon has beaten them to the punch on a Netflix-style ebook offering, they really don’t have anything else going for them.

                  They’re going to go out of business. Personally my money is on a slow disintegration over the next decade or more, barring any major changes.

          • Laura wrote: (Or maybe I’m wrong? Maybe once three publishers are all demanding the same terms… Amazon can ask the DoJ if they think this looks like re-collusion? Is that a word?)~~~

            I imagine Amazon is sharp enough they will keep very close eyes on communications during these negotiations and, if publishers look like they are using talking points and requirements are identical then they just might whistle over to the DOJ. I’d hope so. 😀

            • The DOJ itself may well be keeping a close eye on this already. They did send a letter to some of these pubs a while back inquiring about who they’ve been talking to.

      • Agree with Hugh: Amazon has tried for months to get a deal It’s time to say: “WE have no contract. We must stop selling your books until we do. Bye.”

        I can still have plenty of fun shopping Amazon’s book inventory without Hachette titles…

  15. One of the key indicators that Big Publishing is entirely uncomprehending about what this technology disruption is all about is their attempt to prop up their hardcover business by utilizing high ebook prices.
    This is small-scale tactical thinking, lets-preserve-next-quarters-earnings-so-we-get-our-bonuses thinking.

    If I did comprehend, and wanted to back out of the fiction business with my balance sheet intact, this is exactly what I would do.

  16. Phyllis Humphrey

    What really irks me is the cost of that NYT ad. Money that could – should – have gone to authors. I feel sorry for Hachette authors and thankful I’m not one of them.

  17. I just left this comment on his blog:

    “It’s just a really clumsy attempt to reinforce the idea that Amazon is doing this for readers, rather than for its own business purposes.”

    A slightly modified version could be applied to another camp:

    “It’s just a really clumsy attempt to reinforce the idea that Authors United is doing this for authors, rather than for its own business purposes.”

    I do agree with you that Amazon is certainly doing this in an attempt to benefit their company. But I take offense at 1%ers like Preston and Patterson claiming to speak for authors en masse. I’m pretty sure a whole lot of Hachette’s authors would have jumped at the chance to take one of the deals Amazon proposed, but they were never given the opportunity to do so. Preston dismissed them out of hand even before Hachette did publicly on at least two of the occasions.

    If we’re going to take Amazon to task for their rhetoric, then Hachette and Preston’s cadre should be as well. I truly feel sorry for the debut and mid list authors nominally under Hachette’s umbrella, yet are still being soaked because they are forced to stand beneath the many gaping holes in said protection. They aren’t blessed with writing shacks boasting high speed Internet on 300 acre retreats in Maine.

    We’ll see if he responds.

    • Well, amazon is aware enough to think its business is linked to customer satisfaction.

      As it happens, those customers are called readers.

      Frankly, I’m up to here of Big Five forgetting that and buggering me.

      Take care.

    • Well, he responded with ADS nonsense about “ploys” of Amazon and why I thought Preston had the right to negotiate contracts for Hachette. I responded, but probably shouldn’t have bothered. Amazon Derangement Syndrome is rampant and nearly always incurable.

  18. Scalzi called Amazons offer to set up a fund with Hachette (like they did with MAcmillan in 2010) a ploy.

    Yes, A Ploy.

    Thats says all you need to know about Scalzi IMO.

    Dav

    • If it had been just a ploy, Hachette could have called them on it by AGREEING and seeing if they followed through. But Hachette stayed mum. I think they knew damn well Amazon was serious and would have done exactly what they said for authors in the crossfire

      Even if it was a ploy, it would have benefitted the “little guys and gals” writing for Hachette. If Hachette gave a damn about those non-mega-sellers, they would have taken one of the 3 offers. They did not. That speaks volumes.

  19. Kind of fussy of Scalzi to insist historical parallels have to be exact (the factor of ten argument). Interestingly there is something like a factor of ten difference between Indies and hardcovers, though.

  20. Frankly, all this reactionary cry from authors I used to respect is mind-boggling. I stopped visiting websites from guys like Scalzi and Wendig who are beginning to sound like luddites (it’s weird to realize how many SF authors can’t handle new ideas regarding tech as soon as these ideas go out of the pages and become a reality). All this anti-Amazon bias has reminded me of the first years of the MP3 revolution. So many established writers blindly defending a dying way, like a chorus of whining Metallicas.

    • it’s weird to realize how many SF authors can’t handle new ideas regarding tech as soon as these ideas go out of the pages and become a reality

      Not weird at all. SF hasn’t been about new ideas regarding tech since the New Wave blew in, back in the 1960s. Most of the New Wave writers were entirely ignorant of science and technology, and a lot of them were actually proud of the fact. They merely wanted to use the tropes and trappings of SF to tell their own variety of weird stories; and, of course, to glom onto the large and lucrative circulations of the SF magazines at a time when short story markets for mainstream fiction were rapidly drying up.

      There was a time when the majority of SF writers were working scientists or engineers themselves. That time passed before Scalzi was born.

      • Not all of them. I’m proud to raise my hand and say, I’m a scientist who can also use a comma properly. Plus a writer. 🙂

        There are more than you might think, though I agree that it isn’t a majority by any means. Pen names are a requirement for many of us due to real world positions. Out of the group of 30 or so writers I deal with on a regular basis, (PA, Dystopian, SFF writers), three of us admit to being scientists and a couple more were initially educated for that career in one field or another. So, we’re still out there.

        But now there are so *many* writers and the term for SF is very loose indeed. I wouldn’t consider my latest book SF at all, but it clearly fits there based on the way we shelve books today.

        But…I hear ya, in general principle. And yes, it is surprising that it’s so hard for some people who work creatively with their story-telling about the future to accept that future when it is inevitable.

      • I don’t think it has anything to do with who is or isn’t educated in science, nor did it start with the New Wave. Asimov refused to fly, just as an example, and he was a scientist. Nor was he the only one who didn’t like flying. I think imagining all sorts of changes, including scientific and technical, to use in one’s writing is only loosely connected with being comfortable with that level of change in one’s real life, if it’s connected at all. I wouldn’t bet on it.

        Angie

        • As someone with a sideline in breaking phobias, I can state with some authority that being phobic about something has no relation to a person’s intelligence or education.

          • I have an IQ that has always been measured between 135 and 137, variously. I was nicknamed “Brainiac” in grade school and got a full scholarship to college. My brain is squishier in middle age and with illnesses, but still bright. And I have phobias up the wahoo, and they began around puberty and got worse around age 18, when I totally became terrified of flying, then wouldn’t go in the ocean with a fear of sharks, and then slept with the lights on with fear of the dark. I beat the dark one and can sleep without lights, but I still won’t fly or swim in the ocean. So, yeah, you can be smart and phobic.

            I think Ray Bradbury also didn’t fly.

  21. Yeah. I bet Bezos is trembling in his shoes, sweat pouring off his brow, and holding smelling salts to his nose to keep from fainting.

    Hmmm, mebbe Bezos should put out his own $100k, full page ad. But not on the NYT. Perhaps elsewhere, on some other highly regarded newspaper. Like, say, the Washington Post.

    • Bezos doesn’t need the NYT. He owns the Washington Post. But maybe he should forget about ads and just send an email to everyone on the Amazon mailing list. That’s a lot bigger circulation.

      • Yup. He does own the Post. Heh, heh, heh… Just a mere coincidence that I suggested he place an ad there. 😉

        And as for sending out an e-mail telling his side to all the Amazon buyers, that would be a really mean and a totally unfair negotiating tactic to Hachette and other Big Pubs. 🙁

        • I really don’t think they grok the way Amazon can do ads without a newspaper. And, unlike the paper, they can be sure they reach a target audience.

          Take care

          • I suspect the venue of the ad and its audience reflect the mindset of the speaker. Preston is speaking to New Yorkers who read the Book Section of the NYT, and consider themselves special. Bezos is speaking to independent authors and consumers who don’t care about either the NYT Book Section or the special people who read it.

            • I’ve thought it funny throughout the dispute that Preston is the flag-bearer for the New York establishment and the literati of the gate-keeping world.

              He writes techno-thrillers and horror stories. That’s awesome and I certainly don’t write anything more sophisticated that that, either (crime fiction), but Hemingway or Roth he ain’t.

              I’m tickled to think that the many of the “special people” cringe to think that king-of-the-supermarket-check-out-line Preston is being counted as one of their own.

  22. I understand Scalzi feels he needs to kiss his publishers’ asses, but let’s be clear about one thing. Amazon doesn’t give a rat’s a** about that stupid NY Times ad. No one does. $140k down a rathole. They should have given it to a good charity.

    That said, it feels like Amazon is getting tired of the other side’s ongoing operatic nonsense, and they gave in to the temptation to respond. Probably not a great idea. Nobody outside NY publishing cares if Douglas Preston and his poor mistreated millionaire authors need a diaper change or not.

    • That’s exactly why I have responded to some of these threads: I honestly don’t care about the dispute. Hachette has the right to hold out for the terms it wants, and Amazon has the right to blow them a big raspberry.

      Where I take issue is when on side demands that I take sides. When forces by overwhelming whining, I will reluctantly join the fray — but not on the side that has never done anything in my best interests.

      And the whining gets old really fast.

    • It’s is good charity… *authors*!

      Sigh…

      I don’t think Amazon’s strategy is quite equivalent. They’re not placing an add, they’re calling their providers and giving them a ready made page for _those providers_ to act on.

      From what I’ve read here and there, several writers (many?) have had to explain why they were dealing with “that company” (amazon, yes) and how bad it was. Some writers might have trouble giving the whole discourse live, but not pointing to a page… called “*reader’s* united”.

      Take care.

  23. My uncle, never one for tact, mentioned off hand that if Bezos had named his company something like DerRhine.com, Hachette would have surrendered by now.

    Then again, hes also a confirmed anglophile.

    Dav

  24. paperback books existed well before the 1930s — see “penny dreadfuls,” “dime novels” and “pulps” (further comment on these and other flubs here)

    And ebooks existed before KDP too. So?

    • He expects of his opponent a level of precission and commitment he’s not even *close* to provide himself. If you point it, ad hominem. Meanwhile, baculum. I could tolerate the second (right until a recent post of him), and I didn’t see much of the first because I avoided comments. But…

      Take care.

      • Paperbacks were relatively sturdy, whereas dime novels and penny dreadfuls weren’t. The whole reason the company was called Pocket Books was that you could shove them in a jacket pocket and still have them in good condition. This was also true of tiny hardbacks, like the Loeb Latin series or Alice in Wonderland, but those were a lot pricier than a quarter.

  25. Wow. I never realized until now what a tool John Scalzi is.

    • Hm… just a point for the siteadmin: I *just* received the mail for this answer (Heinlein’s).

      • Pardon me Ferran. You just received the mail for my answer? Do you mean my comment just showed up? I sent no email etc. just curious, thanks.

        • I can’t be sure when it actually showed up, since most of my attention was “higher up” in the thread, but I received the notification at 4 pm CET (8 am Mountain). When the site allows for it (like PV does), I try to sign for updates in those threads I post in. At the very least, it helps me being polite (and not forgetting to answer).

          Take care.

  26. On a vaguely related note, I watched the documentary on Napster today. It was so interesting to see the exact same stuff happening (in a totally different way, of course). The most litigious musicians claimed to speak for all musicians while other musicians disagreed entirely.

    • That makes Preston this fights equivalent of Lars Ulrich….I just threw up in my mouth a little…

      Dav

      • So many similarities. Ultimately the record companies placed themselves in opposition to their most active and engaged customers.

        Meanwhile lots of musicians were thrilled with Napster – because it replaced radio, an avenue that was already locked down by the corporate entities. So Napster created an avenue for listeners to share lesser-known music and these performers started getting increased attendance at their performances AND higher sales.

        The people suing were the established acts. They were equating a pirated copy with a lost sale.

        • and sadly, Napster sold out to… drum roll; Bertalsmann, owner of Randy Penguin and BMI. And Napster was… never heard from again, and the guy who ran it has kajillion dollars from selling it…. for more than any indie band has or ever will make. Meanwhile the plethora of great musicians being ‘discovered’ is fragmented and isolationist. Hopefully a third platform will rise up that is not apple, not itunes, not napsterlike, not youtube, but that will allow musicians to make a living at their music. The idea that music groups can make a living by selling merchandise and touring, I’m afraid is out of reach for most but the already established bands. There are exceptions. But few. We’re waiting for better ways and days.

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