“Get Big Fast.” How Amazon Accelerated the Commodification of Literature

From The Literary Hub:

Amazon founder Jeff Bezos came up with the slogan “Get Big Fast” because he knew size was crucial to exacting ever lower prices from suppliers. Publishers have tried to respond to Amazon’s power by doing the exact same thing, accelerating their decades-long campaign of mergers and acquisitions to consolidate into an ever smaller number of bigger firms all trying to publish ever bigger books (like the memoirs of Barack and Michelle Obama, for which Penguin Random House advanced an astonishing $65 million).

The push towards “big” explains Penguin Random House’s play to absorb Simon & Schuster. Matt Stoller describes the merger as “defensive, an attempt to gain bargaining power against a monopolist bookseller.” This kind of producer integration is an understandable response to overly powerful buyers, especially since antitrust law prevents separate companies from banding together to create countervailing power.

But it causes knock-on problems for suppliers and workers downstream. As Stoller puts it, “it’s not fair that authors must sell on the terms laid down by increasingly powerful publishers, but this dynamic is driven by the far more unfair situation whereby publishers are dealing with the utterly ruthless trillion dollar powerhouse Amazon.”

An increasing “bestseller” mentality contributes to the vulnerability of independent presses to being absorbed. Mass-market retailers only stock the titles they predict will be hits, and online marketplaces amplify the books that are shifting fastest. This results in “a cycle so self-fulfilling it’s nearly tautological: Best sellers sell the best because they are best sellers.” As a result, according to book analyst Mike Shatzkin, “the medium-sized publishers can’t sustain themselves anymore. They can’t compete for the really big titles, so they get bought.”

Even the very biggest publishers are merging with one another. Incredibly, Penguin and Random House (the world’s two biggest trade publishers) were permitted to merge in 2013, creating a behemoth of unimaginable scale, now fully owned by private German conglomerate Bertelsmann. That giant is now persuading regulators to let it gulp down Simon & Schuster, one of the world’s biggest remaining publishers.

As publishers go around gobbling up others and being gobbled up themselves, they have sought to recover losses to Amazon with gains exacted from writers and libraries. Writers have found themselves with less power to negotiate the terms of their contracts than perhaps ever before, regularly being obliged to sign away their worldwide English-language rights, audio rights, even graphic novel rights all in one go. Libraries, meanwhile, have seen mounting costs and onerous conditions for the electronic materials they buy from major publishers, even as electronic materials account for an ever larger share of their collections.

Amazon long refused to license the titles it publishes to libraries on any terms at all. In 2020, however, as the COVID-19 pandemic spotlighted the crucial importance of remote access to books, some US states passed legislation to require publishers to license titles to libraries on reasonable terms, and Amazon was finally forced to bend. Some publishers, like Hachette, make their books available to North American libraries but refuse to license them to libraries throughout the UK, Australia, and New Zealand on any terms at all. In other words, as more and more value gets siphoned further up the food chain, there’s less and less for everyone else.

While Amazon started with books, that was never its main game. Right from the beginning it planned to use books we searched for and bought to gather data on us in order to sell us more stuff and, ideally, take over the world. Ebooks were a perfect fit for Amazon’s extractive mindset, because they cost us more in terms of privacy than physical titles ever could. Amazon knows what we search for, what we read, and what we listen to—when and for how long. This “actionable market intelligence” allows it to poach authors, market its own titles to readers, and cross-sell non-book items to readers. The combination of surveillance and vertical integration means that Amazon vastly out-powers both publishers and other retailers, cementing its dominance, and giving it more opportunities to spy on readers.

This is the true heart of “surveillance capitalism”—not the idea that Big Tech uses data-mining and machine learning to create mind-control systems that bypass our critical faculties and trick us into buying whatever they want to sell us. Rather, Big Tech abuses monopoly power to deprive us of choice by limiting what we can buy, redirecting our searches to hide rivals’ products, and locking us into its ecosystem with technologies we can’t alter without risking a lengthy prison sentence.

Amazon tracks the phrases we highlight, the words we look up, who else is reading from the same address. All this allows it to deduce the most intimate information about our lives: whether we’re struggling with our gender identity or sexual orientation, if we think our partner is cheating or that we might be depressed, if we’re having money problems or struggling to get pregnant or considering leaving our jobs. Public libraries have some of this same information, and they guard it fiercely. But Amazon feeds it into an insatiable machine designed to extract maximum profit. If you, as a reader, feel uncomfortable with this, that’s too bad: DRM makes it illegal for you to read or listen to the books you’ve purchased on surveillance-free platforms.

But our individual exposure and commoditization is just the beginning of the harm that was wrought. Amazon used books to extract data on consumers and used that data to slowly subsume all else. The data that came out of physical books and later ebooks and audiobooks all fed into that flywheel that gave it ever more information, which enabled it to attract ever more customers and ever more products, and which has ultimately ended up giving it the power to squeeze its suppliers and workers to near asphyxiation.

There’s no reason to believe this flywheel will slow down without intervention. The money Amazon squeezes out all along the supply chain funds its famous “kill zone.” Anyone who enters Amazon’s territory (or that of Facebook, Google, and other giants) knows they’ll be bought or destroyed. Amazon threw away $200 million in a single month when it went after the company behind diapers.com, first weakening it by bribing away its customers with impossibly low prices, then acquiring it for a fraction of its previous value. At that point Amazon shut down its new acquisition and put its own prices back up.

Link to the rest at The Literary Hub

16 thoughts on ““Get Big Fast.” How Amazon Accelerated the Commodification of Literature”

  1. As Stoller puts it, “it’s not fair that authors must sell on the terms laid down by increasingly powerful publishers, but this dynamic is driven by the far more unfair situation whereby publishers are dealing with the utterly ruthless trillion dollar powerhouse Amazon.”

    It’s driven by the fact that the supply of books to publishers is far more than they need. Want to fix it? Have 90% of authors withdraw from the market.

  2. “Get big fast” had nothing to do with books.

    The literati need to get over themselves because not only does the world not revolve around their concerns, neither does the book business. (The book business revolves around lucre. Like any other business.)

    As to Amazon, you’d think that after 27 years people would’ve noticed that “get big fast” was and is about competitive positioning: getting big enough to compete with *WalMart* (and Target) before they realized how important online shopping would be. And about getting big enough to leverage the free cash flow from the low margin retail business to expand into high margin adjacent businesses. Books were just step one, low lying fruit, on a long road to riches. And it is not a particularly important sector to the “trillion dollar company” Amazon has grown into. (If books were all thzt msttered about Amazon, Bezos would be on welfare.) They’re Gnats railing against Amazon, barely detectable noise pollution.

    All the OP rant achieves is expose their politics, ignorance, and self-importance.

    Because the book business has always been a commodity business. At least ever since literacy stopped being limited to the rich and powerful. They would know that if they weren’t history iliterate on top of economy illiterate.

    • [rant mode on]

      I agree, but their complaint is really about knowing the price of everything and the value of nothing.

      And yes, they did make their politics more important than the problem.

      Let me clarify; everything is political is like saying all science is quantum physics. True, but not useful. While one can calculate the orbit of Pluto using quantum mechanics it would overly complicate the process where one has far simpler and as effective substitutes: Newtonian, or for more precision Einsteinian physics.

      So, all the problems of the human condition can be solved politically, but solving them that way makes the process more complicated than it has to be.

      Market economies need some oversight and regulation (the politics if you like), because all games need rules; especially for edge cases.

      The edge case here being price versus value.

      Things can be as cheap as chips, and still be worth absolutely nothing.

      [rant mode off]

      • Are US market economics “unrestrained”?
        What further kind of restraints are needed?
        To serve which interests?
        And finally, who should get to judge value vs price if not consumers?

        Sony just spent months trying everything out of the FUD playbook to convince Brazilian and UK regulators to block the Microsoft purchase of Activision to boost tbe fortunes of GAMEPASS their gaming subscription service (ala Netflix, but different in that games can be rented or purchased, as consumers prefer).

        https://www.windowscentral.com/gaming/xbox/sony-knows-it-wont-lose-call-of-duty-to-xbox-exclusivity-heres-what-its-really-about

        In Brazil they failed in their very public manipulation and the regulators stated that their job was to protect consumers, not entrenched dominant competitors. (Microsoft is a distant fifth in global gaming and even adding Activision would remain so. What would change is they would have a bigger backlist of games for their subscription service, challenging Sony’s prefered $70 purchase only and “if you don’t like the game, tough” policy.) GAMEPASS starts as a $10 a month service, much like Kindle Unlimited. So which approach best serves consumers?

        In the US the head of tbe FTC gave an entire political rant about how big mergers need to stop and how they would take a detailed look for ways (excuses, really) to block the merger. Eight months later? Nothing yet. Because when push comes to shove tbe deal for MS to take over a crippled brand disfunctunal developer will in fact benefit employees, consumers, and yes, Activision stockholders who saw their stock drop by 40% in two months before tbe deal. During which they went to every other big company that might afford to buy them out and all refused: Amazon, Apple, Google, Tencent, and Sony, too. Not because of tbe price but because modern gaming requires pumping tens of millions into games over 5-6 years and then hoping enough gamers buy it to make some profit. Which can be enormous or none. Microsoft sees a different road with GAMEPASS and they can afford the bet that tbere is more money at $10 than at $70. They might be right, they might be wrong as tbey were in buying out Nokia.

        Time will tell but a race to the bottom in tbe real world is more often than not a race to bigger and mofe stable profits as Walmart, Amazon, and Microsoft itself (Office 365) have proven repeatedly.

        The OP isn’t overcomplicating things by dragging in politics, instead they are bringing in politics to hide the fact that tbeir positions have zero validity without the ideological smokescreen. Strategic stupidity indeed.

        They are not looking to protect creators nor consumers but the (now optional) middlemen who have driven the tradebook industry into stagnation with 19th century policies and lack of vision.

        Trade books have *always* been a high volume low margin play.
        Every single such business ever has *always* depended on racing to the bottom to maximize the volume over which to spread the costs. Basic business 101. High prices only succeed when tbere are no alternatives which was true of books early in tbe 19th stopped being so soon thereafter. In order, penny dreadfuls, pulps, movies, radio, tv, video games, internet, with more alternatives to come.

        As to Amazon, they didn’t invent volume price discounts, the BPHs did. They didn’t invent Agency or global rights grabs or any of tbe disfunctions of trade book publishing. They just play the game as the publishers want it. They just play it better.

        But the OP really shouldn’t sweat book prices: very soon they’ll get their wish of higher prices across the board: $20 trade paperbacks and $40 hardcovers.

        And then we’ll see if price elasticity applies or if “books are special”.

        In the business world, when all is said and done, economics trumps ideology in tbe long run.

        • Mind you this isn’t say Amazon has a halo and wings (though they sell them) but that floating fallacious and disingenuos “issues” over and over obscures and detracts from the things they do that *should* be challenged.

          Diatribes like tbe OP don’t help and instead hurt the market players.

          Bad ideologues, bad, bad, bad…
          Somebody hit them on the nose with a rolled up newspaper.

          • I agree. It seems again that my ability to write what I mean fails to my inability to communicate clearly.

            Rules for me doesn’t mean what I think you interpreted it as.

            It for me is about quality control (and even that is not correct, just a metaphor from the need to process meat hygienically).

            Market regulation, for me, is to prevent/reduce corruption (the politics of life is about favours for favours), and again because I’m an not smart enough to explain myself clearly without ambiguity.

            I’m an idiot, or a stupid person, just like all the other stupid people where the only thing that differentiates me from my peers is that I know I’m stupid and an idiot.

            • Uh no.
              The questions of controls are the underbelly of any democracy.
              “Who watches the watchmen?”
              Corruption is an unavoidable element of every system ever devised. And to date *nobody* has been wise enough to figure out how to restrain human nature. No law yet in place has been able to prevent those with power from using it to benefit “the friends of the party”. And themselves. Two hundred-plus years and counting. Examples abound in every single administration at every level. No clean hands. “Favors for favors” indeed. Everybody who enters politics comes out richer than they went in. Power=money, money=power, and everybody wants more.

              The questions I listed have been part of american political debate since the very beginning and they will remain even after the absolutists win and democracy ends. All anybody can do is fight to keep that day at bay as long as possible by focusing on them. Stop asking them and it’s game over.

  3. Is the OP being misleading or just ignorant?

    ” 2020 some US states passed legislation to require publishers to license titles to libraries on reasonable terms, and Amazon was finally forced to bend”

    Are you ignorant of rulings under the US constitution?

    Maryland ebook licensing law is unconstitutional, U.S. court rules

    https://www.reuters.com/tags/intellectual-property/

    • Both: the appropriate term is “willful ignorance”. It applies to folks that do not wish to be burdened with facts that conflict with their misconceptions.

      https://www.yourdictionary.com/willful-ignorance

      Also:
      “Willful ignorance differs from ordinary “ignorance“ — when someone is simply unaware of something — in that willfully ignorant people are fully aware of facts, resources and sources, but refuse to acknowledge them. Indeed, calling someone “ignorant” shouldn’t really be a pejorative, but intentional and willful ignorance is an entirely different matter. ”

      “Willful ignorance is sometimes referred to as tactical stupidity.”

  4. The OP gives the game away by their constant acknowledgement that Amazon only accelerated existing trends.

    The unfortunate fact for the OP is that while Amazon is bad for *publishers,* authors now have it easier than they ever have. You don’t have to have a publisher to have access to book distribution channels anymore, and authors that might never have seen a dime from their work in the old days are now raking in the cash, or at least making a little supplementary income.

  5. There’s a lot of stupid in the OP.

    Not to mention paranoia about “Amazons know how and what you read because of ebooks, highlights, reading habits, etc….” On this bit of stupid alone, it assumes that all (Amazon) ebook reading takes place on Amazon devices using Amazon software, directly and constantly connected to the internet to send feedback to the mother ship. Even if you are a (cooperative) captive of the Amazon store & reading devices, no one says you have to stay connected to read. You want privacy, you can get privacy.

    • It also assumes Amazon cares.
      They carry several million books and they care which one somebody reads?
      Riiight.

      All of the entire trade publishing business is less that 3% of Amazon’s annual gross and they’re going to track individual reader habits, why?
      As long as you’re buying from them they don’t care what you read or how.

      Netflix does care what you watch and how but that’s because they’re making decisions on *their* hundred million dollar productions. Amazon also cares about their shows and gadgets but books that aren’t even theirs?

      Again: those folks need to get over themselves.

    • agree – there is a LOT of paranoia in the OP. Amazon has tried to sell me other books based on what I am reading – and I appreciate that, and frankly that is no different than what B&M booksellers try to do. Amazon has never, as far as I can tell, tried to sell me other PRODUCTS based on the CONTENTS of what I am reading. Thinking like that is whack.

      • More specifically, Amazon tries to sell you more books based on the *type* of books you read. The contents of tbe book doesn’t factor into it. (I suspect only the book tags factor into it. Makes for a simpler algorithm.)

  6. Is there something wrong with commodification? I hear it as a pejorative quite often, but nobody really explains what it is and what the problem is.

    So, how has literature been transformed into a commodity? What was its previous state?

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