WSJ: E-Book Sales Fall After New Amazon Contracts

[eschwartz]

Originally Posted by Fbone

Also Blossom and issybird.

!!!!

Originally Posted by jgaiser

Wah!!! Why ain't I green? .... Congratulations to all our new overlords.

I just want to know what the criteria are. No offense meant, but the only one I could picture as a Greenie is DD. And he used to be a baby moderator.

No one appreciates me either. We shall cry together.

[jgaiser]

Originally Posted by DiapDealer

One "Takes the Green" by saying their vows in a sept or before a heart tree.

As Kermit says... It's Not Easy Being Green. Good on you.

[jgaiser]

Originally Posted by eschwartz

No one appreciates me either. We shall cry together.

Not that it's ever going to happen (I'm too much of a pain in the ass), but I'd probably say no thank you. Some of you guys would be hell to keep under control.

[cromag]

Originally Posted by Cinisajoy

How does one turn green?

Eat oysters in a month without an "R" in it.

[Cinisajoy]

Originally Posted by eschwartz

!!!!



I just want to know what the criteria are. No offense meant, but the only one I could picture as a Greenie is DD. And he used to be a baby moderator.

No one appreciates me either. We shall cry together.

Don't think I want Green.

[FizzyWater]

Originally Posted by Cinisajoy

Don't think I want Green.

I wouldn't mind being a baby one, deleting spam posts late at night. But I don't think I'd want to have to break up fights.

[eschwartz]

Originally Posted by FizzyWater

I wouldn't mind being a baby one, deleting spam posts late at night. But I don't think I'd want to have to break up fights.

I don't think you have to break up fights if you don't want to. Let's see who gets shut down by DD, though....

Me, I love deleting spam posts, but since I'm only a baby mod I can only do that in the Kindle subforums.
Plus I have to PM Dr. Drib to get them banned.

[Cinisajoy]

I have yet to see a fight here.
Oh wait, maybe it's I haven't been in a fight here.
Eschwartz, I thought you were a big mod.

[eschwartz]

<=== Nope. No green.

[ottdmk]

Originally Posted by Phogg

Well, that was an entirely goofy "Bezos is teh Satan" type screed.

Because Amazon is headed in the exact same direction Feedbooks and Fictionwise were going before the big publishing houses maimed them during their little adventure that was squashed by the Federal Government. This isn't some personality driven conflict. This is an inevitable evolution of business models driven by an advance in technology. It doesn't matter what people are officers or owners of this corporation or that franchise chain.

I don't believe Bezos is Satan, and I certainly didn't mean for that to be the impression my post left. I'm guilty of equating Bezos with his company, which may be somewhat unfair. I don't think personalities have a huge amount to do with this and while the BPH settlements lifted Agency for a while, it appears to be making quite the comeback.

I simply mean that Amazon and the BPHs are not friends. They have a business relationship. And what's best for Amazon is not necessarily what's best for the BPHs. I believe the current contracts (what we can see of them) reflects that.

Amazon has reams of data that supports a "sweet spot" of e-book pricing. And, naturally, Amazon wants to make the most money possible. (They don't want to make any PROFIT, but they do want to make the most money possible.) So they want e-books in that sweet spot.

The BPHs don't fully agree with that. They want to maintain their windowed offerings... it's how they make most of their money. The last thing they want is for Amazon to shape public perception of how much an e-book is worth. Combine public perception on price and Amazon's dominant market position (not quite a monopsony, but still extremely strong) and sooner or later, Amazon holds all the cards in any negotiation. If that happens, the publishers will get squeezed. It's how Amazon works.

Agency avoids this problem. If Amazon can't set the price of the e-books, it's difficult to shape public perception as to how much an e-book should cost. (Of course, with their own publishing arms and their self-publishing division, Amazon is having an impact on public perception anyway, but a) it can be argued it's not as much of an impact and b) if you're a BPH you gotta try something, right?)

Agency also allows for competing retailers that for one reason or another can not or will not follow Amazon's business model of razor-thin profit margins to grow market share.

[fjtorres]

Originally Posted by ottdmk

(They don't want to make any PROFIT, but they do want to make the most money possible.)

That is not correct,
Amazon makes tons of profit from their sales operations. And they *want* to makes as much profit from sales, if nothing else to provide funding for their investments.
(Think of Amazon as a Venture Capital fund that is powered by retail profits.)

They do not *report* taxable revenue because they rollover the profits into acquiring non-taxable assets. That is why Amazon's stock price is more tightly linked to their free cash flow than their reported net.

Trying to create a distinction between Amazon and BPH interests (which are somewhat but not totally different) as a lack of desire for profit is not valid because *both* want to maximize profit.

The division is because Amazon's position is that *everybody* makes more *total* profit with sweet spot pricing whereas the BPHs believe that it is more important to maximize per-unit *gross* profit even if it results in lower total *net* profit for everybody in the chain.

[ottdmk]

My apologies for being overly simplistic. I was referring to the fact that Amazon has only rarely reported a profit, and indeed seems loathe to do so. They're an interesting company. They recently reported a miniscule profit compared to revenue, and their stock soared. They've reported losses more often then not... and their stock still goes up. The markets seem to be banking on them reporting profits (and quite large ones) at some point in the future, but they're very forgiving as to when. I find myself wondering when the tipping point will come, and if I'll be around to see it. (Hope so. Should be interesting.)

I'm glad I'm not a stock broker. None of this makes any sense to me. (I'm not saying it doesn't make sense, only that my brain doesn't seem wired to figure all of it out.)

I'm not characterizing the difference as a lack of desire for profit. I'm saying I can understand the reluctance of an industry that is based on substantial profit margins to not fully trust a company that has a model of using much smaller margins to chase continual growth. Sooner or later, the amount of growth will stop, and if you've lost all bargaining clout as to what your goods are worth, where are you then?

[DiapDealer]

Originally Posted by ottdmk

Sooner or later, the amount of growth will stop, and if you've lost all bargaining clout as to what your goods are worth, where are you then?

Same place you are right now. At the mercy of a retailer you can't possibly survive without.

Amazon will eventually have everything they want from BPHs. Their delaying tactics are only delaying tactics. Instead of innovating, they've decided to bank on the idea that they only need to drag their feet until Amazon messes up or goes away. I understand the "We've got to do something" mindset. I just don't think ebook agency IS that something. Now Amazon is simply heavily discounting their print books. You know ... those things that ebook agency pricing was supposed to be protecting the value of in the first place?

Once consumers get used to the idea that print books (BPHs self-proclaimed "bread & butter") should be dirt cheap--maybe cheaper than ebooks--what then?

[dickloraine]

Originally Posted by ottdmk

My apologies for being overly simplistic. I was referring to the fact that Amazon has only rarely reported a profit, and indeed seems loathe to do so. They're an interesting company. They recently reported a miniscule profit compared to revenue, and their stock soared. They've reported losses more often then not... and their stock still goes up. The markets seem to be banking on them reporting profits (and quite large ones) at some point in the future, but they're very forgiving as to when. I find myself wondering when the tipping point will come, and if I'll be around to see it. (Hope so. Should be interesting.)

I'm glad I'm not a stock broker. None of this makes any sense to me. (I'm not saying it doesn't make sense, only that my brain doesn't seem wired to figure all of it out.)

I'm not characterizing the difference as a lack of desire for profit. I'm saying I can understand the reluctance of an industry that is based on substantial profit margins to not fully trust a company that has a model of using much smaller margins to chase continual growth. Sooner or later, the amount of growth will stop, and if you've lost all bargaining clout as to what your goods are worth, where are you then?

They don't need to make profit ever. They could pay dividends independent from profit and many investors don't even buy for dividents but to sell later for a higher price. Profits are just one sign for a healthy business. And most investors nowadays don't even no anything about the business they invest in. They just see raising and falling and computers decide in the blink of a moment.

[issybird]

Originally Posted by eschwartz

I just want to know what the criteria are. No offense meant, but the only one I could picture as a Greenie is DD. :

Duly noted.

Originally Posted by jgaiser

Congratulations to all our new overlords.

Thank you!