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Originally Posted by David Marseilles
....It was very democratic. Those choices are gone, as is the representative function served by the retailers that drew particular types of consumers into the market.
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Have the number of ebook retailers drastically dropped off, specifically because of agency pricing?
Fictionwise did get blasted, but they were also bought out before agency pricing went into effect -- and were almost certainly going to meet the same fate as Mobipocket after Amazon bought them. Apple and Google -- both of whom actually
asked for agency pricing -- entered the market.
Plus, as I pointed out to JSWolf, it is possible that the ultra-low-cost ebook retailers did not have a sustainable business model. Nor was Fictionwise very popular; again, they apparently sold 7.5 million ebooks between 2000 and 2009, while Apple customers (all agency, when purchased) downloaded 100 million ebooks in one year.
In fact -- and as I pointed out early on in this thread -- one benefit to competition is that agency pricing levels the playing field for the ebook retailers. Amazon will have a much harder time pressuring Penguin into giving them a better deal on wholesale prices than Kobo, for example. The ability of the larger companies to demand lower wholesale prices undoubtedly contributed to the demise of the indie bookstores, which shrank to 1/3 of their number between 1993 and 2009.
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Originally Posted by David Marseilles
Healthy markets ebb and flow.
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I see. Well, publishers have set the prices for paper books in many countries in the EU since the 1980s; has it been an unhealthy market?
By some measures, the ebook market doubled under agency pricing. Does that indicate whether we are in a healthy or unhealthy market?
With ebooks, the pricing is far more dynamic, and can change to reflect conditions, and apparently does follow demand-based pricing. Does that not qualify as "ebb and flow?"
Agency pricing also helped Apple establish itself without getting into a bloody price war with Amazon. Is it a bad thing that Amazon's quest for a monopolistic standing was halted?
Retailers are pressing ahead with empowering self-publishers and small publishers to present their works with fewer intermediaries -- a process that is actually both dependent upon and expecting the self- and small-publisher to set prices. E.g. it's entirely plausible that any day now, a popular established author could eschew a standard contract in exchange for self-publishing simultaneously via CreateSpace, Smashwords, PubIt and his/her own website. Would that not be another example of the market, and the various power relations therein, ebbing and flowing?
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Originally Posted by David Marseilles
The creation of a completely new market wasn't without growing pains, but as I said, there was a strong voice for content producers and a strong voice for consumers that was shaping that market, and now one of those voices has been silenced. The long term ramifications of that will be worse than just higher prices.
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Yeah, no, I can't quite get on board with that.
It's extremely difficult to evaluate the long-term effects -- in part because it's just too easy to imagine counterfactuals that support a divergence of views. E.g. you imagine an "agency pricing crippled ebooks" scenario, I dream up a "discounters went out of business" scenario. The former may well seem more plausible to you, the latter to me.
So, if we stick to the present: Readers are still shaping the market and have the exact same tools at their disposal as before. They can still choose not to purchase books that are too expensive; they can still boycott a retailer, publisher or both; they can express their opinions publicly. None of that was taken away.
I fully agree that a strong voice got choked, though -- specifically the voice of Amazon. As much as I respect their business acumen, though, let's not confuse "what's best for Amazon" with "what's best for readers" -- or, if you prefer, "Amazon's agenda" with "the best interests of readers."