5,000 Kindle titles shut down by Amazon in pricing dispute

[markbot]

Hard ball by Amazon.com or simply part of the normal warp and woof of business? Probably a bit of both

The Independent Publishers Group say Amazon.com has decided not to renew an agreement to resell electronic titles offered by the book distributor's client publishers in an apparent dispute over wholesale discounts on books. About 5,000 Kindle titles will be affected, though the print editions of the books remain available for sale on Amazon.

Read more: http://news.cnet.com/8301-1023_3-573...#ixzz1n9Yas9UU

also

http://paidcontent.org/article/419-a...ht-over-terms/

[pidgeon92]

Nothing new in this. I worked for two different manufacturers that sold directly to Walmart, and they were always putting the screws to the companies I worked for to drop the price, and they always did. They couldn't afford to lose Walmart's business. Whether this little publisher capitulates or not depends on how much they need Amazon to stay afloat.

[Fbone]

No mention of what sort of terms Amazon was requesting. They aren't Agency titles.

[WT Sharpe]

At least this has no chance of affecting my current library in the way the 1984 fiasco affected many, thanks to a certain neophyte space alien and his successors.

[RainingLemur]

I'd be interested to see what the terms that Amazon wants are and see how different they are from what was previously agreed to.

[MrsJoseph]

Originally Posted by RainingLemur

I'd be interested to see what the terms that Amazon wants are and see how different they are from what was previously agreed to.

Me, too.

[osnova]

Amazon's standard terms for self-published authors/independent KDP publishers: Amazon keeps either 30% (+charge for traffic) or 65% for copyrighted and 65% for PD books.

It appears IPG had a better deal, which Amazon would not renew. It seems that it was IPG who played hardball.

"They wanted better margin and we were telling them what our terms were. So they took the titles off," according to Suchomel... I would love to sell them the e-titles titles. If they want them they're certainly available."

From these phrases, it seems IPG stuck to their terms and would not budge.

[calibrated]

Correct me if I'm wrong (which I may very well be), but I believe there's a difference between self-published authors and independent publishers.

[osnova]

KDP allows anyone to publish be it authors or independent publishers. So, there is no difference in the KDP context.

IPG has admittedly more clout than a small independent publisher such as OSNOVA, so they must have been able to get better terms than the standard.

[miguel1626]

I've read about this at Carl Zimmer's blog. He also pointed to a Publishers Weekly article with some background information:

(...)
Many sources said Amazon has been asking for a steeper wholesale discount on books. (Although e-books are sold on the agency model, print books continue to be sold on the wholesale model, in which retailers purchase titles at a certain percentage off the list price.) Co-op requests from Amazon have also escalated, according to a number of insiders. Although publishers and distributors regularly have discussions with Amazon about these issues--negotiating the terms on these matters is a standard aspect of doing business--the retailer's requests, in recent weeks, have sent shocks through many in the industry, some of whom are worried about what will happen to their books if they cannot meet the demands.
(...)
Although publishers fear seeing their titles disappear from Amazon--for many in the industry the retailer accounts for 20% to 25% of their business--some say the demands the retailer is making are impossible to meet and would nearly wipe out all of their profits there anyway. Furthermore, as some have noted, changing wholesale terms with Amazon, could present a legal issue. Although co-op deals can be varied and private, publishers are prevented by the Robinson-Patman Act from favoring one account over another with notably different wholesale terms. (It was the broad discrepancy in discount terms among accounts that led the ABA to sue Barnes & Noble and Borders in the 1990s.)
(...)
The demands regarding co-op have some particularly on edge. Not only are many publishers frustrated about being asked to pay more money for content they are providing, but the whole notion of co-op at the online retailer is unsettling. While the case can be made that co-op in a bricks-and -mortar store is a worthwhile investment--money is spent on getting books to physical areas of the store, such as front tables, where consumers will see those books first--it's much less logical on a Web site. Does having a video or an author Q&A on a book's page on Amazon really encourage a customer who has already clicked on that book to make a purchase?

Anyway, this is business, not politics. Personally, I don't think Amazon will step down, but the final result remains to be seen).

[MrsJoseph]

Originally Posted by miguel1626

I've read about this at Carl Zimmer's blog. He also pointed to a Publishers Weekly article with some background information:



Anyway, this is business, not politics. Personally, I don't think Amazon will step down, but the final result remains to be seen).

That's a really interesting point.

I admit to not being surprised at Amazon's actions. They made their reputation on being a loss leader - and now investors are getting annoyed at waiting for profits.

[Fbone]

Originally Posted by osnova

Amazon's standard terms for self-published authors/independent KDP publishers: Amazon keeps either 30% (+charge for traffic) or 65% for copyrighted and 65% for PD books.

It appears IPG had a better deal, which Amazon would not renew. It seems that it was IPG who played hardball.

"They wanted better margin and we were telling them what our terms were. So they took the titles off," according to Suchomel... I would love to sell them the e-titles titles. If they want them they're certainly available."

From these phrases, it seems IPG stuck to their terms and would not budge.

Since IPG distributed ebooks are routinely discounted they don't use Agency model. It's possible they use a wholesale system. It would be difficult to believe they were offered better terms than Agency's 70/30 split before now.

[carpetmojo]

Not good news.....

[osnova]

IPG: "This is a business decision on Amazon’s part, and hopefully they will soon decide to reverse it and buy at our standard terms."

I wish I would be in a position to (attempt to) strong-arm Amazon.

[MrsJoseph]

Originally Posted by osnova

IPG: "This is a business decision on Amazon’s part, and hopefully they will soon decide to reverse it and buy at our standard terms."

I wish I would be in a position to (attempt to) strong-arm Amazon.

What's wrong with a company having standards? It seems that they are saying "this is what we require to do business with you" and that is their right.

My company has a standard that is profitable to us - anything less than that and we are losing money. We will not go below that standard because employees have to be paid.

Amazon is not the only company who needs to make money. Maybe if companies start banding together they can cut Amazon off at the knees. God knows somebody needs to do it.