Wednesday, August 10, 2011

Price Fixing and Other Publishing Games

A year or so ago, Amazon knuckled under to the big publishers and agreed not to discount their ebooks any more. It was a tough decision and Amazon hung out as long as possible, but in the eleventh hour there was nothing to do but bow the head and take it like a big corporation should. It was tough to see the end of that fight . . . but it's not over yet.

It looks like Apple and the Big Publishers are facing a lawsuit for price fixing. Imagine that. Apple and the big publishers wanted to keep Amazon on a leash because Apple and Steve Jobs were afraid that Amazon would get into the movie and music downloading business, and Jobs wanted that corner of the world for himself. Guess it came back to bite him in his nether regions and he may be forced to give up hsi dream of world domination.

A few days ago, Steve Jobs, looking very thin and ill and having some trouble navigating the stage, unveiled the Apple iCloud, which is similar to the Amazon Cloud Drive, and how even the Mobile Me, which Jobs admitted was a bust, would be incorporated and the annual price, which was $99/year for Mobile Me, was now free. It was a moving moment for the audience, as was the demonstration of what iCloud will do, and that is synch all input from the cloud to every device -- as long as you own Apple products (Mac, iPhone, iPod, etc.).

The thing is, in business you don't beat the competition by making them play on a different field or by taking them off the field completely, but by playing head to head and toe to toe and may the best man win. That is not what happened with Amazon last year and not what is happening now.

On forums all over the Internet, people are complaining about paying near hard cover prices for ebooks. The perceived value is that a file endlessly downloaded and formatted once should not cost as much as a hard cover, paper and board book, and even more than a paperback because there are no physical resources involved. Militant readers are calling for boycotts of the big publishers and waiting on books they really want to be remaindered or become available as secondhand books. Either way, publishers aren't paying attention and neither it seems is Steve Jobs at Apple. They can't see readers are beginning to fight back.

To further expunge all mention of Amazon or links to Amazon in ebooks, books sold in the Apple store through Smashwords must have no mention of Amazon, or any other bookstore, and no links are allowed, which cuts an author's chance to cheaply market their ebooks. Not everyone owns a iPhone, iPad, or Mac and authors know that. Making links to other bookstores is one way to provide access to books and offers a few alternatives for point of sale. When I submitted the revised version of Among Women to Smashwords I was told I had to take down all links other than Apple iStore links or my book would not be distributed at all. Apple's draconian measures affect all the bookstores where Smashwords distributes ebooks, including Amazon, Barnes & Noble, Diesel, Kobo, Sony, etc. Since when does one store have the right to determine what is and is not allowed for other stores? Never, until Apple got into the price fixing and smash Amazon game.

Add to that little titbit, the news that the big publishers' accounting systems are out of date and sales of ebooks are being under reported. In other words, more ebooks are sold than are reported and authors are not getting paid royalties for all ebooks sold. That's not news to authors. We know what is and is not going on with our money.

Publishers have been playing an end game that is going to cost them the reason for their existence -- authors. Self-publishing is looking better and better, even if an eStributor, as Joe Konrath calls agents to help package and manage sales of ebooks, is involved. Even though it was not their intention, it looks like the big publishers and Apple, under the guidance of Steve Jobs, who has not gotten over what happened in the beginning days of computers and operating systems, are going to have to pay for their price fixing and cavalier attitudes towards authors and competitors.

Every day is a new day and in the publishing word outside of the behemoth that traditional publishing has become, each new day hammers a new nail into the coffin. When you add in factors like literary agent, Andrew Wylie's railing against the 30% share of the market distributors like Apple and Amazon get from publishers and calling on publishers to stand firm against such tactics. The Jackal, as Wylie is called, said that Amazon and Apple should be willing to go quid quo pro and give publishers 30% of sales of iPads and Kindles to publishers if they wanted to protect the 30% they demand stating, "They [Amazon and Apple] have the device, but they cannot sell it without the content." Wylie's deal with Amazon to sell ebooks of his clients' back lists seems to fly in the face of his stand against Amazon and Apple, especially in the face of Random House publicly censuring Wylie by calling him a competitor instead of a deal broker between authors and publishers.

Yes, boys and girls, this is a volatile age we live in and the battles in publishing have just begun. Personally, not having to deal with agents and the ponderously slow time table of publishers seems more and more like a smart move, especially when my own publisher can't be bothered to send out quarterly statements quarterly and prefers to do it annually. Granted, the sales have been slow, but they have picked up and here we are in the third quarter without a single word from the publisher. At least Smashwords and Amazon pay every month without fail, no matter what royalties have been earned.


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