Oh boy. I woke up this morning to see this article on the front page of r/books, and you know … I’ve never fisked anything … but this piece couldn’t be ignored. For those not in the know, a “fisking” is when someone replies point by point to the salient points of an article, offering a piece by piece rebuttal. I’ll let you read the original article first, so you can get it in your mind, but it’s just part of the continuing—You know what? You be the judge. Read the article, then check this rebuttal.
The quoted article bits are both quoted and italicized. My responses are the normal text.
So, let’s get started.
For all outward appearances, the relationship between Amazon and the publishing industry had settled into a wary peace, following a highly publicized dust-up in 2014 between Amazon and Hachette, wherein Amazon tried to bully Hachette in negotiations over e-book prices.
And right here the bent of the article becomes clear. Wasn’t this the dust-up that led into Hachette, along with a bunch of other publishers, going to court over a price-fixing scheme?
Also, I love the use of the word “bully” because it’s highly questionable here. Misfitting even; solely there to push the reader towards seeing “big bad Amazon” as the perpetrator.
If you were looking for a book and Amazon was out of stock—or, perhaps, was charging a higher price for a new copy than a third-party seller—you would automatically be prompted, via Amazon’s patented one-click system, to buy from a third party.
So … just like any other bookstore or seller situation, then.
Publishers—including some very, very large ones like Penguin Random House—are now desperately figuring out the sources of these sellers’ books. They are worried that publishers and authors may not be paid from all sales.
What, are they worried that someone else is publishing and selling copies of their books to retailers? Because that’s the only way this could be a worry. Publishers of a book are the sole source of said book. If an author isn’t getting paid for a book, then the publisher is the closest, and most likely, fault.
But it has the potential to be an earthshaking change for some publishers, and is being seen as evidence that Amazon is willing to elevate third-party sellers to further erode publishers’ bargaining power and market share.
Good. That’s business, and more importantly, the open market. And personally, they’ve been too big and too powerful for a long time now. Again, they’re the sole source of these copies, too, so if someone else is undercutting them after buying the book from them in the first place … I mean, raise your wholesale prices or something. Don’t whine about Amazon letting other places sell books too. I mean, how dare other people sell a book?
“If your aggressive promotion of used book sales becomes popular among Amazon’s customers, this service will cut significantly into sales of new titles, directly harming authors and publishers,” they wrote in an open letter to Bezos.
So far this is the sane piece of legitimate worry in the whole article. The games industry has already seen what happens when used sales are too aggressively pushed. For the opening week of Gears of War 2, for example, a full two-thirds of the sales were resold copies, meaning that Gamestop made multiple times what the actual developer did off of the launch. If this happens to books, there is a bit of worry … but I’m unaware of Amazon being quite that aggressive with used book sales. Also, this article so far has been talking about new sales, so does this really apply?
After the news that Amazon had begun allowing third-party sellers to “win” the buy button, it strongly condemned the company. “Without a fair and open publishing marketplace, publishers will soon lose the ability to invest in the books that advance our knowledge and culture,” it said in a statement.
Hogwash and claptrap. This is how a “fair and open” market works. Companies are allowed to sell a product on their shelves at as low a price as they want. If they bought a book from the publisher but sell it at a lower mark-up than the publisher does, that’s their right. To insist that the opposite, which would be establishing a fixed price that all books had to be sold at would be “fair and open” is lunacy. That’d be the opposite: It’d be price fixing, which the big publishers were already found guilty of once befo—Oh.
Many publishers believe they’re being cheated by sellers in the third-party marketplace, which don’t acquire their books from official channels—instead they sell remaindered copies (books that did not sell in stores and were returned to the publisher) or “hurts” (books with minor blemishes), often for rock-bottom prices. If these books are “remainders” or “hurts” or pirated, as some publishers have claimed they are, then publishers and authors won’t see a dime.
Okay, hang on a second here. This doesn’t make sense. So the publishers are complaining that the numbers of remained or damaged books being sold are damaging their sales margin? What?
Let’s look at this reasonably. Yes, damaged copies of books exist. But if they exist in such large numbers that your own book sales are declining because of that … then you already have a problem whether they are sold or not. Because your production process is generating that many damaged copies in the first place. Which means you’re already burning a fair margin of your money on bad prints. Which means something about your printing process probably needs to be looked at. Especially if you’re generating so many damaged books that they can outsell a portion of your normal sales.
The “remainder” excuse is even worse, and yes, an excuse. Because if there were enough books not selling that remaindering copies existed … why are you printing even more and trying to sell them? You should be leaving them on shelves. If they’re “competing” with sales already existing, that means someone went and printed up new copies of a book that didn’t sell well in the first place … which is the bigger problem. If you only sold 200 copies of a 1000-print run, don’t garbage the remaining 800 and print up another 1000. Sell the 800. I’m sorry, but if “remainder” sales are damaging “new” sales, something is wrong with your business plans, not with the market.
And in either of these cases, why isn’t the author seeing any money? That sounds like a poor contract written heavily in the publishers favor, not the fault of the booksellers.
Lastly, I love how the article just casually throws “piracy” out there as if it’s part of the problem. It shouldn’t be. Amazon clamps down on pirates pretty quickly, because pirates are bad for business, and Amazon gets this. If there is piracy going on, the publishers should be working with Amazon to cut it off … not slyly insinuating that Amazon is supporting it somehow.
It’s unlikely that the authors of perennial New York Times bestsellers would be affected by these changes.
Well of course not. The big publishers have already been cannibalizing their mid-listers to make up for all their bad A-list and celeb deals. That’s nothing new.
Rather, it is midlist authors and independent publishers that are most likely to feel the squeeze.
And there it is. Though I don’t see how independent publishers are going to “feel the squeeze.” After all, they’re the ones that are using the new advances of the industry to keep costs low and offer better payouts than the larger, behind-the-times big publishers. They’re not going to be affected by this. Not the way the traditional pubs will.
Furthermore, the big pubs squeezing of their mid-listers is only going to push those authors further towards independent publishing or selling. And this is how business in an open market works: A company only exists until a newer one comes along offering better service at a lower price. The big publishers have rejected industry advances for more than two decades now, resulting in a painfully bloated infrastructure they’re squeezing for every penny … again, mostly from the mid-list. Which in turn makes these newer, more up-to-date and better paying publishers look mighty tempting …
The fear is that there an even stronger focus could be put on frontlist hardcover sales—which are dominated by a mere handful of authors—which would further push out midlist authors.
So wait, the publishers are fearing what they’ve already been doing? I have to admire how this article presents part of the problem, but has worded it as if Amazon is at fault somehow, like Amazon is the one signing celebrity book authors at major publishers, not the agents of the publisher. The publishers are in charge of what gets published, not a bookstore.
Finally, there’s the possibility that this is a ploy to create another revenue stream. The Authors Guild says that several publishing sources have claimed that “Amazon is attempting to coerce publishers into using its print-on-demand (POD) services.” Amazon’s thinking is that, if a book were to unexpectedly go out of stock, then it could be printed immediately, essentially solving the whole stock problem.
Okay, this right here? This is a great example of book publishers not getting with the times. Elsewhere in the article, it’s pointed out that the cost of storing unsold books in a warehouse somewhere is substantial. No one likes having unsold stock on hand. We all agree on that. Now, the article claims that Amazon is pushing publishers to use their print-on-demand service to solve the problem … but let’s be honest: The publishers don’t have to do that. Not when they could easily invest in their own PoD system to make and ship books as they are sold. Print up smaller runs, but always ready to make more.
But that’d require change, something the big pubs aren’t keen on. No, they’d rather print up 200,000 copies of a celeb book that only has a demand to sell 3,000.
Hey, they want to follow out-of-date market practices, that’s their prerogative. But don’t blame poor reception on newer companies that are willing to adapt to new, less costly business practices.
Publishers see this as a slippery slope. Book publishers’ entire business model is based on advance sales—on retailers buying books in bulk from the publisher and then selling them to consumers. Switching to a POD model would disrupt a supply chain that has existed for decades.
What’s that, publishers? The world changed and you won’t change with it, but are crying instead that everyone else should stop that darn advancing and do things the old, costlier way? You advance and adapt … or you’ll be extinct. That’s how the open market works. You’re like a horse-and-buggy company trying to ban horseless carriages rather than switching production over to build said horseless carriages.
Publishers and authors are rightfully concerned that these changes will take money out of their pockets.
So adapt. Clearly your up and rising competitors aren’t having this problem, or you wouldn’t be complaining so much about it. Maybe it’s time to trim the fat a little?
The biggest worry is what impact it could have on America’s literary culture. “The connection that people fail to make,” Authors Guild President Mary Rasenberger told me, “is that if publishers have less money, then they have less to invest. That means they can’t afford to take risks on the kinds of challenging books they’ve published for centuries.”
The problem isn’t the market, publishers. It’s you.