Amazon vs. Hachette Update - It's About Price

[Kumabjorn]

Originally Posted by pwalker8

You mean the quality of the book was mediocre or that you bought the book trying to get a scholarship that was mediocre? The book that I bought was pretty dry, most scholarly texts are but it had some very interesting info on a subject that I find interesting.

It's an English translation of a Jesuit text in Portuguese from the late 16th century with commentaries. The translation is fine, and that is what I needed not being able to read Portuguese. But the commentaries provided did not contain any new insight, hence mediocre to my mind.

[pwalker8]

Originally Posted by ApK

I don't understand how you can see a problem in what you describe.
Every business negation in the world is one side saying "Pay me what I ask, or else you can't have it."
and the other side saying "Give me a lower price or else I won't buy it."

You can argue that the offered price is too low and should be rejected, but there is nothing "scummy" about it at all.

However, such a model is not sustainable. Most of the business world gets by fine with win/win contracts. Companies who consistently screw their suppliers tend not to be in business long term ,long term as in 30, 40, 50 years, not 5 to 10 years.

Occasionally, you run into a company that seems to get by with it. Wallmart, which really didn't hit the big time until the 80's, seems to be the poster child for that mentality. My guess is that eventually product quality will slip enough that customers start to notice and Walmart will end up falling about as fast as they expanded. We will see.

[pwalker8]

Originally Posted by Kumabjorn

It's an English translation of a Jesuit text in Portuguese from the late 16th century with commentaries. The translation is fine, and that is what I needed not being able to read Portuguese. But the commentaries provided did not contain any new insight, hence mediocre to my mind.

I understand.

[JSWolf]

Originally Posted by the.Mtn.Man

It's basically like this: Amazon can make more money across the board selling books at $9.99 even if it means that individual publishers might take a loss, but those publishers would probably take a bigger loss pulling their catalogs from Amazon.

In other words, Amazon is essentially telling publishers, "You either take a small loss or a big loss. Your choice. Either way, we win." It's a pretty scummy way of doing business.

If Amazon makes more money at $9.99, then the publishers would make more money as well.

[ApK]

Originally Posted by pwalker8

However, such a model is not sustainable. Most of the business world gets by fine with win/win contracts.

It's been sustainable for centuries. Both sides negotiate and come up with a deal they can both be happy with. If not, either party can walk away. Amazon would be reluctant to send Hachette customers to competitors, even as Hachette would not want to lose a major retail outlet.
If they negotiate, they will both likely win.

Occasionally, you run into a company that seems to get by with it. Wallmart, which really didn't hit the big time until the 80's, seems to be the poster child for that mentality. My guess is that eventually product quality will slip enough that customers start to notice and Walmart will end up falling about as fast as they expanded. We will see.

I read "The Walmart Effect" and the poor quality of my post-Walmart Levi's jeans makes me tend to agree, but the vendors who succumb are the ones greedily seeking growth at any cost. Companies fail that way every day without Walmart's help.
Some vendors (the book mentions Snapper lawnmowers IIRC) simply said, "No deal , Walmart, you're not the only retailer, and we'll do just fine by keeping our quality high." Apple has a similar attitude.
And some companies can meet Walmart's demands without sacrificing quality, but by becoming more efficient, just as many companies do without Walmart involved.

[SteveEisenberg]

We believe 35% should go to the author, 35% to the publisher and 30% to Amazon.

What's this percent business? Most big publisher authors get a fixed amount from the advance.

I think that if we consider Amazon Publishing and Kindle Direct Publishing as an entity under the same corporate umbrella, Amazon may be considered the sixth big publisher. And that number six is number one for chintzyness when it comes to paying advances. Instead of taking on the risk of the book flopping, as the big five do*, Amazon usually forces author incomes to depend wholly on a percentage of the sales figures. Not too subtly, Amazon is pressuring Hachette to follow their lead of putting more risk on the author.

Do some authors prosper while taking on all the risk themselves? Yes. Most of these authors spent months rather than years writing the book, somewhat moderating their risk. Good novels have been written that way, but I don't think you can do it with, say, Chinese history.

As a reader who will never write a book, I'm not posting here out of altruism. Most of the books I read are non-fiction titles that would never have been as thoroughly researched, or even written, if a big publisher hadn't paid an advance against the book proposal.


_________________
* Penguin Random House threatens to become another low/no advance publisher due to their ownership of Author Solutions.

[ApK]

Originally Posted by SteveEisenberg

What's this percent business? Most big publisher authors get a fixed amount from the advance.

Then a royalty percentage after the advance is recouped.

I think that if we consider Amazon Publishing and Kindle Direct Publishing as an entity under the same corporate umbrella, Amazon may be considered the sixth big publisher.

i don't know how Amazon Publishing works, but KDP is a self publishing platform, not a publisher. You can't just call it one and then bash it for not being like one.

If I, as an author, choose to self-publish, then that's my decision. I didn't need an agent, I didn't need to shop the book around, and hope to get it past the right gate keepers at just the right time. I didn't need to take a publishing house's editorial input. I knew I would not be paying myself an advance.

KDP is a self-publishing platform, not a publisher, and there is no reason to think that all publishers will change to work like it does, any more than all fancy restaurants feel compelled to turn themselves into an automat.

And if your Chinese history author requires an advance from a BPH to do work, maybe it's time to look for a new model: grants, patrons, crowd-fundng....it's a brave new world. Maybe I, as a reader, no longer feel I should have to subsidize that Chinese history advance by paying the overhead in the cost of the books I buy. That 'risk the publishers assume' is really the money we all pay in the cover price. It's not coming out of the CEO's trust fund.

[BearMountainBooks]

Originally Posted by Fluribus

I don't know about other folks, but I don't care how big the author's name is. Unless it's a scholarly tome, or some other specialty work, I'm not paying $15 for it.

I've got a fair number of Hachette titles. Bought when they seemed to me to be a reasonable price. All under $10. I could easily flush all future Hachette titles without breaking a sweat. If all the large publishers move in lockstep, I'm quite willing to flush them all.

I'm with you and the same discussions happen a lot on some of the reading forums I'm on. One of my favorite authors is Patricia Briggs. Love her stuff. But her books are in hardback now, so her ebooks for at least a year run well over 10 dollars. I'm not even likely to buy them at 9.99. Once books get above about 7 or 8 dollars, I start looking at the library and used markets. The cozy group I'm on often has posts: "That's too expensive. I'll wait for the library to get it." And the bottom line: If a book is popular, the library WILL get it--even if it's interlibrary loan.

Now, all that said, I don't care what Hachette or Amazon does in this case. I'm not changing my buying habits. My habits have been in place for a long time. When books started costing 7.99 (mass market) I started spending a lot more time at the library. Then Amazon started doing the buy 4 get one free and I was enticed back into buying. Amazon also had used books for 3.50 and then 4.00...and now they're up there closer to 5 and 6 for a lot of titles.

But I can buy a lot of ebooks for under 5. And some of my favorite trad authors are taking one series or other independent, so my choices are actually INCREASING, not decreasing.

In other words, I had no reason to pay more than 8 dollars before. I'm certainly not going to do it now. Publishers are going to have to hope that there are still a lot of people willing to pay higher prices even though I think the curve is to pay lower prices with more choices.

[SteveEisenberg]

Originally Posted by ApK

And if your Chinese history author requires an advance from a BPH to do work, maybe it's time to look for a new model: grants, patrons, crowd-fundng....it's a brave new world.

Crowd-funding Chinese history is unlikely to work for the prospective authorial/editorial team, and a foolish gamble for investors. By contrast, grants and patrons are old news -- that's how academia works. That system does produces many good history books. But, on average, those from the big five are, to my taste, better written and more interesting.

Originally Posted by ApK

Maybe I, as a reader, no longer feel I should have to subsidize that Chinese history advance by paying the overhead in the cost of the books I buy.

So borrow them from libraries. You live in New Jersey, where there are good ones. If your local one isn't among them, you can join the state library and/or get it on interlibrary loan. Or pay $50 a year to the Brooklyn library, which has one of the largest Overdrive collections. Or buy indie Chinese history books. And if you find even one that's as good as those by Jung Chang, please let me know.

Originally Posted by ApK

That 'risk the publishers assume' is really the money we all pay in the cover price. It's not coming out of the CEO's trust fund.

I read this part of your post several times and do not understand the point.

[ApK]

Originally Posted by SteveEisenberg

So borrow them from libraries.

It was a figurative 'I'...but you missed my point:

I read this part of your post several times and do not understand the point.

The risk of the advance is not covered in the price of the book. The risk is covered in the price of all the publisher's OTHER books. All customers subsidize the risk. It's part of the overhead calculated into pricing so that a house won't fold on one failure.

[Andrew H.]

Originally Posted by pwalker8

However, such a model is not sustainable. Most of the business world gets by fine with win/win contracts. Companies who consistently screw their suppliers tend not to be in business long term ,long term as in 30, 40, 50 years, not 5 to 10 years.

There is absolutely no evidence that this is unsustainable. An equally valid explanation is that Hachette is trying to gouge Amazon and consumers. Hachette is, after all, more profitable than Amazon.

But they're both giant corporations, so I think it's kind of silly to be taking sides.

Occasionally, you run into a company that seems to get by with it. Wallmart, which really didn't hit the big time until the 80's, seems to be the poster child for that mentality. My guess is that eventually product quality will slip enough that customers start to notice and Walmart will end up falling about as fast as they expanded. We will see.

Walmart has tens of thousands of suppliers, and if one doesn't supply a fan or drinking glass or coffee maker at the price Walmart wants, they'll go to another one.

There are only 6 big publishing houses, each one selling non-fungible goods. If S&S doesn't sell the latest Stephen King book to Amazon, it's not like Amazon can go elsewhere and get it.

[crossi]

Books are sort of fungible to me. I read so quickly that if I depended on just a few authors I would quickly run out of anything to read. So if the price of one book is temporarily too high I'm quite happy to fill my time with the dozens of other books I also want to read that are currently better priced, or to simply reread my old favorites.

And I don't particularly care if your chinese history book never gets written. I'm not going to read it. And if having it means all the books I do read are higher priced I actively hope it doesn't get written. I'm not altruistic enough to support your tastes by paying higher prices on my stuff.

[tubemonkey]

Originally Posted by crossi

Books are sort of fungible to me. I read so quickly that if I depended on just a few authors I would quickly run out of anything to read. So if the price of one book is temporarily too high I'm quite happy to fill my time with the dozens of other books I also want to read that are currently better priced, or to simply reread my old favorites.

And I don't particularly care if your chinese history book never gets written. I'm not going to read it. And if having it means all the books I do read are higher priced I actively hope it doesn't get written. I'm not altruistic enough to support your tastes by paying higher prices on my stuff.

[darryl]

It seems quite apparent that the BPH seek at almost any cost to preserve an obsolete business model which I suspect very few of us want. Like tubemonkey I see no reason whatsoever why other readers should subsidise the writing of Chinese history books few will ever read.

Another point missing from this thread so far is piracy. Whilst human nature has its faults it still seems most people choose to pay for their ebooks. Like it or not this can so easily change if stupid policies are pursued by publishers not only on price but on other issues as well. BPH. The old world is gone. Embrace the new or fade into history. I doubt there will be books written about you in this brave new world.

[ST-One]

Originally Posted by fjtorres

Because they need Amazon's selling expertise (the same expertise they find "suspect") to move their books. They just want Amazon to meekly play lapdog and serve them and their agenda, against their own interests.
Not going to happen.
Amazon is effectively daring them to pull out.

Or you could say that Amazon is using their dominant market-position to force everyone to do it their way or go and take a hike.

Nothing unusual really; SOP in a free market.