From the Independent Book Publishers Association:
Amazon doesn’t just take orders. It is used to barking orders at publishers and getting us to salute. But bullying only goes so far, and I’m thankful that a single large publisher, Hachette, stood up to it and that The New York Times ran an editorial about its strong-arm tactics.
I’ve been sitting on my own Amazon story for a while, after having receiving a threatening phone call from its legal department when I refused to agree to a unilateral change of terms. But with all the publicity and debate about Hachette, I thought other publishers, as well as Berkshire Publishing’s friends, colleagues, and customers, might like to know about our experience and why I believe that Amazon is destroying healthy competition in the publishing world.
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My fight with Amazon began when it decided to go after traditional “short discount” publishers (academic presses as well as presses like Berkshire Publishing) with a unilaterally imposed change in business terms announced only in a “case note” within their order-processing platform. This platform is normally used to inquire about the availability of certain books and is used by customer service staff.
A colleague of mine whose staff was puzzled enough to pass the “case note” along to him asked Amazon to contact him directly by telephone or email, saying that business terms were a matter for our company’s executive team. Amazon refused to talk—communication would take place only through the “case.”
Berkshire Publishing had sold print through Amazon.com since 2006. Although it originally demanded a 40% discount—four times our standard—I decided that we should make books available through any major platform that individual readers and libraries use. Our authors like knowing that their books are readily available worldwide. And we reach some people who would never otherwise know about our titles. In fact, I was recently at a meeting in Beijing and showed a copy of our book This Is China: The First 5,000 Years. Two of the people there started whispering and giggling, and finally one spoke up, “I have that book. I ordered it from Amazon!”
Amazon’s demand in 2012 was for an additional 5%, bringing the discount to 45% (some academic presses had been at 25%, so the change to 45% meant a reduction of 80% in their net income from Amazon sales). Bookstores generally get a discount of 30-40%. Amazon has been getting 50-55% from the big trade presses, and the current battles are in part over further discounts that Amazon is demanding to increase its marginal profit.
. . . .
Amazon is destroying competition and innovation because it is not letting the market determine winners and losers, but is instead making the selection itself, deciding arbitrarily where to take its pound of flesh and shore up its feeble margins. Publishers (and authors) would be fine if they were actually competing with one other for sales without Amazon sucking the life out of every transaction.
Finally, what happened? Are Berkshire Publishing titles available through Amazon? Dear reader, I capitulated after four months. It wasn’t fair; it wasn’t good for anyone but Amazon, but I was losing sales that I needed and I gave in.
Link to the rest at the Independent Book Publishers Association and thanks to Karen, who points out that this brings into focus the area where independent publishers and independent authors are NOT aligned for the tip.
While PG almost reflexively takes the side of the little guy/gal in any battle, he would suggest that Amazon is exquisitely attuned to the market, much more so than any publisher.