On Friday, Amazon abruptly dropped all books from publisher Macmillan from their active lists. This is huge for authors of books by that publishing giant (fortunately, I am not one). This story came in the wake of Apple's Wednesday debut of the iPad and its new online bookstore. The gist of the battle with Amazon has to do with Apple giving better terms to publishers for listing books on their new service.
This is normally boring, eye-glazing stuff, and there is undoubtedly a cadre of consumers who demand that all products be as cheap as possible, and publishers and authors be damned. But if you have any interest in the technical details of the book business, take the time to read author Charles Stross' blog entry Amazon, Macmillan: an outsider's guide to the fight. Amazon may be cheap and easy for you as a consumer, but they screw the creators of books, as well as traditional bookstores and wholesalers, to the wall, and make money coming and going. That ultimately harms the book business all the way around. As Stross points out, "book publishing is notoriously, uniquely unprofitable," and Amazon's model of e-books via Kindle is even less profitable to everyone but Amazon.
Consider that Apple announced its cut from e-book sales would be just 30%, compared with Amazon's whopping 70% of the sale price. Whoops, then Amazon suddenly announced late Friday they'd match Apple's deal, now that competition has arrived, with a device that will undoubtedly eviscerate Kindle reader sales.
There are those who argue that authors no longer need publishers in this wik'd kool age of the Intertubes and on-demand publishing. Balderdash. It's true that, if all you desire is to see your name in print, then Lulu yourself till the cows come home. No pesky editors to bother you with deadlines and silly nonsense like proofreading, third-party objectivity about your subject matter, layout, indexing, cover art, or marketing. But if you want to get as many copies of your book in front of as many pairs of eyeballs as possible, as well as getting some kind of partial remuneration for the months or years you spent researching and creating the work, publishers are still a pretty effective group of experts on the subject.
In the specialized world of Masonic books, mainstream publishers are no substitute for the niche publishers like Lewis Masonic, Mike Poll's Cornerstone Book Publishers, venerable Macoy's and a tiny handful of others. Screwing them out of a sizable portion of their profits only ensures they won't survive.
Amazon has been touting "millions" of Kindle readers sold over the last couple of years (that plural word could mean no more than "two" millions), but the company refuses to give out specifics. I will simply say from personal experience that any author who thinks a Kindle deal is the first stop on the publishing gravy train is kidding himself. I can say that, so far, Kindle sales of my own books have been an infinitesimal blip, compared to old fashioned, murdered tree versions. The iPad may turn out to be a game changer in that, but that's yet to be seen.
Meanwhile, publishers, in an effort to provide cheaper Kindle editions that don't detract sales from the full-sized, full-price versions, are looking for creative ways to package existing books, as seen above. Think of them as gateway drugs.
Seems like a good example of how Free Market economics is not the answer to everything.
ReplyDeleteHi Chris,
ReplyDeleteWhile I'm no fan of Amazon's tactics, it should be pointed out that Amazon changed their royalty scheme *before* Apple announced the iPad (see: http://www.thebookseller.com/news/110253-amazon-increases-royalty-rate-for-kindle-books.html). Whether that was a reaction to Google's 65/35 deal, or whether they got wind of Apple's deal early I don't know (or perhaps that's always been their plan, and the original 30/70 model was used simply to reinforce a certain price point to begin with for eBooks).
The old powers and the new power are fighting a battle as to who will control publishing in coming decades. Neither of them are very nice, or interested in the customer's welfare (IMO).
Au contrere. Apple's entry into the market changes the whole equation, and Amazon has to compete.
ReplyDeleteAu contraire, yourself, brother :)
ReplyDeleteOf course Amazon took all the traffic could bear. There wasn't any competition before. (And don't start me on Barnes and Nobles' entry into the game with the Nook; other than the big splash before Christmas when they released it, I haven't heard diddly about their reader. Kindle opened and really created the market the door of which Sony and others had been bashing for years without success.)
The fact is that Kindle now has been around for several years and has a fairly massive base. Apple is late to the market with an overpriced, ill-named device that does more than most readers of e-books really need it to do. Sometimes you just don't need a multitool; you need the right tool.
Now, perhaps, true competition will level the e-book playing field. And if the past is any indicator, Amazon will remain as much of a player as Apple ever will be. Remember, there are a lot of us out here who get along just fine without Apple.
FWIW I will also make the point that I find it nearly impossible to read certain types of books on the Kindle. I blow through e-fiction, but my experience with e-history is mixed, particularly if maps or charts are involved (the screen is just too small and in general the publishers usually do a poor job of converting the images for Kindle). For some things you just need a hard copy. Thus, my guess is that your hardcopy sales will always massively outpace your electronic sales -- even on the iPad.
But we could argue this all day. Religion is involved :)
I understand your concerns Chris about the pricing schemes and cuts for the publishers and authors. But I don't see the iPad as a Kindle killer. I don't think ebook reading on an LCD screen is what most people will buy the iPad for. The Kindle, though it only does ebooks, is a lot nicer on the eyes for reading long books.
ReplyDeleteAlso you can buy kindle books and read them on the iPad right now. So in the long run whoever manages to sell the book cheaper will sell the book.
Overpriced.
ReplyDelete$10 more than the DX?
Blasphemer.
As for a fairly massive base for the Kindle, Amazon isn't telling anyone how many, and I'm having a Joe Wilson moment every time they tout their "6 out of 10 sales are Kindle editions" stat, with nothing to back it up.
ReplyDeleteAccording to an estimate in Digitimes, Asian manufacturers exported 3.82 million eReaders shipped 2009. Amazon owned 63.4% market share – That’s 2.42 million eReaders. That's frankly lousy. That's worse than lousy, especially after 18 months of nonstop hype. That's one of the reasons I call BS on Amazon's claims. And yeah, the Nook is a doorstop at this point.
Like I said on Facebook, Jobs is about lifestyle changing appliances. This thing will start by sneaking up on a whole untapped market and become the Jitterbug phone equivalent for computers, the first computer I'll buy for my mom. Couch dwellers will use them to surf the web while watching their big screen TVs (Dads will finally get out of their basement offices and join Mom in front of the TV, now free to ignore her while in the same room). Dedicated versions will become ubiquitous in hospitals. They will reinvent the newspaper and magazine business. They'll become Power Point/Keynote presentation devices for salespeople. Eventually they'll have cameras and finally become that picturephone that grandma and grandpa can see the kids on. When it's sitting over in the corner charging, it will be a digital frame.
Amazon buckled to Macmillan almost instantly over pricing, so these agreements will be in great flux for a while. Publishers have the iTunes /Big Music Industry example to look carefully at before agreeing to anything and avoiding the pitfalls. But I just don't think Ebooks will ever do what the iPod world did for music. People won't take a $500 computer to the beach or the bathroom, and you can bet people like me and Alice will never give up the experience of a shelf of books over peering into a screen. The publishers are all hailing Ebooks as the savior of the book business, but what they really mean is it cuts the pesky wholesaler and the bookstore out of the loop.
I have to agree with Chris on this one, I am very much looking forward to the IPad. Comparing the Kindle DX and the IPad I really don't see any benefit to the spending the extra $10 on the IPad, I know I will be using it to read my textbooks and technical publications on the road.
ReplyDelete