From The Wall Street Journal:
Amazon.com Inc., which over more than two decades made itself the world’s largest book retailer, has created an unrivaled display window that can catapult titles from obscurity to must-reads.
More recently it has built something else: Its own line of published books.When veteran book author Mark Sullivan tried to sell a World War II saga in 2015, eight New York book publishers rejected it. Then Amazon’s publishing arm scooped up “Beneath a Scarlet Sky” for an advance in the low five figures.
The novel was released in 2017 and featured on Amazon First Reads. The online promotion also is emailed each month to more than 7 million U.S. subscribers and exclusively showcases titles from Amazon Publishing.
“Wham, we get 300,000 downloads,” said Mr. Sullivan, whose title has sold more than 1.5 million print books, e-books and audio books. It was ranked No. 56 on USA Today’s top 100 best-seller list for all of 2018.
The Seattle-based giant houses 15 imprints in the U.S. under the Amazon Publishing banner, turning out everything from thrillers to romance novels to books translated from other languages. Amazon published 1,231 titles in the U.S. in 2017, up from 373 in 2009, the year it entered the $16 billion-a-year consumer book publishing business.
To promote these works, it has tools other publishers can only dream about owning, including Amazon First Reads and Kindle Unlimited, Amazon’s e-book subscription service. Together, they reach an estimated 10 million or more customers who can read offered titles with a few keystrokes.
“They aren’t gaming the system,” literary agent Rick Pascocello said. “They own the system.”
The promotional levers that Amazon has built to lure consumers can boost the opportunities of little-known writers and recharge the careers of experienced authors such as Mr. Sullivan. Amazon Publishing, the company’s book-publishing unit, together with its self-published authors, has made it a fierce competitor in lucrative genres including romance.
To some in the industry, it is an inherently conflicted structure, in which the most powerful retailer has a competing incentive to favor books it publishes and those from authors using its self-publishing technology.
On Wednesday, 16 of the top 20 books on Amazon’s romance best-seller list were titles from its book-publishing arm or were self-published on Amazon’s platform.
Amazon said its marketing and retail programs don’t give its books an unfair advantage, and that it offers all publishers a chance to use them.
“Our focus is on making sure that our customers get great content,” said Jeff Belle, vice president of Amazon Publishing. “The feedback from authors, customers and agents has all been positive.”
Amazon commands some 72% of adult new book sales online, and 49% of all new book sales by units, according to book-industry research firm Codex Group LLC.
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For authors, the company offers a huge potential audience, especially given the decline in large bricks-and-mortar bookstores. Amazon has more than 100 million Amazon Prime members world-wide, and its U.S. subscribers can pick one title from Amazon First Reads free each month. Non-Prime members pay $1.99.
On Jan. 2, Amazon First Reads sent an email to members about six new titles from Amazon Publishing. By early evening, those books were the top six on Amazon’s Kindle store e-book best-seller list.
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The scale of Amazon Publishing isn’t readily apparent because many rival booksellers decline to carry Amazon Publishing titles on their shelves.
“They get enough support on their own,” said Lori Fazio, chief operating officer of R.J. Julia Booksellers in Madison, Conn., which doesn’t stock them.
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Industry trackers say Amazon is shrinking publishing revenue in adult fiction by releasing so many low-price books from Amazon imprints and its self-published authors. Publisher revenue from adult fiction fell 16% to $4.4 billion in 2017 from 2013, the Association of American Publishers said.
“My suspicion is the cumulative impact of Amazon’s highly integrated retail and content programs is cannibalizing traditional publisher fiction sales.” said Peter Hildick-Smith, chief executive of Codex Group, the research firm.
Mr. Hildick-Smith said the decline in revenue for fiction issued by traditional publishers coincided with the Kindle e-book store’s growing share of the overall adult book market—up 43% between 2013 and 2017—to a bit more than a quarter of the total market. E-books skew heavily to fiction, and much of that increase comes from books self-published on Amazon.
Publishers that specialize in genre fiction, especially romance—a fount of publishing profits—are feeling the biggest impact.
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Independent romance publisher Entangled Publishing LLC offers a small number of erotic titles on Kindle Unlimited. For many titles, the small publishing house uses the distribution arm of a larger publisher to get its books into retail stores, a distributor that doesn’t participate in Kindle Unlimited.
As a result, most Entangled books aren’t likely to reach Amazon’s list of best-selling romance titles, which favors Kindle Unlimited titles. While Amazon has opened a lot of doors for authors and publishers, said Liz Pelletier, Entangled’s chief executive, the extra boost given to Kindle Unlimited titles makes Amazon’s best-seller list less applicable for publishers that don’t participate.
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Romance writer Lisa Renee Jones pulled her titles out of Kindle Unlimited in 2018 after her income fell by about one-third over a few months.
“I jumped on the bandwagon, but I later regretted it because it devalued me as an author,” said Ms. Jones, whose books have been published by St. Martin’s Press’s Griffin imprint and others.
An Amazon spokesman said thousands of self-published authors in 2018 “earned more than $50,000, with more than a thousand surpassing $100,000 in royalties.” The spokesman declined to say how many self-published books using Amazon technology were published last year. “Hundreds of thousands of authors have self-published millions of book since 2007,” he said.
Some have hit it big. Laurie Ann Starkey, a certified public accountant, quit her job in 2014 to become a full-time writer. She now owns a small independent press and employs 10 people as editors, managers and social-media staff. She generated $1.15 million last year in gross revenue, she said, mostly from her own books. About 89% of her sales were from Kindle Unlimited.
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Romance writer Inglath Cooper’s self-published novel, “Down a Country Road,” was ranked No. 52 on Amazon’s digital romance list on Jan. 15. She said Amazon has changed publishing, much like Netflix changed the movie and TV business, by making a large inventory of books immediately available to readers.
“Rather than resent the changes,” Ms. Cooper said, “I prefer to choose the opportunities available.”
Amazon Publishing helped resurrect the career of Mr. Sullivan, whose World War II novel found little traction among New York publishers. Previously, he had written more than a dozen novels, including with author James Patterson.
“My son urged me to try Amazon,” he said.
In March 2017, the influential trade publication Publishers Weekly reviewed “Beneath a Scarlet Sky,” saying Mr. Sullivan “lays on history with a trowel in this overstuffed tale of derring-do set in Italy during WWII.”
Amazon told Mr. Sullivan not to worry. “It was such a compulsive read that I knew it had the potential to be a big book,” said Danielle Marshall, editorial director of Lake Union Publishing, the Amazon Publishing imprint.
Link to the rest at The Wall Street Journal
“My suspicion is the cumulative impact of Amazon’s highly integrated retail and content programs is cannibalizing traditional publisher fiction sales.”
Of course, in a well-ordered world, traditional publishers and guys named Leonard would have continued to own the system and handled all the cannibalizing in a far more refined fashion.
We know how Leonard has changed (or not), but PG wonders how such publishers have changed in light of the impact of Amazon.
Of course, (returning to that well-ordered world), Amazon wouldn’t impact anything and nobody who is anybody would live in Seattle.
But order is not to be found in the 21st Century. In its own untidy and ill-kempt manner, change happens.
Or does it? PG hasn’t noticed much change in the cloistered halls of New York publishers. For them, the old ways are the best ways. Are they even capable of change?
Heaven forfend that Big Publishing would ever examine its treatment of all but a tiny slice of its authors or revisit its royalty structure or (gasp!) test whether reducing prices would increase sales on a commodity that, in the case of ebooks, has absolutely no additional incremental cost of goods for each additional copy sold after the first.
In a rational world, publishers would embrace the business of selling organized groups of electrons. After all, Bill Gates got rich selling electrons.
They wouldn’t even have to gather their own electrons. Amazon would collect gobs of electrons and sell them to people who liked to read while destroying nary a tree and then large bank transfers (more electrons!) would decamp from Seattle to Manhattan.
It’s so much easier to hang out with other publishers, whine about Amazon and reassure one another that, any day now, people will come to their senses and flock back to real bookstores to buy dead-tree books from impoverished clerk/drones, just you wait and see.