Archive for the ‘amazon vs publishers’ tag
Agency Model Coming to UK no comments
Since the UK Kindle Store
All of that could be coming to an end very soon if the publishers get their way, and they most likely will. The Bookseller reports that Hachette UK, which is the biggest UK publisher, will impose the agency model there from this Monday, September 20.
Under the agency model the publisher sets the price rather than the reseller. It remains to be seen how Amazon will react to this. My guess is that there will not be a prolonged dispute with Hachette as there was a couple of years ago in the UK, and more recently with Macmillan here in the US.
Update 9/20/2010: The agency pricing model is not being greeted with open arms in the UK. The Bookseller reports today that Waterstone’s, WH Smith, Tesco and The Book Depository have all removed Hachette ebooks from their virtual shelves. Amazon continues to sell Hachette ebooks, but appears to be still setting the prices themselves.
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One Free Kindle Book; Amazon Breakthrough Novel Award Finalists Announced no comments
There is one new free book available for pre-order at the Kindle Store:
Vicious
Amazon Breakthrough Novel Award Finalists
When I first saw the words Amazon and Penguin Group in the title of a press release I was hoping that the two had resolved their pricing dispute which has kept new Penguin titles out of the Kindle Store since the Agency Model pricing plan took effect on April 1, 2010. That would have been very welcome news indeed.
No such luck, although this announcement does impart some very good news for the six finalists for the Amazon Breakthrough Novel Award which is cosponsored by Amazon, Penguin Group (USA) and CreateSpace. From the press release:
From now through June 2, Amazon customers can vote for their favorite work at www.amazon.com/abna after reading excerpts from the finalists’ respective novels in the general fiction and young adult fiction categories. The two grand prize winners of the Amazon Breakthrough Novel Award, who will each receive a publishing contract from Penguin Group (USA) which includes a $15,000 advance, will be revealed in Seattle on Monday, June 14, 2010.
A panel of noted publishing professionals have read the top six finalists’ novels and written critiques of each, posted at www.amazon.com/abna. These industry figures include bestselling authors Tana French, Sarah Dessen and Nancy Werlin; Amy Berkower, president of Writers House, LLC; Julie Barer, of Barer Literary, LLC; Molly Stern, editorial director and executive editor of Viking Books; Ben Schrank, president and publisher of Razorbill.
The top three finalists in the general fiction category, listed in alphabetical order by author’s last name, are:
Jennifer Handford, Warrenton, Va., for "Fortune Cookies"
When Handford, a financial advisor, adopted a daughter from China in 2003, the process went remarkably smoothly, but the aspiring writer in her wondered what might have been. Several years of late-night writing sessions later, Handford had the novel, "Fortune Cookies," which asks the question: what if a family adopted a child and only later learned that the child suffered extreme emotional or developmental problems from her time in the orphanage? In "Fortune Cookies," a Washington, D.C.-based power couple find themselves in just that predicament, along the way exploring the world of adoption and the nature of the bond between parents and children.
Patricia McArdle, Arlington, Va., for "Farishta"
McArdle is a retired American diplomat whose postings have taken her around the world, including northern Afghanistan. In "Farishta"(the Dari word for "angel") American diplomat Angela Morgan, whose career is in free-fall, is ordered against her will to a British Army outpost in Mazar-e-Sharif, where the soldiers and interpreters are not pleased to have a female in their midst. Frustrated at her inability to contribute to Afghanistan’s reconstruction, she leaves camp without permission wearing a burka to work with refugee women. Her well-intentioned actions incur the wrath of warlords and further complicate her relations with her military colleagues. "Farishta" brings to life the soldiers and civilians who are fighting for survival in this ancient and troubled land.
Johnny Shaw,Portland, Ore., for "Dove Season"
Shaw was born and raised on the Calexico/Mexicali border, the setting of his novel, "Dove Season." Shaw owned a bookstore in Los Angeles, which is now entirely online, and he works as both a screenwriter and a university lecturer teaching screenwriting. Only recently did Shaw feel that he had the distance he needed to write a novel about the people and places of his childhood home, the Imperial Valley. In "Dove Season," Jimmy Veeder returns to his hometown on the California/Mexico border, where his attempt to satisfy his father’s highly unusual dying wish–for a Mexican prostitute named Yolanda–leads him into a world of murder and corruption.
The top three finalists in the young adult fiction category, listed in alphabetical order by author’s last name, are:
Amy Ackley, Brighton, Mich., for "Sign Language"
Ackley is a mother of three whose career has run the gamut from public administration to labor relations for top automakers. At the age of 16, Ackley left home and began supporting herself. She began writing "Sign Language" seven years ago. Drawn from her personal experiences of losing a father and two friends to cancer, "Sign Language" is the story of a 13-year-old girl whose father’s battle with cancer sends her into an emotional tailspin from which she is determined to recover.
Alex Airdale, Nutley, N.J., for "Service of the Crown"
A native of Russia, Airdale moved to the United States at the age of nine. Throughout her teens, she rode horses, fenced, and read Tamora Pierce fantasies about strong female warriors. Airdale –a pseudonym–combines these three pastimes in her young adult fantasy novel, "Service of the Crown," a coming-of-age story about 16-year-old Renee, a student at the Realm’s top military academy who battles her male classmates by day and an underground crime group by night.
Alison Stewart, Sydney, Australia, for "Days Like This"
Stewart, a journalist and writer who loves to travel, was born in South Africa. Over the years, her travels took her to Australia, where she met her husband and had two children. Many years ago, a fortune teller predicted that Stewart would write a book set in the future that would take her "all the way to America!" Her dystopian novel, "Days Like This," is a cautionary tale set in a walled, futuristic Sydney, where young people, confined to their homes under a nameless dictatorship and in danger from their parents, must escape to survive.
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Harper Collins Next Publisher to Renegotiate with Amazon? no comments
During News Corporation’s earnings call on Tuesday, Rupert Murdoch had the following to say when asked about his perspective on the controversy over Apple vs Amazon ebook pricing:
We don’t like the Amazon model of selling everything at $9.99. They don’t pay us that. They pay us the full wholesale price of $14 or whatever we charge. We think it really devalues books and it hurts all the retailers of the hard cover books. We are not against [inaudible] books. On the contrary we like them very much indeed. It is low cost to us and so on. But we want some room to maneuver in it. Amazon, sorry Apple in its agreement with us which has not been disclosed in detail does allow for a variety of slightly higher prices.
There will be prices very much less than the printed copies of books but still will not be fixed in a way that Amazon has been doing it. It appears that Amazon is now ready to sit down with us again and renegotiate pricing.
News Corporation owns Harper Collins. It’s probably just a matter of time before the other major publishers follow Macmillan’s lead after the events of the past weekend. It’s too early to judge what the full impact will be, but most likely we will have to pay more to read newly released titles on our ereaders.
You can read the full transcript of the News Corp earnings call at Seeking Alpha.
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Amazon Statement on Macmillan Books Removal no comments
Amazon just released a statement on the Kindle boards regarding their dispute with Macmillan.
The Amazon Kindle team says:
Dear Customers:
Macmillan, one of the "big six" publishers, has clearly communicated to us that, regardless of our viewpoint, they are committed to switching to an agency model and charging $12.99 to $14.99 for e-book versions of bestsellers and most hardcover releases.We have expressed our strong disagreement and the seriousness of our disagreement by temporarily ceasing the sale of all Macmillan titles. We want you to know that ultimately, however, we will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books. Amazon customers will at that point decide for themselves whether they believe it’s reasonable to pay $14.99 for a bestselling e-book. We don’t believe that all of the major publishers will take the same route as Macmillan. And we know for sure that many independent presses and self-published authors will see this as an opportunity to provide attractively priced e-books as an alternative.
Kindle is a business for Amazon, and it is also a mission. We never expected it to be easy!Thank you for being a customer.
This sounds as though you will end up having to pay more if you choose to read an ebook from Macmillan or one of its imprints.
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Amazon vs Macmillan – More Details no comments
Macmillan’s CEO John Sargent published an open letter in PublishersLunch yesterday in which he makes it clear that the deletion of Macmillan’s books from Amazon was a direct result of the publisher trying to force the same terms on Amazon as were negotiated for the Apple iPad.
This past Thursday I met with Amazon in Seattle. I gave them our proposal for new terms of sale for e books under the agency model which will become effective in early March. In addition, I told them they could stay with their old terms of sale, but that this would involve extensive and deep windowing of titles. By the time I arrived back in New York late yesterday afternoon they informed me that they were taking all our books off the Kindle site, and off Amazon. The books will continue to be available on Amazon.com through third parties.
The “deep windowing” of titles refers to the practice of delaying the release of a new title in ebook format, just as paperback releases are windowed or delayed until sometime after the hardcover release. Apparently if Amazon didn’t choose to accept Macmillan’s new terms Amazon (and Kindle owners) would be punished by having the release of Kindle editions of new titles significantly delayed.
Sargent goes on to say
I regret that we have reached this impasse. Amazon has been a valuable customer for a long time, and it is my great hope that they will continue to be in the very near future. They have been a great innovator in our industry, and I suspect they will continue to be for decades to come.
It is those decades that concern me now, as I am sure they concern you. In the ink-on-paper world we sell books to retailers far and wide on a business model that provides a level playing field, and allows all retailers the possibility of selling books profitably. Looking to the future and to a growing digital business, we need to establish the same sort of business model, one that encourages new devices and new stores. One that encourages healthy competition. One that is stable and rational. It also needs to insure that intellectual property can be widely available digitally at a price that is both fair to the consumer and allows those who create it and publish it to be fairly compensated.Under the agency model, we will sell the digital editions of our books to consumers through our retailers. Our retailers will act as our agents and will take a 30% commission (the standard split today for many digital media businesses). The price will be set the price for each book individually. Our plan is to price the digital edition of most adult trade books in a price range from $14.99 to $5.99. At first release, concurrent with a hardcover, most titles will be priced between $14.99 and $12.99. E books will almost always appear day on date with the physical edition. Pricing will be dynamic over time.
The agency model would allow Amazon to make more money selling our books, not less. We would make less money in our dealings with Amazon under the new model. Our disagreement is not about short-term profitability but rather about the long-term viability and stability of the digital book market.
If Amazon agreed to these terms most bestsellers would probably go up 50% to $14.99. The reference to Amazon making more money under these terms refers to the way in which Amazon currently buys titles wholesale and then sells them for $9.99, which is sometimes below their wholesale cost.
So are we going to see an antitrust lawsuit, or perhaps if more publishers join Macmillan will they be guilty of collusion to set prices? Or is this a case of Macmillan merely attempting legal retail price maintenance? Dearauthor has a great article about some of the legal ramifications of Macmillan’s attempt to set prices – be sure to check out the comments as well.
And what about authors? There are some interesting posts from their perspective. Check out the blogs of Charles Stross, John Scalzi, Bob Mayer and Cory Doctorow’s post at Boingboing.
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Amazon Stops Selling Macmillan’s Books no comments
The NYT is reporting that books published by Macmillan, which is one of the largest publishers in the U.S., have been disappeared from Amazon’s shelves. You can still purchase these titles from third party sellers through the Amazon marketplace.
Most likely Amazon has stopped selling the books of MacMillan and its various imprints as part of an ongoing dispute over ebook pricing. Publishers are not at all happy about Amazon’s policy of pricing most bestselling books at $9.99 in the Kindle store, which is cheaper than the paper versions. Publishers like Macmillan seem to think that there should be little or no price differentiation between pbooks and ebooks.
Bestsellers on the Apple iPad will apparently sell for $14.99, and perhaps Macmillan thinks that they can use whatever threat the iPad represents to the Kindle ereaders as leverage to get Amazon to change its pricing policy. It is hard to see how higher pricing on the iPad will be of much benefit to publishers though. I am going to make a wild guess here that for every ebook that a typical iPad owner will download and read the typical Kindle ereader owner probably reads around 20 or so. eBooks on the iPad will probably generate nothing close to the sales the Kindle store does, but Apple is letting the publishers control the prices. Prices at Amazon are not controlled by publishers, but rather by Amazon.
The publishing industry is in crisis, and many in the industry seem to regard ebooks as another threat against their business rather than as an opportunity to revitalize it. Some publishers seem to wish ebooks would just go away – which is not going to happen.
eBook sales, even if more profitable than hardcover sales once the initial production costs have been covered, would generate less overall revenue for publishers because the selling price is less. Publishers, like any other business have their fixed expenses which they need to cover by generating enough revenue. I would think that in time ebooks could make up for the lower overall revenue generated by their lower selling price with increased sales volume. Anecdotal evidence suggests, and studies are starting to confirm that when people buy ereaders they start reading more books; in many cases a lot more.
Reading as a pastime faces competition from an ever-growing array of increasingly sophisticated technologies that also vie for our leisure time such as HD television, DVD’s and video games, etc. Now the paper book industry has the chance to actually go digital and capitalize on the advantages (mainly conveniences: downloading vs going shopping, carrying many ebooks on one ereader, adjustable fonts, built-in dictionary and search, etc. Plus there is also the coolness factor of ereaders) that portable digital reading devices offer. As ereader sales grow over the next few years reading could actually become a popular pastime again.
Some publishers today seem unable or unwilling to adapt to the new technology, but hopefully this will change. In the meantime, it is we readers who are caught in the crossfire between Amazon and Macmillan.
History is littered with the corpses of companies and whole industries that, when faced with disruptive technology, dragged their feet in a futile attempt to slow down or stop the new tech rather than embracing it and trying to adapt to and grow with it. Publishers are not just purveyors of physical paper books; they are also the distributers and sellers of the stories, knowledge, ideas and content contained within those books. Perhaps they will need to concentrate less on the paper container and more on selling the actual content in order to survive and thrive in the future.
