On Friday, Amazon removed the “buy” links on its site from every book published by Macmillan or its subsidiaries. The two companies were in the middle of negotiations about ebook rights and pricing, and Amazon got tired of negotiating, so they de-listed Macmillan’s books to force them to capitulate.
I opine that Amazon’s demands were overblown and excessively self-serving, and their attempt to strongarm Macmillan put them in clear violation of federal antitrust regulations. I observe that Amazon has pulled this same trick on several previous occasions, and gotten away with it more often than not. Those victories had nothing to do with laws and rights, and everything to do with the power distributors hold over publishers.
The book production pipeline is long and expensive. If a major distributor suspends sales of a publisher’s books, there’s a good chance the publisher will go broke and go out of business before they can do anything about the situation.
It’s been an exciting weekend.
Today, Amazon backed down and said they’d decided not to invade Belgium after all. It’s good news, though I’m still waiting to hear they’ve actually put the links back up. In the meantime, some selected readings:
From Zinc Blinked, by Scott Westerfeld:
This is not a case of two corporations pissing down on us mere mortals with equal disdain; it’s a case of complex negotiations in an ancient industry with many arcane traditions that’s in a state of technological flux, being conducted at a level which the overwhelming majority of readers do not understand (nor should they have to), and which were going along in a way that made, frankly, perfect sense to those of us who understand this industry a little, when suddenly, out of the blue, one of the sides in this negotiation spat their pacifier across the room in a very public and embarrassing display of petulance. And that corporation was Amazon.From the formidable Amazon, Macmillan: an outsider’s guide to the fight, by Charlie Stross:
Note that Amazon have been trying to grab a larger share of the cake by dipping into the publishers’ — and the authors’ — share of what meagre profits there are (book publishing is notoriously, uniquely unprofitable, within the media world), even though they’ve already got the wholesale and retail supply chains stitched up. Their buy wholesale/sell retail model screws publishers’ ability to manage their cash flow and tends to induce price wars on the supply side, which is okay if we’re talking widgets with a range of competing suppliers, but books are individually unique products and the industry already runs on alarmingly narrow margins: this isn’t the music or movie biz. …John Scalzi has been on top of this story all weekend, starting with Macmillan Books Gone Missing from Amazon, and continuing on with A Quick Note on eBook Pricing and Amazon Hijinx, It’s All About Timing, and Dear Amazon. His most recent entry, All the Many Ways Amazon So Very Failed This Weekend, is gratifyingly thorough:
Just before Apple announced the iPad and the agency deal for ebooks, Amazon pre-empted by announcing an option for publishing ebooks in which they would graciously reduce their cut from 70% to 30%, “same as Apple”. From a distance this looks competitive, but the devil is in the small print; to get the 30% rate, you have to agree that Amazon is a publisher, license your rights to Amazon to publish through the Kindle platform, guarantee that you will not allow other ebook editions to sell for less than the Kindle price, and let Amazon set that price, with a ceiling of $9.99. In other words, Amazon choose how much to pay you, while using your books to undercut any possible rivals (including the paper editions you still sell). It shouldn’t surprise anyone that the major publishers don’t think very highly of this offer.
Leaving aside the moral, philosophical, cultural and financial implications of this weekend’s Amazon/Macmillan slapfight and What It All Means for book readers and the future of the publishing industry, in one very real sense the whole thing was an exercise in public communications, a process by which two very large companies made a case for themselves in the public arena. And in this respect, we can say this much without qualification: oh, sweet Jesus, did Amazon ever hump the bunk.For further discussion, check out the comment thread of the preceding entry on Making Light.
How did it do so? I’m glad you asked! Let us count the ways. …
2. Amazon Lost the Authors.Amazon apparently forgot that when it moved against Macmillan, it also moved against Macmillan’s authors. Macmillan may be a faceless, soulless baby-consuming corporate entity with no feelings or emotions, but authors have both of those, and are also twitchy neurotic messes who obsess about their sales, a fact which Amazon should be well aware of because we check our Amazon numbers four hundred times a day, and a one-star Amazon review causes us to crush up six Zoloft and snort them into our nasal cavities, because waiting for the pills to digest would just take too long.
These are the people Amazon pissed off. Which was not smart thing, because as we all know, the salient feature of writers is that they write. And they did, about this, all weekend long.
From Tobias Buckell, Why My Books Are No Longer Available on Amazon.com.