Thursday, May 10, 2012

AAR Fail

I just read the letter the Association of Authors Representatives sent to the DOJ yesterday. 

Then I threw up in my mouth. Ack. 

The letter in plain text, my comments in bold. 

My comments will not be kind. 

May 8, 2012
John R. Read
Chief, Litigation III Section United States Department of Justice 450 5th St NW Suite 4000 Washington DC 20530

Dear Mr. Read,
I write to you as the President of the AAR, the largest organization of literary and dramatic agents in the United States, and on behalf of the unanimous AAR Board of Directors. Our more than four hundred seventy-five members represent writers who number in the tens of thousands. We want you to know in the strongest terms possible that we firmly oppose the proposed settlement between the Justice Department and three publishers with respect to e-book pricing.

Translation: We're about to put our collective foot in our mouth. Stay tuned!

Joe sez: I count thirteen names on this letter. I don't see the names of the other 462 AAR members, nor the names of the tens of thousands of authors they seem to be insinuating they speak for.

They DO NOT speak for me. And I hope the majority of the AAR who didn't sign their name to this nonsense show some guts and leave an organization that erroneously claims to speak for them. Or at least fire the board members that sent this without getting a majority vote.

Readers, writers and the general public benefit when there is a healthy competitive literary marketplace. Two and a half years ago Amazon, with its proprietary Kindle devices and its willingness to discount e-book “bestsellers” to a level at which it sustained a significant loss on each copy sold, threatened the entire marketplace for books. 

Translation: Amazon invented a device that consumers wanted. That's BAD. Readers were getting cheap ebooks. That's BAD. It may not seem bad on the surface, and we don't back-up our claim with any actual evidence, but boy oh boy trust us it really is because we say so.

Amazon’s practice of targeting the very titles that drive profitability of our entire industry and pricing them several dollars below cost was clearly leading to the demise of the independent bookstore, hastened the loss of Borders, and threatened the existence of Barnes & Noble, the one remaining large chain store that sells books. 

Translation: Customers were changing how and where they shopped because Amazon gave them a clearly better alternative; ebooks delivered instantly for less.

Joe sez: Apparently the AAR doesn't remember that under the previous model, their authors were making more damn money.

Doesn't AAR stand for Association of AUTHORS Representatives? Why are they suddenly spokesmen for Barnes and Noble?

And Borders? Weren't they on the verge of bankruptcy (or at least in serious trouble) before Amazon even introduced the Kindle? Blaming Amazon for Borders’ woes is bullshit correlation. Or as a friend of mine calls it: causality magical thinking.

This was not healthy for competition or for authors or indeed for consumers in the long-term. 

Translation: Trying to outsell your competition, or attract customers with lower prices and better service, is bad.

And it's bad when authors get paid more for each copy sold and sell more copies because of lower prices. 

And lower prices are bad for consumers, because maybe one day Amazon will again raise prices, possibly even up to the lofty heights publishers have them raised to now under the current Agency Model.

Retailers shouldn't be allowed to set their own prices. That's bad. It's much better for the wholesaler to set both the wholesale and the retail price, because THAT and THAT ALONE encourages healthy competition. ESPECIALLY when there are several wholesalers in lockstep. 

Nothing is better for consumers than a group of companies who set wholesale and retail. And even though they set the SAME prices, it really still is competition! Really!

The steep discounting from Amazon was a practice of selling our clients’ work at a loss in order to make it impossible for other businesses to enter the e-book marketplace in a way that made financial sense for them.    

Translation: This predatory pricing is driving competitors out of business, like it did with... um... what's that famous case where a company lowered prices, destroyed competition, and then became a monopoly and raised prices?

It must happen all the time, right?

Or if it doesn't, it's because the government steps in and stops it. Like in the case of... um...

Joe sez: Like in the case of the DOJ stepping in because 5 of the Big 6 were colluding to raise ebook prices?

This artificially low pricing unfairly threatened the world of publishing and bookselling and would ultimately have a devastating effect on the choices available to book consumers.

Translation: Apparently starting a company that allowed writers to self-publish their books, and that sold all the major publishers' books for less, is VERY BAD for authors and readers. Because more titles being sold at lower prices means less choice. 

Joe sez: How could they write that with a straight face? What's worse, knowing you're spouting BS and doing it anyway to further your own self-interests, or actually believing the BS you're spouting?

What's a better quality to have for an agent? Someone more concerned with buddying up with Big Publishing at your expense, and making bullshit arguments to defend Big Publishing? Or being so stupid they actually believe they're correct?

Personally, I want my agents to be smart and to look out for my best interests. I want them to recognize they work for me, not the Big 6 or bookstores. And if I were repped by one of the 13 agents who signed their name to this, I'd be a lot angrier than I am right now. 

When Apple launched the iPad and offered to sell books at the “agency model” terms it was already using for other media sales, our members breathed a sigh of relief. This would create a fair playing field for Barnes & Noble, Apple and others to develop devices and join the e-book marketplace. 

Translation: For healthy competition to exist we need to disregard consumer preference and put floundering competitors on life support. Because no one can ever start a company to compete with Amazon.

Which is odd, because Amazon started a company to compete with bookstores and did just fine. 

And soon Amazon will compete with publishers as its imprints begin to outsell theirs. 

Which is what we're REALLY afraid of, because Amazon doesn't return our calls. Or take us out to lunch all the time at posh Manhattan restaurants.

Consumers would be able to buy their books at various retailers or e-booksellers; the threat of a monopoly was diminished. 

Translation: Consumers couldn't buy ebooks from other retailers prior to the agency model. After all, there was only Kindle.

And the Nook.

And the Kobo.

And the Sony Reader. 

And even though publishers band together to control price, making it impossible for these different companies to ACTUALLY compete on price, it really really still is competition. 

We cheered this development despite the fact that, as you no doubt know, under the agency model publishers were taking in less money per copy sold and therefore we and our clients were getting less in royalties and commissions. But we believe this sacrifice was in the best interests of the book landscape and therefore our clients long-term.

Translation: We're in bed with Big Publishing, even though we allegedly work for authors. 

Joe sez: How noble of you guys to sacrifice your authors' incomes by taking up this worthy cause, without consulting us.

How about changing your name to the Association of Book Landscape Protectors? Or the Champions of What We Call Healthy Competition Even if Authors Get Screwed?

The proposed settlement would allow for a resumption of predatory discounting of our clients’ most important and profitable new ‘frontlist’ and bestselling titles and undermines the growth of a competitive marketplace for books. 

Translation: Discounting is predatory, even if it benefits our authors and consumers in general. But higher ebook prices via collusion and lower royalties isn't predatory, it encourages a competitive marketplace.

Also, the Big 6 in no way ever undermined the growth of a competitive marketplace for books.

Sure, the Big 6 never created an ereader or an ebook store. And never innovated anything. 

Sure, the Big 6 all price their books comparably.

Sure, the Big 6 offer authors shockingly similar contract terms and royalty rates.

Sure, the Big 6 fit the definition of a cartel.

But Amazon is the real enemy here! Can't you see?

Joe sez: This is the part in the letter where Mr. Reid is laughing so hard he falls off his chair.

It seems to us outrageous that the Department of Justice would choose to interfere in a functioning marketplace where consumers can choose from a broad array of titles with huge differential in prices and formats with a very unclear picture of whether or not ‘agency pricing’ did indeed raise e-book prices on anything but a select number of titles that had been targeted for underselling by Amazon. 

Translation: The marketplace can only function to our satisfaction with collusion and price-fixing, even though we admit it is harmful to our clients' wallets. You DOJ folks should just mind your own business. Stop picking on our crooked industry!

We do not want to return to an environment in which our clients’ intellectual property is irrationally priced in order to stifle innovation and harm consumer choice.

Translation: Because the only choice consumers should be allowed is paying more money for ebooks, which is what Big Publishing wants. 

Joe sez: Where is there more choice—the legacy way? Or via the kind of self-publishing Amazon has enabled? Which system produces more titles and more variety? Which bestseller list has more variety—the NYT? Or the Kindle Store? Which bookstore has more variety, a brick and mortar shop stocking 200 copies of Patterson's latest near the front door, or an online bookstore were EVERY title ever in print is available and given equal virtual shelf space?

Of course we have no way of knowing if there was collusion among the publishers and Apple. 

Translation: We didn't do nothing! We swear! We can’t look to the lockstep royalties, the draconian rights lockups, and the absolute absence of innovation from legacy publishing, to see if maybe there’s been some collusion. We can’t even read the allegations in the DOJ’s own complaint or in the complaint brought by sixteen states! There’s just no way to know! What are we, psychic or something?

But this proposed settlement damages our clients and the industry in a way that goes beyond any appropriate remedy for any possible misconduct. 

Translation: Any possible misconduct?!

Look, I know we did a crappy job of presenting our terrible argument, but it should be okay for the Big 6 to break the law. So can you allow it? Just this once?

We urge you to reject the proposed settlement and allow the market to return to one that protects the value of our clients’ intellectual property from unfair and predatory discounting. This will protect and encourage broader competition among all booksellers, will allow the consumer the protection of a range of choices in format, price, and retailer, and will encourage digital innovation in the burgeoning field of e-book publishing and retailing.

Translation: If we keep repeating the same bullshit over and over, maybe someone will believe it.

Gail Hochman,
President, AAR
The AAR Board of Directors:
Brian Defiore
Mitchell S. Waters
Anne Edelstein
Beth Blickers
Sarah Lazin
Jim Rutman
Jodi Reamer
Liza Dawson
Ellen Geiger
Dorian Karchmar
Barbara Hogenson
Anne Reingold

Here is my response, which they won't reply to but will be seen by over a hundred thousand people this week thanks to readers like you.

Dear AAR-

I understand these are uncertain, even scary times. But methinks you're forgetting who you work for.

Your clients are writers, not publishers. Your job is to make them more money, not support a program (the Agency Model) that makes them less money. 

Your job isn't to defend publishers—that would be the job of the Association of Publisher Representatives. 

Your job isn't to make sure Pop's Books on 3rd Street doesn't go out of business—that would be the job of the Association of Brick-and-Mortar Representatives. 

Again, last I checked, you were calling yourselves the Association of Author Representatives. If the name you’ve bestowed on yourselves means anything, you should be representing authors. By costing us money without even consulting us, you’re not representing us. You’re screwing us.

I know you're worried that without the Big 6, more and more authors will self-publish, and won't require your services to the extent they do now. But the disservice you're doing your authors with this letter is damn near unforgivable. 

You are taking the side of the companies you're hired to negotiate with. You really don't see a problem with that? Even worse, the side you're taking is one that continues to screw authors--your clients--in many, many ways.

Am I the only one who sees ethical problems with this stance? First the Writers Guild, now the AAR. Those who are supposed to protect authors, are betraying authors. 

It's appeasement, caused by fear.

Winston Churchill said it best. “An appeaser is one who feeds a crocodile—hoping it will eat him last.”

I've accused authors of having Stockholm Syndrome. Apparently it is alive and well in the agent biz as well.

I know you feel threatened by Amazon just like publishers do. But your letter is bullshit. To imply that the tens of thousands of writers you represent agree with your bullshit is even more bullshit. 

I assume John R. Read will be able to detect bullshit when he hears it, but I'm going to send him a copy of this blog post just the same. 

If this blog post made you mad, your anger is misplaced. You shouldn't be pissed at me, or the DOJ. You should be mad at Big Publishing, which has screwed you guys the same way it has screwed your clients for decades. Think about all the books they abandoned or orphaned or tanked or passed up on, all the hoops you had to jump through to get your clients slightly better terms, all the onerous, unfair clauses in those archaic, one-sided contracts that they en masse refuse to consider changing, all the accounting errors and questionable royalty statements, all the shitty covers and poor editing jobs, all the late checks and late contracts, all the pain and depression your writers have had to deal with because they had no power and no other choice. Now publishers have forced Amazon--a company that benefits authors and readers--to accept the Agency Model, which I've clearly explained sucks

And how do you react? You defend them.

Your clients trusted you. You were supposed to be advocates for authors. Champions for authors. 

Instead, you've shown yourself to be self-interested cowards.

You've sold out. Shame on you.

Once upon a time I praised the AAR for its ethics and standards.

I won't be doing that in the future. Your behavior has made it impossible. 

Joe Konrath

Addendum: Many have asked why I haven't taken agent Simon Lipskar to task for his bullshit letter to the DOJ. Now I have.

Bestselling author Bob Mayer also wrote a terrific piece worth checking out.