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Amazon, E-books, and the Future of Publishing (updated)

November 24, 2012

Tags: Amazon, Barnes & Noble, Kindle, e-books, co-op terms, libraries

Recent reports on Amazon's apparent march toward world domination, and book publishing's efforts to survive (more recent articles first):

Amazon as a threat to steal big titles from big publishers is still a ways off (Mike Shatzkin, Shatzkin Files, 10-23-12). Do read the whole article, which is interesting, but here's a sample: "But, for now, it would seem that B&N definitely did the right thing for their own good by boycotting Amazon’s titles. And, for now, it would seem that most of the authors Amazon will get for their general list will be those who are annoyed at the publishing establishment like Konrath and Eisler or curious about working with a tech-oriented publisher like Ferriss. ___________
The Amazon Effect (Steve Wasserman, The Nation, 6-18-12). Yale University Press executive editor-at-large Steve Wasserman looks at the ways Amazon has already succeeded, and where it has yet to prove itself. Excellent long pieces. Here's one excerpt:"The inexorable shift in the United States from physical to digital books poses a palpable threat to the ways publishers have gone about their business. Jason Epstein got it right two years ago when he wrote, 'The resistance today by publishers to the onrushing digital future does not arise from fear of disruptive literacy, but from the understandable fear of their own obsolescence and the complexity of the digital transformation that awaits them, one in which much of their traditional infrastructure and perhaps they too will be redundant.'”

And this: "Two decades ago, there were about 4,000 independent bookstores in the United States; only about 1,900 remain. And now, even the victors are imperiled. The fate of the two largest US chain bookstores—themselves partly responsible for putting smaller stores to the sword—is instructive: Borders declared bankruptcy in 2011 and closed its several hundred stores across the country, its demise benefiting over the short term its rival Barnes & Noble, which is nonetheless desperately trying to figure out ways to pay the mortgage on the considerable real estate occupied by its 1,332 stores across the nation. It is removing thousands of physical books from stores in order to create nifty digital zones to persuade customers to embrace the Nook e-book readers, the company’s alternative to Amazon’s Kindle."

Note: You don't need to own a Kindle to read a Kindle book. You can download free Kindle Reading Apps. Download an app to read a Kindle book on your iPhone, Windows PC, Mac, Blackberry, iPad, Android, or Windows Phone 7. Or download app for the Kindle Cloud Reader, to read online in your Web browser.
_____________
What’s the greater fear for publishers? Amazon or piracy? (Mike Shatzkin, Shatzkin Files, 3-27-12). Kindle editions of the seven Harry Potter books are available only from the Pottermore site. Pottermore CEO Charlie Redmayne gave Amazon a take-it-or-leave-it offer. By referring Amazon patrons to the Pottermore site, Amazon can collect an affiliate fee. (The alternative was to ignore the Potter books.)

"Redmayne and Pottermore have now demonstrated that if you will live with the anti-piracy protection of watermarking, rather than insisting on a digital hammerlock through DRM, you can gain extraordinary leverage."
___________
Miniature E-Books Let Journalists Stretch Legs (Dwight Garner, Books, NY Times, 3-6-12). Kindle Singles are "probably the best reason to buy an e-reader in the first place. They’re works of long-form journalism that seek out that sweet spot between magazine articles and hardcover books. Amazon calls them “compelling ideas expressed at their natural length.”
___________
If the government makes agency go away (Mike Shatzkin, 3-8-12). Am adding this to blog entry two days later, because it belongs with this batch!). "The Wall Street Journal reports that the Justice Department has notified the Agency Five (Hachette, HarperCollins, Macmillan, Penguin, and Simon & Schuster) and Apple that it plans to sue them for colluding to raise the price of electronic books. ...Agency pricing, for those who have not been following the most important development in the growth of the book market, enabled the publishers to enforce a uniform price for each ebook title across all retail outlets. This was Apple’s desired way to do business, and it addressed deep concerns the big publishers had about the effect of Amazon’s loss-leader discounting....
__________

Letter from Scott Turow: Grim News, Authors Guild 3-9-12. Writes Turow: "The Justice Department has been investigating whether those publishers colluded in adopting a new model, pioneered by Apple for its sale of iTunes and apps, for selling e-books. Under that model, Apple simply acts as the publisher’s sales agent, with no authority to discount prices.

We have no way of knowing whether publishers colluded in adopting the agency model for e-book pricing. We do know that collusion wasn’t necessary: given the chance, any rational publisher would have leapt at Apple’s offer and clung to it like a life raft. Amazon was using e-book discounting to destroy bookselling, making it uneconomic for physical bookstores to keep their doors open....
Let’s hope the reports are wrong, or that the Justice Department reconsiders. The irony bites hard: our government may be on the verge of killing real competition in order to save the appearance of competition."
_______________

The expected changes in the book business favor Amazon’s share growth (Mike Shatzkin, The Shatzkin Files, The Idea Logical Company, 3-5-12)

Two questions that loom over the trade publishing business (Mike Shatzkin, 2-28-12). The questions: When will the growth in Amazon’s share of the consumer book business stop? Who will be left standing when it does?
___________
Barnes & Noble Won’t Sell Books From Amazon Publishing (Julie Bosman, NY Times, Media Decoder, 1-31-12). Among other points made: "Barnes & Noble has chafed at deals that prevent it from selling the digital versions of books even as it is expected to market the books by displaying the print versions in stores. In August, the company said it would not sell print books published by Amazon unless it could also sell the e-book versions, in an objection to Amazon’s deals to publish authors’ work exclusively. In October, it removed from its stores all the physical copies of graphic novels from DC Comics because of a deal that allowed Amazon exclusive digital rights to them."

"It also seemed unlikely that many of the 1,900 independent bookstores in the United States would be willing to stock Amazon books."

_________-----
As Goodreads Ends Sourcing From Amazon, Users Fear Lost Books (Laura Hazard Owen, paidContent, 1-27-12). "Book-centered social networking site Goodreads, which allows users to keep records of the books they read and share the information with others, has long sourced most of its basic book data from Amazon (NSDQ: AMZN). Now, saying Amazon’s API terms have become 'more and more restrictive,' Goodreads is switching data providers and entering an agreement with book wholesaler Ingram — alarming some users who fear their reading records will be lost."

Is Amazon Pushing Publishers to Brink On Terms, Co-op? (Rachel Deahl and Jim Milliot, PW, 12-15-11)

Amazon Is Said to Have Fewer Prime Subscribers Than Estimated (Bloomberg Businessweek 2-21-12).

Two Distributors Do Sign with Kindle--And Pay eBook Coop (Michael Cader, PublishersLunch 2-26-12)

Libraries and publishers don’t have symmetrical interest in a conversation (Mike Shatzkin, 2-22-12). "Because libraries are, at most 5% of a general trade publisher’s business and far less of the ebook business, and because the market is changing so rapidly and because every retailer except Amazon can be said to be struggling to carve out a sustainable position in the global ebook marketplace, there are many legitimate reasons for the biggest publishers to take a wait-and-see attitude about libraries and ebooks....That fear is not just about a 'lost sale'. It is also about a 'lost channel' of sales, or a pipe to the consumer that runs entirely through Amazon."

Clever moves all around in the B&N and Amazon chess game (Mike Shatzkin 2-8-12)

The Amazon Paradox: Coming to Terms With Publishing's Colossus (The Atlantic, 3-6-12)

Amazon Signs Up Authors, Writing Publishers Out of Deal (David Streitfeld, NY Times 10-16-11)

Publishing’s Ecosystem on the Brink: The Backstory (Authors Guild, 1-31-12)

Amazon's grip tightens on the entire book-publishing chain (Julianne Pepitone, CNNMoney 2-27-11)

Also of interest:
Who wins and loses from DoJ's suit against Big Publishers and Apple? (Pat McNees, Writers and Editors blog)

Comments

  1. March 9, 2012 4:23 PM EST
    - Anonymous
  2. March 12, 2012 1:59 PM EDT
    Postscript. You don't need to own a Kindle to read a Kindle book. You can download free Kindle Reading Apps. Download an app to read a Kindle book on your iPhone, Windows PC, Mac, Blackberry, iPad, Android, or Windows Phone 7. Or download app for the Kindle Cloud Reader, to read online in your Web browser.
    - PM
  3. March 27, 2012 1:27 PM EDT
    What’s the greater fear for publishers? Amazon or piracy? (Mike Shatzkin, Shatzkin Files, 3-27-12). Kindle editions of the seven Harry Potter books are available only from the Pottermore site. Pottermore CEO Charlie Redmayne gave Amazon a take-it-or-leave-it offer. By referring Amazon patrons to the Pottermore site, Amazon can collect an affiliate fee. (The alternative was to ignore the Potter books.) "Redmayne and Pottermore have now demonstrated that if you will live with the anti-piracy protection of watermarking, rather than insisting on a digital hammerlock through DRM, you can gain extraordinary leverage."
    - Pat McNees
  4. April 16, 2012 2:03 PM EDT
    Barnes & Noble Won’t Sell Books From Amazon Publishing (Julie Bosman, NY Times, Media Decoder, 1-31-12). Among other points made: "Barnes & Noble has chafed at deals that prevent it from selling the digital versions of books even as it is expected to market the books by displaying the print versions in stores. In August, the company said it would not sell print books published by Amazon unless it could also sell the e-book versions, in an objection to Amazon’s deals to publish authors’ work exclusively. In October, it removed from its stores all the physical copies of graphic novels from DC Comics because of a deal that allowed Amazon exclusive digital rights to them." "It also seemed unlikely that many of the 1,900 independent bookstores in the United States would be willing to stock Amazon books." As Goodreads Ends Sourcing From Amazon, Users Fear Lost Books (Laura Hazard Owen, paidContent, 1-27-12). "Book-centered social networking site Goodreads, which allows users to keep records of the books they read and share the information with others, has long sourced most of its basic book data from Amazon (NSDQ: AMZN). Now, saying Amazon’s API terms have become 'more and more restrictive,' Goodreads is switching data providers and entering an agreement with book wholesaler Ingram — alarming some users who fear their reading records will be lost."
    - PM
  5. October 24, 2012 4:16 PM EDT
    Amazon as a threat to steal big titles from big publishers is still a ways off (Mike Shatzkin, Shatzkin Files, 10-23-12). Do read the whole article, which is interesting, but here's a sample: "But, for now, it would seem that B&N definitely did the right thing for their own good by boycotting Amazon’s titles. And, for now, it would seem that most of the authors Amazon will get for their general list will be those who are annoyed at the publishing establishment like Konrath and Eisler or curious about working with a tech-oriented publisher like Ferriss.
    - PM
  6. November 24, 2012 6:19 PM EST
    The Amazon Effect (Steve Wasserman, The Nation, 6-18-12). Yale University Press executive editor-at-large Steve Wasserman looks at the ways Amazon has already succeeded, and where it has yet to prove itself. Excellent long pieces. Here's one excerpt:"The inexorable shift in the United States from physical to digital books poses a palpable threat to the ways publishers have gone about their business. Jason Epstein got it right two years ago when he wrote, 'The resistance today by publishers to the onrushing digital future does not arise from fear of disruptive literacy, but from the understandable fear of their own obsolescence and the complexity of the digital transformation that awaits them, one in which much of their traditional infrastructure and perhaps they too will be redundant.'” And this: "Two decades ago, there were about 4,000 independent bookstores in the United States; only about 1,900 remain. And now, even the victors are imperiled. The fate of the two largest US chain bookstores—themselves partly responsible for putting smaller stores to the sword—is instructive: Borders declared bankruptcy in 2011 and closed its several hundred stores across the country, its demise benefiting over the short term its rival Barnes & Noble, which is nonetheless desperately trying to figure out ways to pay the mortgage on the considerable real estate occupied by its 1,332 stores across the nation. It is removing thousands of physical books from stores in order to create nifty digital zones to persuade customers to embrace the Nook e-book readers, the company’s alternative to Amazon’s Kindle."
    - PM
  7. November 24, 2012 6:22 PM EST
    - PM
  8. November 24, 2012 6:24 PM EST
    The Bookstore’s Last Stand (Julie Bosman, NY Times, 1-28-12) "...why Barnes & Noble, once viewed as the brutal capitalist of the book trade, now seems so crucial to that industry’s future. Sure, you can buy bestsellers at Walmart and potboilers at the supermarket. But in many locales, Barnes & Noble is the only retailer offering a wide selection of books. If something were to happen to Barnes & Noble, if it were merely to scale back its ambitions, Amazon could become even more powerful and — well, the very thought makes publishers queasy."
    - PM