Amazon

France’s anti-Amazon minister goes

31 August 2014

From TeleRead:

In the latest of a series of ministerial exits from the deeply unpopular government of French President François Hollande, minister for culture Aurélie Filippetti has quit during a ministerial reshuffle, ostensibly over Hollande’s new austerity policies.

. . . .

Filippetti has been at the forefront of France’s cultural offensive against Amazon and in favor of its own bookstores and publishing industry. The campaign’s significant lack of success is not listed as a major reason for her departure, but it hardly adds to her list of achievements. As recently as mid-August, Filippetti was publicly castigating Amazon again as a destroyer of literary diversity, and pledging her support for the Authors United anti-Amazon campaign.

Link to the rest at TeleRead

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.

Publishing Wars

29 August 2014

From BBC Radio 4:

Who will win the book wars between the world’s largest publishers and Amazon, the comprehensive online retailer? Adam Fleming reports on the latest – and potentially epoch-making – chapter in the book wars.

The big French publishing house Hachette is locked in a battle with Amazon in the US over the price of Ebooks. Amazon alleges the prices which publishers, including Hachette, charge for these titles are too high. In support of its campaign to lower them, Amazon has made purchases on its website of books by authors who are published by Hachette – including such well-known writers as Ian Rankin – slower and more expensive.

. . . .

 Adam Fleming asks why this row has flared up now and who will win it. Where do authors and readers stand in this battle between corporate giants and what do they stand to win and lose? He also explores the radical changes that are taking place elsewhere in the publishing industry – such as self-publishing – in which Amazon is itself involved – and independent funding of books. How will these changes affect all those who write, publish, buy and read books.

Link to the rest at BBC Radio 4 and thanks to Nick and several others for the tip.

There’s a 28-minute radio program at the link that includes interviews with three British indie authors.

Book publishers shout foul over Amazon Japan’s new ratings

29 August 2014

From The Asahi Shimbun:

Online retail giant Amazon Japan introduced a new system this summer to rank book publishers, a decision that has not gone down well with its business partners.

Amazon Japan is the nation’s largest book retailer for paper and electronic media. Its new system gives higher rankings to publishers that pay higher fees to Amazon Japan and to publishers with larger eBook catalogs.

Additionally, eBooks from publishers ranked higher are given more prominence on the Amazon.co.jp website.

Many publishers, including high-profile publishing houses, have protested the move, calling it a form of “blackmail” that exploits the company’s considerable dominance in the book retailing industry.

. . . .

An official with Amazon Japan’s public relations department said, “It’s difficult to comment because the issue deals with individual contracts.”

Link to the rest at The Asahi Shimbun and thanks to SFR for the tip.

I Just Can’t Quit You, Jeff

29 August 2014

From author Jane Adams via The Huffington Post:

The disclaimer comes first. In Amazon’s early days, I had a regular gig reviewing mystery novels — it was like being a taster at the chocolate factory! Still, it wasn’t enough to convince me to invest in their stock, which could then be had for even less than my occasional $50 review checks. As a writer myself, I knew the sorry economics of publishing — an industry where 90 percent of the product lost money, 7 percent broke even, and the rest made the owners enough to cover the others. Why throw good money after bad?

Of course, that was back when Amazon only sold books,its stock was $9 a share, and I thought of the company as being part of an industry that was even then on life support..

Today books are such a small part of the company’s bottom line and Amazon is such a big part of the online economy, you wonder why they fight so hard with publishers who won’t give in for such (relatively) small gains. And why they keep triangulating authors like me — the midlisters — between a rock and a hard place.

. . . .

After a dozen editors who fell in love with my protagonist told my agent they couldn’t sell a book with an elderly (60) romantic heroine, I self-published it with Amazon. Hardly the great American novel — more like chick lit for older women – Sugar Time was smart and funny and I wanted it out there . But “out there” is different in cyberspace, which was the only place it went — sort of like George Clooney spinning into the void in Gravity. I’d always assumed that even if I couldn’t figure out how to break it out via social media, I’d sell enough copies locally and regionally to make a few dollars, and I’d at least get it reviewed in the Seattle papers, which had reviewed my previous 11 titles.

But any home-field advantage I might have reasonably expected evaporated. Not one bookseller would stock it unless ordered and paid for it in advance. “And even then, we wouldn’t put it on our shelves,” added a buyer from Powell’s. “Why would I sell a book by a company that’s driving me out of business?”

. . . .

I don’t blame Jeff Bezos for my failure to take my own advice, Sugar Time has a few sexy scenes, but 50 shades of gray described my heroine’s hair, not her libido. However, like a battered wife, I am still insanely devoted to my (fifth) Kindle. I am a sucker for its instant gratification, low prices, and ease of use.

Link to the rest at The Huffington Post

Here’s a link to Jane Adams’ books

Some Suspicions

28 August 2014

From White Fox:

Global publishing has been buoyed in recent years by a string of books that have exploded globally like supernovas.  From The Girl With the Dragon Tattoo to The Hunger Games, from Twilight to 50 Shades, publisher accountants have separated out such business altering exceptions so as not to distort their day job of copyright exploitation.

So why have there been none of those in the past two years?

. . . .

Now, it could just be that nothing has emerged. That no publisher or indie writer has recently hit on the alchemical formula for mass consumption. Before Harry Potter and Dan Brown, you could argue that it had been a while since Bridget Jones or Thomas Harris. But maybe it’s because the last two years have coincided with Amazon’s being the dominant global seller of books, a business in which promotion and buying and selling is now based on the science of algorithms, not the instincts and experience of a publisher. It is truly consumer driven. And that is not how these bubbles come about.

Link to the rest at White Fox and thanks to Annie for the tip.

Meet The Publisher Who Ditched Amazon And Is Selling More Books Than Ever

28 August 2014

From Business Insider:

Ask Randall White, the 72-year-old CEO of the Educational Development Corp., an Oklahoma-based book distributor, why he decided pull his company’s 2,000 titles — including the acclaimed potty bestiary “Everyone Poops” — from Amazon.com, and the longtime publishing executive makes reference not to a book but to a movie.

“Remember ‘Butch Cassidy and the Sundance Kid,’ when they’re on the cliff and getting ready to jump and one guy says, ‘I can’t swim?’” asks the folksy 72-year-old, referring to the classic Robert Redford-Paul Newman film. “And the other guy says, ‘What are you worried about? The fall’s going to kill you.’”

That was essentially the situation White found himself in, watching helplessly as EDC’s revenues were steadily eaten away by competition from world’s most successful, and most aggressive, online retailer. “We were selling more to Amazon but our business kept declining,” he says, describing a dip of some 40% in one division alone. “I’m thinking, ‘What can I do here? This is crazy.’ You had to fix it, or you’re going to die anyway.”

. . . .

With no real choice, White took the leap in 2012, becoming one of the only publishers in the country to spurn the “everything store.” Distributors who resell books to Amazon, including Ingram and Baker & Taylor, also soon found their supplies of books like “The Gas We Pass” and “Sticker Dolly Dressing Dream Jobs” cut off. For good measure, EDC also ditched other big-box discount stores, including Sam’s Club, Costco, and Target.

In a turn of events that might offer some solace to other publishers, White recently announced that EDC has not only survived the leap into the unknown but just had its best year ever in net revenues. July sales were up 28% over the same month last year, and first-quarter revenues came in 20% higher than 2013’s numbers.

. . . .

One concerned observer was Peter Usborne, founder and CEO of Usborne Books, the U.K.-based publisher of children’s books, for which EDC has long held U.S. distribution rights (EDC also owns the small California publisher Kane Miller). “We weren’t involved in the decision,” says Usborne, who continues to do business with Amazon in the UK and elsewhere. “Randall just told me he’d done it. He quite likes a fight, and I think he was looking down the wrong end of a shotgun. It looked pretty grim for a while, but now it seems he’s the wind in his sails.”

EDC’s stockholders also initially found the decision alarming. “They weren’t happy,” White says. Shares had already drifted down from a high of around $12 to something like $2.50. “Fortunately, I own enough that I don’t get fired,” he says with a laugh.

. . . .

The success of EDC is a rare piece of good news for book publishers, who have spent most of the last two decades watching helplessly as the Seattle-based behemoth relentlessly came to dominate the industry. Although Amazon now sells more books than every other outlet combined, the entire division represents just 7% of the company’s annual revenue, according to an educated guess by The New Yorker.

Link to the rest at Business Insider and thanks to Shelly for the tip.

6 Ways Competitors Are Trying to Kill Amazon

27 August 2014

From New York magazine:

As Circuit City, Borders, or any number of other defeated corporations will tell you, competing with Amazon is hell. Jeff Bezos’s e-commerce empire is a muscled behemoth, with $75 billion in annual sales, Genghis Khan–size ambitions, and the leverage to wrangle extreme concessions from its suppliers. What Amazon does, it does very well, and that includes steamrolling companies that get too close to its turf.

“Amazon has such a lead at this point that trying to eat away at their core business is pretty challenging,” says Scott Tilghman, a senior analyst at B. Riley. Challenging, but not impossible. Like knights circling a dragon looking for patches of soft skin between the scales, smaller, newer companies have spent years scanning Amazon’s business model for weak points. And now, increasingly, they’re finding them. Here are a few ways competitors will try to chip away at Amazon’s dominance in the months ahead.

Win at discovery. Amazon’s recommendation system works best for people who already know what they want to buy. Go to Amazon for a broom, and you might be persuaded to buy a dustpan, too, but you’re not likely to walk away with a wrap dress.

That’s because Amazon is relatively weak at what e-commerce types call discovery: helping consumers find things to buy through browsing, in the manner of a catalogue.

One start-up that’s hoping to exploit this weakness is Spring, a new shopping app backed by a slate of A-list investors, where more than 200 fashion brands post their wares. Spring’s main advantage is that it is prettier than Amazon, with a sleek Instagram-­like interface that allows users to browse outfits from high-end brands like Rebecca Minkoff and Alice + Olivia and make purchases directly from the retailer with a few taps.

“I probably spend half my disposable income on Amazon, but I do think there are weaknesses,” says Spring co-founder David Tisch. “They’re better at data and recommendations than anyone, but they’re not good at impulse. We focus on: How do you find things you didn’t know you were looking for? How do you get inspired?”

. . . .

Target the extremities. Amazon’s biggest strength is its size and idiosyncratic structure—it does so many things, from buying original TV shows to building in-house video games, that it’s basically impossible to replicate the entire thing from scratch. But doing everything also makes Amazon vulnerable to smaller, nimbler start-ups carving off chunks of its business.

One e-book start-up, Oyster, has already drawn return fire from Amazon, which launched an all-you-can-read e-book subscription service to compete with Oyster’s $9.95-a-month “Netflix of books” service. Another start-up, BookLamp, which recommends books to users based on a Pandora-­style analysis, was acquired by Apple in July in hopes of turning it into an Amazon-killer.

Still, wresting back books will be hard, considering Amazon’s enormous advantage. (Kindles reportedly account for six out of ten e-book sales in the U.S.) The bigger opportunities will be in areas where Amazon’s infrastructure hasn’t become ubiquitous: namely, streaming media. There’s Netflix, of course, as well as Spotify, Pandora, Hulu, and Beats Music—all of which are outdoing Amazon by some measure—but more competitors are surely on the way.

Link to the rest at New York

PG thinks Amazon does a great job with discovery. The PG household buys a lot of different items on Amazon, but books constitute the largest number of purchases and Amazon’s personalization and emails regularly lead both PG and Mrs. PG to new books.

Why Amazon Is Paying $1 Billion to Help People Watch Video Games

26 August 2014

From Blookberg Businessweek:

For months Twitch, the video-game streaming service, was supposedly putting the finishing touches on a deal with Google. Now Twitch’s suitor has switched, and a deal has been reached with Amazon. The $970 million cash deal is the biggest acquisition in Amazon’s history. In a statement, Twitch’s chief executive said the company would continue to operate independently.

There are a few reasons Amazon would want Twitch, some of them Amazon-specific, others more general. First, a primer on Twitch. It’s a website on which people watch other people play video games. Some of the people playing are experts; others aren’t even all that good. To understand why Amazon would pay for a website such as this, you have to accept one fact: People like watching other people play video games. This consistently baffles many non-gamers, but it’s true.

Twitch, founded in 2011 as part of now-defunct Justin.tv, has 55 million unique monthly users, and 7 million people log onto the website each day. While Web entertainment is reputedly all about short attention spans, Twitch users stick around for nearly two hours per day on average.

. . . .

It might be better to see Twitch not as the next step in Amazon’s plan to become a gaming empire, but as its latest move to get hold of video content that people want to watch. Twitch is a place where people watch video games, not where they play them.

Link to the rest at Bloomberg Businessweek and thanks to India and several others for the tip.

According to The Wall Street Journal, Twitch is the fourth-largest source of U.S. Internet traffic, behind only Netflix, Google and Apple.

Ellora’s Cave CEO Confirms Amazon Sales Drop

25 August 2014

From Publishers Weekly:

Ellora’s Cave CEO Patty Marks confirmed the house is downsizing in the wake of what she described as “drastic’ and unexplained declines in its e-book sales via Amazon. Marks confirmed the layoffs of freelance editors, and said the house continues to have discussion with Amazon to find the cause of the sales dropoff.

Marks sent a letter to Ellora’s Cave authors about the major sales dip, and the note was then re-posted online. Marks said Ellora’s Cave sales via Amazon have dropped by as much as 75%.

. . . .

According to Marks, the issue is likely related to a change in Amazon’s search algorithm. Many of Ellora’s Cave’s bestselling authors and titles simply don’t show up in the Amazon search engine anymore.

. . . .

Marks also wanted to emphasize that Ellora’s Cave is paying all royalties on time and, contrary to some rumors, is not considering bankruptcy.

. . . .

“Sales have dropped before, but not like this,” Marks elaborated. “It’s been a drain.”

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

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