Amazon `Targeting’ Hachette Writers

21 September 2014

Malcolm Gladwell criticises Amazon in Hachette dispute

19 September 2014

From The Financial Times:

Amazon’s dispute with Hachette publishing house is threatening the loyalty of Amazon’s customers and sabotaging its relations with authors, according to Malcolm Gladwell, the best-selling writer of The Tipping Point and Outliers.

The online retailer’s aggressive tactics, which involve delaying shipments of Hachette books or declining to make others available for purchase, are “a violation of their best interests”, said Mr Gladwell, a Hachette author.

. . . .

In an interview for Saturday’s FT Weekend Magazine, Mr Gladwell said he was “agnostic” on the business dispute but disliked becoming a “pawn”. He said: “I thought Amazon wanted to be nice to me. I thought their endgame was to woo authors. So, then why are they sabotaging us?”

. . . .

The company also acts as a platform for the sale of self-published books, potentially challenging the historic role of publishers, whose services to authors include paying advances and publicising their work, as well as publishing and distributing books.

Mr Gladwell dismissed the idea that successful authors could cut out traditional publishers in the digital era. “I hesitate to weigh in on this most sensitive occasion. I have a very nice arrangement with my publisher,” he said.

“The truth is the relationship between an author and a publisher is not set in stone. It’s a relationship. You can structure it however you wish. And if circumstances change and you think that the publisher needs to do more or less than they’ve done in the past then you should just alter your business arrangement. These things aren’t givens.”

Link to the rest at The Financial Times (which has an unpredictable paywall. Search Google using the title of this post and you should get in) and thanks to SMH for the tip.

PG suggests that if Gladwell didn’t want to be a pawn, he shouldn’t have signed with a company like Hachette in the first place.

In Latest Volley Against Amazon, Hachette’s Writers Target Its Board

15 September 2014

From The New York Times:

Amazon is at war with Hachette, and it sometimes seems as if it has always been that way.

As a negotiating tool in the battle, which is over the price of e-books, Amazon is discouraging its customers from buying the publisher’s printed books. After six months of being largely cut off from what is by far the largest bookstore in the country, many Hachette writers are fearful and angry. So this week, they are trying a new tactic to get their work unshackled.

Authors United, a group of Hachette writers and their allies, is appealing directly to Amazon’s board. It is warning the board that the reputation of the retailer, and of the directors themselves, is at risk.

“Efforts to impede or block the sale of books have a long and ugly history,” reads a letter being posted to the group’s website on Monday morning. “Do you, personally, want to be associated with this?”

. . . .

“Since its founding, Amazon has been a highly regarded and progressive brand,” it says. “But if this is how Amazon continues to treat the literary community, how long will the company’s fine reputation last?”

. . . .

The letter warns the directors that the discontent might spread.

“Since its founding, Amazon has been a highly regarded and progressive brand,” it says. “But if this is how Amazon continues to treat the literary community, how long will the company’s fine reputation last?”

Link to the rest at The New York Times and thanks to Tom for the tip.

Punching straw men in the Hachette-Amazon dispute

8 September 2014

From author J. Nelson Leith:

There’s an all-out reactionary assault against the evil leviathan Amazon which, unfortunately, is manifesting itself as a foolish defense of the greater evils of incompetence and irrationality.

. . . .

Which nicely segues into the most egregiously inane slash-piece against Amazon lately, a quasi-viral piece in the Los Angeles Times, wherein Carolyn Kellogg punches her way through a squad of straw men while pretending to pick apart Amazon’s position.

When you choose to attack straw men instead of attacking your opponent’s arguments, it’s usually because your opponent’s arguments are unassailable.

. . . .

Kellogg either doesn’t understand what she just read or is being intentionally dishonest.

[from Amazon] “With an e-book, there’s no printing, no over-printing, no need to forecast, no returns, no lost sales due to out-of-stock, no warehousing costs, no transportation costs, and there is no secondary market — e-books cannot be resold as used books. E-books can be and should be less expensive.”

It’s true that these material costs are removed from the equation of e-book costs. But most publishers are still publishing print books, so those costs remain part of their bottom line. Publishing e-books adds costs: making design adjustments, encoding in multiple formats, creating metadata methodology, etc. Making an e-book is not cost-free.

Again, “e-books are cost-free” is not even close to what Amazon is saying. Amazon is saying that e-books are less expensive and that this difference isn’t fully reflected in the prices being charged for them.

Can Amazon’s opponents only think in absolutes?

And, pointing out that publishing print books is also part of a company’s bottom line is like pointing out that Berkshire Hathaway sells See’s Candies and Fruit of the Loom. “We can’t mark down the chocolate because underwear is still part of our bottom line!” But in reality, Kellogg’s point is even more ridiculous than that, because print and e-books have the same source material, which means that many costs (e.g., screening, reviewing, and editing manuscripts) are shared by the two products. That’s not more cost per product as she’s implying. That’s less.

. . . .

Amazon’s admittedly problematic size gives it a clear advantage over publishers in determining what the price should be, because they can quickly and easily experiment with pricing until they understand, scientifically, the optimal sales price to maximize profits for everyone: themselves, publishers, and authors. There is simply no way a company like Hachette could match the sheer scale of Amazon’s data and analysis on this matter. If Hachette had any sense (which their incessant fumbling proves they do not) they would take Amazon’s calculations more seriously.

Link to the rest at J. Nelson Leith and thanks to SMH for the tip.

Here’s a link to J. Nelson Leith’s books

Amazon Vs. Hachette: Fewer Middlemen Equals A Better World

31 August 2014

From TechCrunch:

By now everyone is well aware of the ongoing battle between Amazon and publisher Hachette. The thing is, we all know how this story ends; we just don’t know when it will be over. This one does not have a David vs. Goliath ending. Goliath is going to win — and that is a good thing for the world.

An investor in oDesk once said, “Two middlemen seems like one too many.” It was a pivotal statement that solidified the early focus on providing direct connections between employers and freelancers anywhere in the world. Everything we did in the early days of oDesk to support and benefit these direct connections paid off. Everything we did to accommodate other middlemen in the process was a waste of time.

. . . .

Hachette is a middleman. So is Amazon. There should be only one.

The arguments for Hachette go something like this: without great publishers, there will be fewer great writers, and emerging talents will have a harder time establishing themselves. For at least 900 authors, this is a scary proposition. Publishers do provide valuable services of talent discovery, quality control and distribution. But let’s look at each one of these points and see how things could be better with fewer middlemen.

. . . .

Take a look at Apple’s App Store. They’ve effectively destroyed the old guard of video game publishers. It’s only in the last few years that an independent game developer from Vietnam could end up with the No. 1 game in the world. That developer probably never would have been discovered by EA. Platforms like the App Store or Amazon can do a better job of talent discovery than the status quo, because they lower the barriers to entry for aspiring app developers or authors. They give everyone a chance. I don’t hear consumers complaining about the lack of good games available. On the contrary, mobile gaming is hotter than ever.

A platform like Amazon will get data about user conversion rates and user ratings much faster than anyone else and can let the cream rise to the top. Granted, they will not discover authors before they ever write a book, but as soon as a title is available for sale, Amazon can take care of the rest. An aspiring author that self-publishes a title that resonates with readers will rise to the top of the charts in a meritocratic platform like Amazon. We should be embracing meritocratic platforms.

. . . .

The bonus for the world is that eliminating middlemen makes the world more economically efficient and maybe even more educated. Prices come down and the amount of reading goes up.

The lessons for other marketplaces here are straightforward. Align the incentives of the buyer and supplier and, if possible, ignore the incentives of other middlemen.

Link to the rest at TechCrunch and thanks to Joshua for the tip.

Amazon vs. Hachette: Soul searching in techie, bookish Seattle

23 August 2014

From The Seattle Times:

In this city famous for its independent bookstores and pungent coffee shops — brick-and-mortar institutions that value touch, taste and long, rainy afternoons — a high-profile conflict about the business of selling e-books has left many readers feeling conflicted.

Their dilemma: balancing an addiction to the convenient and wallet-friendly services of the local Internet giant with their devotion to the local literary culture.

“I’ve spent more on Amazon just to support them just because everyone was boycotting them,” said Peg Manning, an Orcas Island resident and self-described Amazon junkie who also loves wandering into her local bookstore with her granddaughter.

. . . .

Because of its status as the largest distributor of books, Amazon’s tactics in the Hachette dispute have grabbed headlines and polarized consumers and authors. One national survey indicates some consumers are voting with their wallets — against Amazon — and an informal poll in Seattle shows the issue playing out at cash registers here, too.

. . . .

Small contradictions — the Amazon lover who also supports the local bookstore, and the Amazon skeptic who still buys e-books for his Kindle — point to internal conflicts for readers who are becoming more and more aware of their purchasing power.

It’s a classic case of convenience versus conscience.

At a recent gathering of Seattle’s Meetup Book Club, for readers in their twenties and thirties, 11 members were split between those who prioritize convenience and those who view Amazon’s business practices as monopolistic and strong-arm.

But even during a civil discussion among the reasonable book-clubbers, it became clear this is a touchy subject in the land of Amazon.

One member, his Kindle resting on the table in front of him, said he was an ex-Amazon employee. He didn’t say much else. Down the table, a woman called Amazon a book bully, citing concerns about the company’s growing power. She emailed later asking that her name not be used because she works in tech and doesn’t want to limit future job opportunities.

. . . .

Local writer Lyanda Lynn Haupt, a Hachette author who says her book sales have been affected, claims Amazon’s tactics stifle “ideas and art and a marketplace” because “they are not working in the interest of authors.”

“Amazon’s reach is just so much farther than it should be …,” she said. “It can be really harmful and restricting to authors’ projects.”

Still, Haupt has $150 in Amazon gift cards from friends, and she plans to use them.

Bainbridge Island novelist Jonathan Evison, who spends at least $100 at independent bookstores each month, takes more of a hard-line approach to Amazon, which he believes is seeking world domination (though he has friends who work at the company, and “they’re good people”).

. . . .

“I am like 99.99 percent of the consumers out there,” said local author Robert Dugoni, who was previously published by Hachette but is currently under contract with Thomas & Mercer, one of Amazon’s publishing imprints. “I will always look for a product at the best price and the most convenient way of buying it. It’s hard to pass up the opportunity to sit at your computer, buy a product, and have it delivered to your home two days later.”

Link to the rest at The Seattle Times

 

The Guardian view on Amazon v Hachette: reading and writing

19 August 2014

From The Guardian:

It is either an existential threat to intellectual freedom or a rustbelt media industry meeting its comeuppance at the hands of disruptive technology. The battle between the multibillion-dollar publisher Hachette (and now the Scandinavian publisher Bonnier) and the even more multibillion-dollar Amazon is usually discussed in high-minded tones, particularly by publishers and their authors. But at heart, it is merely another collision between producers and consumers that has a particular significance only if you ascribe a value to books as cultural artefacts. It is perfectly possible, instead of Hachette and Amazon, and the 900 writers who took out a two-page ad in the New York Times to protest, to substitute supermarkets, dairy farmers and the price of milk.

. . . .

There are many ways of arguing the rival cases, but the important question is whether a one-size-fits-all, low-price, consumer-dominated sales model can support a diverse, innovative, challenging literary output. Publishers, and their authors, feel that without the front-loaded system of royalties and editorial and marketing support that publishers provide, many important books would never reach an audience. Amazon and its supporters argue that the digital world slashes the back-office costs of publishing, opens up a world of self-publishing, demolishes the gatekeepers of taste, and democratises the literary world.

Neither side is entirely right, nor entirely wrong. Publishing is not perfect. It has a heavily concentrated ownership and a tendency to publish only what has already proved successful (and plenty of booksellers demand a payment for a place on the table by the door too). But Amazon’s business model, which ranks books neither higher nor lower than ladies’ shavers and pet supplies, claims low prices invariably benefit consumers.

Link to the rest at The Guardian and thanks to Patricia for the tip.

PG suggests that books are too important to entrust to huge corporate publishers. Only authors care enough about books not to sell out their art to the almighty dollar (or pound, euro, etc.).

Ultimately with publishers it’s all about the Benjamins.

The war over e-book sales resonates widely as Amazon, Hachette battle

17 August 2014

From The Globe and Mail:

The obdurate war between the giant international corporations Amazon and Hachette – a battle raging far over our heads like the rumble of gods clashing on Valhalla – will affect the future of publishing around the world. But it is also revealing a number of fervently held and basically emotional beliefs on the part of writers. Writers are coming across as a rather conservative bunch.

. . . .

As the media have been reporting for the past several weeks, the online retailer Amazon.com Inc. and the mega-publisher Hachette Book Group (owner of a couple of U.S. imprints, including Hyperion) are in a dispute over the pricing of e-books. Amazon wants to sell them for around $10, and the publisher, like most other publishers, wants full control over the price, and wants that price to be higher (it doesn’t say exactly how much higher, but e-books sell for as much as $16 right now).

. . . .

So far, most U.S. authors have lined up against Amazon, a corporation that has done almost as much for the dissemination of literature as the printing press itself, yet is pretty much universally despised in artistic circles. Amazon’s transgressions against the artistic spirit are many.

For one, it is almost as powerful as a monopoly. It tries to tell publishers what to do in various ways, and most publishers feel they have no choice but to comply. It has put bookstores out of business, and writers love bookstores.

. . . .

And so they are expressing outrage at Amazon’s treatment of Hachette and its innocent authors. In doing so, they confirm the widely held publishers’ view that e-books should be kept at high prices so as to better reward authors for their labour and brilliance.

. . . .

I understand this, but I think authors should reconsider their pleas for expensive books. The idea that literature should be expensive is an odd one for a group that is generally leftist. Books should not be luxury items; books should be everywhere. People shouldn’t have to think hard about clicking that “buy” button.

Odd, too, is the idea that cheaper books will lose money for the creators. Surely, even writers understand the basic business tenet that lower prices lead to greater sales.

. . . .

In bookselling in particular, high volume is your friend: A large readership is the best possible advertisement a book can have, and it will snowball. People sometimes buy books simply because they are bestsellers.

Okay, the writers say, but what about respect for the book – you know, the notion that even though this digital file may cost exactly nothing to send from one storage device to another, it cost the author five years to write and a lifetime to imagine? Do we really want to start to consider books as mere digital files, as inexpensive, easily consumable and disposable, like pop songs?

Well, you may be surprised to hear that as a (doggedly slow) writer of books, I honestly wouldn’t mind if my books were considered cheap-and-easy pleasures, even disposable. It might make more people buy them.

Link to the rest at The Globe and Mail and thanks to Patricia for the tip.

Weekend Brunch: Amazon v. Hachette, Axe, and Candy Crush

17 August 2014

From Marketplace:

 

 
Thanks to Nikki for the tip.

Hugh Howey on Hachette/Amazon

14 August 2014

From Publishers Weekly:

With the Amazon-Hachette dispute showing no signs of resolution, PW spoke to Wool author Hugh Howey, who has been an outspoken advocate for Amazon, about the ongoing stalemate, e-book pricing and where he thinks this situation is headed.

Amazon has said, repeatedly, that what is at stake in its sales terms dispute with Hachette is e-book prices. Amazon has also said that it is lobbying to keep e-book prices low. Hachette described the situation as a battle to preserve a healthy bookselling environment, that includes physical retailers. Do you think this is really about e-book prices or a healthy bookselling ecosystem? Isn’t it ultimately about two companies that are each attempting to maintain a better operating margin?

I think it’s all of those things, simultaneously. Amazon believes it can sell more books and please more of its customers at a price range of $4.99 to $9.99. Hachette believes e-books cannibalize print sales to the detriment of its longstanding relationship with brick and mortar stores. Hachette has also expressed worry over how much of the book market Amazon controls, and any increased share of e-books strengthens that dominance.

It is also about better operating margin, as you suggest. Amazon is currently discounting e-books at the expense of their own margin, while paying Hachette the full amount based on list price. Hachette needs Amazon to do this discounting, otherwise their readers shop for other e-books. Douglas Preston, one of the authors vocally in support of Hachette’s control over e-book prices, has felt this wrath from his readers in the past, which is why one of his complaints today is that Amazon is refusing to discount his e-books enough! Which is a strange argument. It tacitly agrees with Amazon’s position, which is that Hachette’s e-book prices are much too high.

Of course, Hachette wants to maintain its current deal with Amazon, where it makes 70% of the list price, Amazon takes a hit by discounting down to sane levels and makes perhaps 5%, and Hachette enjoys record profit margins. Look at News Corp’s latest earnings report; under “Book Publishing,” you can see the increase in earnings due to e-books and a clear admission that this format enjoys much greater degree of profitability. As a reader and a writer, I would love to see those record profits more evenly distributed in the form of higher royalties to authors and lower prices for readers. Hachette disagrees. They want to keep it all. From what I understand, they aren’t even currently negotiating with Amazon to settle this dispute, as they can’t possibly get a better deal than the one they currently enjoy.

. . . .

Looking ahead, do you see this showdown between Amazon and Hachette—in which a standard aspect of doing business has erupted into a public fight representing a number of big-picture debates in the industry—leading to anything positive? Is it a landmark moment in the industry, or something that’s been blown out of proportion in the press and, ultimately, won’t affect much in the long run?

I don’t see anything positive coming out of this. Authors’ careers have already been irrevocably harmed. I know what they are going through; I went through this exact same thing when Barnes & Noble refused to carry my novel as part of a boycott of Simon & Schuster titles. Hachette won’t remember why books didn’t perform during this time; the bean counters will look at sales, and authors will be dropped. They’ll carry a black mark for the rest of their careers. It tears me up that this is taking place. For these authors, there is no way to blow this out of proportion. They worked for years to get published, and now they find themselves like children harmed by a nasty marital dispute.

The real danger here is that the other four major publishers see this as a cause and join the fight. There is precedent for thinking they might. They have broken the law in the very recent past in order to collude and force terms on Amazon (and to force higher prices on readers). Publishers have a long and uneasy history with their largest retail partners. Barnes & Noble was the enemy before Amazon came along. Deeply discounted hardbacks were the evil-of-the-day when I was a B&N employee. Publishers seem loathe to give up control of their wares, but it’s the mistake they made by forgetting who their real customers are. The culture inside publishing houses is one of catering to retailers and media outlets; hardly anyone talks about the reader, and that’s a problem.

The result has been increased market share for self-published authors, who communicate directly with their readers, who price their e-books below what a mass market paperback used to cost, and who don’t rely on DRM or fight piracy they way publishers do. I dearly want publishers to survive. I have titles with them. I read their books every day. I spent years selling their titles at bookstores and working with their sales reps. My blog is a tireless attempt to help them navigate the changing publishing landscape, because I want them to do well and to stick around. The end result of this dispute, if it continues, and if other publishers adopt similar stances when it comes to digital pricing, will be that publishers become irrelevant to the majority of readers. No one should want that.

Link to the rest at Publishers Weekly and thanks to Ashe for the tip.

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