Guardian: "New Amazon Terms Amount to 'Assisted Suicide' for Book Industry"

[Prestidigitweeze]

According to Bookseller editor Philip Jones and others quoted in this recent Guardian article:

"New Amazon Terms Amount to 'Assisted Suicide' for Book Industry"

Amazon is putting publishers under "heavy pressure" to introduce new terms. The Bookseller reports that these include the proviso that "should a book be out of stock from the publisher, Amazon would be entitled to supply its own copies to customers via its print-on-demand facilities", and that "books cannot be sold for a lower price than Amazon's anywhere, including on a publisher's own website". . . .

Philip Jones said the ongoing negotiations "indicate a direction of travel that would see [Amazon] take a sizeable control over both a publisher's inventory and its marketing", and that . . . "This is a form of assisted suicide for the book business, driven by the idea that publishers are a sickly lot unable to run even the most basic operations efficiently."

[HarryT]

Amazon have always had the "you can't sell it more cheaply elsewhere" condition, to the best of my knowledge. They certainly do for self-published books.

[tubemonkey]

"This is a form of assisted suicide for the book business, driven by the idea that publishers are a sickly lot unable to run even the most basic operations efficiently."

Aren't they?

[fjtorres]

Originally Posted by HarryT

Amazon have always had the "you can't sell it more cheaply elsewhere" condition, to the best of my knowledge. They certainly do for self-published books.

Baen, too.
Probably most other (non-BPH?) publishers.

It's insurance against a publisher favoring another retailer with better terms to harm them. (Like, really, have they ever conspired to do such a thing?)

It could simply be that the BPHs are no longer important enough to be given special terms or maybe it is just a negotiation stance.

In standard negotiations you ask for the moon and stars and let the other guy make a counter offer. It might be that the BPHs have become so used to "take it or leave it" contract negotiations they no longer understand what it is like to negotiate fairly or, worse for them, from a position of weakness.

[crossi]

If a book unexpectedly sold so many that the publishers ran out I would think they would be delighted if Amazon took on the expence of putting more copies in the hands of the slavering hordes wanting the book until the publishers have time to print a new batch. It's not like they wouldn't get the same royalties. Certainly the authors should be delighted to sell more copies. If anything it's insurance for the publishers so they wouldn't need to print un-needed copies of a potential dud book. Isn't that a major expence for the publishers, printing, and paying for the printing and storage of a lot of books that simply no one wants to buy?

[fjtorres]

Before the hyper-ventilation gets too loud, one more time:

All we know for certain is that money-grubbing multinationals are engaged in confidential contract negotiations and one side is apparently breaking NDA to engage in a whisper campaign of rumor and innuendo and to raise a mob and put public pressure on the other camp. The sort of thing usually requires spin and misrepresentation and lies of one sort or another.

The channels through which these "leaks" are coming all have vested interests in this "fight" and track records that are far from clean. Until somebody comes clean and speaks on the record, putting their name and legal liability on the line, take everything with a pound of salt. You are very likely being played.

Simply put, we do not actually know anything about what is really going on other than it is about the return of no-discount agency pricing for ebooks. That much we know for certain because the Hachette CEO said so last week.

Everything else so far is coming from "anonymous insiders" who are supposed to be saying nothing or face legal action for breaking NDA. Of course, they wouldn't be at any legal risk if the rumors are false...

There is both more and less going on in these attempts to stampede bystanders so I would suggest just taking a chill pill and wait and see what comes out from behind the closed doors before getting too riled up.

[tubemonkey]

Originally Posted by fjtorres

There is both more and less going on in these attempts to stampede bystanders so I would suggest just taking a chill pill and wait and see what comes out from behind the closed doors before getting too riled up.

[crossi]

I was wondering also how the article came by it's information since the terms being negotiated weren't being made public by the companies during negotiation. Right now it's all just rumor.

[DiapDealer]

This article only hints at it vaguely:

their budgets will be under further pressure if they have to concede larger discounts to Amazon and pay for 'services'.

"Services" in quotations is the key item. A subtle attempt to dismiss the things Amazon wants to be be compensated for as imaginary, or not really services at all.

This article from Melville House takes a similar approach (and claims to have even more anonymous "insider" details): calling things like the pre-order system "standard." Amazon's inhouse dedicated Hachette employee is also apparently "standard."

You can't have it both ways. Either the pre-order system (and other services) provided by Amazon is vital, valuable and negotiable; or it's not and you can live without it. Judging by how authors and pundits on social media have been screaming about just how important Amazon's preorders are for the welfare of a new book, I'm going with valuable.

If you can't live without the service, and someone else is providing it for you, they're eventually going to ask you to pay for it.

Clearly, Hachette relies heavily on Amazon's preorders to get an idea of how many initial copies to print. That's not an imaginary service. It has value. A value that's negotiable. So negotiate it. Don't scream "we needs it, but we're not going to pays for it!"

[fjtorres]

Originally Posted by crossi

If a book unexpectedly sold so many that the publishers ran out I would think they would be delighted if Amazon took on the expence of putting more copies in the hands of the slavering hordes wanting the book until the publishers have time to print a new batch. It's not like they wouldn't get the same royalties. Certainly the authors should be delighted to sell more copies. If anything it's insurance for the publishers so they wouldn't need to print un-needed copies of a potential dud book. Isn't that a major expence for the publishers, printing, and paying for the printing and storage of a lot of books that simply no one wants to buy?

Yes it is.
Traditionally, 40% of books printed and shipped at launch get returned to be pulped or sold at "deep discount" generating very low or zero income to the authors.

This has gone down a lot in recent years because Amazon rarely returns books (which is why they aren't just one of the biggest pbook distributors but sls
on by far the most profitable channel for publishers) and because independent bookstores have been more careful with their orders since the publishers pushed BORDERS into Chapter 7 liquidation by refusing to take books back during their Chapter 11 reorganization proceedings.

The main benefit of retailer POD is faster delivery of books without incurring warehousing costs so, if this *rumor* is true, the intent is for Amazon to save money on their end while still making up for publishers inability to deliver books fast enough to satisfy customer needs. It also theoretically allows Amazon to sell books that would otherwise be technically out of print which is a competutive advantage all its own for Amazon.

On the minus side, the publisher gives up control over the finished product the consumer receives and highlights even to tradpub authors just how little value add traditiinal publishers bring to the table which is innevitably goingto reduce the publishers' control over their authors, hence the "suicide" aspect.

And we all know by now know obsessive the BPHs have become over retaining their declining control over a uthors, distributors, and retailers, right?

[fjtorres]

Originally Posted by DiapDealer

This article only hints at it vaguely:

Vaguely being the key aspect.
They say amazon wants "bigger discounts" but they never say openly from what baseline.
Is it the traditional 45-50% publishers have given to big retaikers for decades now in the wholesale model?
Or is it from the Apple-introduced 30% no-discount agency terms?

Lies, damn lies, and statistics all depend on obscuring facts and hiding baselines.
So yeah, Amazon might be asking for "bigger discounts" than the agency straightjacket allocates to them but not bigger discounts than they used to get pre-agency. And since agency was introduced via an illegal conspiracy, they might not be willing to agree to it meekly a second time. Not without compensation.

Without a clear reference point, "bigger discounts", "more fees", "service charges" by themselves are just inflammatory (but meaningless) phrases.

Of course, thanks to the blabbermouths at Hachette and Lagardere we do know it is the lower 30% number that is the baseline.

It's all about Agency.
Again.

[Barcey]

The thing that I find interesting is that Hachette is so willing to violate a signed non disclosure agreement. I guess that means that legal agreements don't matter to them. It also must mean those click through agreements are even more meaningless. We should all feel free to ignore them (for Hachette books) as long as we do so anonymously. :sarcasm:

[fjtorres]

Originally Posted by Barcey

The thing that I find interesting is that Hachette is so willing to violate a signed non disclosure agreement. I guess that means that legal agreements don't matter to them. It also must mean those click through agreements are even more meaningless. We should all feel free to ignore them (for Hachette books) as long as we do so anonymously. :sarcasm:

Well, now...
For them to be violating NDA the leaks would have to be true.

[Prestidigitweeze]

Originally Posted by DiapDealer

This article from Melville House[/URL] takes a similar approach (and claims to have even more anonymous "insider" details): calling things like the pre-order system "standard." Amazon's inhouse dedicated Hachette employee is also apparently "standard."

Originally Posted by FJTorres

All we know for certain is that money-grubbing multinationals are engaged in confidential contract negotiations and one side is apparently breaking NDA to engage in a whisper campaign of rumor and innuendo and to raise a mob and put public pressure on the other camp. The sort of thing usually requires spin and misrepresentation and lies of one sort or another. The channels through which these "leaks" are coming all have vested interests in this "fight" and track records that are far from clean. Until somebody comes clean and speaks on the record, putting their name and legal liability on the line, take everything with a pound of salt. You are very likely being played.

The Guardian underlines Bookseller's cred in the second sentence of the article in an attempt to make a distinction between unsubstantiated rumor-mongering and a source they deem to be reliable. When we report unsubstantiated rumors regarding, say, a photoshopped picture of a new e-reader leaked in Technofetishist's Gadget-Grope Daily, we're talking about rumor in a different sense.

Suggesting that The Guardian has a "vested interest in this 'fight'" seems a tad extreme. They have a political outlook that would tend to favor smaller publishers, but characterizing them or Bookseller as having an unusual amount of bias, or characterizing Hachette and/or the unnamed publishers as "money-grubbing" "unclean" "liars" and Amazon as the white knight, seems a wee tad hyperbolic. For one thing, Amazon isn't a philanthropic organization. All of the parties involved are focused on making money and all are, in the absolute sense, "unclean."

The specific issue raised -- regardless of whether some "moneygrubbing liar" emerges from the shadows exuded by their supposed dishonesty -- seems to be whether Amazon is right to push for total control of pricing and publishing in every case. This speaks to the question of whether or not Amazon's advantage is unfair in specific cases -- a question that is not answered by inferences against inferences; by ad hominem about the writer who happens to ask or the anonymous publisher who happens to complain.

It seems to me that this issue involves a question that FJTorres and I discussed on another thread at some point, which is whether it is always permissible for a powerful negotiator to pressure a party without leverage (which might not even be true in this case) to sign a contract that turns out to be unfair. Studying the history of recording rights in the North American music industry amounts to a course on that subject. One lesson it teaches is that certain things which producers and labels asked for from the '60s to the '80s were deemed to be a priori unfair. I think we'd have to know more about the publishers that are complaining today to know whether or not that lesson applies.

You can't have it both ways. Either the pre-order system (and other services) provided by Amazon is vital, valuable and negotiable; or it's not and you can live without it. Judging by how authors and pundits on social media have been screaming about just how important Amazon's preorders are for the welfare of a new book, I'm going with valuable.

I'm not sure that the situation is quite so Boolean. It's possible to find Amazon's POD/pre-distribution and price-lowering models valuable without expecting them to apply universally to all of the products offered on Amazon's site. The mere fact that some products are offered by Amazon Prime and others are not, and that other sellers are allowed to sell products in the Amazon Marketplace under various conditions, suggests that variables are permitted and different models might apply. No one distribution model is universally applicable even in the U.S. store -- let alone in every Amazon store in the world, let alone as specified in the contract of every publisher with which Amazon negotiates a deal.

If a publisher feels they are not in a position to negotiate a contract that might have an adverse effect on their business because Amazon is the gatekeeper, then it is possible that that specific publisher might have a point. It is also possible they might not.

You can be the fairest company in the world and still promote policies that prove to be insufficiently competitive according to the standards of every business and every country in every case. However much we might enjoy its prices and customer service, Amazon is likely not even the fairest company in the entire world; hence its policies are fallible; hence, negotiation that can't be leveraged might be an issue if the obstacle to leverage does turn out to be Amazon.

[Rizla]

Is a cartel better than a monopoly?