PG’s Thoughts (such as they are)

How to Read a Book Contract – Somebody’s Gonna Die

12 October 2019

Per a request in the comments, from an earlier post on The Passive Voice

Let’s assume you are an author represented by a literary agent. If Passive Guy asks you who your agent is, you’ll respond with something like “Suzanne Jones” or “James Davis.”

Passive Guy is certain Suzanne and James are wonderful people, but they’re going to die.

This is not a threat, simply a statement of biological reality.

Who will your agent be after Suzanne dies? Will it be someone you choose or not?

You selected Suzanne because she had a great reputation for helping authors build good long-term careers. Your career isn’t built yet. Who’s going to help build your career if she’s gone?

These are not hypothetical questions. One of the comments to a recent essay about agents by Kristine Kathryn Rusch described the story of Ralph Vicinanza, a literary agent for Stephen King, the Dalai Lama and others, who died in September, 2010, at age 60.

Here’s a bullet-point description of what has happened since Mr. Vicinanza’s death, according to the comment (which fits with other accounts PG has found):

  • The other two agents in the Vicinanza agency quit their jobs
  • A letter was sent to all authors advising them to find other agents and promising to continue to pay royalty checks
  • The executor of the Vicinanza estate intends to keep receiving payments from publishers and collecting agency fees from the authors
  • Other agents are asking Vicinanza authors for more than 15% to handle titles the Vicinanza agency handled, presumably because the estate will claim the first 15%

Contracts with a large organization should differ from those with an individual or small organization. A large organization, like a big publisher, is not going to disappear. It may go bankrupt or be sold, but it will have enough value so someone is likely to keep it running in some form or fashion.

However, if somebody in a large publisher dies, another person will replace the dear departed and business will continue as usual. An author has a relationship with a big publisher because the publisher can jam a lot of books into bookstores, airports, Wal-Mart, etc. The jammers may change, but the jamming continues. (PG knows about author/editor relationships, but you can hire an editor without hiring Random House.)

In a small organization, like a literary agency, a death of an individual can result in the death of the agency. PG would suspect many of the clients of Mr. Vicinanza’s agency signed the agency contracts because of Mr. Vicinanza, and quite possibly, only because of Mr. Vicinanza. PG would have signed if Mr. Vicinanza promised to turn him into another Stephen King.

It appears the executor of Mr. Vicinanza’s estate is his sister, Louise Billie. Passive Guy did a quick Google search and couldn’t find any evidence that Ms. Billie is a literary agent or has any experience in that business. Yet, under the agency’s contracts with authors, Ms. Billie, acting on behalf of the estate, is handling royalties and, presumably, retaining 15% plus, perhaps, expenses.

What’s the contractual solution to problems like this? It’s much simpler than stating the problem.

If the services of a particular individual are a key value to you, include a provision in the contract that gives you the right to terminate the contract:

  • if that person dies,
  • becomes disabled and unable to perform his/her normal work, or
  • leaves the agency for any reason

As far as what happens to the agency percentage on book contracts the agent negotiated while alive or working at the original agency, PG would push for a provision that says those end when your agent goes.

A possible compromise would be that the agency percentage continues to be paid to the agency for one or two years after termination, but PG doesn’t like that because, at least according to the hypothetical value proposition of an agent, the agent’s services are continuing and overlap from book to book. The work an agent puts into your third book also enhances sales of books one an two.

The Vicinanza experience demonstrates that other agents are not willing to accept authors under standard compensation terms if they have to share compensation.

If agents boohoo about this, Passive Guy would simply point out that, if an attorney dies, the attorney is entitled to fees earned up until he takes his last breath and no more. A client is always free to hire another attorney at any time, whether the attorney is alive, partly dead or all the way dead.

Someone is bound to ask why the author should receive royalties forever while the agent who negotiated the publishing contract doesn’t receive agency fees forever.

The answer is that when the author wrote the book, she created an asset, recognized under copyright law, that will exist for a long time and is capable of generating income in a variety of different ways over its lifetime, some of which are recognized today and others of which won’t be conceivable for another 50 years.

The author owns the asset, the agent does not. The agent was paid for a service provided. PG would argue if the ongoing services of a particular agent were the key value to the author, when those services are no longer provided for any reason, the author shouldn’t be required to make any additional service payments.

One big change in book publishing is that it does not require you to have much of an organization to play anymore

30 September 2019

From veteran publishing consultant, Mike Shatzkin:

More than two decades into its digital transition, book publishing has evolved so that a capital-intensive infrastructure is no longer a requirement to successfully develop a book, or a list of books, and bring the books to market. This has resulted in a self-publishing segment, so far almost entirely author-driven, that is substantial in reach and readership and which offers ongoing competition to the commercial publishing business largely because of its ability to price its ebooks below what would be survival levels for commercial publishers.

. . . .

What publishers do, over and over again, is the business of “content” and “markets”. Each book is unique content and is individually delivered to its own unique market. So publishers need to stick to content and markets that they understand in a contextual way. That is usually done by sticking to genres in fiction and topics or “audiences” for non-fiction. But people who live in any of many non-fiction “worlds” could well be as well-equipped as any publisher to grasp the content-and-market equations in those environments.

The discrete tasks are:

1. Creating the content, which requires domain knowledge (the world of the content) and, of course, the ability to discern good and effective writing and presentation. And a knowledge of the content world implies a sense of any particular project’s uniqueness and timeliness.

2. “Packaging” the content in a form that is reproducible. That means different things for print and for digital. And it is more complicated for books that are illustrated or annotated with charts or graphs.

3. “Marketing”, or making potential readers aware of the book. This takes in what we used to think of as publicity and advertising, which in the “old days” largely centered around book reviews and the sections in newspapers that carried them, but which is now much more about search engine optimization and social network marketing.

4. Connecting with the avenues of distribution: reaching the sources of printed books their customers might use — bookstores, other retailers, or online merchants for consumers and wholesalers or distributors for those intermediaries, print and e. You have to sell to them and serve them: persuade them to carry or list the book and then deliver, bill, and collect so they can.

5. Selling rights where you can’t sell books. Because many books, no matter their origin, have the potential to gain additional revenue and exposure through licensing for other languages or placing chunks of the book’s content in other venues (what was very simply “serialization” in the all-print days), rights sales and mangement is another activity that a book publisher has to cover.

How have the avenues for sale to end users changed in the past two decades?

Before digital change arrived, which for trade publishers we could say began when Amazon opened in 1995, publishers sold most of their books in stores. The books got there because their sales reps persuaded the stores to stock them. Reps and stores are still a part of the delivery system, but they are no longer the only path to an audience that can deliver a book’s author substantial revenue.

In the past 20 years, online sales of print have moved from under 5% of the total units to certainly 40% of units, perhaps 50%. And it can be much more for some titles.

In addition to print, publishers sell ebooks and those are exclusively online. Twenty years ago, sales were zero. Now they appear to be 20% or more of the sales for big publishers. Once again, there is a range across titles and types of titles and there is a whole new segment of digital-first publishers for which the percentage of ebook sales is much higher, sometimes approaching 100%.

. . . .

Twenty years ago was probably the peak of the big bookstore chains — Borders and Barnes & Noble. Two decades ago, those two retail behemoths were more than 30% of many publishers’ sales. Today, Borders is gone, Barnes & Noble has shrunk, and their sales are less than 10% for most publishers. The number of chain stores is fewer than half of what it was, but shelf space for books has shrunk even more.

As a result of the diminishing bookstore space — shrinking and disappearing chains and despite a recent resurgence of independents the growth from them hasn’t nearly replaced what’s been lost — the opportunities to put printed books in front of consumers have shrunk. So the shelf space in mass merchants, like Walmart and Costco, is especially important for the big books.

. . . .

At the same time, the general interest book clubs have pretty much disappeared. Publishers used to be able to move thousands of copies of big books through those direct mail channels. They’re effectively gone.

And all of the above is really attributable to the fact that the sales have moved to Amazon. Twenty years ago they were probably not as much as 2 percent of book sales. Now, if you include Kindle sales, they are almost certainly 50 percent of the sales. For printed books alone, they are over 40 percent for most publishers.

. . . .

Amazon sales reached a tipping point about ten years ago. Kindle, launched in 2007, grew fast, as the first “direct download” ebook system. (Before Kindle, the ebooks had to be downloaded into a computer and then “synched” to a device.) So when Amazon first offered the self-publishing opportunity through Kindle, they were able to “reach” an audience of sufficient size to enable aspiring authors to actually make some money. When they added their “Create Space” capability for print-on-demand, an author could readily reach half the book-buying audience with one stop.

That was really the catalyst for what has become a tsunami of self-publishing.

. . . .

The much-cheaper [indie ebooks on Amazon] were most compelling for the audiences that consumed many titles: readers of romance, sci-fi, thrillers, and mysteries. It didn’t take long — maybe a couple of years — for a very robust title selection in those genres to become available from many previously-unknown authors.

Whether it was intentional or not, Amazon’s flipping of the time-honored “razors and blades” pricing strategy contributed to their rounding up all those multiple-book readers.

. . . .

[F]rom day one, the tiny-but-growing community of Kindle readers bought an outsized number of books.

For those authors who captured readers through the combination of low-pricing and the appeal of the free book “samples” that digital enabled, the Amazon self-publishing ecosystem could be very remuerative.

. . . .

Regular publishing required an agent most of the time but it required a lot of patience all of the time. Finding an agent took effort and could take months. The publishers’ decision-making process to buy also took a long time, often months. The act of publishing took a long time, also often months. It quite often added up to years. And then the share the author got was a fraction of what Kindle would pay them.

. . . .

So by 2010, we had a very different profile of intermediaries between publishers and their readers than we had a decade or so before.

And in the decade since, the total retail shelf space dedicated to books, across chains, independents, mass merchants, and specialty merchants, has continued to decline. The share of sales being taken by online has continued to grow to the level we cited: 50 percent for most titles. All publishers, but particularly big publishers, have taken to heart that they have to market direct to consumers . . . .

. . . .

If you go back to the top to look at the requirements to publish a book, numbers one and two are the creation and designing of a book, and most publishers use freelance capabilities for that which are available to anybody, including individual authors. Number three (marketing) has many components, but there are a plethora of independent services available to deliver most of the capabilities. Number four (connecting with the avenues of distribution) is delivered by Amazon to their customers and by Ingram to the world. And number five (licensing, particularly foreign rights) can be done by a vast network of agents and digital marketing consultants that already exists. You don’t need to own any of it to play.

And, as a result of all of that, many of the structural advantages a being a book publisher have faded in importance. A person with a manuscript, a computer, and a bit of a budget has been able to publish effectively, and sometimes profitably, for the past ten years. That has spawned the current infrastructure of capabilities and services that might suddenly be discovered as a key tool by entities bigger than individual authors. On another day, we’ll explore that might mean to publishing’s future.

Link to the rest at The Shatzkin Files

PG has been hard on Mr. Shatzkin on many occasions in the past. However, over the past several months, Shatzkin has come around nicely (in PG’s occasionally meek and deferential opinion).

If PG were to date this change, he thinks it may have begun when Shatzkin retired (or mostly-retired, PG has no familiarity with anything other than what The Shatzkin Files have disclosed) from his work as a long-time and well-respected publishing consultant based in New York City.

As PG considered this apparent change, he was reminded of Miles’ Law, reputedly named for Rufus E. Miles, Jr., a supervisor in the Bureau of the Budget in the 1940s who told a group of subordinates that, in government agencies, “Where you stand depends on where you sit.”

PG has never been in the traditional publishing business (although he has been exposed to traditional publishers via helping Mrs. PG by reviewing the publishing contracts from the traditional publishers with which she formerly did business).

PG was not alone in recognizing the potential for Amazon and its general pricing practices, but particularly for its aggressive move into ebooks, to completely upend traditional publishing. He had witnessed and participated in the revolution that had significantly impacted the legal profession with the birth of computer-based word-processing and its ability to turn out perfect, custom-fitted documents of all sorts very quickly and inexpensively. When he was still practicing retail law, PG made a lot of money by building software programs that could start printing out sophisticated wills and trusts or divorce petitions and related documents while the client was still in the process of writing a check and handing it to one of his legal assistants.

Even more importantly, PG had absorbed significant amounts of the thinking and writing of Clayton M. Christensen, Harvard Business School professor and well-known author of The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail, a book that Jeff Bezos and Steve Jobs have each said had a major impact on how they built Amazon and Apple.

The early moves of Bezos into providing self-publishing tools for the masses were extraordinarily disruptive, especially for ebooks, putting Amazon’s promotional power behind making some of those indie ebooks into big sellers and, even more important, on a per-ebook basis, paying authors far more than they would receive from the sale of an ebook via a traditional publisher through Amazon.

When you add the tools Amazon has provided for author to exercise broad control over ebook pricing plus author access to the Amazon-based advertising and marketing tools for selling books, Amazon has effectively set up an online laboratory that permits authors to experiment with all sorts of marketing/pricing strategies in an ongoing search for the best way to sell a lot of ebooks. Perhaps more important even than the money Amazon earns from selling indie ebooks, it is in a position impossible for any traditional publisher to equal, where it can watch and learn from all the various pricing/marketing/product design experimentation going on among thousands of individual authors, including some who are selling a huge number of ebooks.

PG suggests that, while good editors, nicely-formatted books and skilled cover designers are very important for most indie authors, paying for those services separately (or doing them yourself, particularly in the case of book formatting), instead of offloading those jobs to publishers and giving up far more income than even the most expensive editor or designer would charge just doesn’t make sense.

If you’re writing in a niche that benefits from quick-to-market strategies to take advantage of something that’s happening right now or soon will happen, a traditional publisher is most definitely not a smart strategy. You can make it all happen much faster (and probably  much better – most publishers’ employees are generalists, not specialists in particular market segments or sub-segments, plus everything at a publisher is subject to bureaucratic time lags) by doing it (or hiring specialists to do it) yourself.

The discovery of truth is prevented more effectively, not by the false appearance things present and which mislead into error, not directly by weakness of the reasoning powers, but by preconceived opinion, by prejudice.

~ Arthur Schopenhauer

Bureaucracy defends the status quo long past the time when the quo has lost its status.

~ Laurence J. Peter

In any bureaucracy, there’s a natural tendency to let the system become an excuse for inaction.

~  Chris Fussell

Bureaucracy is a giant mechanism operated by pygmies.

~  Honore de Balzac

Why Did Interactive Ebooks Never Catch On?

5 September 2019

From BookRiot:

It’s taken for granted that an ebook will be almost indistinguishable from its paper version. You could change the font or text size, sure, but you aren’t getting anything that couldn’t be achieved in print. But reading text on a screen offers a lot more options: when reading lengthy online pieces, we expect to have embedded images, videos, and hyperlinks mixed in with the text. Click on a Wikipedia article, and it’s a very different experience from a paper encyclopedia, if just for the links. You can get lost in a never-ending proliferation of tabs. Paper books don’t usually invite this non-linear reading experience, and ebooks copy this system.

. . . .

So why did interactive ebooks never take off? Why can’t I check out an interactive version of my favourite book, where there is an embedded playlist, so I hear the same music or bird songs the characters are listening to? Why don’t my textbooks all come with interactive illustrations that can be rotated and disassembled? Why isn’t there an ebook of House of Leaves that is even more immersive and claustrophobic? Where are the ebook gifs, I ask you?

There’s an excellent Wired article by Steven Johnson that I recommend called “Why No One Clicked On the Great Hypertext Story.” In it, Johnson describes how in the ’90s, with the growing possibilities of the internet, “hypertext fiction” became not only possible, but seen as the future of literature: a pick-your-path story for the digital age. After all, the internet makes the navigation of these kind of stories a lot easier. This technology opened up a lot of possibilities for storytelling. Decades later, we have come nowhere near realizing that potential.

For hypertext fiction, there are were a couple of problems, and they can be expanded to interactive text in general. For one thing, they were incredibly difficult to write. A story that can be endlessly reshuffled in its parts to combine into new stories is a lot to demand of an author, but even the most basic of interactive ebooks requires additional work to finding the right words. Imagine if authors not only had to craft their world, but also provide Pottermore-style interactive illustrations for each scene, and select the perfect soundtrack.

Even when you have all the component parts, it’s a whole other layer of difficulty to make an interactive ebook work. Right now, most interactive ebooks are available as their own apps, because the most popular ebook apps don’t support interactive formats. And if you’re going to be making an app, you need to be able to code.

There’s a lot more demanded on the reader’s end. You have to find and download each individual book’s app . . . . If they are truly interactive, these ebooks also require more from their readers⁠—which was another problem with hypertext fiction. Most people picking up a book don’t want endless ways to read them, and don’t want to pause partway to play a mini game before they can read the next chapter. For the most part, we want our books to be linear.

This isn’t to say that interactive ebooks don’t exist. There are some, but they have not come anywhere near to being mainstream. They aren’t available as a format next to the audiobook and standard ebook option.

. . . .

[I]s the simple, text-based format of books a feature, not a deficit?

. . . .

At their best, books become invisible. They are the means by which we dive into a story, and once we are invested, we stop even seeing the words in front of our eyes. We don’t register that we’re reading. We’re transported. An interactive ebook may end up being less engaging than the plain text version, because it creates a barrier to losing yourself in the story; it makes it harder to forget that you’re reading.

Link to the rest at BookRiot

PG suggests linearity in books is a feature, not a bug. He suggests the human brain is constructed to absorb, retain and analyze information in a linear form.

Beginning, middle and end is not the only way stories can be constructed or recounted, but it is almost certainly the most common story form. Flashbacks can be interesting, but, ultimately they’re not usually satisfactory (at least for PG) unless they contribute to an understanding of a character or story at the time when the story, in the main, is taking place.

For the record, PG doesn’t characterize stories that begin, “When I was a little girl . . .” and end with something like “And so, I’ve always remembered to be kind to all animals.” as a flashback so much as it is a story that takes place in the past with a bit of a frame on it.

PG also doesn’t have a problem with the linearity of two parallel stories taking place at different times with the narratives jumping between past and present so long as they are linked in some way that creates a satisfying experience for the reader. However, if an author tried to combine an episodic telling of the stories of Charlotte’s Web and The Cat in the Hat into a single narrative, PG doubts that a result more satisfying than reading each story by itself would be delivered to the reader.

PG also poses a question. He understands there is a concern with substantial numbers of young people who seldom read for a variety of reasons including poor schools, addictive videogames, unlimited television, etc., etc.

However, is there any real evidence that children who receive a decent education that includes reading and have the opportunity to read outside of school are not enjoying the experience and continuing to read as they grow older? In other words, is there significant and reliable evidence that stories told linearly, beginning, middle and end, are no longer satisfying for such children?

Or, perhaps, PG is entirely out of touch and wrong as can be?

Amazon Has Ceded Control of Its Site. The Result: Thousands of Banned, Unsafe or Mislabeled Products

23 August 2019

From The Wall Street Journal:

Many of the millions of people who shop on Amazon.com see it as if it were an American big-box store, a retailer with goods deemed safe enough for customers.

In practice, Amazon has increasingly evolved like a flea market. It exercises limited oversight over items listed by millions of third-party sellers, many of them anonymous, many in China, some offering scant information.

A Wall Street Journal investigation found 4,152 items for sale on Amazon.com Inc. ’s site that have been declared unsafe by federal agencies, are deceptively labeled or are banned by federal regulators—items that big-box retailers’ policies would bar from their shelves. Among those items, at least 2,000 listings for toys and medications lacked warnings about health risks to children.

The Journal identified at least 157 items for sale that Amazon had said it banned, including sleeping mats the Food and Drug Administration warns can suffocate infants. The Journal commissioned tests of 10 children’s products it bought on Amazon, many promoted as “Amazon’s Choice.” Four failed tests based on federal safety standards, according to the testing company, including one with lead levels that exceeded federal limits.

Of the 4,152 products the Journal identified, 46% were listed as shipping from Amazon warehouses.

After the Journal brought the listings to Amazon’s attention, 57% of the 4,152 listings had their wording altered or were taken down. Amazon said that it reviewed and addressed the listings the Journal provided and that company policies require all products to comply with laws and regulations.

“Safety is a top priority at Amazon,” says a spokeswoman. Amazon uses automated tools that scan hundreds of millions of items every few minutes to screen would-be sellers and block suspicious ones from registering and listing items, using the tools to block three billion items in 2018, she says.

“When a concern arises,” she says, “we move quickly to protect customers and work directly with sellers, brands, and government agencies.”

Amazon declined to make executives available for interviews.

. . . .

“There are bad actors that attempt to evade our systems,” Amazon said of products in violation of its policies that appear on the site, adding that “should one ever slip through, we work quickly to take action on the seller and protect customers.”

. . . .

Amazon’s struggle to police its site adds to the mounting evidence that America’s tech giants have lost control of their massive platforms—or decline to control them. This is emerging as among the companies’ biggest challenges.

. . . .

Some lawmakers have begun calling for more regulation of the companies. Courts have begun challenging the firms’ interpretation of their legal protections, and regulators are scrutinizing them. Tech companies say they aren’t illegal monopolies and have generally pledged to address issues such as misinformation and privacy.

Amazon’s common legal defense in safety disputes over third-party sales is that it is not the seller and so can’t be responsible under state statutes that let consumers sue retailers. Amazon also says that, as a provider of an online forum, it is protected by the law—Section 230 of the Communications Decency Act of 1996—that shields internet platforms from liability for what others post there.

. . . .

Last month, the U.S. Court of Appeals for the Third Circuit held that a Pennsylvania customer could sue Amazon over an allegedly unsafe product. The court said Amazon could be considered a seller under Pennsylvania law, in part because the company had no vetting process to ensure that third-party sellers were accessible and available for consumers to sue if they were harmed by an item, leaving consumers with no recourse in many cases. The court also held Amazon had considerable control over third-party sellers and could prevent sales of unsafe items. Amazon has asked the appeals court to review the decision.

. . . .

Last year, the Environmental Protection Agency fined Amazon for letting people sell unregistered pesticides. Amazon agreed, without admitting wrongdoing, to pay a fine and set up new systems to stop such sales. Earlier this year, Washington state’s attorney general and Amazon filed a settlement in state court over state allegations that the company allowed school products on the platform that contained lead and cadmium above federal and state limits. Amazon didn’t admit wrongdoing.

Amazon tells customers, on its payments site: “We want you to buy with confidence anytime you make a purchase on the Amazon.com website.”

On its site aimed at third-party sellers, it says customers “know and trust us, and that trust extends to you.”

Third-party sellers are crucial to Amazon because their sales have exploded—to nearly 60% of physical merchandise sales in 2018 from 30% a decade ago, Amazon says. The site had 2.5 million merchants with items for sale at the end of 2018, estimates e-commerce-intelligence firm Marketplace Pulse.

Amazon doesn’t make it easy for customers to see that many products aren’t sold by the company. Many third-party items the Journal examined were listed as Amazon Prime eligible and sold through the Fulfillment by Amazon program, which generally ships items from Amazon warehouses in Amazon-branded boxes. The actual seller’s name appeared only in small print on the listing page.

Link to the rest at The Wall Street Journal (Sorry if you encounter a paywall)

PG says this report hurts Amazon. By PG’s assessment, the WSJ has generally been neutral or positive in its past coverage of the company, so this criticism comes with substantial credibility.

As depicted in the article, Amazon’s response is immensely ham-handed.

The quote from the “anonymous spokeswoman” was pure PR babble and Amazon’s refusal to make an executive available for comment was an even more stupid move. The WSJ is going to print a major story that has taken weeks of work criticizing Amazon on a Friday and no Amazon executive is available for a comment on the preceding Monday, Tuesday, Wednesday or Thursday?

Amazon has been a very smart company in the past and Jeff Bezos has been a superb voice for the company.

PG has to admit that the Bezos divorce/other woman story made him worry that Bezos would become too distracted to provide the brilliant leadership that has been very beneficial to the company (and its customers) in the past.

Another Distracted-Bezos concern that has been floating about in PG’s mind is a common pattern in US corporate management history, particularly in tech companies. This pattern sometimes appears when a founder/CEO has a strong personality and clear, unconventional vision for what the company is and how it will operate.

PG is thinking of Steve Jobs and Apple, Bill Gates and Microsoft, and Sam Walton and Walmart as examples. (Walmart is not a tech company, but during its developing years, made brilliant use of computer technology to successfully manage its explosive growth.)

This pattern is that the magnetic CEO either doesn’t attract or drives away executives who have similar personalities and talents, so continued excellence suffers without that CEO because the leadership and innovation qualities of the next management layer down are lacking.

A prime example is Apple. Whatever virtues current CEO Tim Cook possesses, in PG’s digitally humble opinion, he’s no Steve Jobs.

Sales of the iPhone, which accounted for 59% of Apple’s revenues in Q4 2018, have been flat, compelling new features have disappeared and purposely-leaked news of future iPhone innovations has been received with far less enthusiasm than in prior years.

Anticipating some pushback on the Microsoft example, PG suggests that Gates was technically charismatic for the tech audiences of his time.

If, as PG fears, Bezos/Amazon is another example of this pattern, he wonders if Amazon will lose its way in ebooks and books as well. While there is some Amazon Derangement Syndrome at work in recent stories about counterfeit books and copyright violations in listings by some sellers, especially those headquartered outside the US, the lax oversight of sellers by Amazon described in the WSJ article may be reflected in its book business as well.

PG regards the reported behavior of allowing Chinese firms to sell almost anything they want to sell on Amazon while the company accepts no responsibility for the sellers’ bad behavior as a disturbing indication that executives below Bezos lack the firm commitment to customer satisfaction that powered Amazon’s ascendance to its current position.

Amazon’s defense position that it is not the seller in lawsuits by Amazon customers for damages caused by defective products may be legally correct, but this sort of behavior by Amazon will undercut customer confidence that Amazon is a quality company selling quality products and a good place to shop. A typical American consumer has absolutely no ability to obtain reparations from a Chinese merchant for defective products.

If, as the OP suggests, many parts of Amazon’s ecommerce offerings are devolving into online flea markets, Amazon’s reputation is headed downward.

Nike Nixes ‘Betsy Ross Flag’ Sneaker

3 July 2019

Tomorrow, July 4, is a major American holiday, Independence Day.

The holiday commemorates the Declaration of Independence of the United States on July 4, 1776.

The Continental Congress declared that the thirteen American colonies were no longer subject (and subordinate) to the monarch of Britain and were now united, free, and independent states. The Congress had voted to declare independence two days earlier, on July 2, but it was not declared until July 4.

From The Wall Street Journal:

Nike Inc. is yanking a U.S.A.-themed sneaker featuring an early American flag after NFL star-turned-activist Colin Kaepernick told the company it shouldn’t sell a shoe with a symbol that he and others consider offensive, according to people familiar with the matter.

The sneaker giant created the Air Max 1 USA in celebration of the July Fourth holiday, and it was slated to go on sale this week. The heel of the shoe featured a U.S. flag with 13 white stars in a circle, a design created during the American Revolution and commonly referred to as the Betsy Ross flag.

After shipping the shoes to retailers, Nike asked for them to be returned without explaining why, the people said. The shoes aren’t available on Nike’s own apps and websites.

“Nike has chosen not to release the Air Max 1 Quick Strike Fourth of July as it featured the old version of the American flag,” a Nike spokeswoman said.

After images of the shoe were posted online, Mr. Kaepernick, a Nike endorser, reached out to company officials saying that he and others felt the Betsy Ross flag is an offensive symbol because of its connection to an era of slavery, the people said. Some users on social media responded to posts about the shoe with similar concerns. Mr. Kaepernick declined to comment.

The design was created in the 1770s to represent the 13 original colonies, though there were many early versions of the America flag, according to the Smithsonian. In 1795, stars were added to reflect the addition of Vermont and Kentucky as states.

In 2016, the superintendent of a Michigan school district apologized after students waved the Betsy Ross flag at a high-school football game, saying that for some it is a symbol of white supremacy and nationalism, according to Mlive.com, a local news outlet. While the flag’s use isn’t widespread, the local chapter of the National Association for the Advancement of Colored People said at the time that it has been appropriated by some extremist groups opposed to America’s increasing diversity.

Link to the rest at The Wall Street Journal (Sorry if you encounter a paywall)

Here’s a replica of the offending flag:

Here’s the story behind this flag per The History Channel:

Perhaps the best-known figure from the American Revolutionary era who wasn’t a president, general or statesman, Betsy Ross (1752-1836) became a patriotic icon in the late 19th century when stories surfaced that she had sewn the first “stars and stripes” U.S. flag in 1776. Though that story is likely apocryphal, Ross is known to have sewn flags during the Revolutionary War.

. . . .

Elizabeth Griscom was born on January 1, 1752, in the bustling colonial city of Philadelphia. She was the eighth of 17 children. Her parents, Rebecca James Griscom and Samuel Griscom were both Quakers. The daughter of generations of craftsman (her father was a house carpenter), young Betsy attended a Quaker school and was then apprenticed to William Webster, an upholsterer. In Webster’s workshop she learned to sew mattresses, chair covers and window blinds.

. . . .

In 1773, at age 21, Betsy crossed the river to New Jersey to elope with John Ross, a fellow apprentice of Webster’s and the son of an Episcopal rector—a double act of defiance that got her expelled from the Quaker church. The Rosses started their own upholstery shop, and John joined the militia. He died after barely two years of marriage. Though family legend would attribute John’s death to a gunpowder explosion, illness is a more likely culprit.

. . . .

In the summer of 1776 (or possibly 1777) Betsy Ross, newly widowed, is said to have received a visit from General George Washington regarding a design for a flag for the new nation. Washington and the Continental Congress had come up with the basic layout, but, according to legend, Betsy allegedly finalized the design, arguing for stars with five points (Washington had suggested six) because the cloth could be folded and cut out with a single snip.

The tale of Washington’s visit to Ross was first made public in 1870, nearly a century later, by Betsy Ross’s grandson. However, the flag’s design was not fixed until later than 1776 or 1777. Charles Wilson Peale’s 1779 painting of George Washington following the 1777 Battle of Princeton features a flag with six-pointed stars.

Betsy Ross was making flags around that time—a receipt shows that the Pennsylvania State Navy Board paid her 15 pounds for sewing ship’s standards. But similar receipts exist for Philadelphia seamstresses Margaret Manning (from as early as 1775), Cornelia Bridges (1776) and Rebecca Young, whose daughter Mary Pickersgill would sew the mammoth flag that later inspired Francis Scott Key to write “The Star-Spangled Banner.”

. . . .

In June 1777, Betsy married Joseph Ashburn, a sailor, with whom she had two daughters. In 1782 Ashburn was apprehended while working as a privateer in the West Indies and died in a British prison. A year later, Betsy married John Claypoole, a man who had grown up with her in Philadelphia’s Quaker community and had been imprisoned in England with Ashburn. A few months after their wedding, the Treaty of Paris was signed, ending the Revolutionary War. They went on to have five daughters.

Link to the rest at The History Channel

PG will note that Ms. Ross’ connection with the Quakers is particularly ironic. Per Wikipedia:

The Religious Society of Friends (Quakers) played a major role in the abolition movement against slavery in both the United Kingdom and in the United States of America. Quakers were among the first white people to denounce slavery in the American colonies and Europe, and the Society of Friends became the first organization to take a collective stand against both slavery and the slave trade, later spearheading the international and ecumenical campaigns against slavery.

. . . .

Quaker colonists began questioning slavery in Barbados in the 1670s, but first openly denounced it in 1688. In that year, four German settlers (the Lutheran Francis Daniel Pastorius and three Quakers) issued a protest from Germantown, close to Philadelphia in the newly founded American colony of Pennsylvania. This action, although seemingly overlooked at the time, ushered in almost a century of active debate among Pennsylvanian Quakers about the morality of slavery which saw energetic anti-slavery writing and direct action from several Quakers, including William Southeby, John Hepburn, Ralph Sandiford, and Benjamin Lay.

During the 1740s and 50s, anti-slavery sentiment took a firmer hold. A new generation of Quakers, including John Woolman, Anthony Benezet and David Cooper, protested against slavery, and demanded that Quaker society cut ties with the slave trade. They were able to carry popular Quaker sentiment with them and, beginning in the 1750s, Pennsylvanian Quakers tightened their rules, by 1758 making it effectively an act of misconduct to engage in slave trading. The London Yearly Meeting soon followed, issuing a ‘strong minute’ against slave trading in 1761. On paper at least, global politics would intervene. The American Revolution would divide Quakers across the Atlantic.

. . . .

In the United Kingdom, Quakers would be foremost in the Society for Effecting the Abolition of the Slave Trade in 1787 which, with some setbacks, would be responsible for forcing the end of the British slave trade in 1807 and the end of slavery throughout the British Empire by 1838.

Link to the rest at Wikipedia

So Kaepernick and Nike managed a woke twofer, smearing one of the most famous women in the history of the early United States and a religious group (during an era when religious groups were quite influential in American public life) that was the single most prominent early religious force urging the abolition of slavery.

 

Amazon Gets Bulk of Complaint in AAP Filing with US Trade Commission

27 June 2019

From Publishing Perspectives:

For years, many in the publishing industry of the United States and other parts of the world have wanted to see Amazon examined by American governmental regulators for potential anti-competitive practices.

And, as various elements of Washington’s apparatus now address issues in terms of the major tech platforms, the Association of American Publishers (AAP today (June 27) is filing a 12-page statement with the Federal Trade Commission (FTC), urging the commission to more closely scrutinize the behavior of dominant online platforms that “pervade every aspect of the economy.”

. . . .

And while we find 12 references to Google in AAP’s commentary, it will surprise few in the book business that Amazon is mentioned 33 times.

Today’s filing from the Washington-based AAP, in fact, references that Streitfeld article from the Times’ June 23 edition, though not the Amazon answer, and is responsive to the FTC’s hearings near the close of a long cycle called “Competition and Consumer Protection in the 21st Century”

. . . .

A distinctively international element is engaged at points in which AAP relies on the European Commission’s investigations and action on Amazon’s use of “most favored nation” clauses (MFNs)and the May 2017 acceptance by the EU of Amazon’s commitment to stop using those clauses in distribution agreements with book publishers in Europe.

. . . .

AAP president and CEO Maria A. Pallante is quoted, saying, ““Unfortunately, the marketplace of ideas is now at risk for serious if not irreparable damage because of the unprecedented dominance of a very small number of technology platforms.

“In order to mitigate this crisis and protect the public interest, AAP urges the FTC to exercise much-needed oversight and regulation, particularly as to circumstances where technology platforms stifle competition and manipulate consumer outcomes.”

. . . .

The formulation used by AAP in setting up its commentary rests in two key areas: book distribution and search.

Regarding search, Google is naturally the key interest and AAP’s messaging to the media flags this, saying, “AAP notes that Google’s complete and untouchable dominance is highly problematic [quoting now from its own FTC filing] ‘because its business model is largely indifferent to whether consumers arrive at legitimate or pirated goods.’”

But in reference to book distribution, of course, it’s Amazon that comes in for the lion’s share of complaint. The association in its media announcements finds something of a thesis statement in its commentary to be “No publisher can avoid distributing through Amazon and, for all intents and purposes, Amazon dictates the economic terms, with publishers paying more for Amazon’s services each year and receiving less in return.”

The association delineates five “primary areas of concern” for structuring its commentary this way, we’re quoting here:

  • “Platforms exercising extraordinary market power in the markets for book distribution and Internet search
  • “The threat to competition when platforms act as both producers and suppliers to the marketplaces they operate
  • “Platforms’ imposition of most-favored nation clauses and other parity provisions that stifle competition, market entry, and innovation
  • “Platforms’ use of non-transparent search algorithms and manipulated discovery tools that facilitate infringement and deceive consumers
  • “Platforms’ tying of distribution services to the purchase of advertising services.”

. . . .

In its introductory comments, AAP asks the FTC to consider ways in which tech platforms differ from other players in dominant market operation. It’s here that the association starts grappling with the traditional idea that if prices are low, then anti-competitive harm to the consumer isn’t a factor.

“First,” the association writes, “the assumptions that consumers will purchase goods at the lowest available price and that competition for market share will exert downward pressure on market prices depend on consumers receiving timely and accurate information about prices and quality. … That is often not the case in markets in which one or a handful of platforms use proprietary search algorithms and manipulated discovery tools to tilt the playing field toward particular suppliers or their own distribution channels or products.

“Second, modern technology platforms benefit from—and in some cases depend on—network effects. The larger the network, the greater the competitive advantage over rivals and potential rivals and, once entrenched, the platform has a greater ability to preserve and extend its market power in ways that are not available in markets that are not characterized by network effects.

“Third, in markets dominated by modern technology platforms, an analysis of consumer welfare must not overemphasize retail price levels relative to other critically important factors. The analysis of consumer welfare also must account appropriately for factors such as decreases in quality, consumer choice, and innovation, and a corresponding rise in consumer deception. Nowhere are these considerations more important than in the marketplace for information and ideas.”

Link to the rest at Publishing Perspectives

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‘Restoring the Promise’ Review: High Cost, Low Yield

25 June 2019

Not exactly about books, but PG would bet that over 80% of those who read the books written by regular visitors to TPV (excepting authors of children’s and YA books) are college graduates.

From The Wall Street Journal:

We are at the end of an era in American higher education. It is an era that began in the decades after the Civil War, when colleges and universities gradually stopped being preparatory schools for ministers and lawyers and embraced the ideals of research and academic professionalism. It reached full bloom after World War II, when the spigots of public funding were opened in full, and eventually became an overpriced caricature of itself, bloated by a mix of irrelevance and complacency and facing declining enrollments and a contracting market. No one has better explained the economics of this decline—and its broad cultural effects—than Richard Vedder.

Mr. Vedder is an academic lifer—a Ph.D. from the University of Illinois and a long career teaching economic history at Ohio University. In 2004 he brought out “Going Broke by Degree: Why College Costs Too Much,” and in 2005 he was appointed to the Commission on the Future of Higher Education, a group convened by Margaret Spellings, the U.S. education secretary. “Restoring the Promise: Higher Education in America” is a summary of the arguments he has been making since then as the Cassandra of American colleges and universities. Despite the optimistic tilt of the book’s title, Mr. Vedder has little to offer in the way of comfort.

As late as 1940, American higher education was a modest affair. Less than 5% of adults held a college degree, and the collegiate population amounted to about 1.5 million students. This scale changed with the first federal subsidies, Mr. Vedder notes, beginning in 1944 with the Servicemen’s Readjustment Act (the “GI Bill”). Within three years, veterans accounted for 49% of all undergraduate enrollment—some 2.2 million students. Having earned degrees themselves, the veterans expected their own children to do likewise.

Such expectations were supported by still further subsidies, through the National Defense Education Act (1958) and the Higher Education Act of 1965. By the 1970s, there would be 12 million students in the American college and university system; by 2017, there would be 20 million. Meanwhile, more and more federal research dollars poured into campus budgets—reaching some $50 billion in direct funding by 2016—and set off infrastructure binges. To pay for them, as Mr. Vedder documents, tuition and fees vaulted upward, while the federal programs that were intended to ease the financial burden—especially low-interest student loans—only enticed institutions to jack up their prices still higher and spend the increased revenue on useless but attention-getting flimflam (from lavish facilities to outsize athletic programs). At Mr. Vedder’s alma mater, Northwestern, tuition rose from 16% of median family income in 1958 to almost 70% in 2016. Over time, armies of administrators wrested the direction of their institutions away from the hands of faculties and trustees.

Today a college degree has become so common that 30% of adult Americans hold one. Its role as a bridge to middle-class success is assumed—though bourgeois comfort is rather hard to achieve these days with a B.A. in English literature or a degree in, say, sociology. The modern economy, says Mr. Vedder, simply doesn’t possess the number of jobs commensurate with the expectations of all the degree-holders.

The over-educated barista is one of the standing jokes of American society, but the laughter hasn’t eased the loan burden that the barista probably took on to get his degree. Mr. Vedder says that student loans have injected a kind of social acid into a generation of young adults who, over time, manifest a “decline in household formation, birth rates, and . . . the purchase of homes.” Pajama Boy was born, and took up residence in his parents’ basement.

Link to the rest at The Wall Street Journal (Sorry if you encounter a paywall)

And a quote from economist Herbert Stein:

What economists know seems to consist entirely of a list of things that cannot go on forever . . . . But if it can’t go on forever it will stop.

PG suspects that this practice may have become impolite or illegal, but when he was interviewing for his first job out of college (before he went to law school) one of the last questions he was asked by the final interviewer, the head of the department in which the job opening existed, was, “What were your SAT scores?”

Evidentally PG’s answer was satisfactory because he was hired for the position despite having absolutely no training or education that might lead a reasonable person to conclude he was prepared for the specific tasks involved in carrying out his job responsibilities.

What the interviewer was trying to ascertain was whether PG might be smart enough to learn how to do the job if he was hired. (PG was, and received a promotion after about a year, but left the company when a better job beckoned.)

PG has read that the SAT and ACT tests (for visitors to TPV from outside of the United States, these are standardized tests required for entry into virtually any college or university in the country) are effectively proxies for IQ tests.

IQ tests were first developed during the early part of the 20th Century for the purpose of identifying retardation in school children. During World War I an intelligence test was devised to help quickly screen soldiers coming into the US Army for assignment to either basic training or officers training. (At the start of the war, the US ground forces included about 9,000 officers. At the end of the war, there were over 200,000 officers.)

After World War I, IQ testing became much more widespread in both education and business. Unfortunately, it also became entangled with the eugenics movement during the 1920’s and 1930’s.

On a general basis, there is a correlation between educational attainment and IQ – MDs, JDs, and PhDs have higher IQ’s on average than college graduates who, in turn have higher IQ’s than those who attended college but did not graduate and those individuals have higher average IQ’s than those who graduated from high school, but received no additional education.

In this as in countless other things, correlation is not causation. There are plenty of people who possess the inherent intelligence and ability to become MDs, JDs and PhDs who choose not to pursue that educational/occupational path. Such individuals do not, of course, become less intelligent if they go in another direction. From personal experience, PG can attest that there is no shortage of attorneys who do stupid things.

A US Supreme Court case titled Griggs v. Duke Power Co., decided in 1971, effectively forbade employers from using arbitrary tests—such as those for measuring IQ or literacy—to evaluate an employee or a potential employee, a practice that some companies at the time were using as a way to get around rules that prohibited outright racial discrimination.

Griggs began when African American workers at the Duke Power Company in North Carolina sued the company because of a rule that required employees who wished to transfer between different departments to have a high-school diploma or pass an intelligence test.

By a unanimous decision, the Supreme Court held that the tests given by Duke Power were artificial and unnecessary and that the requirements for transfer had a disparate impact on African-Americans. Furthermore, the court ruled that, even if the motive for the requirements had nothing to do with racial discrimination, they were nonetheless discriminatory and therefore illegal. In its ruling, the Supreme Court held that employment tests must be “related to job performance.”

Griggs and resulting civil rights laws notwithstanding, prospective employers still want the best evidence available that a job applicant possesses the abilities (including intelligence) to succeed in the position that needs to be filled.

Given the regulatory environment in which employers operate, post-high school education is a common (and legal) requirement specified in a great many job descriptions. In the US business world, a bachelor’s or advanced degree is often a hard and fast must-have. Written or online job applications always include a section for the applicant to list undergraduate and post-graduate degrees and the institutions that granted such degree(s).

In addition to a degree, the identity of the college/university the applicant attended is often regarded as a proxy for the applicant’s intelligence and ability. The holder of a bachelor’s degree from Harvard will generally be assumed to be more intelligent than someone who graduated from Northeast Hickville State College and Welding School regardless of the personal abilities, talents, work ethic and raw intelligence of the latter.

So, back to the OP,

  • A college degree from an institution generally known for its selective nature is becoming more and more and more expensive because there is no indication that increased tuition and other costs will have any adverse impact on the number and general qualifications (intelligence) of its applicants; and
  • A college degree from some institution, high-quality or not-so-high-quality, as a proxy for intelligence, regardless of the field of study, is a requirement for obtaining a job with a reasonable salary or even getting a foot in the door at a very large number of employers; and
  • Government and other loans are available to any student who wishes to attend almost any college, regardless of a student’s field of study or ability to pay; and
  • As a general proposition under US bankruptcy laws, it is difficult or impossible to avoid the obligation to repay student loans, especially for recent college graduates or graduates who have obtained jobs, regardless of the amount of their current income.

PG wonders one of the ways to address this problem would be to permit employers to receive the results of an IQ test or quasi-IQ test like the SAT or ACT from a job applicant without risking litigation or other penalties for doing so.

Memorial Day

27 May 2019

Repost from Memorial Day, 2013:

For readers outside the United States, today is Memorial Day in the US.

While for many, the holiday is only a long weekend marking the beginning of summer, Memorial Day, originally called Decoration Day because flowers were used to decorate gravesites, was established in 1868, following the American Civil War to commemorate men and women who died while in military service.

PG took this photograph of the American military cemetery in rural Tuscany near Florence. Most soldiers buried there died in World War II, fighting in Italy.

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