Amazon’s Advantage

The tortoise and the Hare from the Gutenberg Project via Wikipedia
The tortoise and the Hare from the Gutenberg Project via Wikipedia. Who the tortoise is and who the hare represents in this ongoing conflict depends largely on point of view.

Life On Normal Street

Recently, I had the pleasant opportunity of viewing one of Amazon Studio’s new releases, Gortimer Gibbon’s Life on Normal Street. It was an enjoying half-hour program about three kids finding their own adventure on an unusually hot summer day. The first of this kid’s series was done very well. The Main Street setting and the liberal use of magic realism reminded me of some of Ray Bradbury tales from his childhood in Waukegan, Illinois. Created by David Anaxagoras, this story came to Amazon Studios by open submission.

Amazon Diversifies

Amazon Studios is Amazon’s answer to Netflix. The above-mentioned, Gortimer Gibbon’s Life on Normal Street, is just the first in a line of TV pilots and movies from Amazon Studios that can be downloaded and watched on various electronic devices, ranging from a Smartphone to a large flat screen TV. These programs usually cost to view, but some pilots can be watched free of charge by the general public, as was the case with the first episode of Gortimer Gibbons. The point here, is that Amazon is a company that seems willing and capable of expanding its creative efforts. And in the case of Amazon Studios, they are more than willing to deal directly with writers in developing visual content.

Hachette and Simon & Schuster 

Though these two Big Five publishers appear to have received the better part of their deal with Amazon. However, they, along with other large-scale publishers, may face an uncertain future with the paperback bestseller. The high-priced e-book deal these companies cut with Amazon is designed to aid the sale of paperbacks. I don’t know of anybody that believes e-books will replace the paperback, but they will take a larger slice of the pie in the upcoming years. Just how big this slice will be could depend on how well each party plays its own hand.

Parent Companies

Strangely enough, the biggest problem for these publishers may be their parent companies, who may demand maximum profits at the expense of literary quality, fair royalties for writers and incentives to diversify. The Big Five may not be doomed as some the new Kindle millionaires may suggest, but they certainly do face a challenging future.

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Amazon Settles With Hachette, Who Won?

Two grizzly bears fighting, from wikipedia
Two grizzly bears fighting, from wikipedia

“As with most battles, all combatants lost a little something in end.”  Mark Coker, CEO of Smashwords

The News

Last week, Amazon and Hachette came to a tenuous agreement on their feud concerning ebook pricing. The Amazon-Hachette settlement followed an Amazon-Simon & Schuster agreement that went down just a few weeks ago. If you stand back and look at both agreements, they are not all that different. The Agency means of ebook pricing pretty much stayed in tact. What this means is that the publisher (Hachette and Simon & Schuster), gets to set ebook prices in most cases. Amazon gets to some discounting (they wanted much more), but only under certain circumstances.

Good News for the Print Market

Most observers believe that Hachette and the Big Five publishers wanted to keep ebook prices high so that they could discourage ebook sales and push paper sales, which at present  are their main bread and butter. This should benefit authors, who are capable of generating large numbers of paperback sales in the mass marketplace. It is no wonder than best-selling authors such  as Stephen King, Tess Gerritsen, James Paterson, JK Rowling, John Grisham and Donna Tartt, all supported high-priced ebooks to keep paperback sales high.

Thorough Agreement

This agreement that Simon & Schuster first achieved will most likely set the tone for any negotiation between Amazon and any other Big Five or large-scale publisher. Although Amazon did get some concessions, these terms favor the short-term livelihood of the large publisher.

Why Indie Authors Might Be the Big Winner

By keeping ebook prices high for traditional authors, self published ebook authors, who keep their prices low and royalties high, may be the biggest winners. For those working outside a major paper publisher, large sales and high royalties are possible by placing a book in the $2.99 to $7.99 range, not only through Amazon, but with other ebook publishers as well. By maintaining the status quo, Big Five publishers may drive more readers to the Indie market, where ebook prices will probably stay the same in the near future.

The Ultimate Irony

The ultimate irony is that in order to develop and encourage new talent that can create mass paperback sales, companies like Hachette may have to mine the field of self-published Indie authors. This situation may come to exist if  the Agency model does become less lucrative for mid list and first time authors. In this situation, much depends on how much of an overall share the ebook market achieves.

Hachette’s (and other Big 5) Dilemma

After this agreement, Hachette will come under increasing pressure to raise ebook royalties for authors and also to show a better bottom line in profits to its parent company, Legendaire. These could be conflicting demands that will never be met at the same time….or a situation, where the publisher might opt for lower ebook prices to increase sale and profits.

Across the Great Divide – Update On the Amazon-Hachette Feud

“Fine! So stop selling them (Hachette books), already. Just shut up about it and pull the trigger. Be mercenary.” Chuck Wendig, commenting on the Amazon-Hachette feud

220px-AcrosstheGreatDivide1976

Across the Great Divide is a 1976 film that stars Robert Logan, Heather Rattray, and George Buck Flower. Perhaps, the title is also symbolic as to what a small group of well-financed writers headquartered in the Northeast has done to the American writing community.

Authors Purchase Big Time Add In NY Times

“Authors aren’t united on anything. Why would they be? We work from home. Alone. We can maaaaaybe agree that pants are a tool of the oppressors and that we subsist on various liquids (tea, coffee, whiskey, the tears of our readers). Why do we have to be united?” Chuck Wendig

On Sunday August 10 a group of authors, calling themselves Authors United ran a full page add in the Sunday NY Times defending the Hachette Corporation of France in its economic loggerhead with Amazon. Around 900 names appeared on the ad, which cost in thelow  six figure range and was financed by 72 of the 900. Basically, the letter accused the Amazon Corp. of organizing a boycott of Hachette products, refusing to discount Hachette products, slowing the delivery of Hachette books and suggesting to readers that they purchase different (non-Hachette) titles.

This debate has dragged on for several months and at this point in time, a settlement seems far off. In the meantime, growing discontent among pro-Hachette and pro-Amazon writers has turned the feud into a bit of a soap opera, especially on the Social Media, where everybody who’s anybody is sounding off on the issue. Though this may make for great entertainment, the situation does not encourage ebook sales, which is essentially the heart of the debate.

My Turn To Rant

Ok, it’s my turn to rant. And by the way, I’m not exactly neutral in this debate since I sell low-priced ebooks through both Amazon and Smashwords. Also, I do sell a story or two to online journals, but this is a rather rare event. Moreover, I have not found a way to break into the print market, except P.O.D., a pathway, which I have not even remotely considered.

My basic complaint with Amazon is that they have too nice to Hachette. They were a primary player in the development of the ebook market and their opinion that ebooks sell best in the three digit range seems valid. And I don’t consider them a monopoly (just a Giant corporation) either for they have lots of competition with businesses like Google, Apple, Kobo and B & N.

On the other hand Hachette’s main line are books in print, so why are they wasting so much time in energy in this fight. It might hurt their print sales and if things go really bad, their French holder, Legardere, might dump them completely. I guess I don’t the understand French business karma very well at all, but it does seem like they are shooting themselves in the foot.

Writers Gone Goofy 

To me the strangest thing of all is the way that millionaire genre writers, such as Stephen King, JK Rowling, Douglas Preston, James Patterson, John Grisham and Heather Graham, have taken on Amazon like it was the devil incarnate. They seem to have all jumped in bed with Big Five publishing (at the same time) without any concerns for their own well-being. Have these people forgotten that once they were unpublished writers?

Things have changed over the last ten years and breaking into print has become much more difficult than it used to be. True this is a slowly developing situation that goes back to the  post WWII years, when there weren’t so many authors pining for a book contract. But today’s Indie ebook market helps newbie authors find a platform. (So do small presses and university publishers). Overall, the old maxim that good writing will find its audience still holds true, but the rules have definitely changed quite a bit……And maybe not so much for the better.

2001 Sourdough Raft Race, passing beneath the High Level Bridge's Great Divide waterfall. (Edmonton, Alberta)
2001 Sourdough Raft Race, passing beneath the High Level Bridge’s Great Divide waterfall. (Edmonton, Alberta) from Wikipedia

And the Thot Plickens – Updates on the Amazon-Hachette Dispute

God Speed! by Edmund Blair Leighton, 1900 from wikipedia
God Speed! by Edmund Blair Leighton, 1900 from wikipedia

Bad News For Amazon

Currently, the Amazon-Hachette dispute seems to be leaning in Amazon’s favor (my opinion), despite the fact that a whole bunch of literary heavyweights have taken up the cause of the Big Five publisher. For those of you not familiar with the situation, Amazon and Hachette are currently locked in a monetary dispute that, as time goes on, seems to favor Amazon coming away from the disagreement in the best shape. However, all is not hunky dory in the Amazon camp. Here are a few recent news story to illustrate some of the problems the giant online retailer may be facing in the near future, not to mention their growing competition for the ebook market.

Another Federal Lawsuit

Currently, the Federal Trade Commission (FTC) is suing Amazon over its children’s in-app purchases. According to the Feds, Amazon has made it way too easy for minors to make online purchase through a variety of mobile and non-mobile apps. The Feds want to make it impossible for children to purchase online without their parent’s permission. Amazon does not deny the situation, but responds by saying that they are already improving the situation.

The gardens at the Luxembourg palace in the Grand Duchy of Luxembourg, which is the official name for this tiny land-locked European nation. from wikipedia commons, photo by Benh Lieu Song
The gardens at the Luxembourg palace in the Grand Duchy of Luxembourg, which is the official name for this tiny land-locked European nation. from wikipedia commons, photo by Benh Lieu Song

Children’s Book Author Turns Down Amazon-backed Award

Just about the same time as news of the Federal lawsuit was released, Allan Ahlberg, a UK children’s author, turned down a lifetime achievement award, because Booktrust, the giver of the award, has used Amazon funds to award the recipient. Ahlberg cites Amazon’s use of Luxembourg as a tax dodge, while selling a large volume of books in Great Britain, as the main reasoning behind his refusal. Reportedly, Amazon has avoided millions in British taxes by claiming to be a Luxemborg-based business,

My View

Despite the Hachette thing, all the hoopla from successful authors and the FTC lawsuit, Amazon’s biggest problem may be competition from other ebook retailers. Although Amazon my have dominated this new bookselling phenomena in the past, I expect other ebook publishers to make inroads on the market in the years to come. Competition is a good thing, really.

The Rude Boys Are Back In Town

 

Boxing Match, painting by James Pollard
Boxing Match, painting by James Pollard

The Issue

The issue is not exactly a new one, for the debate between Amazon and Hachette has been around for a while. There was even a Department of Justice settlement recently awarded to Amazon, after they determined that Apple, along with four book publishers (including Hatchette) were found guilty of colluding with Apple to set ebook prices. Incidentally, this was one of the biggest anti-trust lawsuits ever brought by US federal authorities. Since that decision, Amazon and Hatchetet are now undergoing negotiations to work out ebook prices for books sold by Amazon. At issue here is who determines the price of the ebook, Hatchette, Amazon or some combination of the two. During negotiations Amazon has removed pre-order buttons from all soon-to-be-released Hatchette books and is reportedly delaying shipment of  all hard copy books published by Hatchette.

Sound Off

Everybody who’s anybody in the publishing world has been sounding off on this feud, which may be destined to determine how much readers will pay for ebooks at Amazon.com. James Patterson, a Hatchette author and one of the most most successful authors in the world, is down on Amazon, as is Steve Colbert, another large-selling Hatchette author, who also stars in the Comedy Central hit, the Colbert report. On a recent episode of the award-winning show, Colbert joined forces with Sherman Alexie to totally trash Amazon’s dispute with Hatchette. Mr. Colbert even goes as far as to call for a boycott of Amazon. Others supporting Hatchette include John Green, JK Rowling and the AAR (Association of Author’s Representatives).

 

JK Rowling, a millionaire writer, has sided with her publisher, Hatchette, in its dispute with Amazon
JK Rowling, a millionaire writer of Harry Potter fame, has sided with her publisher, Hatchette, in its dispute with Amazon

The Battle of Fingers

When I first read about the ensuing conflict on JA Konrath’s popular blog ( A Newbie’s Guide To Publishing) I was a bit dismayed by his visual display of his middle finger. At the time it just seemed like a lot of arrogance, displayed by a successful Amazon author, who makes over a thousand dollars a day. That was until I viewed an online video of the Colbert Report, where a distraught Mr. Colbert uses the middle appendage of his right hand to stick it to Amazon. I guess dueling it out with middle fingers is a lot better than using pistols at twenty paces, but still, there seems to be a lot of room for improving how one expresses themselve.

Other Viewpoints

Not everybody is jumping to the defense of Hatchette. One of the most adamant Amazon supporters is JA Konrath. You can read his rant and check out his middle finger to Colbert, here. Other interesting opinions have been expressed at the  Huffington Post, the Washington Post (also owned by Amazon CEO, Jeff Bezos,) and the Slate.

In 2015 the host spot for the Tonight Show will go to Steve Colbert
In 2015 the host spot for the Late Show will go to Steve Colbert

Not Yet Ready For Prime Time

One of the most surprising and disgusting outcomes of this whole episode is the veracity with which Steve Colbert has defended his own publisher. It is hard for me to believe that soon this guy will have be hosting one of the major night talk shows at CBS. This not bode well for the health of our national TV industry or our political discourse.

My Take

Unfortunately, most of Hatchette’s biggest defenders have been those who make the most money with their writing. Sometimes it seems like the 1% analogy that permeates our current political discussion has trickled down to the literary world. In recent years, breaking into paper publishing has gotten more difficult, even though the Big Five are finding it more difficult to make money or just survive. For mid-list and low-list writers who depend on ebook sales for this livelihood this dispute is most unwelcome. Despite its size and aggressive business practices, Amazon provides much-needed income to writers, who would receive next to nil, if ebook sales didn’t exist. Presently, I see the various ebook markets as a way in which unrecognized writers can find a voice in the world.

P.S.

One much-needed beneficiary of this running debate are the independent booksellers, who are presently seeing a surge in their tree book sales.

The Tree Book Ain’t Dead Yet

Redwood_National_Park,_fog_in_the_forest
Redwood trees in fog, Redwood NP, from Wikipedia, photo by Michael Schweppe

Is This A Golden Age For Writers?

Just recently, Stephen Marche, in his Thousand Words About Our Culture column for Esquire, raised this exact question. To back up his assertion, he put forth numerous graphs and figures, showing that adult readership and book sales are up. Some of the facts are quite convincing; such as increase in both hardcover and ebook sales. For the first half of 2012, adult hardcover sales rose over 8 %, while ebook sales jumped by a whopping 34 %. Also on the increase are the percentage of adult Americans who read literature and the average number of books (of any kind) that are read by individual readers. This is definitely encouraging news.

480px-BarackObamaportrait
Barrack Obama portrait in front of the Capitol building, from Wikipedia, photo source U.S. Senate

A Writer In the White House

Now serving in his second term as U.S. President is Barrack Obama from Illinois, a successful politician, who helped further his political career by writing two widely read books, Dreams From My Father (1995) and The Audacity of Hope (2006). Though most presidents, now publish after they leave office, it is less common to find presidents that used the written word to enhance their political career. John Kennedy and Richard Nixon are two past presidents, who have made it to the White House aided by a successful book publication.

A Good Time To Be A Successful Writer?

Maybe what Stephen Marche should have said is that it is a great time to be a successful writer. Breaking in is still difficult, and perhaps complicated by the huge number of competing writers, all trying for a slice of that same pie that is not nearly big enough to accommodate all those who wish to enjoy some of the sweet rewards.

A Silver Lining For Marginal Writers

One positive development for the struggling  writer is the ebook market, which seems to lend itself admirably to the unknown wordsmith. The ebook does not guarantee success for the upcoming writer, it just levels the playing field a little bit. It still takes a lot of skill and perseverance and perhaps a little luck to breakthrough.