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Amazon vs Book Publishers (Do Writers Win or Lose?) Updated 1-24-16

January 24, 2016

Tags: Amazon, Hachette, ebooks, Big 5

Published initially 11/14/2014; updated 4-16-15, 11-17-15; 1-24-16; 2-3-16\

NEWSFLASH: Amazon To Open Hundreds Of Brick-And-Mortar Bookstores (Pavithra Mohan, Fast Company, 2-2-16) Amazon, the online retailer that killed off so many independent bookshops, is getting ready to launch its own brick-and-mortar book chain. According to the Wall Street Journal, the CEO of a major mall operator, General Growth Properties, revealed on Tuesday that Amazon intends to launch hundreds of bookstores.
Why Amazon's Rumored "Bookstores" Probably Won't Be What You Think (Rich Bellis, Fast Company, 2-3-16) If Amazon does expand its physical retail footprint, don’t expect it to focus exclusively or even primarily on books. It may see physical locations as (among other things) more akin to Apple Stores, where it can showcase the hardware it sells online.
Meet the Guy Behind Amazon’s Secret Retail Store Plans (Jason Del Rey, re/code, 2-3-16) The man behind the Kindle is leading Amazon’s project to create the retail stores of the future. And bookstores are just the beginning. These are two of the new details Re/code has uncovered about Amazon’s plans for expansion into physical retail.
Amazon Plans Hundreds of Brick-and-Mortar Bookstores, Mall CEO Says (Greg Bensinger, WSJ, 2-2-16) mazon Plans Hundreds of Brick-and-Mortar Bookstores, Mall CEO Says

In the following pieces about a dispute among them, Amazon and book publishers take turns being the bad guy. Authors, read these often excellent arguments for and against book publishers, Amazon, and others engaged in this battle for market power and tell us what you think! Updated with Mike Shatzkin's interesting observation, in a blog post titled Big focus at DBW 2016 on the tech companies that are shaping the world the book business has to live in

"Ever since Amazon arrived in the “book business” 20 years ago, each year the “book business” has become less and less of a stand-alone industry. Of course, the only part that ever really was a stand-alone was the trade business, where the entire ecosystem: authors and their agents, publishers, booksellers, and even — for the most part — the printers lived in a world of mutual dependency but pretty much standing apart from what went on in the rest of the world.

"Amazon actually took advantage of that industry insularity. They developed a business model that used books as a customer-recruitment tool but with the intention of making their profits elsewhere. In ways that were not understood at the time, that strategy was both viable (the book publishing world didn’t believe Wall Street would fund a company nearly indefinitely with current losses to build a future position of strength, but they did) and impossible for a book-dependent business to compete with. (Barnes & Noble and Borders had to make money selling books; Amazon didn’t.)"
Read more at
There is very profitable revenue that the organizational structure of big publishers makes it hard for them to get (Mike Shatzkin, 1-14-16) Publishers have inadequate data systems about whether their books can be marketed outside the U.S.; Amazon and other online accounts have greater global reach. Publishers are not well set up to sell backlist titles and they should be, especially on titles with advances not earned out-- so publisher has "margin advantage" ("the house gets to keep the part of the sales dollar that would go to royalties"). "Discovery" of books is MUCH easier on Amazon.

Book publishing lives in an environment shaped by larger forces and always has (Mike Shatzkin, 1-10-16) Part 1 is "must-read" history: (1) Long period when publishers focus on business-to-business marketing, especially to bookstores and libraries: Andrew Carnegie financed development of libraries. In the 1930s, publishers began authorizing "returns" of unsold books. After WWII: the paperback revolution. 1960s: shopping malls and mall bookstore chains. Late 1980s: destination superstores.

Game-changer (1995): Amazon, a disruptive innovator. Environment for marketing shaped by Amazon, Apple, Facebook, Google. For Amazon, customer acquisition is key, a first step; investors enable underpricing. In the first couple of years of this century the buying habits of academics shifted away from store-shopping to buying from Amazon, which dominated both the book and the e-book business, having achieved that status by underpricing, even when it meant taking losses. It was in for the long game. "Publishers now live in a world where more than half the sales for most of them — the exceptions are those who are heavily into illustrated books and children’s books — occur online through varying combinations of print and ebooks." Where bookstores were once the path to "discovery" of new books, online is that path now. And "where somebody buys something is not necessarily where they made the buying decision. If you’re an Amazon Prime subscriber getting free shipping on your books, you go to Amazon to buy regardless of where you learned about the book."
"Google Plus hasn’t turned out to be much of a social interaction platform, but an author’s profile there can have a big impact on how the author and his/her books rank for search. This has long been true but is not, even now, universally appreciated. In short, Google Plus author pages are nearly as important as Amazon author pages, a fact totally independent of the traffic either of them gets."


Who can rival Amazon? (Joseph Esposito, The Scholarly Kitchen, 1-22-14 )

Big focus at DBW 2016 on the tech companies that are shaping the world the book business has to live in (Mike Shatzkin, Idealog, 11-17-15)

The War of the Words: How Did Amazon End Up as Literary Enemy No. 1? (Keith Gessen, Vanity Fair, December 2014) "Goodreads gave publishers some hope that they could solve discovery; it may also have given them hope that they could solve a more immediate problem: Amazon....Then, in March 2013, for an undisclosed sum, Goodreads was bought by Amazon."
"The size of the self-publishing program alone within Amazon is already so large that, because the company does not reveal any sales figures about self-publishing, some believe that statistics about book publishing in general can no longer be trusted. Some huge and growing part of the market is simply unaccounted for."
An informative piece written in VF's deliciously gossipy style.

The Ubiquitous Bookstore (Joseph Esposito, The Scholarly Kitchen, 3-31-05). Amazon . . . is a destination site; it was built when the idea was to bring users to a site. Marketers call this pull marketing. ...Amazon is exceedingly good at what they do....But the Web is now being brought to us; it’s evolving into a push medium. All that time we spend looking at the news feeds for Facebook, Flipboard, and Twitter point to where the Web is going and where new bookstores will have to be." What bookstores must do to be competitive.
Amazon Is Winning at Publishing – Here’s Some Reasons Why(Nate Hoffelder, Publishing/Writing, 4-6-15). On why HarperCollins can't build a retail site to save its life.
Amazon Offers All-You-Can-Eat Books. Authors Turn Up Noses. (David Streitfeld, NY Times, 12-17-14) "For romance and mystery novelists who embraced digital technology, loved chatting up their fans and wrote really, really fast, the last few years have been a golden age. Fiction underwent a boom unseen since the postwar era..." Now, that market is saturated, the honeymoon is over, genre fiction authors are going back to their day jobs, and Kindle Unlimited is looking particularly undesirable in terms of author income.
Writers Are Mixed Over Amazon Unlimited (David Streitfeld, NY Times, 1-1-15) "...if a book is downloaded on Kindle Unlimited, its Amazon ranking immediately rises. It looks more popular. But the writer only gets paid if the buyer reads at least 10 percent. Otherwise, it is a 'ghost borrow.'" Learning only half the readers who downloaded a book actually read it is a blow of its own.

End of a year, and perhaps the end of a stage of the ebook transition (Shatzkin Files, 12-31-14) Following up on Streitfeld's piece 12-17-14, Shatzkin writes that indie authors "still have the supply and demand problem, compounded by the conversion of a chunk of their static market to the subscription model. ... Who bought indie author ebooks in the first place? The price-sensitive reader! Who switches from buying individual ebooks to the subscription service first? The price-sensitive reader!"

Hawking Radiation: Figuring Out How Many Books Are Sold to Libraries (Joseph Esposito, The Scholarly Kitchen, 2-22-12) Amazon may be overtaking publishers on academic and library sales, but how can one tell? Amazon doesn't share those numbers.

Amazon and Hachette have settled so there will be no big bang change in the publishing business model (Shatzkin Files, 11-14-14)

Amazon and Hachette Resolve Dispute (David Streitfeld, NY Times, 11-13-14) "Hachette won an important victory on Thursday in its battle with Amazon: the ability to set its own prices for e-books, which it sees as critical to its survival."
"And even if Amazon got less in the deal than it originally wanted, it still controls nearly half the book trade, an unprecedented level for one retailer. And the dispute showed it is not afraid to use its power to discourage sales."

JA Konrath and Lee Child debate. From this long and enlightening exchange between Joe Konrath and Lee Childs, I quote only some of the points made: Lee: "Amazon is a tech company. The basic tech paradigm says content is always the smallest part of the cost. Those guys really believe that. Storytellers will be working for whatever few pennies they choose to hand out." Joe: "As you said, bookstores have been selling coop for decades, and publishers have bought coop to place books such as yours (and not mine) in prominent places around the store. This isn't protection money, it's more like a kickback....kickbacks are part of the book business, and Amazon didn't invent them, and they're legal." Joe: "For the majority of writers, print has become a subsidiary right. Ebooks are the main income. But you are not in the majority. For you, print is still your main source of book income." Joe: "Authors can't do it alone, and publishers make a lot of mistakes. Neither you nor I had any power over how many stores our titles were available in, or how big our marketing pushes were, or if our titles were pre-printed on the NYT Bestseller list, or how many reviews we received, or how many ads were bought. We don't know how my books would sell in airports or drug stores or Sam's Club or in Uzbekistan, because I've never been available in those places." Lee: "Hachette sold to wholesalers, at a certain discount, and the wholesalers sold on to Amazon, at a slight markup. Soon Amazon wanted to avoid that markup, so it went to Hachette and asked, “Please will you sell to us direct?” And Hachette said, “OK.” And that’s the so-called contract, right there. William Ockham, in comments: "The current negotiation between Hachette and Amazon is about their ebook contract. Period. Since 2010 Amazon has sold Hachette ebooks under an agency agreement>. Although the DoJ-Hachette settlement now allows Amazon to offer discounts, the selling arrangement is still under an agency agreement. An agency agreement creates a fiduciary agreement between the principal (Hachette) and the agent (Amazon) whereby the agent can bind the principal to honor sales agreements the agent makes. Making agency sales without an agreement is legally risky. Technically, Hachette has no legal obligation to pay Amazon their commission AND Hachette could demand that Amazon remove from customer devices all Hachette ebooks sold since the expiration of the contract."

Amazon-Hachette: The war of the button (Elizabeth Weise, USA Today, 11-14-14)
In some ways, the great Amazon-Hachette publishing war of 2014 was over a button. The pre-order button, to be precise. A major rallying point in the fight was Amazon's practice of delaying the availability of Hachette authors' books—and not allowing would-be readers to pre-order them" [which is important for getting on bestseller lists].
Amazon and Hachette Resolve Dispute(David Streitfeld, NY Times, 11-13-14) "Hachette won an important victory on Thursday in its battle with Amazon: the ability to set its own prices for e-books, which it sees as critical to its survival."

Amazon is doing the world a favor by crushing book publishers (Matthew Yglesias, Vox, 10-22-14). In this persuasive opinion piece Yglesias argues with comments in two other pieces, among others: Amazon Must Be Stopped It's too big. It's cannibalizing the economy. It's time for a radical plan. (Franklin Foer, New Republic, 10-9-14) and Amazon’s Monopsony Is Not O.K. (Paul Krugman, Opinionator, NY Times, 10-19-14), saying Amazon has too much power, and is abusing that power. The Times also posted letters to the editor about Krugman's piece: Amazon’s Dominance (10-26-14)

The Amazon/Hachette Battle and Why It’s Great to Be a Self-Published Author (Miral Sattar, MediaShift: Your Guide to the Digital Revolution, 6-3-14) . "Realistically, publishers aren’t going to be the ones to take on Amazon effectively because Amazon is so good at out-executing other retailers. What Amazon offers is too valuable right now to readers and independent authors. I myself am an Amazon Prime customer and love that I can order something today and it shows up at my doorstep within a couple of days."

"Digital has changed the publishing industry and publishers don’t like that, so they’re trying to hold onto whatever control they historically had. Soon, they’ll realize that if you want to be a player, you need to step up the game."

• In a letter the Authors Guild sent to its members (7-10-14), author Richard Russo writes: "Over the years the Guild has often opposed Amazon’s more ruthless tactics, not because we’re anti-Amazon but because we believe the company has stepped over the line and threatened the publishing ecosystem in ways that jeopardize both our livelihoods and the future of authorship itself. There’s no need to rehash our disagreements here. But it is worth stating that we are not anti-Amazon, or anti-e-book, or anti-indie-publishing. Amazon invented a platform for selling e-books that enriches the very ecosystem we believe in, and for which we are grateful. If indie authors are making a living using that platform, bravo. Nor are we taking Hachette’s side in the present dispute. Those of us who publish traditionally may love our publishers, but the truth is, they’ve not treated us fairly with regard to e-book revenues, and they know it. That needs to change. If we sometimes appear to take their side against Amazon, it’s because we’re in the same business: the book business. It may be true that some of our publishers are owned by corporations that, like Amazon, sell a lot more than books, but those larger corporations seem to understand that books are special, indeed integral to the culture in a way that garden tools and diapers and flat-screen TVs are not. To our knowledge, Amazon has never clearly and unequivocally stated (as traditional publishers have) that books are different and special, that they can’t be treated like the other commodities they sell. This doesn’t strike us as an oversight. If we’re wrong, Mr. Bezos, now would be a good time to correct us. First say it, then act like you believe it. We’d love to be your partners."

Big Publishing is the Problem (Hugh Howey, 6-14-14). And Much as I like Hugh Howey, I disagree with just about all of this recent post of his (Mike Shatzkin, The Shatzkin Files, 6-16-14).


Give Customers What They Want (Hugh Howey, 10-2-14) An interesting argument: "Uber, Tesla, Netflix, Google, and Amazon that are trying their damnedest to provide a better experience at a better price with more choices. While other companies, in expensive towers built of stone, are conspiring with one another and appealing to the courts to do whatever they can to fool and rob their paying customers."
Don’t Anyone Put Me in Charge (Hugh Howey, 1-8-14) Some interesting ideas here, among them: "Readers are the ones who build buzz, on their Facebook pages and Twitter accounts. On their review blogs and on Goodreads. Forget Publishers Weekly. Forget Kirkus. That’s trying to fashion bestsellers through bookstores. Bestsellers happen through readers. Through social media. So we are going to get them the ebook immediately, and price it low enough ($6.99 or less) that they’ll pick up a print copy if they love the work."..."It never ceased to amaze me, working in a bookstore, to see all the promotional money spent while the least-desired format (the hardback) was released. And then a whimper when the paperback came out." "Print needs to appeal to the high end and the disposable end."

Amazon’s selfish defender: Hugh Howey’s short-sighted, Ayn Rand-ian argument harms book culture (Rob Spillman, Salon, 10-14-14) New York Times keeps letting the same self-published author defend Amazon. He misunderstands Amazon's real agenda

Cheap Words (George Packer, New Yorker, 2-17-14) Amazon is good for customers. But is it good for books?

Can Authors Move Amazon’s Board? (Vauhini Vara, New Yorker, 9-17-14)
Authors take aim at Amazon over fight with publisher Hachette (transcript, PBS NewsHour, 9-29-14) Philip Roth, Salman Rushdie, Ursula Le Guin and many other notable authors have joined a public fight against Amazon for wielding its commercial power against publisher Hachette in a dispute over the price of e-books. Jeffrey Brown discusses the writers’ concerns with novelist Roxana Robinson, president of the Author’s Guild.
Digital revolution threatens American literature, says best-selling author James Patterson (Frank Carlson, PBS NewsHour, 6-6-14) Patterson’s publisher, Little, Brown & Co., is owned by Hachette, which is currently undergoing tense contract negotiations with Amazon. As the negotiations drag on, some Hachette titles are being delayed, while upcoming titles have had their pre-order buttons removed.
Authors United letter to Amazon board of directors
'Authors United' promises long-term Amazon strategy (Sarah Shaffi, The Bookseller, 7-21-14)

A Writerly Chill at Jeff Bezos’ Campfire (David Streitfeld, NY Times, 9-20-14) "For five years, Amazon has hosted Campfire, an exclusive and secret gathering for prominent writers. Some repeat Campfire attendees who have supported Hachette in the dispute say they were not invited this year. Others say they are having second thoughts about going."

Amazon-Hachette’s Staying Power Shows Dispute’s Importance to Future of Books (Authors Guild, 10-16-14)

Amazon and Its Missing Books (David Streitfeld, Bits, NY Times blog 10-12-14) "Plunging sales by Hachette writers on Amazon indicate that the retailer’s tactics have discouraged potential customers. A delay in shipping may not be censorship. But what if the book is hard or even impossible to find on Amazon, which sells nearly half the books in America?"

Literary Lions Unite in Protest Over Amazon’s E-Book Tactics David Streitfeld, NY Times, 9-29-14)

• "Authors, change your business model instead of complaining that others need to change their model to maintain your status quo." The Content Flood and Authors Whining (Bob Mayer, Digital Book World, 9-22-14)

The motivation of the publisher-bashing commentariat is what I cannot figure out (Mike Shatzkin, Shatzkin Files, 9-24-14)
Are Amazon exclusives the next big challenge for everybody else in publishing? (Mike Shatzkin, The Shatzkin Files, 9-22-14) "Every point of market share that shifts strengthens Amazon’s proposition for exclusivity and increases the likelihood that a high-visibility author will make the self-publishing leap. The combination of the two — highly branded authors and Amazon exclusivity — is among the most unwelcome inevitabilities the rest of the industry will probably face in the years, if not months, to come."
Big publisher bashing again with fictional facts (Mike Shatzkin, 9-14-14, arguing persuasively and in interesting detail with Clay Shirky Amazon, Publishers and Readers (medium.com, 9-12-14) "Starting in 2009, five of the six biggest publishers colluded with Apple to re-inflate ebook prices. The model they worked out netted them less revenue per digital sale, because of Apple’s cut, but ebooks were not their immediate worry. They wanted (and want) to shield expensive hardbacks from competition with cheap ebooks, so ebook prices had to rise. No one had any trouble seeing the big record companies as unscrupulous rentiers when they tried to keep prices for digital downloads as high as they had been for CDs; the book industry went further, violating anti-trust law as they attempted to protect their more profitable product." Worth a read.

Publishing Battle Should Be Covered, Not Joined (Margaret Sullivan, Public Editor, NY Times, 10-4-14) "It’s important to remember that this is a tale of digital disruption, not good and evil....I would like to see more unemotional exploration of the economic issues; more critical questioning of the statements of big-name publishing players; and greater representation of those who think Amazon may be a boon to a book-loving culture, not its killer."
Lee Child Chimes In

On Mourning the Passing of Barnes & Noble (Richard Adin, An American Editor, 9-17-14) Adin prepares a premature obit, based on B&N's poor management and customer service, including the fact that he paid $100 to buy a book, for which they sent him a POD copy, not the print original--and then failed to understand his complaint.

Amazon, a Friendly Giant as Long as It’s Fed (David Streitfeld, front page, NY Times, 7-12-14)

Douglas Preston: On Amazon, Hachette, and Indie Authors (Porter Anderson, FutureBook, The Bookseller, 7-30-14)

Amazon Plead for Your Support in Hachette Dispute and Why You Shouldn’t Give It (Michele Demers, Global Indie Author 8-9-14) "So when Amazon ask us to support their fight to lower the ebook prices of Hachette authors, what Amazon do NOT want indie authors to appreciate is that the $20 bottle of wine sells well only because of the $100 option beside it....In the publishing world, we are Walmart; the Big Five are Louis Vuitton (their mid-list authors are, say, Macy’s and J.C. Penny).
The new Amazon offer to Hachette (Mike Shatzkin, The Shatzkin Files 7-9-14) "So we have a $10 ebook. Normally, Amazon would pay $7 to Hachette and keep $3. Hachette would notionally divide the $7 as $5.25 to Hachette and $1.75 to the author. What Amazon proposed was that the author would get the whole ten dollars, Amazon would give up its $3 and Hachette would give up its $5.25. ...[But]... Hachette has already paid the author’s $1.75 in the advance for the lion’s share of the sales that would be made under this deal if it were agreed to. So Amazon is giving up $3 and Hachette is giving up $7 on most of the books. And many of the authors, frankly, aren’t entitled to even their own share on those sales (they already got it), let alone Hachette’s (or Amazon’s)." It's not a deal Hachette can accept.

All the Amazon-Hachette coverage doesn’t seem to cover some important causes and implications (Mike Shatzkin, 6-3-14)
Inevitable consequences follow from the new hierarchy of power among publishers (Mike Shatzkin, 5-21-14) One publishing firm Amazon can't bully is Penguin Random House.


Amazon Hits Hachette Where It Hurts (Ellen Killoran, International Business Times 7-9-14) An excellent review of the situation and who the good and bad guys have been (the roles change) during this ongoing dispute.... "given the company’s reputation for bullying its wholesalers into compliance, it’s hard not to think that Amazon’s ultimate goal is to drive a wedge between authors and their publishers. “As one publisher put it to me, Amazon’s strategy, in his view, is to ‘clear the field’ of anybody standing between Amazon and its customers,” Turow told IBTimes last month. “Amazon is a ruthless capitalist enterprise. They innovate brilliantly and compete ferociously, and rhetoric notwithstanding, are interested only in Amazon.”
"Still, the publicity generated by Amazon’s offer reminds those paying attention that Hachette has indeed been stubborn in its protection of e-book profits. Hachette has been riding a wave of public goodwill since news broke that Amazon was imposing artificial delays on its titles, with the popular view being that Amazon is the villain. By presenting itself as more generous and more interested in returning to business as usual, Amazon has taken a significant move toward recasting itself as a savior."

Amazon Really, Really Wants This Book War To End (Timothy Stenovec, Huff Pot, 7-8-14) As The Guardian recently noted, other independent authors are petitioning in the retailer's favor. Self-published authors Hugh Howey, J.A. Konrath, Barry Eisler and others have asked readers not to boycott Amazon, because the company "has done more to liberate readers and writers than any other entity since Johannes Gutenberg refined the movable type printing press."
"Major publishers like Hachette have a long history of treating authors and readers poorly," the petition reads. "Amazon, on the other hand, has built its reputation on valuing authors and readers dearly. The two companies didn’t simultaneously change directions overnight."

Is Amazon Really the Devil? (Calvin Reid, Pubishers Weekly, 6-6-14) The Amazon-Hachette dispute is more nuanced than has been portrayed, some argue "While showing no support for Amazon position, Robinson acknowledged that authors don’t completely support the Big Five publishers, which have refused to raise the e-book royalty rate of 25%, which is generally considered too low for a format that has low production costs. “The [author-publisher] partnership based on mutual cooperation and shared success that was traditionally part of the publishing world is being lost,” she said. “Publishers used to split their profits with authors, after accounting for the costs of production, 50/50. Now [publishers] are treating authors as hostile opponents. It’s not a good economic model, and it’s not a way in which anyone prospers or makes money. It doesn’t bode well for the future of publishing either.”

“The industry is a hysterical bunch. They like a crisis even if it’s a generated, fabricated crisis. There’s always going to contractual disputes,” Anderson said. “We now have the biggest retail channel for books in our history. Publishers sell more because Amazon exists to sell their books all around the world in a flash. Amazon made e-reading come alive.”

Author Rejects Award Due to Amazon Backing (Mercy Pilkington, Good e-Reader, 7-11-14). "UK-based children’s book author Allan Ahlberg declined the Booktrust Best Book Awards‘ Lifetime Achievement Award because the £5,000 prize money had been donated by Amazon....[like many international companies, Amazon bases] its European headquarters in Luxembourg to take advantage of the significant tax breaks. That means Amazon pays far less in taxes than both independent booksellers and retail chain bookstores that are based in the UK, a fact that has left many citizens and businesspeople alike wondering why their government allows it to continue. Criticism of companies like Amazon, Starbucks, and Google has led to the release of figures that show how many billions of pounds this tax structure has already cost the UK alone."

Library Consortium’s Get the Shaft with Simon & Schuster eBooks (Michael Kozlowski, Good eReader, 7-7-14). This time publisher Simon & Schuster is the lead villain. Said one librarian: “It is hard to believe that publishers think that offering an ebook to a library for only one year softens the blow of having to be a store for them as well. To me it presents an ethical dilemma. Are book talks literary sales pitches now?

One-Percent Authors Want To End Destructive Conflict, Bring Order to the Galaxy (from the picking-sides dept, TechDirt 7-3-14) "One day, historians and psychologists might manage to explain how various authors came to fear and revile a company that has sold more books than anyone in history; that pays authors up to nearly six times the royalties of the New York “Big Five” lockstep rate; that single-handedly created the ebook and self-publishing markets; that offers more choice and better prices to more readers than anyone ever has before; and that consistently ranks as one of the world’s most admired companies. But for now, let's see if we can figure it out ourselves... "

If you love books then you should be rooting for Amazon, not Hachette or the Big Five (Mathew Ingram, Gigaom, 7-2-14) The conventional wisdom seems to be that by putting the screws to publishers like Hachette, Amazon is displaying its monopoly powers and ruining the book industry. But it is actually making the market better — not just for book buyers but authors too

Child, Grisham, Patterson in Amazon protest (Philip Jones, The Bookseller, 7-10-14) "Without taking sides on the contractual dispute between Hachette and Amazon, we encourage Amazon in the strongest possible terms to stop harming the livelihood of the authors on whom it has built its business."

Citizen Bezos (Steve Coll, NY Review of Books, 7-10-14). A review worthy of a deeply reported book, which is getting five-star ratings on Amazon, which it criticizes. The Everything Store: Jeff Bezos and the Age of Amazon . "Over the last decade, Amazon’s growing market share and persistent bullying, particularly in the realm of digital books, where it now controls about two thirds of the market, raise the question of how well competition and antitrust law can protect diverse authors and publishers. Amazon has become a powerful distribution bottleneck for books at the same time that it is also moving to create its own books, in competition with the very publishers it is squeezing....The question now is whether the Justice Department will apply the same degree of scrutiny to Amazon’s activities in the digital book market that it applied to Apple five years ago." And where will Bezos go with the Washington Post?

Stephen Colbert has some choice words for Amazon (+video) (Molly Driscoll, Christian Science Monitor, 6-5-14) Amazon is fighting Hachette for a bigger piece of the ebook pie; neither side will provide details.

The Amazon/Hachette Battle and Why It’s Great to Be a Self-Published Author (Miral Sattar, MediaShift, PBS, 6-3-14). Neither Amazon nor the publishers are fighting for authors' rights. It's good we have the option of self-publishing.

Book wars: A monopolist vs. the cartel (Steve Pearlstein, Business, Washington Post 6-7-14). In " in a long-running battle between a manufacturing cartel (the publishers) and a monopoly retailer (Amazon) for control of the value chain that links book writers and their readers....neither side comes with clean hands or pure heart. The publishers are more than a little disingenuous in conflating their own interests with those of authors, readers and booksellers. And Amazon might want to consider that its admirable campaign to lower book prices may have reached a point of diminishing return, with the risk that further cuts really will have an adverse effect on consumer choice and the quality of what is published."

Robinson and Alexie Draw the Focus to Authors in Amazon-Hachette Dispute (Authors Guild, 6-5-14) "...while Amazon may be the bully in this particular dispute, Hachette and the rest of the Big Five don’t exactly have clean records when it comes to e-book revenue, which seems to be the object of the two firms’ standoff....Hachette and other major trade publishers, Robinson said, regularly put the squeeze on their authors when it comes to e-book royalty rates...an e-book royalty of 25% of net receipts is a windfall to the publisher and a major step back for authors."

Amazon Versus The Book Publishers (On Point radio with Tom Ashbrook, 6-5-14) Guest: Jeffrey Trachtenberg, book publishing reporter for The Wall Street Journal; Roxana Robinson, novelist and president of the Authors Guild; Porter Bibb, managing partner in corporate finance at Mediatech Capital Partners; Ben Edelman, associate professor of business administration at Harvard Business School.)

Amazon Absorbing Price Fight Punches (David Carr, The Media Equation, NY Times, 6-1-14)

Amazon/Hachette dispute unlikely to provoke regulators, experts say (Diane Bartz, Reuter, 5-29-14)

Amazon’s Power Play ( Editorial Board, NY Times, 6-3-14) 'What seems clear is that Amazon is using its market power — the company accounts for about 40 percent of new books, print and digital, sold in the United States and more than 50 percent in Germany — to get the best deal for itself while it squeezes publishers, annoys its customers and hurts authors by limiting their sales.'

As Publishers Fight Amazon, Books Vanish (David Streitfeld and Melissa Eddy, Bits (on e-commerce), 5-23-14

The Dispute At Amazon Over E-Book Pricing Lynn Neary, Jeremy Greenfield, and Mark Cooper on the Diane Rehm show, 6-5-14). Listen or read the transcript.

Book Fight: Amazon vs. Publishers (interesting letters to the editor, NY Times, Opinion page, 6-5-14) Chris Watson: "A Publisher’s Lunch article last year showed the profit breakdown for HarperCollins: A $27.99 hardcover provides a $5.67 profit to the publisher and a $4.20 royalty to the author; a $14.99 e-book provides a $7.87 profit to the publisher and a $2.62 royalty to the author....The two players that are suffering in this situation are the authors (book sales delayed or prevented, dramatically lower royalties) and the consumers, many of whom have invested heavily in the Kindle-based environment."

Amazon’s ‘Bullying’ Tactics (Joe Nocera, Opinion, NY Times, 5-30-14) "... its goal is not to raise prices, which is contrary to Amazon’s pro-consumer culture. Instead, it is trying to upend the economic model that has long sustained book publishers. No wonder the stakes feel so high, and the fear and loathing so palpable....The way I hear it, what Amazon is insisting upon is a deal where it would no longer have to bear the full brunt of its discounting — the publisher would have to bear some of it, in the form of tighter margins, or even losses." Bezos is taking the process of "commoditizing books" to "its logical extreme."

Here's Why I Won't Boycott Amazon over Its Fight with Hachette (Galen Moore, BostInno, 6-4-14). Publishers seem to be fighting to preserve the status quo.

Goodbye, Amazon: We’re through! (Laura Miller, Salon, 5-20-14). "I quit Amazon because of its monopolistic tactics. Is it impossible for book publishers to do the same?"

Amazon Feud With Publishers to Escalate as Contracts End (Edmund Lee, Adam Satariano and Carol Hymowitz, Bloomberg News, 6-5-14) "Amazon.com Inc. (AMZN)’s sales contracts with some of the world’s biggest publishers, Simon & Schuster and HarperCollins, are next up for renewal, signaling that skirmishes over e-book pricing are set to spread....Amazon and Hachette started negotiating as early as January, one person said. The disagreement spilled into public view last month when Amazon tried to dissuade its customers from buying Hachette titles on its website, removing discounts from some books or delaying shipments by as much as five weeks when items typically ship within three to five days. By refusing to buckle under the pressure, Hachette is leading the charge for publishers’ fight against Amazon."

How the Amazon-Hachette Fight Could Shape the Future of Ideas (Jeremy Greenfield, The Atlantic, 5-28-14) While the bookseller and publisher are battling over mundane business specifics, the state of publishing hangs in the balance.

Writers Feel an Amazon-Hachette Spat (David Streitfeld, NY Times, 5-9-14) Amazon controls about a third of the book business, which means big publishers cannot live without it. But its negotiating tactics come across as bullying.

Hachette Says Amazon Is Delaying Delivery of Some Books (David Streitfeld, NY Times, 5-8-14)
Writers Feel an Amazon-Hachette Spat (David Streitfeld, NY Times, 5-9-14)

Amazon’s Shrinking Profit Sets Off a Seismic Shock to Its Shares (James B. Stewart, NY Time, 4- ) Stewart weighs in on whether investors are finally getting impatient with Amazon’s notable lack of profits.

Inside Amazon's Battle With Hachette (Jeremy Greenfield, Forbes, 5-14-14)

Report: Amazon Attacking Hachette?

France Proposes Law Forbidding Book Discounts on Web (Sam Schechner, WSJ, 10-3-13) Bill, approved by lower house, is aimed at Amazon. Approved unanimously by France's lower house of parliament, the bill "would effectively force online booksellers to sell at higher prices than brick-and-mortar stores, by banning any seller from applying government-regulated discounts to the cover prices of books that are shipped to readers. Instead, sellers could only mark down the cost of shipping. 'Free shipping is simply—we must use the word—a strategy of dumping,' French Culture Minister Aurelie Filipetti said, during parliamentary debate Thursday."

Amazon Ends Affiliate Program in California After Sales Tax Law (Jason Boog, Galley Cat 6-30-11). Amazon amends affiliate agreement to read: “if at any time following your enrollment in the Program you become a resident of California, Colorado, Illinois, North Carolina, Rhode Island, or Connecticut, you will become ineligible to participate in the Program.” This was in 2011. Now, on April 22, 2013, Planet Money (NPR) posts Why Amazon Supports An Online Sales-Tax Bill. Among other things: "For a long time, Amazon kept warehouses out of big states so it could avoid charging sales tax in those states. Brick-and-mortar retailers didn't like this, and started lobbying state governments to push for Amazon to charge sales tax. So Amazon changed its strategy. The company agreed to start paying sales tax in more states — and it started building huge warehouses near major metropolitan areas in those states." The little companies can't compete and Amazon can offer cheap same-day delivery.'

The Everything Store: Jeff Bezos and the Age of Amazon by Brad Stone. ( "target="_blank">Reviewed in New York Times)

Amazon Gets Stupid (John Kremer's Book Marketing Tip of the Week, 4-5-09) If you sign your review with anything other than your name, your reviews could be deleted. "Now an author can only write a review if they promise not to provide their credentials."

Amazon Turns On The Twitter Pump To Fuel Referral Fees (MG Siegler, TechCrunch, 11-4-09) Judging from responses elsewhere, Twitter has no problem with this, but affiliates on user forums report getting many clicks but no sales from the links.

Elsevier Won't Pay for Praise. Inside Higher Ed reports Elsevier offering $25 gifts to post 5-star ratings on Amazon.com. As if the textbook industry didn't have an image problem already...

Historian Orlando Figes agrees to pay damages for fake reviews on Amazon (Alexandra Topping, Guardian, 7-16-10). Historian to pay damages and costs to two rivals who launched a libel case after he posted reviews "praising his own work and rubbishing that of his rivals." See many more related stories at Fake, not-quite-kosher, and poison book reviews Sock puppets and Amazon's mass deletion of reviews (on Writers and Editors site).

Comments

  1. November 28, 2014 1:47 PM EST
    - PM
  2. March 21, 2015 1:26 PM EDT
    Mike Shatzkin writes about three+ ways Amazon has profoundly changed book publishing, in Asking whether Amazon is friend or foe is a simple question that is complicated to answer (Shatzkin Files, 3-15-15)
    - PM
  3. February 10, 2016 4:51 PM EST
    Mike Shatzkin adds to discussion of Amazon opening bookstores: On Amazon stores 2-10-16): "Barnes & Noble 'beat' Borders largely because they had a network of distribution centers that made stocking their retail locations extremely efficient. Amazon’s network of distribution centers is complicated because it isn’t just books, but they have many times the number of points of inventory storage as B&N.... Amazon has tons of information that nobody else does that would inform their stocking decisions if they harnessed it....It is possible that if B&N and the indies had responded differently to Amazon Publishing, agreeing to stock the books rather than boycotting them, this could have played out differently." Mike explains the ways in which Amazon could become even more disruptive to bookselling than it is already.
    - PM
  4. April 7, 2016 12:31 PM EDT
    In an indie-dominant world, what happens to the high-cost non-fiction?" (Mike Shatzkin, 4-6-16) "[Hugh Howey] gives credit for the indie bookstore resurgence to Amazon, which would be true if you credit Amazon with the demise of Borders that wiped out over 400 big bookstores and created new opportunities for indies. But the idea that Amazon is allied with indie bookstores is contradicted by two realities. One is that the indie stores won’t stock Amazon-published books. The other is that Amazon, now in the process of opening its second retail store, may plan dozens, hundreds, or thousands more to come! We really don’t know. Certainly, very few indie bookstores would be applauding that."
    - PM
  5. July 2, 2016 2:06 PM EDT
    What the Heck Is Amazon Up to Now? (Joseph Esposito, The Scholarly Kitchen, 5-3-16) "When it first appeared on the scene, it seemed clear that it was a new kind of bookstore....The affiliates program had the potential to convert every Web site into a storefront for Amazon (you could never do anything remotely like this in bricks and mortar), and it also carried the implication that there would be one and only one bookstore on the Internet, a situation that is close to being the case today. So was Amazon a bookstore . . . or something else?...

    "From bookstores it branched into other kinds of ecommerce: music, video, electronics.... "If it had learned how to provide secure credit card transactions online (a truly amazing bit of technology), it would simply make that capability available to others — for a fee...

    "When Amazon began to sell used books...look more closely and you see that the used book business is not textbook ecommerce (which, of course, Amazon pretty much invented) but more like a virtual marketplace, a variant on eBay, where Amazon simply matches buyers and sellers and never actually takes control of any of the products whose sale it facilitates."

    "The next hypothesis was that Amazon is all about the user data: like Google and Facebook, Amazon wants to know everything about you. Whereas Google and Facebook use this information to sell advertising, Amazon uses it to sell products.

    "No doubt end-user data collection is a big part of Amazon’s paradigm, but what are we to make then of AWS — Amazon Web Services — Amazon’s market-leading cloud-hosting business? AWS is a B2B operation; it does not collect user data. Now, how does that fit in?

    And so on: A wonderfully thoughtful piece!
    - PM
  6. October 13, 2016 9:57 PM EDT
    A few more items: • A Writer’s Defense of Amazon (Frank Schaeffer, Huffington Post, 6-10-14) Pretty persuasive.

    The war on Amazon is Big Publishing's 1% moment. What about other writers? (Barry Eisler, The Guardian, 6-4-14) More people are buying more books than ever, and more people are making a living by writing them. Why do millionaire authors want to destroy the one company that's made this all possible?

    - PM
  7. April 12, 2017 4:26 AM EDT
    It is obvious that giants such as Amazon are not interested in the normal incomes of ordinary writers, which is why they have been in this business for 20 years.
    - Writer Web
  8. April 12, 2017 12:22 PM EDT
    Writer Web: Ghostwriting someone's thesis or writing a corporate honcho's speech might make me more money than publishing my own work via Amazon, but it's a different kind of work and one few of us aspire to. Amazon is guilty of a lot of things, but it's where nearly half of books are sold now, and when you publish directly with Amazon you get a much higher "royalty rate" than you would from a traditional print publisher. Trying to make a living writing books is what doesn't typically make writers a lot of money -- with some exceptions. So the question is first, what type of work do you want to do, and then, with whom do you want to do it? And what are your reasons for writing a book? Income might not be the only goal.
    - PM