Tuesday, September 30, 2014

Lee Child Responds

After sending me an email to share why he signed the Authors United petition, and spending some time engaging with people in the comments, Lee Child has continued to generously share his thoughts and has responded to some of the questions I had.

I'll run it in its entirety, then provide my answers.

Lee: Joe, here’s my response to the points you made that interest me.

I think the first part of your reply (about relative success) can be summed up by quoting your words “That’s luck … the legacy industry never handed me the keys to the kingdom like they did with you.”

That’s a little self-pitying, don’t you think?  Poor Joe!  And it doesn’t hold up under analysis.  We both started from the same place, albeit a few years apart, but as it happens those particular years saw no change in the model. We both had the same small print run in debut hardcover.  We both had the same extremely limited distribution.  We both had the same non-existent marketing support.  We were first-year clones of each other.  We were typical throw-it-at-the-wall-and-see-if-it-sticks gambits.

The same was pretty much true of our second and third years, too. Meanwhile, of course, we both went to work, trying to get ahead, by writing the best books we could, and promoting them as effectively as possible.

Now, I’m the first to acknowledge the existential luck I had in life.  I was born white, male, middle class, tall, healthy, not visibly deformed, in a stable postwar Western democracy at peace, with a welfare state and free education. I think my own little demographic was literally the luckiest ever in all of human history.

But you certainly shared that luck.  Not quite as tall, maybe, but certainly better looking … not as extensive a welfare state, but certainly a far more prosperous society.  And so on.  We started equal, and we made choices. Yours were poor.  You threw immense energy into misguided – and actually damaging – stratagems.  You didn’t understand the game.  Which is not just hindsight.  I remember trying to dissuade you, as a friend, in a conference hotel somewhere long ago.  You ignored me, and were eventually dropped, while I stayed in the game.

No one “handed” me a key, and no one withheld one from you.  Instead, a bean counter sat down and figured he could make more money out of me than you.  It was that simple.

And in fact you were then very lucky – a new platform was invented that suited your skill set perfectly.  I’m a close observer of the whole self-publishing scene (and I have read more than 600 self-published books) and I think your weaknesses under the old model have been matched by exceptional strengths perfectly attuned to the new model.

I think you should celebrate that, and I think you should stop letting traditional publishing live rent-free in your head.  I think all self-publishers should.  Because all these endless screechy blogs make you look whiny, not us.  “I coulda been a contender!”  Get over it already.  Move on.  Don’t perpetuate the “bitter reject” meme.

Later you said, “I believe you overestimate the value of Hachette’s catalog to Amazon.”  No, I don’t.  I said I think Amazon overestimates the value of Hachette’s catalog to Amazon.  My point was quite clear – Amazon won’t dump Hachette because Amazon’s own internal credo is built on being the everything store.  Which dilutes its negotiating power.  All negotiations are built on a willingness to walk away.  Amazon isn’t willing.

Later you mention print disappearing – which it might, and which I would regret, because I think it would happen without a positive desire on the part of customers.  People like print.  If it goes, it will have gone because of retail economics, not lack of appeal.  Which sounds confused, but that’s an accurate analysis.  Mass market is dying not because there’s diminished demand, but because there isn’t enough margin in it.  “I can make more out of broccoli than books,” one retailer said.  Will all readers switch to e-readers?  Not all, I think.  Sadly reading’s appeal is fragile now, and many folks will quit and find alternatives.  Or not – I’ll be particularly sad about poor people.  Any e-reading ecosystem is entirely inaccessible unless you have a working credit card or a viable bank account for PayPal – which poor people don’t.  They love used paperbacks – all worn and furry, found, traded, borrowed, bought for fifty cents.  But hey.  This is the modern world.

As for the rest … I guess I have one question.  One thing few people know about me is I love ironing.  I just moved, which was a great excuse for a new ironing board.  I checked Amazon, naturally, who had boards ranging from $18 all the way to $220.  Has Amazon approached the expensive manufacturer and said, “C’mon, pal, America needs cheaper ironing boards!  Think of the children!”  No, it said, “Sure, throw it up on the site and we’ll see if anyone’s interested.  We trust our customers to decide for themselves.”

Another interest is audio.  Amazon has low-powered two-channel audio amplifiers listed from $24 to $24,000.  Did it approach the expensive manufacturer and say, “C’mon, pal, America needs cheaper amplifiers!  Think of the puppies!”  No, it said, “Sure, throw it up on the site and we’ll see if anyone’s interested.  We trust our customers to decide for themselves.”

Can you explain in detail why the e-book market shouldn’t operate the same way as the ironing board market or the amplifier market?  Why do e-book buyers – uniquely – need Nanny Amazon to save them from deciding for themselves?  Are books special?  Are they different?  Or are there others factors in play?

Joe: Thanks again for stopping by, Lee. Your thoughts are smart and refreshing. I'll respond point by point.

Lee: I think the first part of your reply (about relative success) can be summed up by quoting your words “That’s luck … the legacy industry never handed me the keys to the kingdom like they did with you.”

That’s a little self-pitying, don’t you think?  Poor Joe!  

Joe: I find it empowering. My daddy didn't buy me a car. I went out and earned my own.

Ribbing aside, you had advantages that I didn't, but that's life. I'm pleased with what I've been able to accomplish, and don't lament what I never had.  

Lee: And it doesn’t hold up under analysis.  We both started from the same place, albeit a few years apart, but as it happens those particular years saw no change in the model.  We both had the same small print run in debut hardcover.  We both had the same extremely limited distribution.  We both had the same non-existent marketing support.  We were first-year clones of each other.  We were typical throw-it-at-the-wall-and-see-if-it-sticks gambits.

Joe: I'm pretty sure your advance and print run were higher than mine. Didn't Stephen King review your first book in Entertainment Weekly? Didn't you also debut in the UK? You already had several advantages out of the gate.

Lee: The same was pretty much true of our second and third years, too.  Meanwhile, of course, we both went to work, trying to get ahead, by writing the best books we could, and promoting them as effectively as possible.

Joe: Right after my third book came out, my publisher dropped their entire mystery line. Not only my series, but others as well. This was after I signed a deal for three more books.

My first three novels never got coop, never got discounting, never got worldwide distribution. I went on book tours for #2 and #3, which I'll get to in a moment. But we were very far from starting at the same place.

Lee: Now, I’m the first to acknowledge the existential luck I had in life.  I was born white, male, middle class, tall, healthy, not visibly deformed, in a stable postwar Western democracy at peace, with a welfare state and free education.  I think my own little demographic was literally the luckiest ever in all of human history.

But you certainly shared that luck.  Not quite as tall, maybe, but certainly better looking … not as extensive a welfare state, but certainly a far more prosperous society.  And so on.  

Joe: Agreed, except on the better looking part. You've got a suave British Secret Agent look about you, I get mistaken for an elderly Jack Black.

I grew up in America a privileged white male in an affluent family. But as I neared adulthood, our family lost everything. While in college, and for years later, I was poor. I wrote my first novel in 1992, in a basement apartment in the Chicago suburbs, and often had to choose between eating and turning on the heat. (On a particularly cold winter night went to the bathroom and couldn't shower because my shampoo bottle had frozen).

It was during a pretty serious rescission, and writing was something I squeezed in between any job I could get, some white collar, some blue.

This taught me a lot. First, to not be afraid of hard work. Second, to not give up.

I was lucky, but at lot of the time it didn't feel like it. I was, literally at times, a starving artist.

Lee: We started equal, and we made choices. Yours were poor. You threw immense energy into misguided – and actually damaging – stratagems. You didn’t understand the game. Which is not just hindsight. I remember trying to dissuade you, as a friend, in a conference hotel somewhere long ago. You ignored me, and were eventually dropped, while I stayed in the game.

Joe: My stratagems--learning how to self-promote and signing in as many bookstores as possible--were the reason my books went into multiple printings and earned out their modest advances ($110,000 for the first three novels, $125,000 for the next three novels). Here's a guide a wrote in 2006 t about all the work you didn't have to do.

Your publishing experience was a lot different than mine.

My efforts, the ones you call damaging, kept food on my table and allowed me to stay a fulltime writer, rather than a writer with a day job. This is what 99% of legacy authors must do; hustle, or work part time (or full time) at something else.

Lee: No one “handed” me a key, and no one withheld one from you.  Instead, a bean counter sat down and figured he could make more money out of me than you.  It was that simple.

Joe: That's called luck, Lee. Your bean counter gave you a break. Mine axed the mystery line, even as my sales were growing.

It wasn't a quality issue. It wasn't because your books were better.

Before I self-pubbed, I had less than 500 reviews on Amazon, all of my titles combined. I wasn't being read, because I wasn't easy to find.

Now I have 13,000 reviews, averaging four stars. Not many authors, no matter how they publish, have over 1000 reviews on a single title. You do. So do other monster bestsellers. So do I.

In the comments you mentioned:

I remember meeting Dick Francis early on and learning a lot from him. In some ways he was the pioneer of the regular-as-clockwork, book-a-year paradigm. How much sense would it have made for me to say, "Oh, you just got lucky, so I'm going to ignore you"?

Joe: Dick Francis is the perfect counterexample to my experience. His publisher carried him for over ten years (was it twenty?) before he had a breakout hit. Your publisher also carried you (and I bet you were getting coop and discounting early on in both the US and UK, along with reviews and ads and a slew of others things I didn't get.)

For my first book, I got some minor support from my publisher. They took me to BEA, introduced me to many mystery bookstore buyers. They printed up 10,000 Whiskey Sour coasters with my book cover on them. But they refused to let me do book signings, because that cost coop money and they didn't feel giving a bookstore $25 would result in enough debut hardcover sales to cover that meager cost.

Since I wasn't allowed to tour, I popped into bookstores and signed stock, then handsold that stock until it was gone. When the store restocked, in larger numbers, I did it again.

To counter that I spent 8 hours in a Waldenbooks and handsold 100 hardcovers at $23.95 a pop. During the holiday season, I did this every day, at every bookstore within driving distance. From Thanksgiving to Xmas, for several years.

And as a result, I sold more books than anyone expected.

For Book #2, sensing they could enhance my efforts, my publisher arranged for a West Coast tour, comprising of 7 events over ten days. Besides the official signings, I also signed stock at 100 more stores. I also mailed out 6500 letters to libraries, each with a signed coaster, telling them about my books.

Since I wasn't getting big distribution or discounting or coop space, I enlisted booksellers to help me, which meant meeting as many as I could, signing stock, and explaining who I was and what my books were about.

This also circumvented the dreaded return system. Booksellers were less likely to return signed books, increasing my shelf life. Booksellers I met were more likely to order more books and handsell them. And bookstore algorithms (I believe B&N called it "modeling") would automatically order new copies of books that sold well.

For book #3, I signed at over 500 stores during a single summer.

Then my publisher's mystery line vanished.

For book #4, my publisher gave me ZERO support, even though my sales had been rising. No touring, no marketing. They screwed up the drop date of my launch, and didn't care. And my hardcover still went into a second printing.

Books #5 and #6, also effectively orphaned, weren't even submitted to the usual reviewers. For my last book, Borders couldn't even order it because of some colossal distributor screw-up, and they were my biggest supporter (I got to speak at a Borders regional sales meeting--something I set up, not something my daddy set up for me).

The result of my efforts; I earned out $235,000 in royalties, and all of my books had multiple printings.

But no one wanted to pick up a series in situ. So I wound up selling a horror novel, AFRAID, under the pen name Jack Kilborn, for a $20k advance. 

It's nice that you get to write about the same character in the same genre. Some of us had to diversify in order to survive.

I visited 200 bookstores to support the release, and did one of the first author blog tours. I earned out that advance in a month. But then Hachette refused to publish my follow-up novel because the editor didn't like it (it was a two book deal). I wrote a third book for them, and they wanted major changes.

I told them to piss off. But I'm getting ahead of myself.

Lee: And in fact you were then very lucky – a new platform was invented that suited your skill set perfectly.  I’m a close observer of the whole self-publishing scene (and I have read more than 600 self-published books) and I think your weaknesses under the old model have been matched by exceptional strengths perfectly attuned to the new model.

Joe: What weaknesses? You mentioned them, but didn't point them out. I feel I was lucky to land two deals, and unlucky with how they turned out. 

I also did wind up becoming my own worst enemy, because when Kindle was invented I had IPs earning steady money for my publishers, and they didn't want to give me those rights back. I had to fight hard for them. 

Those books Hachette didn't want have earned me hundreds of thousands of dollars.

That series Hyperion didn't want to continue has earned me a million.

And you still want to insist my publisher gave me the same shot that yours gave you? If that's the case, you need to quit your publisher right now, because your sales will go up 1000% like mine did. :D

Lee: I think you should celebrate that, and I think you should stop letting traditional publishing live rent-free in your head.  I think all self-publishers should.  Because all these endless screechy blogs make you look whiny, not us.  “I coulda been a contender!”  Get over it already.  Move on.  Don’t perpetuate the “bitter reject” meme.

Joe:  Even if I had been given the same treatment you had, and experienced great success, I'm still pretty sure I wouldn't be siding with Authors United.

I believe all newbie writers should read this blog post, to see both sides. Your experience is unique, mine is common. The majority of legacy writers get excoriated by the legacy system.

I was, however, very lucky that Amazon invented the Kindle, and that I had a backlist of rejected titles that put me in a perfect position to take advantage of it.

That's how well your system works. I bought my house and two cars for cash, with books that the Big 6 were convinced wouldn't sell. I'm talking about my rejected novels, not the ones that were legacy pubbed.

The only time I mention "I coulda been a contender" is when someone says they earned their success through hard work and talent.

C'mon, Lee. You know luck plays a huge part. You got a lot luckier than I ever did, so why not acknowledge that? You've even mentioned luck before:

"To get as successful as I have gotten as a writer, it's like winning the lottery the same day that you get hit by lightning twice. It's staggeringly unlikely. So I'm unbelievably fortunate." - Lee Child

I can understand the "hit by lightning" part. Circumstances beyond my control ruined two of my publishing deals. In my case, the luck I had was bad.

But my luck was still greater than thousands of other legacy authors, who sold 1/10 of what I did when I was with Hyperion and Hachette. And I never thought I was better, or more deserving, than any of them.

Lee: Later you said, “I believe you overestimate the value of Hachette’s catalog to Amazon.”  No, I don’t.  I said I think Amazon overestimates the value of Hachette’s catalog to Amazon.  My point was quite clear – Amazon won’t dump Hachette because Amazon’s own internal credo is built on being the everything store.  Which dilutes its negotiating power.  All negotiations are built on a willingness to walk away.  Amazon isn’t willing.

Joe: And yet Amazon has zero problem removing pre-order buttons and discounts. This runs counter to your statement. 

Amazon can still be the everything store without giving into Hachette's demands. It's doing that very thing right now. And Amazon readers don't care. Since this dispute began, Amazon's reputation has gotten even better. Its approval rating has gone up, and it has claimed the number 1 spot in customer reputation. 

Amazon doesn't need to walk away. They still sell Hachette's books, and other Big 5 publisher titles, while also selling 500,000 exclusive titles.

Hachette's sales have gone down. I doubt Amazon even noticed a blip. They may be selling fewer Hachette titles, but they're making more per title because they aren't discounting, as well as selling titles in lieu of Hachette titles. This Hachette book takes 3 weeks to ship? I'll just buy a different book that ships overnight. 

And think of all the warehouse space they're saving. :)

Lee: Later you mention print disappearing – which it might, and which I would regret, because I think it would happen without a positive desire on the part of customers.  People like print.  If it goes, it will have gone because of retail economics, not lack of appeal.  Which sounds confused, but that’s an accurate analysis.  Mass market is dying not because there’s diminished demand, but because there isn’t enough margin in it.  “I can make more out of broccoli than books,” one retailer said.  Will all readers switch to e-readers?  Not all, I think.  Sadly reading’s appeal is fragile now, and many folks will quit and find alternatives.  Or not – I’ll be particularly sad about poor people.  Any e-reading ecosystem is entirely inaccessible unless you have a working credit card or a viable bank account for PayPal – which poor people don’t.  They love used paperbacks – all worn and furry, found, traded, borrowed, bought for fifty cents.  But hey.  This is the modern world.

Joe: Print won't disappear. It will become a subsidiary right, which I blogged about four and a half years ago.

It's nice that you feel bad for the poor. Thankfully, even the poor have access to computers and smart phones, and many ebooks are a lot cheaper than used paperbacks. You may have heard that there are also millions of free ebooks. 

As for people liking print, this is a tired old meme that I debunked years ago. 

Lee: As for the rest … I guess I have one question.  One thing few people know about me is I love ironing.  I just moved, which was a great excuse for a new ironing board.  I checked Amazon, naturally, who had boards ranging from $18 all the way to $220.  Has Amazon approached the expensive manufacturer and said, “C’mon, pal, America needs cheaper ironing boards!  Think of the children!”  No, it said, “Sure, throw it up on the site and we’ll see if anyone’s interested.  We trust our customers to decide for themselves.”

Another interest is audio.  Amazon has low-powered two-channel audio amplifiers listed from $24 to $24,000.  Did it approach the expensive manufacturer and say, “C’mon, pal, America needs cheaper amplifiers!  Think of the puppies!”  No, it said, “Sure, throw it up on the site and we’ll see if anyone’s interested.  We trust our customers to decide for themselves.”

Can you explain in detail why the e-book market shouldn’t operate the same way as the ironing board market or the amplifier market?  Why do e-book buyers – uniquely – need Nanny Amazon to save them from deciding for themselves?  Are books special?  Are they different?  Or are there others factors in play?

Joe: Lee, this is a great comparison. You did a bit of chest thumping in both of these posts, and I went on the defensive. I'm happy you did that, because it shakes things up a bit and makes for an interesting read.

But the end of your previous post, where you spoke about your concern that Amazon becomes the only publisher left, is a valid point and could have been brought to the forefront.

You make another valid point here. Are books different from other markets where prices diverge?

I'll opine that books don't have as wide a range of prices, like an amplifier or an ironing board, because their components all cost about the same. You don't expect a Bentley to cost the same as a Hyundai. The Rolls is a better car, made of better materials.

A Lee Child hardcover costs about as much to print as a JA Konrath hardcover (actually, mine was more expensive because you had much larger print runs).

You were paid more, and the publisher certainly wants to recoup as much of that as possible. Since your brand is strong, you're able to move a lot of ebooks at $12.99.

I'm fine with that, and good for you. It does go against your earlier point about feeling bad for the poor people who can't buy expensive books, but I do believe there is a market for $12.99 ebooks, or even $29.99 ebooks.

That's not the problem I have. 

The problem I have is authors like you, right now, and groups like the Authors Guild and Authors United, are fueling the belief that Lee Child sells well at $12.99, therefor Joe Blow can sell well at $12.99 if he signs with the Big 5, too.

That is far from the truth. 

Yes, high ebook prices work for a few handfuls of bestsellers. But they kill the careers of midlisters stuck in shitty legacy contracts.

My sales went up 1000% once I got my rights back from my publishers. How many midlist authors are being held hostage in a similar way, just so publishers can maintain control of the paper oligopoly that makes them and a handful of authors like you amazingly rich?

You're thriving, but thousands of others are withering.

Even without Amazon discounts, Doug Preston's latest Kindle thriller is ranked at #861 and priced at $12.99. He's probably not recouping his huge advance, but he's doing okay. If all he had were those sales, he could make a living.

In contrast, The Three by Sarah Lotz, a new Hachette release, is also $12.99 and ranked #119,551. Her hardcover is in the 200,000s. How is she going to earn her advance out? Make a living? Put food on the table? Hachette loves the book enough to promote it on its website as a lead title. But is it getting her book into Target department stores? I looked, didn't see it. I did see yours and Doug's books, though.

I don't mean to pick on Sarah, or put her on the spot. I don't know her, she was just the first debut Hachette author I found when I went looking. I did notice she didn't sign your little Authors United petition (I say "little" when comparing it to the petition Hugh and I did with 8x as many signatures).

Amazon offered, three separate times, to compensate authors who were being harmed by this negotiation. I bet Sarah would benefit from that compensation. So would hundreds of other authors. Where was AU? Hint: they were immediately rejecting the proposals, as was Hachette.

These are the folks you've chosen to side with.

Authors signing with big publishers not only have to contend with those publishers pricing their ebooks as luxury items, failing to get them into bookstores and other paper outlets (especially with coop), they also can wind up as collateral damage because their publisher refuses to negotiate with the biggest bookseller on the planet.

I know you said that writers should make hay when the sun is shining, and self-publish. Good, smart advice. But that is counter to you supporting Hachette in this dispute.

You're sending out the message that Amazon--the only competition that the Big 5 ever had and the company that has allowed more authors to make money than any other time in history--is the bad guy and is going to hurt authors. You're also sending out the message that high ebook prices are okay, when they're only okay for a small minority of major bestsellers. 

Right now, the authors being hurt are those stuck in the middle of this negotiation--and Amazon has tried to take those authors out of the line of fire three times. Hachette has not.

Authors United, in their ridiculous and oft-repeated assertion that they aren't taking sides, is making those Hachette authors suffer even more. They should be pressuring their own publisher to negotiate (because, you know, that's who they have contracts with, not Amazon). But AFAIK they haven't even contacted Hachette.

All the biased media coverage is perpetuating a bunch of lies and nonsense. And that's harmful.

To your credit, you haven't perpetuated any nonsense here. You came in guns blazing, and I like that. We disagree on the luck factor, and that's fine. And you made two very good points in these posts.

Why the hell isn't AU making those points?

If you spoke for AU, and used the comparisons and rhetoric you used on my blog, I wouldn't have much to disagree with. I don't want Amazon to rule the world. I believe ebook pricing is elastic and everyone's sweet spot (where unit sales and profits peak) is different. We're not far apart on those issues.

But while this system has worked extraordinarily well for you, it screwed me. And it has screwed thousands of others.

That's why I continue to write this blog. So authors don't have to go through what I went through.

That isn't whining, Lee. That's activism. And I need to point these things out, repeatedly, for new authors who are learning about these topics for the very first time. This is A Newbie's Guide to Publishing, not an Insider's Guide for Pros.

It's unlikely that anyone reading this will ever attain the level of success you've had. Encouraging writers to follow your path is like encouraging toddlers to climb Mount Everest. 

In contrast, thousands of writers have followed my path. Some have succeeded well beyond me. Others are making money for the very first time.

As doctors know, "First do no harm."

All of the one-sided media coverage is harmful. 

Large publishers are harmful.

Being ill-informed is harmful.

Authors United is harmful.

Amazon may be harmful sometime in the future, but right now it is doing good by the vast majority of authors who self-publish. I just got a nice bottle of scotch and a shadowbox in the mail today from Amazon, because my Jack Daniels novel, Stirred, has sold 100,000 copies.

That's 100,000 copies without appearing in brick and mortar bookstores, because they boycott Amazon books.

That's 100,000 copies that could have been through Hyperion, but they missed the boat.

100,000 copies is nothing to you. But to a guy who knows how hard it is to handsell 100 hardcovers, one at a time, over an eight hour period in a mall bookstore, that number amazes me.

All authors work hard. Many authors are damn talented. 

Very few will get the breaks you got. And very few will get the breaks I got.

But my dream is more attainable for the masses than yours is. And positioning yourself against a company, Amazon, that makes those dreams possible, while endorsing publishers that exploit and harm the careers and pocketbooks of the majority of authors they work with, saddens me. Especially since anyone looking at the situation can easily see that Authors United is very much out to protect the rich and privileged at the expense of the poor and unlucky.

Thanks again for your thoughts on this. You're always welcome here, and it's a pleasure to have someone with a much different perspective than mine voice their opinion.

I also asked Barry Eisler to chime in (even though he and I vehemently disagree about airline seats) and he emailed me:

Barry: Hi Lee, you mentioned ironing boards and amplifiers as products that Amazon allows suppliers to price as they like, knowing some people will prefer the high-end items and others the low-end. In this system, no one is being denied access to ironing boards etc because low-priced alternatives are plentiful. And you asked, Why not just do the same for books? I think this is a great question and a great way to frame the issue — by far the best presentation I’ve seen on the topic yet from anyone affiliated with Authors United. So thank you for that.

For the most part, I agree. We already live in a world where there are more low-priced and probably even free books (not to mention library access) than any one person could read in a lifetime. So if some readers can’t afford, or don’t want to spend the money on, what we might think of as the luxury end of the book market, it’s not exactly a national tragedy.

I wouldn't want to go too far with this argument; I think reading is an important public good and in general I’m in favor of lower prices, more choice, and easier access for everyone, and therefore I tend to favor the business model that’s built to accomplish those aims rather than the one that’s built to impede them. But I’m also in favor of people having the freedom to price their goods as they like. There’s a balance in there somewhere, and maybe we fall to slightly different sides of it, or we have somewhat different views of the best way those possibly competing interests can be reconciled. Thinking about your points, I had the sense that our views might not be so different.

But this is what gets me. Why is this the first time anyone affiliated with Authors United has made an argument in such a cogent, no-bullshit, non-propagandistic way?

Just today, the New York Times ran another puff piece quoting new Authors United member Ursula K. Leguin saying, "We’re talking about censorship: deliberately making a book hard or impossible to get, ‘disappearing’ an author… Governments use censorship for moral and political ends, justifiable or not. Amazon is using censorship to gain total market control so they can dictate to publishers what they can publish, to authors what they can write, to readers what they can buy.”

And Andrew Wylie, who’s pitching all his clients to join Authors United, is quoted as saying, “If Amazon is not stopped, we are facing the end of literary culture in America.”

Not to mention all the existing rhetoric from your cohorts about books being “sanctioned,” and “boycotted,” about “We’re not taking sides,” etc.

Lee… do you really believe any of that craziness? If not, why are you lending your name to it?

If Authors United were as thoughtful and honest as you were in the thoughts I’m addressing here, l’d probably have written a blog post or two analyzing our different visions of the best system for serving readers and authors and that would have been the end of it. But instead what they peddle is overheated rhetoric, distortions, and propaganda. All of which we might loosely classify as “bullshit,” and all of which is what concerns me so much about the effect the organization is likely to have.

Because as I’ve said many times: I don’t care what choices authors make for themselves; I care that they can make those choices based on accurate information. I think it’s great that for the first time there are competing systems within publishing. What’s disturbing is when one of those systems peddles disinformation as a way of attracting new entrants — and this is the essence of what Authors United is part of. For lots more on this, here’s a post Joe and I did earlier this year called Publishing is Lottery/Publishing is a Carny Game.

http://jakonrath.blogspot.com/2014/02/eisler-publishing-is-lottery-konrath.html

If Authors United is on the level, why can’t they take a straight-up position, as you have? Why all the distortions and bullshit?

I don’t know. Maybe it’s a rhetorical question. But as long as the organization continues to present itself as propagandistically as it does, I hope people will keep calling it out. I wish you would, too.

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Edward G. Talbot said...

Another great exchange. I do agree with the idea of not allowing traditional publishing to live rent free in our heads. And I suppose that engaging in fisking/battle with those attacking Amazon or self-publishing in general could be construed that way. On the other hand, I tend to think that cranial residency is better determined by our actions, not the fact that we push back verbally or cite our own negative experiences with tradpub.

As Barry and Joe have suggested, it seems puzzling that Child has chosen to support AU. I understand that he is a lot more worried about Amazon's potential power and dominance than many of us are, but that doesn't automatically mean support of a group that seems to have succumbed to mass hysteria. The authors who signed on really should be embarrassed by the way AU has approached this in their name. The Authors United stuff is laughable. Only a step removed from Sen. Lindsay Graham saying last week that ISIS is coming to America to kill us all.

Maybe we just need Amazon and Hachette locked in a room with Jack Reacher and this all would get resolved very quickly.

Anonymous said...

Great dialogue...

what's missing for me was a comment on the obvious collusion between the big five, found guilty of the very thing AU accuses Amazon of...

which makes it difficult to trust AU in their mission.

Just as interesting is that Amazon pays far more in terms of royalties...

I'd note that the royalties for all the big five are the same, yes (for a debut author)... so how is that in any way competitive?

Amazon is paying monthly and better royalties... treating authors better, and doing so as a retailer (it's true, Amazon is a retailer for most)...

re the agency pricing, I seem to recall that the supply never forces a retail price upon a retailer... there's a suggested retail price... then there's the actual price... which is why B & N sells books for less than retail quite often. Or did.

A lot of the AU objections (and Lee's) come from what Amazon MIGHT do (which little proof that they will) and from outright falsehoods (banning books from H authors, which is a ridiculous claim) and it makes it hard to be sympathetic to their position.

Espec when so many other authors have been treated far worse by actual publishers who have been found guilty of the very thing AU is accusing Amazon of.

There's a cognitive dissonance in that, and it's very troubling.

As always, however, I want to thank Lee for dialoguing with you here. I am a big fan and will remain so.

Todd Travis.

Paolo Amoroso said...

Google recently announced the Android One initiative to bring affrodable smartphones (and digital content such es ebooks) to India and other countries with low-income people.

The initiative is interesting because it doesn't stop with the smartphone hardware and software. It also provides affordable data plans to let users download apps and buy content, thanks to agreements with local phone carriers.

A credit card or PayPal are not stricly necessary, as carrier billing is a viable option.

Lee Child said...

Joe, I still disagree about the luck factor. Stephen King didn't review my first book - that was the 10th or 11th, I think. Objectively, we started equal. But if it's important to you to cling to an opposite belief, I will no longer stand in your way. Quote me: "All success in the indie sphere is richly merited; all success in the traditional sphere is favoritism and dumb luck."

Joe and Barry: I have voted in elections these past 40 years, and hundreds of times on union committee motions and so on, without ever once agreeing 100% with what was on offer. I'm sure your experience is the same. Sometimes you have to choose sides based on a vague preponderance of evidence or instinct or feelings.

Tony Hursh said...

"Any e-reading ecosystem is entirely inaccessible unless you have a working credit card or a viable bank account for PayPal – which poor people don’t."

That's simply wrong. You can buy a prepaid cash card at any Walmart store (as well many other retailers). They work just fine on Amazon. Good credit not needed. Bank account not needed.

Google indicates that prepaid cash cards are also available in the U.K.

In fact, many people who do have credit and bank accounts use prepaid cash cards for online shopping, so they don't run the risk of compromising their "real" credit card.

In addition, there are over 46,000 books at gutenberg.org which are available for free.

Lee Child said...

Tony Hursh: C'mon, man. There are 20 million food-insecure people in the US, and 20 million more just pennies better off. They're not going to - and shouldn't - buy pre-paid Visas for e-book purchases. They need used paperbacks - found, borrowed, lent, traded. You guys need to face this issue: e-reading will be inaccessible for the poor.

Joe Konrath said...

"All success in the indie sphere is richly merited; all success in the traditional sphere is favoritism and dumb luck."

I don't believe in either/or. My quote is: "All success involves luck."

I got damn lucky to sell as many ebooks as I have. I'm not discounting hard work, or talent, but those aren't as important as luck, no matter which publishing path one travels.

Sometimes you have to choose sides based on a vague preponderance of evidence or instinct or feelings.

Makes sense to me. But I dislike the two party system in the United States, so I vote the Libertarian ticket. A wasted vote? Maybe. I just can't subscribe to voting for the lesser of two evils when they both make me wince.

I believe you hitched yourself to the wrong horse for what you think are some right reasons. You're a smart person, you make good points, I'm fine with disagreeing on this.

Thanks again for your thoughts and time, and you're always welcome here.

Chris Armstrong said...

Why is it bad when a retailer is selling nearly 50% of books, but good when a cartel of companies (offering identical contracts to suppliers) are publishing well over 50% of books that are sold?

Davieboy said...

One thing I will say is you're both great writers and you do have one fab thing in common - Dick Hill reads your audiobooks and does a fine job.

Joseph Ratliff said...

Lee,

You said: "You guys need to face this issue: e-reading will be inaccessible for the poor."

That is so wrong it's not funny.

My library offers free downloads of books (for Kindle and other formats). The downloads expire after the check out period.

Plus, there are computers in some libraries (like mine) where people can read the e-books right then and there.

I anticipate this will increase.

So yes, e-reading IS accessible for the poor.

And, it "will be" for future so far as I can tell, at the very least in well-developed cities.

But, if you're talking about 3rd world countries as the "poor" ... the problem could be easily solved.

Paperbacks are only one of many ways to solve the problem you identify.

Tony Hursh said...

"There are 20 million food-insecure people in the US, and 20 million more just pennies better off."

Definition of "food-insecure"?

Someone who's actually starving isn't going to be worried about reading any book, free or not.

I know that there's a widespread belief in Europe that poor Americans are starving in the streets, but...ah...that's not actually the case.

Anonymous said...

Lee, it's not about whether you or Joe were lucky... or worked hard.

It's about business practices... it's about which company is treating the average author better, and which one is not.

As mentioned, Amazon is frequently accused of being a monopoly, but there's zero evidence to support this claim (they, uh, actual direct sales to other retailers if they don't have that product... that's not monopoly)

Publishers were actually FOUND GUILTY of price collusion... the sane publishers who have a history of treating many (but not all) authors badly... which is why thousands more signed the petition that Hugh started rather than the one that AU started.

In practical terms, which one would you chose now, given your talents and work ethic... the publisher who pays you 70 percent on the dollar and gives you complete control, or the one who pays you far less (25 to 15) and doesn't allow you control over cover, allow you to write anything else and owns the rights for 70 years after your death?

I love books, I love them, I don't mind spending money on books... but it's pretty clear that there's a big disconnect between what authors deserve and what they get.

To me, that's an important issue that's not being addressed here, respectfully.

Todd Travis

Todd Travis.

Tony Hursh said...

Over 90% of Americans have cell phones:

http://www.pewinternet.org/fact-sheets/mobile-technology-fact-sheet/

Virtually all cell phones today can be used to read ebooks (including the free ones at Project Gutenberg).

Lee Child said...

Tony Hursh: I live in the US, not Europe, and I think you need to get out more. You seem to have no idea how poor people live. Food-insecure means one or more family members probably going without food at the end of the week or the month, probably with disconnected power, no car, and meager public transportation. Such folks are not running to the library with their e-readers in hand. Again, this is an issue you can't bluff you way out of. It's real.

Nick Crawford said...

In regards to why Lee has allied himself so vehemently with traditional publishing I think it’s quite easy to explain. If the big five are forced to capitulate to Amazon’s demands or go into bankruptcy, Lee may see smaller multi-million dollar advances or possibly even lose the rights to his books (see here about publishing rights and bankruptcy: http://dearauthor.com/features/letters-of-opinion/authors-rights-when-a-publisher-files-bankruptcy/). I imagine that these are pretty compelling reasons for Lee to hold his nose and support Hachette and AU.

Sabrina Chase said...

Regarding the comment about ironing boards...

Do the ironing board manufacturers expect things like preorders, Amazon-funded discounts, and free warehousing? It seems that Hachette is being treated exactly like the ironing board sellers. No discounts, no preorders, no warehousing. So why are they so upset?

Lee Child said...

Nick Crawford: If I was younger, in the middle of my career, your analysis might be plausible. But as I've said before, I'm at the end of my career, and genuinely feel I don't have a live dog in the fight. I'm just speculating about what might happen, as impartially as I can. For your sake I hope I'm wrong, but I don't think I am. But I would say that, wouldn't I?

Lee Child said...

Sabrina Chase says, "Do the ironing board manufacturers expect things like preorders, Amazon-funded discounts, and free warehousing? It seems that Hachette is being treated exactly like the ironing board sellers. No discounts, no preorders, no warehousing. So why are they so upset?"

Sadly, ironing boards don't excite people like an imminent release from a favorite author, so preorders aren't really a factor. Amazon is free to discount what they want, as come-ons and loss-leaders, and I'm sure they discount many household items, including - happily - ironing boards. Which get far more free warehousing than books - publishers are pretty good at fast just-in-time supply now. Hachette is upset because it is paying for a level playing field vis-a-vis other publishers and not currently getting it, and because it is being asked for suicidal trading terms.

Joe Konrath said...

Hachette is upset because it is paying for a level playing field vis-a-vis other publishers and not currently getting it, and because it is being asked for suicidal trading terms.

I wish someone would share what those terms are. Lots of heat on this situation, not much light.

That said, if I was a retailer, and 5 of my wholesalers illegally colluded and forced me to accept a pricing structure I didn't want, and the DOJ ruled against them, when it came time to renegotiate my contract with said wholesalers I'd probably be a tad bit vindictive.

I wrote a blog post about Amazon essentially subsidizing the Big 5 with discounts.

http://jakonrath.blogspot.com/2014/08/amazon-vs-hachette.html

Amazon has, for the most part, stopped subsidizing Hachette. Amazon can weather this storm. I don't believe the Big 6 can.

I suppose we'll see.

Edward G. Talbot said...

Lee -

Given that I usually vote for the lesser of two evils rather than a third party, I do see your point on why you chose to back AU.

Independent of the specific battle with Hachette, I tend to share Joe's view that what Amazon is doing now and at least for the near future is better for far more authors than what the Big 5 do. Regarding the specific conflict between Amazon and Hachette, I haven't really seen much to suggest that one side has any sort of moral high ground, so it's hard to get worked up.

Paying for visibility, paying for availability; These are occurring, but this is so much part of the way the world works that I can't fault it. If the Amazon rankings themselves are not actually what they purport to be - a proprietary ranking mechanism that weighs an objective set of data unrelated to any sort of payments - I would agree that this would be a factor in my evaluation of the negotiations.

But I googled Japan and Amazon Rankings and didn't find anything on what you alluded to in the prior post. I may not assume that the Amazon rankings are exactly as claimed, but neither can I assume anything nefarious without some reasonable amount of evidence. I dwell on this only because - aside from the long view that Amazon may be too dominant - the issue with fudging the rankings is the only real negative that isn't automatically associated with almost every large business. Quite possibly you are privy to private details that I am not.

The thing I agree with you the most about, also from your first email to Joe, is the idea that authors need to take advantage of the opportunities we have now, not whine about what we don't have or what it could have been. If I were trying to make a living at this right now in Sept 2014, I would almost certainly consider writing a whole lot of books per year and seek to have a few of them traditionally published (assuming interest on the part of a publisher). I'd view potential lost income due to draconian terms as a marketing expense or an investment in my brand. I'd like to think I'd be doing it with eyes open about the tradeoffs, which sadly many authors tend not to do.

In any case, thanks again for sharing your opinions on this.

JainaKay said...

Hachette is upset because it is paying for a level playing field vis-a-vis other publishers and not currently getting it, and because it is being asked for suicidal trading terms.

I imagine that a lot of Hachette's support comes from the other publishers, who want Hachette to get more favorable terms so when it comes time for them to renegotiate their contracts, they can use Hachette's contract as leverage.

I wonder, though - what do you mean by "paying for"? Who are they paying? Not their authors, since boilerplate legacy contracts are all basically the same. Are they paying Amazon for all the bells and whistles--out of contract? Why on earth would they do that?

Or am I missing some really fundamental way these negotiations work?

Jason Brant said...

I agree with a lot of the points Lee has made here. It's been great to read a coherent argument in favor of Hachette for a change.

I'm also with Barry though, in that I can't understand why Lee is the only one for Authors United who is making any kind of valid point. And if they're all being d-bags (except Lee) with talking points that are total crap, why did Lee put his name in with them?

The whole thing is quite jarring.

Anonymous said...

Gentlemen, let us cease unzipping our sales and comparing check sizes. It's irrelevant. Lee's books succeed wildly because readers got into them and wanted more. It wasn't luck. The luck meme is a bunch of crap. It's a convenient balm for the bruised ego. There have been innumerable examples of publishers giving the big push to a book and it fizzles. Lee is where he is because he cracked the code for more readers than other writers have. I applaud him for that. If he says in an interview he was lucky, he's both humble and wrong.

It's probably more like natural selection. The system was rolling along and Lee's books were selected because they had favorable adaptive advantages. Other books, even though an author or even publisher knock themselves out, fail to reproduce because of the harsh reality that nature...I mean readers have the final say.

But now Amazon has opened up a whole new archipelago for energetic writers. There's all sorts of reproducing going on. Some weird creatures to be sure (monster porn, anyone?) but a Darwin of literature would have a field day here.

Which is why I say to AU, get off of my island. Go back to New York and shut up. You're messing with my ecosystem.

Joe Konrath said...

There have been innumerable examples of publishers giving the big push to a book and it fizzles.

There's a word for that: unlucky.

Lee Child said...

Jason Brant said, "I can't understand why Lee is the only one for Authors United who is making any kind of valid point."

Dumb luck, I expect.

But seriously, Doug has to marshal and satisfy 1000 people - aka herding cats - whereas I have made it clear I'm speaking personally here. I have been a spokesperson for a diverse group many times, and it's very difficult. I think Doug is doing fine, and he has my complete support.

Lee Child said...

JainaKay said, "I wonder, though - what do you mean by "paying for"? Who are they paying?"

Publishers pay Amazon - or not, their choice - for the cyber equivalent of placement in stores ... e.g. spine-out on a shelf on the fourth floor, or on the front table just inside the street door. Publishers make the choice per book - some here, some there - but what's happening here is (roughly) the equivalent of those various payments being accepted but ignored, and *all* their books being left in boxes on the loading dock.

JainaKay said...

Thanks for clearing that up, Lee. I would never have guessed that they would pay Amazon for those things while they're out of contract!

Anonymous said...

I think it's pretty telling where the Amazon business model is headed when they use their power over the marketplace to promote their own authors over other reading selections.

Looking at the current top sellers in Kindle sales, Amazon-published titles at #2, #4, #6, and #12 are all Amazon-published selections from September's Kindle First promotion, which as I understand it allows Amazon Prime subscribers to get these books for free while also weighting a free sale as a paid sale, driving up the rank position and subsequent visibility of their books on the marketplace.

Doesn't this strike anyone as shady? It seems to me like this is manipulation of the marketplace and buying decisions in favor of Amazon titles, which isn't a level playing field whatsoever. That's like bookseller Wal-Mart becoming a publisher and putting only deeply discounted Wal-Mart titles on the endcaps and everything else stays in the back...

The whole way Amazon is doing business smells. Just my thoughts.

Lee Child said...

Anonymous said, "Which is why I say to AU, get off of my island. Go back to New York and shut up."

Back atcha, my friend. Like I said, don't let traditional publishing live rent-free in your head. You deal with your stuff, and we'll deal with ours. AU has said nothing disparaging about you ...

Joseph Ratliff said...

Lee, you said:

"Food-insecure means one or more family members probably going without food at the end of the week or the month, probably with disconnected power, no car, and meager public transportation. Such folks are not running to the library with their e-readers in hand."

You're right, they probably don't want to read much though, so would they be a good "target audience" for determining if "access to e-reading" is effective?

If they don't want to read, understandably so because of their situation (looking for food and shelter in the first place), does it matter if they do have access to e-reading at all?

It's like you're asking baseball players if they have access to a football field. They don't need it to play baseball.

The "extremely poor" would only be reading in a structured program offered directly to them, right? And only if they were interested? (wouldn't be high on my priority list if I was looking for food)

But the lower income "poor" fits with the solution I pointed out (the library). And, some libraries are even starting to offer e-readers for check out.

http://the-digital-reader.com/2013/04/16/76-of-us-libraries-offer-ebooks-nearly-2-in-5-lend-ereaders/

So you are almost completely wrong, so long as we are using a group that is in a situation where reading is even a logical possibility.





Lee Child said...

Joseph Ratliff: I guess you need to get out more, too. Hang out in trailer parks and blighted neighborhoods, and watch people taking solace from losing themselves in battered paperbacks ... then look at their circumstances and try to figure out how the theoretical BS you just spouted could possibly happen.

Tony Hursh said...

"You seem to have no idea how poor people live."

I grew up on welfare. My stepfather disappeared and left Mom with five kids.


So, yes, I have a pretty good idea "how poor people live."

You?

"Such folks are not running to the library with their e-readers in hand."

More than 80% of people below the poverty line have cell phones.

http://www.census.gov/hhes/well-being/files/p70-136/tab1.xls

If they're not "running to the library with their e-readers in hand" it's because they don't want to.

"Food-insecure means one or more family members probably going without food at the end of the week or the month,"

Virtually every town in the United States has places where you can get food and clothing for free. The Salvation Army. Food banks. Other church groups. Been there. Done that. Worn the hand-me-down tee shirts.

Someone needs to get out more, all right, but it's not me.

Edward G. Talbot said...

I guess what I'm wondering is why Hachette continue to pay Amazon for all that placement given that they're not getting what they're paying for. There's no contract any more, right ( though I understand that there are aspects of contract law that would bind the two parties to a previous contract if they continue to operate as if nothing has changed)

Unless those specifics of contract law are the reason, which I doubt if Amazon is actually materially changing things during the negotiations, then why doesn't Hachette just not pay the amount for placement and availability? Has Amazon told them if they stop with the payment for these extras, the books will be pulled? Or is this a case of the placement and availability being baked into their terms and therefore not separable?

Lee Child said...

Tony Hursh: Let's not get into a prolier-than-thou contest. E-reading isn't going to work well for the poor. Own it, don't dance around it. Collateral damage, maybe for a greater good, but damage nonetheless.

Anonymous said...

If someone is "food insecure", how is fighting for higher ebook prices going to help them in the long run? By taking the option to buy a book off the table due to a high price, they'll buy food because it's cheaper?

I used to live in the sticks, and by the sticks I mean Central Montana. I read more ebooks on my Amazon app on my HTC than I did anything else, because the nearest bookstore was a couple of hundred miles away and the closest town has a population of 200, and no library.

Maybe instead of tearing the covers of all those books that don't sell, they're given to charity?

But that would force a change to the returns system, and we know that's never going to happen...

Tony Hursh said...

"Let's not get into a prolier-than-thou contest."


Given that you went to a private school ("public school" in the UK) that costs somewhere in the neigborhood of $20,000/year, and are now a millionaire, I can see why you'd prefer to avoid doing that.

"E-reading isn't going to work well for the poor."

Ah, now we get to the "proof by blind assertion" stage.

I think my work is done here.

Anonymous said...

you deal with your stuff, and we'll deal with ours. AU has said nothing disparaging about you ...

It's not about me. It's about my island. AU wants the effing government to come mess up my paradise. They want to make it harder for me to make a living as a writer. As a fellow author I find your support of that puzzling.

Lee Child said...

Tony, I didn't go to a private school. That's completely untrue. It was entirely government-funded. Where do you get this stuff?

(True, it went private much later, because a conservative government didn't like meritocracy, and now I give huge sums to let poor kids still go there.)

Lee Child said...

Anon: "AU wants the effing government to come mess up my paradise."

Didn't the government just back Amazon a while ago? On the merits, you might say, but don't other people get to test their merits? Or is the DoJ strictly one-way on your island?

Andrew said...

Mr Child,

7 Billion people in the world, 6 million have access to a cell phone.

50% of Indians do not have a toilet in their home. 63% of Indians have a cell phone.

http://economy.money.cnn.com/2012/03/14/in-india-more-cell-phones-than-toilets/

So, I can sell an ebook to an Indian, but chances are he's not going to read it in the bathroom.

Is your assertion that ereaders for the poor aren't going to work out supported by anything else other than a personal opinion?

Lee Child said...

Andrew, can you sell an e-book to an Indian without a credit card or a bank account? That's the pinch point, not the device.

Robert Ross said...

Wonderful discussion...!!! Thank you Joe, Lee and Barry. I would just like to point out that most avid readers, like my family and me, don't care about Amazon or your publishers. We care about you, our favorite authors.

We want to keep reading your works. Accordingly, we care that you are at least successful enough in your passions for writing to keep writing.

What has enabled your successes may be different, and it makes for interesting discussions. However, it would be more than a bit nice ...for a change... that you consider us, your readers, in all this Amazon-AU-Hachette brouhaha.

I would like to hear how all you "successful" writers intend to support your readers once this current dust storm settles.

Do you care about HOW proprietary ebook formats negatively impact your readers? If so, what are your plans support open formats and device interoperability?

Does it bother you that your readers don't have nearly as many viable shopping choices when it comes to purchasing physical books or licensing ebooks? What are your plans to help change this reality?

Have you considered how your support and use of micro-licensing, the semantic web, and open publishing initiatives would shift the balance of power to you and your readers?

Please consider the future of publishing for all, and how the long-term ramifications of these current issue impact writers AND readers. We readers want to support you writers, but we need your support too.

James Scott Bell said...

Major ;props to Mr. Lee Child for showing up, and not just as a drive-by. This whole exchange has been entertaining, but also with good arguments coming from both sides.

So what now? Since I'm buttering good bread because of Amazon, I tend to side with the status quo. But trad-pub was good to me, too, though it was sometimes fickle. I don't want it to dry up and go away.

Why not let the market decide? And part of the market is big biz negotiating in its best interest. Too bad if one side has more leverage than the other. That's the way it works.

Meanwhile, writers should spend more time writing than complaining.

Joe Konrath said...

now I give huge sums to let poor kids still go there

Awesome. That's just awesome.

Joe Konrath said...

Let's play nice, everyone. This isn't personal.

Tony Hursh said...

Lee, look:

You can get a bare-bones Android phone, perfectly adequate for e-reading, for as little as $20. New.

You can likely get a cast-off older model phone for free, if you check with your buddies. You don't even need to have the phone service activated. It will work fine as an e-reader without it.

That, plus a free wifi connection (which can be had at any McDonald's or public library) gets you the entire 46,000 volume Project Gutenberg collection, which contains every important classic work of English literature.

Net outlay: zero, if you can find someone with an old phone they're not using, twenty bucks if you can't.

I would have killed for that capability when I was a kid.

To be blunt, you simply don't know what you're talking about.


Joseph said...

Please don't fuck this up for us Lee Child. Amazon is how new people make it nowadays.

Encourage competition = good.
Boycotts and mud slinging = bad.

Joseph Ratliff said...

Lee,

So the "stuff" I'm seeing with my own eyes, is B.S.

I get out plenty, Mr. Childs. Your assumptions are very misplaced.

I can see you're not open to the possibilities for the poor with e-reader technology, especially the ones that are actually happening, and that's fine. You certainly don't have to be.

I've seen it first hand though, at least around the city where I live.

I don't need any more proof that at least the possibility exists for other places as well.

Thank you for participating in this discussion. I appreciate your time.

Joe Konrath said...

Let's move away from poverty stories and who owns cell phones. I'm not finding it helpful.



Joe Konrath said...

Encourage competition = good.

Is Amazon encouraging competition?

Amazon is competition. But it doesn't encourage competition.

I don't know of any business that encourages competition.

Competition is good for the marketplace, but companies prefer getting all the marketshare they can.

Liam Sweeny said...

Lee, I can understand your desire to keep printed books out there. I'm a self-published author, and I do release ebooks, but not without print books. Aside from nostalgia and the ease of just giving a book to someone when you're poor (which I most definitely am,) science is currently looking at how we process reading physical books versus digital books.

http://www.scientificamerican.com/article/reading-paper-screens/

With regards to breaks and luck, as I said, I'm poor. Always been. On disability, hand-to-mouth. And I started out self publishing. No legacy deal to get me started. The three books I have currently are in the millions rank, which is no surprise to me. There are a lot of costs to putting out a good book as a self-pub that a majority of us self-pubs can't scrap together easily. Like professional editors. Like professional cover designs. And, indirectly, like the confidence to push a self-edited, self-designed book using, yes, many of the free marketing channels available today.

I probably represent most of the self-published authors out there.

Does Amazon benefit me? Yes. Does the legacy system benefit me? Not now. So even though I may be tempted to take the pro-Amazon stance completely, I know that without the resources to turn my work into a truly marketable product, I, like many self-published authors, can't afford to take sides in this dispute. Joe, I know the legacy system screws a lot of authors. But so does being broke and going it alone.

Nirmala (free spiritual ebooks) said...

Regarding Lee's points about different priced products, Amazon has clearly stated that they beleive some ebooks should be priced higher than $9.99. Most likely they are trying to get terms that would discourage, but not prohibit higher prices by taking a higher percentage on those sales. But their reasoning for encouraging $9.99 or less is that due to the almost zero marginal cost for ebooks, everyone stands to make more money from low priced ebooks: the publishers, the authors, and of course Amazon. This is simply not the case with a $24,000 amplifier or a $200 ironing board, or if it is the case that an item like that is grossly overpriced, then the manufacturer is shooting themself in the foot and hurting its employees, its suppliers and Amazon's chance to profit all at the same time.

In every business, there is a decision to be made regarding pricing that should ideally be made on what will bring in the most profit over the long run. I guess it could be argued that the publishers think they are doing that by protecting their paper sales, but why not just say so instead of making up all kinds of ridiculous reasons why the culture of literature is at stake?

Also, I have to give the prize for hyperventilating hyperbole to Ursula K Leguin when she said authors are being disappeared. I had a image of Amazon sending out black vans full of death squads to kidnap authors in the middle of the night, and the author never being heard from again. I somehow doubt that is happening very often :)

Nirmala (free spiritual ebooks) said...

PS: Streitfeld is at it again today with one of the most confused and confusing pieces of writing I have ever read. I read it over and could not for the life of me figure out what he was really caliming as he seemed to contradict himself repeatedly. Maybe that is his idea of balanced reporting.
Here is the latest Streifeldian Folly:
http://bits.blogs.nytimes.com/2014/09/30/amazon-is-not-holding-back-on-paul-ryan/?_php=true&_type=blogs&_r=0

Joseph said...

"Encourage competition = good."

@Konrath-

I was addressing Mr. Child there. If AU is hoping to encourage competition, that's good. But mud slinging and boycotting and trying to bring down a company is bad for writers.

It seems the primary disconnect with AU is equating Amazon's 'winning' with 'cheating'. Also the strange notion that Amazon might morph into legacy once legacy is broken. Both notions are hard to support with current evidence so what we really have is just mud slinging.

Too bad AU isn't interested in starting their own online store...with affiliate independent book stores or some such. That's what I thought their big move was going to be in the past few weeks. I'm a dreamer.

Paul Draker said...

Lee,

Here's a dilemma a lot of newer writers are facing right now.

Many of us don't have any strong feelings about agents, or legacy publishers, or Amazon publishing imprints, for that matter. We don't get all the angst. We simply prefer to maintain control over our IP and reap the benefits of doing so.
It's just business.

And for ebooks, we see an essentially level playing field right now, with the higher indie revenue share giving us a nice home-field advantage -- make hay while the sun shines, right?

We love selling paper books, too, although we don't move as many of them. We have POD trade paperbacks, and even hardcovers. Again, with online sales, it's (theoretically) a level playing field, and growing more level every day. And the higher margins on our POD books offset the steeper POD print costs.

Which brings us to bookstores...

The meme that indie authors can't get into bookstores is frankly bullshit -- it takes a little hustle, but it's very doable.

The economics of bookstore sales, however, just don't work for most of us indies. The high relative cost of POD versus offset, coupled with the requirement for returnability, make bookstores a waste of time for most of us. In fact, if we roll out to bookstores aggressively, we are even likely to lose money.

And that's the dilemma right there.

Bookstores are a segment of the retail market where indies at a huge disadvantage.

As readers, we might well love bookstores. But as indie author-publishers and business-people, it's hard to avoid the conclusion that the quicker the bookstores fade away, along with the visibility advantage they give legacy publishers, the better for us indies.

Lip-licking vindictiveness? Not really. Not for a lot of us.

But we're new to this and we're hungry, so we look forward to seeing the playing field get even more level.

It's a bit of a Gordian knot, no?

Silas Payton said...

Lee,
I don't understand your argument that supporting AU is in any way good for readers or the poor. Even if you are correct that having paper books are better for the poor, are you suggesting that AU will stop or even slow the cultural shift to ebooks? Paper is costly in production, transportation, storage and in lifespan of a book. Eventually ebooks will bring an end to paper distribution as we know it. It has to. Why would you support higher ebook price. Who is this good for?

Don't get me wrong. I'm all for choice...if you can get people to drop $12.99 for your books, go for it. But what about the midlist authors who have signed on with Hachette and won't sell much or be seen -- those who will be in the "basement" because they are priced too high to compete?

Really, it was the author's choice to give up their rights and I have no doubt newbies are becoming more aware of this mess every day. AU will not slow the progression to ebooks, in fact they may speed it up. And, I'm sure, submissions to trad. publishers will go down the more their lack of choice is highlighted.

Patrice Fitzgerald said...

Lee sez: Because all these endless screechy blogs make you look whiny, not us. “I coulda been a contender!” Get over it already. Move on. Don’t perpetuate the “bitter reject” meme.

We're not bitter rejects. We're daring entrepreneurs, completely in charge of our own success. We like it out here, on the frontiers of publishing. Seriously, despite all the work it takes, it's tremendously satisfying to make one's own creative decisions.

Lee, if you want to self-publish a short story just to try it, I'm happy to lend you my expertise. I suspect you'd sell very well in the indiesphere.

Steve Peterson said...

I know it's been said, but it bears repeating: Kudos to Lee Child for engaging here, and kudos to Joe for hosting it. The discussion is providing more light for all, without much heat.

I think legacy publishing can work well for a few authors, but the system is really not structured to help midlisters or newbies. Worse, those authors who have titles with the Big 5 are locked in unless they can fight there way out of their contracts. (That's a really slimy interpretation of "in print" since e-books never go out of print.)

I've known some authors who really need the help a legacy publisher provides -- one best-seller told a group of us that she basically writes a bunch of scenes and her editor turns it into a novel. I still shake my head at that. She also admitted she neither knows nor cares anything about the business side of things, or marketing her books, or social media... she would be lost trying to self-publish.

But she's rare, I think. And while many authors may not know much about business or marketing or cover design or editing, all of those services are available. I'm sure even more people will step forward to offer a suite of services to self-publishing authors who need help.

The key point that needs to be remembered about Amazon as opposed Hachette is this: You can walk away from Amazon at any time with your book rights (OK, unless you've signed a specific agreement to the contrary, but most don't) whereas with Hachette you're locked in forever.

If Amazon starts reducing its royalties, or making it harder for authors to promote their books, they can go to Kobo or Smashwords or just put up their own website.

And print is not dead -- anyone get a print-on-demand copy of an e-book, if it's set up properly. Radio's not dead, either, and in fact is undergoing a renaissance with streaming music services, podcasts, and the like. New technology doesn't kill the old, though it certainly changes who's making the money.

I'm appalled at Authors United because they are using inflammatory rhetoric which is obviously false -- and as professional writers they should know the meaning of the words they are using so improperly.

Self-publishing is coming into its own, and it's providing far more revenue for a much larger group of authors than ever before. I suppose it's annoying when your exclusive club gets overrun with newcomers, but for most authors and all readers this is a great thing -- far indeed from the apocalyptic visions being bruited about by Authors United.

All that said, Mr. Child, you've been a good debater and I hope you continue to engage. And at some point, if you talk to your friends in Authors United, you can get them to stop sounding so damn foolish in their public comments.

The real problem I have left is that I'm envisioning a Jack Daniels/Jack Reacher crossover, and I think I'm likely to be waiting quite a while for that one.

But damn, it would be great. :)

Lee Child said...

Silas - my point about the poor is that if cheap print disappears (which isn't directly related to the AU argument) then the poor will be disadvantaged.

Patrice - I'm sure you personally are daring, happy, satisfied and energized by what you're doing (as indeed you should be, because you're terrific) - so, just as people ask me to disavow AU for what it says, will you disavow your indie peers for their constant bitching and moaning about a business they're not actually in? Look at PV, or this blog - full of snark about traditional publishing, and virtually nothing about the creative joys you champion.

Patrice Fitzgerald said...

Lee: Thank you.

Most of what I read from indie writers is full of the excitement about what we do, and extends helping hands to the newbies coming up behind us. This Hachette/Amazon stuff is a small percentage of what gets blogged about--but it does get a lot of eyeballs. I mostly just reach for the popcorn and watch the slogging. We don't have the NYTimes carrying water for us, and giving baby writers the other side of the picture. We have Joe, PG, Hugh Howey, David Gaughran.

Dang, you were so nice, now I'm gonna have to go read one of your books. And of course add that statement as a blurb on mine! "You're terrific." Lee Child, NYTimes bestselling author. (Insert tongue-in-cheek emoticon here.)

No wonder you make all the ladies swoon. Cheers.

John Ellsworth said...

I found Jack Reacher out of all this. That's right, recently retired from a profession that left me zero time to read for enjoyment, i'm finding that I've missed a lot of fun reading.

Jack Reacher is a blast.

John Ellsworth said...

One side-note for Joe: I'm one of those 100,000 who bought Jack Daniels.

An equally fun read.

I'll be back to visit both Jack and Jack.

Anonymous said...

I'm not precisely sure why Lee Child's argument that books should be variably priced is an argument *in favor of* Hachette and Authors United. The Big 5 are far from wanting true market pricing-- after all, they want to establish a price threshold below which neither they *nor* Amazon can discount ebooks. That's not exactly supply and demand. On Amazon, you can find *the same* ironing board for different prices from different vendors, something that would never be true under the Hachette model. In fact, neither Amazon nor Hachette are pursuing market pricing of books that resembles pricing of other products on Amazon, so that hypothetical is not trenchant to the argument at all-- and Amazon remains the party fighting for lower consumer prices (for better or worse, and with whatever motive).

Anonymous said...

The question that keeps resonating with me is why shouldn't Amazon get to set its own prices and discount what it distributes? In what business do you get to tell a distributor I demand that you carry my product and sell it at the price I want and get away with it?

Also, I'm in love with Jack Reacher. Thank you, Lee Child for creating him.

Jim Self said...

Lee,

I don't agree with Joe that everything amounted to luck between your career and his. Testing the "quality" of a book is impossible, but if there were ever a single metric that could do it, it would be sales. So, a tip of the hat to you, sir, for what it's worth.

I understand your example of voting for the lesser evil, and how it never represents 100% of your beliefs. I've done it, yep. The thing is, there's a huge difference between you voting in an election and you supporting AU. In the latter case, you're not just a single ballot to be counted. You're you, the famous bestselling writer. When you sign your name to their cause you're giving them 100% of your support with 100% of your reputation and credibility.

I respect you a lot for all of the arguments you've made here and over at The Passive Voice. Heck, I respect you immensely for showing up. I especially respect when you said that this all isn't about nurturing or culture or any of that crap. I agree, it's about two corps trying to score some extra profits off of each other. That isn't what AU is arguing at all, though. All of this "targeting authors" and "suppressing books" and whatnot, it's just painful. Having read your responses here, I wish you wouldn't led your name to all the crap coming from the AU platform. If you feel strongly about the contract dispute, state your own case instead.

Again, much respect to you and thanks for taking the inevitable potshots with good humor.

Paolo Amoroso said...

A possible reason why ironing boards, amplifiers, and other physical products have such a wide price variation, related to what Joe said, is that those products come in a wide variety of sizes, materials, shapes, performance, accessories, features, configurations, and capabilities.

Let me illustrate this with an extreme example I’m more familiar with, i.e. amateur telescopes. Prices start around 30-50$ and go up to several thousand $, but there may be no close upper bound.

If you want to spot the moons of Jupiter you can get a $50 2” refractor, or just use grandma’s opera glasses you already have in the closet. If instead you want to see those moons as discs with surface features, you need an 8-10” reflector in the 500-1,000$ range or more.

Also, telescopes with the same objective size (i.e. light-gathering power) but different optical configurations have very different prices, as refractors cost roughly twice as much or more than reflectors. If you want to do astrophotography rather the visual observation, you need to buy additional accessories like a tracking system and imaging equipment.

Retail prices reflect the variability in product diversity and manufacturing costs.

Another issue. In this discussion I seem to perceive the implicit assumption that nobody is willing to challenge Amazon’s current or future market dominance. Why wouldn’t Apple, Google, or some tiny startup want to compete to grab a larger slice or increase the pie’s size? These days web and tech companies are continually stepping into each other’s turfs.

The significant market share of the major social networks such as Facebook, Twitter, and Google+ isn’t apparently discouraging even the possible “suicide mission” of latecomer Ello. And, despite WhatsApp’s success in the messaging space, new startups aren’t afraid either. The messaging space is particularly interesting because latecomers face an additional challenge besides the competitors’ market share: the network effects established players enjoy.

This is in the tech world’s DNA, but traditional publishers and players may be more conservative.

Broken Yogi said...

This time, I agree with most everything Lee says in his response - though I do note that he confines himself to areas in which he can actually be right, and doesn't defend the huge number of things that Hachette and AU claim and complain about.

The most important part of Lee's criticism of Amazon is in pointing out something I've been talking about here for some time - that Amazon's whole book business model depends on their being the one-stop-shopping place for books, carrying most every title imaginable, from every publisher and self-publisher.

That whole model goes out the window if they actually come to the point of not carrying a major publisher's books. So even though they don't have a contract with Hachette, they still technically sell their books, though under certain favorable limitations. So they can sort of slide under the weather with that one. But the really big 6.4 billion dollar question is, what will they do if all the other Big Five publishers, representing about 85% of all the books sold in America, take a stand similar to Hachette's? Which they very likely will?

What will Amazon do then? Will they stand firm and put all their books on lockdown also? Doesn't seem like they could really do that, and still be Amazon. So, I have a very hard time seeing Amazon winning this. Just as they caved back in 2010 when 5 of the Big 6 colluded on the agency model with Apple, Amazon will likely have to cave on this as well. Because they can't hold their own as the major book retailer in the country otherwise. And they still need that. Self-publishing is nice, and pretty much free and easy money for Amazon, but it isn't what keeps them in business. It's still just an add-on. Its promise is huge of course, but not there yet.

Lee's point about the iron boards is right on, and again it's something I've said before, but no one seems to listen to (except maybe Lee). The real point is that Amazon really doesn't have any business dictating to publishers what prices they want to set for their ebooks. I understand and even agree with Joe and Hugh's arguments that ebooks should be more cheaply priced than most publishers price them. But so what? What business is that of Amazon's? If they want to price their books badly, it only hurts them, not Amazon. After all, as even Joe says, it just means that people will spend their money on other books from other publishers, including self-publishers, priced more reasonably.

cont.

Broken Yogi said...

The one area I can see an issue is with the inability of Amazon to discount books. I could see Amazon insisting that it should be able to pay publishers their wholesale price, and then discounting as they see fit. That's a big part of Amazon's business model. Or looking for a bigger margin so that they can afford to discount more. Those are standard retailer demands that I don't think are out of the question. But demanding that publishers lower prices across the board? That's just out of line.

Now, obviously the Big Five want to protect print distribution by keeping ebook prices high. That's a business decision on their part. Amazon may not like that, but it's not their business to decide such things. Amazon may even be right, but still, it's not for them to insist that their suppliers go along. They don't insist that any other suppliers price all their products according to Amazon's gauge of what the "correct" price is. They let their customers decide that. Sales figures don't lie, and suppliers that price the best will get the best sales. If Lee's books max out their margins best at 12.99, let them. If another author's profits max out at 4.99, let them. Certainly publishers should be more intelligent about pricing, but that's between them and the author.

Where Joe is right is in all his criticisms of how the Big Five treat authors, and how AU is ignoring the needs of most authors. That's truly scandalous. And how AU and the Author's Guild should be speaking out and pressuring Hachette and other publishers to fix these problems and give authors a better deal. It's insane for them to be pressuring Amazon, when they don't have a business relationship to Amazon in the first place. Their only business relationship is with Hachette. They should be pressuring Hachette while they can, and asking the Justice Department to look into the scandalous contracts authors are offered, and which seem to be part of an illegal cartel exploitation throughout the industry.

In fact, I'm wondering if Joe's 8,000 authors might put together a letter to the Justice Department detailing these violations of fair trade law, and demanding an investigation of the publishing industry's contractual abuse of authors. That's something that should have some real tread on it.

Alan Spade said...
This comment has been removed by the author.
Alan Spade said...

If I were to summarize your arguments, Lee, I would say that Amazon wants to be a monopoly, it will one day screw indie authors as all other authors, it is currently cheating with sales and operating like the Mafia, demanding "protection money".

Other commenters here have pointed out, among many other things, the non sequitur of Hachette still sending protection money to Amazon, while Hachette has no more contract.

The problem is that you tell us about some facts that are mostly unproved to this date. You tell us about fear and suppositions for the future.

But we rely on facts. Many indies like me have found out, by our own experience or by our peer's experience that publishers are badly screwing authors. I notice, for example, that you have not replied to Joe's point about Sarah Lotz, an Hachette author who will, sadly, probably be dumped sooner or later by Hachette because she's not selling enough. While it's Hachette that tries to sell a book from an unknown author at $12.99. She should be the one to dump Hachette.

You'll reply to me that I'm playing with fear when saying she will probably be dumped sooner rather than later, because Hachette's policies are only fine for their bestsellers.

Yes. That's what I do. But there are also proven facts: the price of her ebook and her ranking.

What I can infer from what you say is that you have some attachment for paper books and that Amazon's dirty practices plus the shadow cast by a technological mogul, shadow magnified by books like Fahrenheit 451, 1984, or movies like Terminator or The Matrix weighs heavily on you.

You seem to infer that your viewpoint is not biased because you don't have any dog in this fight. But how would your viewpoint not be biased, while you are deliberately closing your eyes at all the infamous practices of big publishers?

I could understand if an independent publisher would step in and say: "neither Amazon nor big publishing are good, both are evil". The fact that you won't admit the big publishers' enormous fails is very telling.

For the record, even to that independent publisher, I would say that if we weigh what the big 5 are bringing to society as a whole, and what Amazon brings to society, Amazon is the easy winner.

I agree that we have to be careful not to put too much power in the hands of a single company, though. There may be a future when Amazon will do more evil than good. So, your words of wisdom are welcome here, as long as you don't suggest that we base our decisions on fear.

Broken Yogi said...

This whole argument that if cheap print disappears, the poor won't have access to books, seems to completely lack foresight.

The fact is, print won't disappear any time soon, and if it does, it will only be because ereaders will have become so cheap and ubiquitous and easy to use and enjoyable that there's literally no demand for print. And in that future world, poor people will likely have just as much access to ebooks as they now do to television and refrigerators and so on. Meaning, no, not every poor person will have them, but the ones who care about reading probably will. The payment method problem is different, but it's also likely that in this future world without print books, that problem will likely be solved, since it's probably a world where epayments are a lot more common and accessible too.

In other words, it's more an example of concern-trolling than a real problem we need to worry about any time soon. If the demise of print is high overestimated, as Lee has already claimed it is, then so is this concern. You can't have it both ways, Lee.

Elka said...

The payment method problem is different, but it's also likely that in this future world without print books, that problem will likely be solved, since it's probably a world where epayments are a lot more common and accessible too. Why would somebody poor even want to buy an e-book, when there's so much free content? They don't need a credit card to get a free book on Project Gutenberg, Smashwords or red it on FictionPress, Wattpad, etc.

Paul Sparks said...

I write this, not as an author but as a consumer. I don't really have a dog in this fight. I do have some thoughts though that I think get lost in the arguments between authors.
I own an iPad and spent an entire year reading nothing but ebooks. I saved money that year but I found that I enjoy reading print books more. And it seems that I'm not an outlier: http://www.thebookseller.com/news/nearly-three-quarters-young-people-prefer-print.html
Though I'm a bit, maybe a lot, older than those young people. Now I spend more money on less books because it gives me more pleasure and because it makes me feel like I'm doing my small part in helping indie bookstores stay alive. Because I like bookstores. Who doesn't like bookstores and who wants them to go away? I remember a few years ago when Amazon encouraged their customers to go to brick and mortar stores to scan books that they wanted to but on Amazon's website. That's when I decided my book buying isn't solely about money. So I choose to spend my money at indie bookstores.
I think that it is overstating it a bit to say that when someone goes on to Amazon and finds the book they want is delayed by a few weeks because of a dispute with a publisher will just buy a different less expensive book. If that happened to me I would look somewhere else for the book that I wanted, even if meant paying more. Like I said, I'm not an author. I don't understand everything going on between Amazon, Hachette, and AU. But I do know that I rely on the big publishers to find books that I might like. If self publishing became the norm, I'd worry that the authors who don't know how to market themselves well will be lost, no matter how good their book is.
I like physical books. I like seeing them on my shelf. I like going to other people's homes and looking at their books. I can't really ask to see someone's ereader so I can browse their books.
Maybe I'm just out of touch or behind the times but I don't think so. I'm a photographer that buys the best digital camera body that I can afford. I don't use film anymore. So I don't think I'm just being nostalgic.

Nirmala (free spiritual ebooks) said...

While it has been pointed out that Amazon probably wants to keep its ability to discount ebooks if it cannot effectively encourage publishers to price ebooks lower, I don't think anyone has pointed out that typically when Amazon (not a third party seller)sells an ironing board or electronic device they do generally discount it from the suggested retail price, and sometimes dramatically:
http://bit.ly/1rHtBNn
(BTW: I did not know there was such a thing as a $3000 ironing board!)

So that is another way his metaphor is not relevant if it is likely true that Hachette is trying to return to agency pricing and therefore take away Amazon's ability to discount ebooks. If Amazon cannot discount, then when the publishers sell their ebooks at high prices, it is readers, authors and Amazon who suffer from the reduced sales, while publishers at least believe they benefit from increased paper sales (although the logic of this is questionable: how many readers just don't buy the book at all because of the high price of the ebook?).

Nirmala (free spiritual ebooks) said...

PS: I loved this comment which appeared today on the latest Streifeldian Folly in the NYT:

The argument against Amazon is a classic oxymoron: Amazon is a monopoly, so you should buy elsewhere.

Nirmala (free spiritual ebooks) said...

@Paul Sparks: You may not realize that with rare exceptions, publishers generally no longer promote or market new authors' (or even non best-selling established authors') work. It is now up the author to do their own marketing and promotion, whether they are traditionally published or self-published.

Lee Mountford said...

'That isn't whining, Lee. That's activism. And I need to point these things out, repeatedly, for new authors who are learning about these topics for the very first time.'

That is a very valid point - I'm hoping to have my first novel ready in the next few months but until finding Joe's blog, almost everything I'd read on the subject was anti-amazon (even though some claimed to be neutral).
This counter point is vital so people can make their own, informed decisions.
Thanks Joe - interesting stuff.

Alan Spade said...

Paul Sparks: if you look only for "anointed books", indie bookstores are fine. Other readers find more diversity of choices on Amazon, and they like it.

For us indies, the sacrifices made by submitting our books to publishers simply aren't worth it.

Would you rather have a 0,00001% chance of selling millions of paper books, or a 90% chances of at least making a few bucks selling ebooks?

In theory, we would be better of to benefit from as much markets as we can. In reality, we prefer to benefit mostly from ebook sales and to own our publication rights.

Some of us also rely on POD books. In fact, for the moment I'm handselling more paperback books than I sell ebooks. But a publisher? No way! :)

Anonymous said...

Fourish years ago, social security decided it would make all its payments electronically. Many SS recipients did not have a bank account, so the SSA provided them with a special prepaid debit card which would be automatically recharged every month. This system has worked successfully for some time now.
I am confident that by the time paper books disappear in the US, all welfare payments in this country will be made electronically, and there will be no payment problem for the poor to buy books, assuming they don't stick entirely with free and library books.

Nirmala (free spiritual ebooks) said...

I agree with Alan that it is a bit of a straw man to try and make this about paper books versus ebooks. It is about so much more: control of your final product, percentages that you earn, bypassing the incredibly high hurdles of the old gatekeepers, and much more. Ebooks just paved the way for these more fundamental advantages.

And as non-fiction writers, my wife, Gina Lake, and I earn about a quarter as much from POD as we do from ebooks. Not a lot, but definitely not nothing either. And all of the advantages of ebooks for self-published authors are still true with POD (even if it is difficult or not worthwhile to get our books into brick and mortar bookstores). I will also add that audiobooks we produce ourselves (through Audible) also offer all of the advantages of ebooks.

A publisher would have to offer us a boatload of money as an advance to even get us to think about going with a publisher now. They just cannot or are unwilling to compete on so many other levels, that the money would have to more than make up the difference.

w. adam mandelbaum esq. said...

Now I've learned the secret to literary success--all I have to do is iron my amplifier and spray starch my CD player. Who'd a thunk it?

Alan Tucker said...

Point of fact regarding the ironing boards and amplifiers: those outrageous high prices are from third party sellers and they exist for books as well. I've seen print copies of my books being listed for hundreds of dollars before. I certainly hope no one was silly enough to buy one.

Ebooks, however, don't have third party sellers at Amazon. If you buy a Kindle book, you're buying it from Amazon (assuming you've purchased it on their site, of course) and they are looking to get the best price they can for their customers.

I think the over-arching issue here is middlemen. Amazon despises them. They take a chunk of money (in Big Publishing's case, a huge chunk) that Amazon sees as "in play". The more authors Amazon gets to self publish, the weaker those middlemen get. Big Publishing has a huge lead in this race in the form of well-entrenched beliefs held by the general populace (like the idea that the only good books come from Big Publishing and all their authors are rich) but Amazon is gaining ground in those areas.

AU's arguments are emotional appeals, not based in logic or facts, as Joe and many others have shown over the past few weeks. Arguments based on emotion are difficult to defend, but are even more difficult to dissuade someone from.

Anonymous said...

To all those asking why Amazon has any right to dictate a price to publishers: leaving aside the fact that this is just a contractual negotiation between a producer and a distributor, you could indeed reasonably argue that Amazon has no right to dictate to Hachette what prices it should charge... TO AMAZON. And consequently, Hachette should then have no right to dictate what Amazon should charge TO THE CONSUMER. You are forgetting that there are two transactions occurring, and that Amazon is a *reseller* (i.e. retailer, which is a synonym). Hachette very much wants to dictate the prices Amazon can charge for books; you can't reasonably argue that Amazon shouldn't be able to negotiate on prices, but Hachette should. If Hachette wants unlimited ability to set prices it sells to retailers, it should accept that retailers can subsequently mark up or mark down those prices as they see fit-- otherwise, you're just right back where we are now: in a contractual negotiation about the limits of pricing between a producer and a retailer.

Paul Sparks said...

@ Nimala, I don't doubt you are correct. I do know that if not for publisher marketing I probably wouldn't have read Emily St. John Mandel's wonderful novel Station Eleven. I'm not here to argue my position. I'm not saying print books are better than ebooks, just that I prefer them.

@ Alan Spade, I'm not sure if you are implying that because I don't buy what Amazon is selling that I only like "anointed" book or that I don't like a variety of different books but if so, I think you need to rethink your pitch to buy ebooks. I consider myself a knowledgeable shopper. I don't just buy what the publishers are pushing. My book funds are limited so I am choosy about what I buy. But I'm done defending myself. I don't have a position to argue, I'm just relaying my thoughts as a consumer.

Alexandra Sokoloff said...

Fantastic debate between two of my favorite men and authors. Really a pleasure to see these two minds engaging.

I have to say Joe sums up my feeling on the issue here:

"Very few will get the breaks you got. And very few will get the breaks I got.

But my dream is more attainable for the masses than yours is. And positioning yourself against a company, Amazon, that makes those dreams possible, while endorsing publishers that exploit and harm the careers and pocketbooks of the majority of authors they work with, saddens me. Especially since anyone looking at the situation can easily see that Authors United is very much out to protect the rich and privileged at the expense of the poor and unlucky."

Yeah.

VARNBYRDE said...

Somehow many of the 'food-insecure' seem to find a way to have both cell phones and flat-screen TVs, neither of which guarantees books to be a priority in their lives.

This argument for the poor, Lee, is ludicrous.

Tracy Sharp - Author of the Leah Ryan Series said...

Thank you, Alexandra. You are much more elegant that I can ever hope to be in verbalizing the situation as I too, see it.

And a damned fine writer, too!

Nirmala (free spiritual ebooks) said...

@Paul: I appreciated your comments and found them to be quite reasonable. We all have our preferences, i.e. lots of people still prefer vinyl records.

I was just responding narrowly to one point you made, and trying to be helpful in pointing out something you might not have been aware of about some of the many changes in how publishers operate these days, especially regarding promotion and marketing.

I do hope you continue to comment on here and do not think you have to defend yourself from me.

Nirmala (free spiritual ebooks) said...

@Alan Tucker: Surprisingly, the $3000 ironing board I linked to is being sold by Amazon (not a third party seller). But they are discounting it right now to just $2465. What a steal! I really have a hard time comprehending how an ironing board can be worth that much, but then again for some people, price really does not matter.

But generally you are correct that a lot of overpriced items on Amazon are being sold by third party sellers. I remember also reading somewhere that some people put up a listing on Amazon that is really meant to just be a place holder while they get the item in stock or something, which explains the million dollar headphones and the like that I have seen. Then when the seller is ready to take orders, they drop the price (which did happen with the headphones I saw initially listed at $1,000,000 but that then a few days later were selling for $295).

A more nefarious explanation is that some extremely high priced items by third party sellers are part of a money laundering scheme using sales on Amazon to transfer illegal funds.

Alexandra Sokoloff said...

Tracy, I was quoting Joe! Who eloquently verbalized MY feelings on the subject!

Tracy Sharp - Author of the Leah Ryan Series said...

Joe always sums up the way I feel, whether he's being eloquent or not so eloquent. Usually I prefer the latter, because it means he has me falling over sideways, laughing!

I wanna be Joe when I grow up :D

Alan Tucker said...

@Nirmala, Ah, my mistake then on that, but I believe the argument still holds. Ebooks sold by Amazon are intended for Kindle readers (via device or app) and, as such, Amazon seeks to provide every reason possible for people to read on Kindle. Price and exclusivity are the two main weapons Amazon has against other ereading companies/devices.

twliterary said...

Joe (and Barry) -

I share many of your criticisms of AU, and have done so publicly. Disappointingly, there are two things Amazon has done that you have yet to clearly decry, which calls into question your impartiality and motivation in these debates:

1. Putting a banner on top of individual Hachette author’s individual book pages saying “would you maybe like to buy a different book?” On what planet would any author consider that fair or honorable or appropriate? Would Kellogg stand for it if Wal-Mart had shelf signs above their cereals saying "would you maybe like to buy a General Mills cereal"? No. And your failure to criticize Amazon for this is telling.

2. Delaying shipment of Hachette books. This is where your lack of experience in traditional print publishing shows. You have variously claimed (without any factual evidence) first that Hachette wasn't shipping in a timely fashion and then (when that argument was debunked) that Amazon didn't want to stock books they might not be able to sell (which is similarly silly). Even if EITHER of those arguments were true, Amazon (or any other major retailer) can get all Hachette's books from the major distributors (Ingram, Baker & Taylor - and Amazon already often does this) and have then in hand in *24-48 hours*. So Amazon's "that Hachette book will ship in 3-4 weeks" is ENTIRELY their own choice, for which they should be criticized.

You both are masters of changing the subject as a way of keeping the (often appropriate) pressure on whoever you're debating. But let's stay focused. Will you publicly criticize Amazon for these two egregious behaviors?

Scott Dyson said...

In an interview with the Costco Connection magazine, Stephen King said this: "Some writers have begun referring to Amazon as "The Death Star," and I don't buy that. Publishers will have to adapt to the technology, because the technology isn't going away." (http://www.costcoconnection.com/connection/201410#pg30) How does this go along with signing the AU letter?

BTW, Patrice, start at the beginning with THE KILLING FLOOR. Terrific thriller.

Talin said...

@twliterary
1) Walmart would likely just remove Kellogg from it's stores. It's pretty brutal with suppliers. Many grocery brands pay coop though to be in stores, which presumeably Hatchette isn't paying at the moment.

2) Two issues with this. One is that third party sellers can still ship instantly if they have it stocked(they can pay Amazon for warehouse space as an option btw), just Amazon isn't stocking the books in their warehouses.

Secondly, Amazon tries not to use distributors as much as possible. They have pretty much stated in the past that middlemen are a waste of money. That's why they have direct contracts with all the big publishers. The whole price fixing conspiracy forcing Amazon to change to Agency pricing couldn't have happened if Amazon had relied on/or switched to distributors instead of direct deals with publishers.

If Amazon wasn't willing to switch then, I doubt they will for 1 contract negotiation.

Joe Konrath said...

1. Putting a banner on top of individual Hachette author’s individual book pages saying “would you maybe like to buy a different book?”

Hi Ted. I've heard about this happening, but haven't seen it. I've even gone so far as to spend five minutes clicking on Hachette authors on Amazon. I didn't see any pop-ups or banners.

That said, I did opine on this in a previous blog post.

http://jakonrath.blogspot.com/2014/09/nonsense-united.html

1. Should Amazon be allowed to do whatever it wants to on its own website? Sell what it wants to, for prices it wants to? Sell ad space if it wants to? Stock what it wants to? Ship how it wants to?

2. If a retailer isn't behaving like the supplier wants it to behave, should the supplier fight for better terms? Leave? Negotiate in good faith? Capitulate?

For some reason, Authors United believes that publishers have the right to tell Amazon, Bezos, and the board of directors, how to run their store.

Now, the US has a history of third parties trying to intimidate retailers. But at least the mob did it effectively. Authors United seems to be using the intimidation tool of shame.

Shame doesn't work. I know this for a fact, because I've repeatedly shamed Authors United signatories to stop their nonsense, and they haven't.

On what planet would any author consider that fair or honorable or appropriate?

So now publishers not only get to dictate how Amazon prices and sells merchandise, they also are allowed to force what is "honorable and appropriate" on a retailer?

I can think of two businesses, Chik Fil A and Hobby Lobby, who espouse ideologies I don't agree with.

Guess what? They're allowed to be as homophobic as they like. Their businesses, their rules, and I support their freedom to be ignorant jerks.

Why? Because I fear the opposite more. I fear not being able to say or do things because someone objects to them.

Would Kellogg stand for it if Wal-Mart had shelf signs above their cereals saying "would you maybe like to buy a General Mills cereal"? No. And your failure to criticize Amazon for this is telling.

You're right. It's like a grocery store selling their generic version of cereal right next to the Kellogg's version.

Wait, that's not quite what you were saying.

Okay, it's like a grocery store promoting Post Raisin Bran with a huge sale display, right next to the Kellogg's Raisin Bran. I mean, that would never happen, right?

Broken Yogi said...

To all those asking why Amazon has any right to dictate a price to publishers: leaving aside the fact that this is just a contractual negotiation between a producer and a distributor, you could indeed reasonably argue that Amazon has no right to dictate to Hachette what prices it should charge

This is a straw man. I never said Amazon has no right to dictate prices on ebooks, only that it's not it's business to do so. In other words, it's not in Amazon's business model or its direct interests to try to dictate the suggested retail price of anything it carries.

It would be different if Amazon were Costco, which carries only a limited stock of items. But that's Costco's business model, not Amazon's. Amazon's model is that it carries just about everything, especially in books. It stocks according to what sells, but it offers everything, regardless of the price the supplier offers. It doesn't punish suppliers who set their prices too high. Amazon's customers do that.

And for the book industry in particular, retailers have never demanded any particular prices from publishers, just particular margins. If Amazon is just arguing about margins, fine, have at it. But if it is demanding that suggested retail prices be lowered, that's just not its business model. If it is trying to change its successful business model in midstream, it has the right to do that, but I think it's a mistake.

We all know what this is really about, and both sides are being disingenuous. The Big Five want to protect print sales, which they control, by keeping ebook prices higher than the market would dictate on its own. It doesn't want to come out and say that, so it obfuscates the issue with all kinds of collaterial lies and deceptions. Amazon, conversely, wants to accelerate the migration to digital, by lowering ebook prices. So it is trying to force Hachette to accept 9.99 as the highest price on an ebook.

Hachette and the other Big Five of course resist that, because it would destroy their business model. Now, I have to admit that I'm fine with destroying their business model, but I can understand why they are not, and why they are sticking to their guns, and likely will to the end. Amazon cannot do that, however, because their business model is not at stake here. They can continue along just fine with a modified agency pricing model that at least allows some discounting. They can do just fine with somewhat higher ebook prices in the short run, and let the marketplace reward those who price their books best.

So it's literally not their business. They need to be more patient, and goose up their self-publishing terms if anything, to make it more attractive to midlist authors. That's their business model, and it's actually helped by the Big Five offering higher ebook prices.

Joe Konrath said...

2. Delaying shipment of Hachette books. This is where your lack of experience in traditional print publishing shows. You have variously claimed (without any factual evidence) first that Hachette wasn't shipping in a timely fashion and then (when that argument was debunked) that Amazon didn't want to stock books they might not be able to sell (which is similarly silly).

Ted, I've quoted the Amazon statement several times.

"For titles with no stock on hand, customers can still place an order at which time we order the inventory from Hachette -- availability on those titles is dependent on how long it takes Hachette to fill the orders we place. Once the inventory arrives, we ship it to the customer promptly."

Can you point out to me where this was debunked?

Even if EITHER of those arguments were true, Amazon (or any other major retailer) can get all Hachette's books from the major distributors (Ingram, Baker & Taylor - and Amazon already often does this) and have then in hand in *24-48 hours*.

Are you sure Amazon does this? I may be wrong, but I was under the impression that Amazon has a whole bunch of huge warehouses so they no longer need to use distributors. Perhaps I'm misinformed, but I thought Amazon dealt with publishers directly.

So Amazon's "that Hachette book will ship in 3-4 weeks" is ENTIRELY their own choice, for which they should be criticized.

Does it actually take 3-4 weeks? Have you timed it?

Tangential story, I recently was in Chicago to take two friends to the top of the Sears Tower (now Willis Tower). We were quoted a 90 minute wait. I knew this was BS, because I worked in restaurants for years. You always quote a longer times to seat customers, to CYA. If you quote thirty minutes, and it takes fifteen, the customer is grateful. If you quote ten minutes, and it takes fifteen to get seated, the customer is irate.

If Amazon has no stock in their warehouses (why would they with no contract?) they must depend on Hachette to fulfill orders rather than their own team.

What if Amazon said 1 week, and it took 10 days? Angry customer.

That said, does Amazon perhaps have a right to be a little angry with Hachette? If I were Amazon and 5 of my wholesalers illegally colluded and forced me to accept a pricing structure I didn't want, and the DOJ ruled against them, when it came time to renegotiate my contract with said wholesalers I'd probably be a tad bit vindictive.

As an author, do you know who I'd be angry at? My publisher, Hachette, for being unable to come to terms with the biggest bookseller in the world. I was a Hachette author, and one of the reasons I signed with them was because they have far reaching distribution. This is Hachette's failure, and that's whom authors should blame.

Joe Konrath said...

You both are masters of changing the subject as a way of keeping the (often appropriate) pressure on whoever you're debating. But let's stay focused. Will you publicly criticize Amazon for these two egregious behaviors?

Ted, can you point out any instance where Barry or I changed the subject rather than address an opposing point? Any instance at all?

Both of the points you brought up, I've opined on. You can certainly disagree with me, and pose counterpoints, but please don't infer I'm hiding from any facts.

twliterary said...

Thanks, Joe - your response is clear. I'll leave it to each reader to decide what they think it indicates about your larger views and motivations on this topic. Luv ya.

twliterary said...

Oh, here's screenshot of Amazon offering competitive books atop an author's book:

https://twitter.com/EvilWylie/status/464805731536228352

They appear to have stopped doing it after all the deserved criticism.

Chris Armstrong said...

Hi Lee - Earlier you mentioned that many self-pubbers partake in too much posturing considering it is a business they don't participate in.

I see that type of remark from the likes of Shatzkin as well. It points out to me a base assumption on the part of some industry "insiders" - the assumption that if you write a book, edit it yourself or hire editors, format it, package it with a cover, and put it up for sale in the same marketplace as everyone else - you ultimately still lack the cred to comment on publishing.

From what I've seen, the people that do these things actually often know much more about publishing. Maybe it isn't publishing as it's done by the big 5, but it's publishing.

Nirmala (free spiritual ebooks) said...

Broken Yogi said: "So it is trying to force Hachette to accept 9.99 as the highest price on an ebook."

I am not sure this is correct as Amazon has clearly stated that some ebooks should be priced higher than $9.99. My guess is that they are trying to get a higher margin on ebooks priced higher than $9.99 to discourage (not prohibit) ebooks priced higher, similar to what they already do on KDP where the auhor's share drops to 35 % on ebooks priced higher than $9.99.

If this is correct, then it is still technically a negotiation on Amazon's part about margin, and not about a ceiling for ebook prices. However, depending on what the actual margin is on ebooks at the various price points, it could put a huge damper on higher priced ebooks, so your overall sens of Amazon's agenda would still be pretty correct.

Joe Konrath said...

Can you give me another example, Ted?

The screenshot you provided came from someone notoriously stupid, vindictive, and narrow-minded. Seriously, read his feed. As polarizing a figure as I am, I've only had to block a few people on Twitter for being impossible to deal with, and he was the first. I wouldn't put it past him to make things up, and any teenager can use Photoshop.

Now I'm not saying Amazon didn't do this. I've heard it from several sources (without any evidence, I might add). It could be true, and I'm willing to accept it as a truth. But at this point it doesn't meet my definition of "beyond a reasonable doubt".

That said, AU wrote in its last letter that Amazon is "using pop-up windows to cover authors' pages".

The screenshot you provided isn't an example of that. No part of the author page is covered.

twliterary said...

Are you kidding me Joe? That's the kind of shucking and jiving I was referring to. Don't EVER tie me to AU, whom I have criticized endlessly - *I* didn't say anything about a pop-up. I did say banners atop pages, of which that image is an actual screenshot, identical to what I saw with my own eyes, as did many many many others. 'That could have been Photoshopped' is utter BS and proves my point about your sincerity in these discussions. I'm outta here...

Joe Konrath said...

I Googled, and found this:

http://www.maggiemeade.com/amazonWBFG.jpg

That is a Hachette title.

Joe Konrath said...

'That could have been Photoshopped' is utter BS

I've dealt with him, Ted. It isn't utter BS. The guy is a crackpot.

FWIW, when I heard about iPhone 6's bending, my first reaction was, "Wow, major screw-up, Apple."

That reaction lasted about ten seconds. Then I wondered why I was believing something without getting more facts.

If the only facts you have are AU's letters and EvilWylie, you need to dig a little deeper. Like I just did, finding the Margaret Meade jpg.

My mind remains open, brother. That I require proof before I believe something is a strength, not a weakness, and any reasonably smart person knows you always have to consider the source.

Joe Konrath said...

Don't EVER tie me to AU

Where did I do that?

I'm referring to the AU letter, and I thought I was clear that I was. I'd welcome seeing a pop up that covers an author's page. I'm willing to believe it if I see it.

I'm willing to believe anything with ample proof, even if it changes my mind.

Broken Yogi said...

Nirmala, you may be right that Amazon is trying to create a "margin tax" on books higher than 9.99. But again, my same criticism applies. Why is that Amazon's business? Are there actually higher costs on Amazon's part if ebooks are priced higher than 9.99? Of course not. So there's no real business reason to have margins change at that level. In fact, the opposite might be argued to be the case, that margins should go down when prices are above 9.99.

I criticize Amazon for doing this with KDP books, when there's no sane reason for it there either, other than to use as pressure on the Big 5 perhaps, using KDP as a precedent. But in and of itself it makes no sense whatsoever. KDP authors have learned that the best price points for profits are lower than 9.99 anyway. And there certainly are some books that deserve to be priced higher. Particularly art books, but also scholarly and other works of greater length and difficulty than a rushed off genre novel. So why increase margins above 9.99 for anyone?


Likewise, there's no sane reason why KDP margins should be higher on books priced between .99-2.99 also. If anything, that hurts self-published authors, and Amazon itself. Perhaps a compromise would be if Amazon included in KDP the ability to do promotional discount campaigns of limited duration, in which prices could be dropped to those levels without a worse margin bite.

Joe Konrath said...

But in and of itself it makes no sense whatsoever.

Really?

If Amazon wants to speed the adoption of ebooks and sell a lot of Kindles, it makes perfect sense to want ebooks to be inexpensive.

Amazon also has massive amounts of data to show the sweet spot for ebook pricing (the point where profits and units sold meet for maximum revenue).

Those are two sensible reasons Amazon wants books priced below $9.99.

As for 35% under $2.99, I'd love to see that royalty rate increase.

Edward M. Grant said...

This is a straw man. I never said Amazon has no right to dictate prices on ebooks, only that it's not it's business to do so. In other words, it's not in Amazon's business model or its direct interests to try to dictate the suggested retail price of anything it carries.

I don't see where Amazon is doing that. As I understand it, the issue is that Big Pubs want to be able to control the price Amazon sells their ebooks for (while simultaneously complaining that they don't discount their print books enough). Hence the whole agency model kerfuffle.

Clearly Amazon is the retailer, and Amazon is the one who should be setting the retail price. Publishers are the producers, and should be setting the price they sell ebooks to Amazon for. Though, obviously, Amazon should be free to refuse to carry their products if they think that price is too high.

I'd be more than happy if Amazon would give me $9.99 for my ebooks, but retail them for $0.99.

Lee Child said...

Chris Armstrong: No argument from me. I think the best of the self-published authors are superb at their craft and know all there is to know about self-publishing, and I have often said so publicly. But let's turn that around - I also think the best trad-published authors are superb at their craft and know all there is to know about trad publishing.

Can you find a self-pubber who has said that? Can you find a blog where trad-pubbed authors sit around hooting and jeering and sniggering and scoffing at self-publishing?

Joe: You're on shaky ground about the shipping delays. Amazon came right out and said it, in their "Orwell" letter: "We took steps to reduce availability of their books." Pretty definitive, and active rather than passive.

And finally, in 100+ comments, two tentative answers to my question: Amazon wants downward price pressure to lock in Kindle sales and usage. They'd be better advised to make publishers their partners in that endeavor, rather than use strong-arm tactics.

w.adam mandelbaum said...

Delivery systems for media consumption change with technological advances, eliminating for practical purposes, certain older less convenient technologies.That is so self-evident it approaches cliche'. Your love for printed books will be diminished when you have to pay to move them. One can get classics for free electronically from Project Gutenberg. Cheap electronic delivery systems are not only present competitors with print, but shall be the future successors. The rest is but noise.

Lee Child said...

Mr Mandelbaum: If it's an inevitability, why not let it happen naturally and organically, led only by customers' surprise and delight, rather than by manipulating the market with ugly disputes? I think the organic way would produce more durable results, and I think the ugly way betrays hints of doubt and insecurity.

twliterary said...

Joe, facts are stubborn things. Here is incontrovertible proof that Amazon was offering competing books ABOVE individual Hachette authors books:

Yahoo:
https://finance.yahoo.com/news/amazon-takes-away-pre-orders-133212546.html

Unimpeachable publishing source:
https://twitter.com/jasonpinter/status/469829659945730049/photo/1

The NY Times:
http://www.nytimes.com/2014/06/02/business/media/amazon-absorbing-price-fight-punches.html

Enough. Deal with the facts, not the messenger. You are lying to yourself and proving my point if you refuse to acknowledge this FACT of what Amazon was doing and comment publicly accordingly.

w.adam mandelbaum said...

Mr. Child--Since you are president of ITW which I just joined by reason of my old trad published hardcover from St. Martins...okay will do. :-)

Edward M. Grant said...

so, just as people ask me to disavow AU for what it says, will you disavow your indie peers for their constant bitching and moaning about a business they're not actually in?

Nuts are nuts, but the rational ones might stop that, if people in the trade publishing business didn't keep attacking Amazon, which is where most of us make most of our money. Are they really supposed to just ignore those who are trying to reduce their income? Surely that makes it their business?

Back on the poverty front, I have over four thousand free ebooks on my Kindle account. No Lee Child books, few trade published, and probably 90% of them aren't really worth reading, but that would still leave four hundred that are. A poor person with a smartphone or cheap tablet could probably find more than enough free ebooks on Amazon to keep them entertained for years without spending a cent.

Can you find a self-pubber who has said that?

I'm certainly happy to say that my favourite trade-published writers are superb at their craft... that is, after all, why I read them. I've no idea whether they know all there is to know about trade publishing.

Can you find a blog where trad-pubbed authors sit around hooting and jeering and sniggering and scoffing at self-publishing?

Self-publishers have been scoffed at for years, though more by publishers, agents and wannabe trade-published authors than successful trade-published authors. Go to any sizable writing forum and you'll still find plenty of people telling others that trade publishing is the only real kind of publishing, or that all self-published books are crap.

Lee Child said...

For Alan Spade at 5:35a.m. - Specifically, I think Hachette will regard this as a blank year when judging authors' performance. Like a strike year in baseball, perhaps. But generically, and to use the baseball metaphor again, if a prospect becomes a bench player and doesn't do much, then sure, he gets sent down. Afterward he might complain - "Wasn't fair! Coach put me in against tough pitching! I got no support!" But hey. I would imagine self-reliant entrepreneurial types would be at home with that. No one is owed a living.

And as far as trad-pub's "infamous" practices ... motes and beams, my friend. In our contracts we don't have: "We reserve the right to change the terms of this agreement at any time in our sole discretion ... you are responsible for checking for updates." That's hardly a contract at all. We're not overcharged 200,000% for delivery ... in fact we aren't charged at all. And so on.

This all should be a choice, not an ideology, and both paths are equally good and bad. My way suits me and many others - including newbies aiming high - and your way suits others.

Lee Child said...

Edward M. Grant: you said, " ... the rational ones might stop that, if people in the trade publishing business didn't keep attacking Amazon, which is where most of us make most of our money."

This is a major disconnect, I think. The Big 5's trading terms can't possibly impact a self-pubber's ability to make money through Amazon - unless, per Amazon's own desire, we become direct competitors on price. Which would be disruptive to you. I remember a comment on Joe's blog from some time ago, in which a librarian experimenting with free e-book loans said, in effect, "When price isn't a factor, there's no demand for self-published works ... everyone wants the established brands."

Far into an all-digital future, sure, old brands will have receded into memory, but you'd have a rough few years. I don't understand why you aren't more appreciative of your current price advantage.

Lee Child said...

Mr. Mandelbaum: Very glad to have you in ITW, but it's worth pointing out that self-published authors are equally welcome under identical terms and status, both theoretical and practical. Google Joanna Penn's blog for her impressions.

John said...

AU should appoint Lee Child as their representative to go on talk shows. The last time I saw an AU spokeswoman, she was ready to commit seppuku because someone called her a "special snowflake." The poor woman looked like she had forgotten her own name, much less make a coherent argument against Amazon.

Joe Konrath said...

Pretty definitive, and active rather than passive.

Point taken.

Amazon wants downward price pressure to lock in Kindle sales and usage. They'd be better advised to make publishers their partners in that endeavor, rather than use strong-arm tactics.

Amazon has half a million exclusive Kindle titles, and their publishing partners colluded to thwart Bezos's business plan. It will be interesting to see how much Amazon decides it needs legacy publishers, and vice versa.

Thanks for continuing the comments. It's helpful to have a different viewpoint.

Lee Child said...

John, to be fair, she was AG, not AU.

Joe Konrath said...

Joe, facts are stubborn things.

I love facts, Ted. Which is why I nicely asked you for some from reliable sources.

Thank you for providing those links. It's good to have those things I heard confirmed.

Deal with the facts, not the messenger.

C'mon, Ted. If I sent you a picture of bigfoot, taken by someone who has attacked you repeatedly online, would you immediately believe in bigfoot, or would you want more proof than that?

It is now clear in my mind that Amazon was adding banners to books.

I'm curious if, as AU said, Amazon was also "using pop-up windows to cover authors' pages."

Does anyone have a link to that happening?

Chris Armstrong said...

Thanks Lee for your response.

The point I think I was dancing around is that the distinction between trad and self pubbers and their expertise is largely immaterial.

In the end, they are producing the same end result. The writer and the reader are the principles in the relationship.

There's a common theme on blogs across the spectrum of trad people telling self-pubbers they know nothing about the business. My point would be that the business is selling books to people. And the way they choose to do it is their choice but not the only way nor is it the way things will probably done in the future.

Randall J. Morris said...

It seems to me that Lee is making the opposite argument of many authors in AU. He compared books to ironing boards and other Amazon products. AU, however, insists that books are not razor blades, diapers, bricks, etc.

I agree with some of Lee's points here, I just think it's almost the polar opposite of what AU is claiming in its letters.

Lee Child said...

Joe, back at ya. You say, "It will be interesting to see how much Amazon decides it needs legacy publishers, and vice versa."

You bet. As I said before, the "need" on both sides is more complex than it appears. It would be a huge step for Bezos to give up on the "everything" mission, and it would be a huge step for publishers to actually get tough with a retailer. There's always a first time, I guess.

Lee Child said...

Chris Armstrong: You say, "There's a common theme on blogs across the spectrum of trad people telling self-pubbers they know nothing about the business."

About the trad business, perhaps, and often that's richly earned. But equally self-pubbers - like Howey, or PG - say, "It's amazing how little these big authors know about their business." Which is crap.

If indeed we're all doing the same thing - which of course we are - wouldn't it make sense to listen to people who sell *more* books to *more* people than you?

Barry Eisler said...

Hi Ted (twliterary), it looks like Joe has already responded to most of your points. FWIW, a few additional thoughts, speaking just for myself…

You said, "there are two things Amazon has done that you have yet to clearly decry, which calls into question your impartiality and motivation in these debates.” I guess a lack of impartiality and questionable motivations could be one explanation for a failure to decry. But another possibility is just that I don’t find the acts in question to be as censorious as you do. Let me try to explain…

"Putting a banner on top of individual Hachette author’s individual book pages saying 'would you maybe like to buy a different book?'”

You’ve mentioned this to me before and I remember laughing and agreeing it was nasty in an almost childish way — a bit like the British calling syphilis “the French disease.” But I don’t see it as unethical, immoral, dishonorable, or anything else I can think of that would mean a failure to decry means ipso facto a person's impartiality and motivations must now be called into question.

In fact, I’ve never claimed to be impartial in this debate, and indeed have been at pains many times to try to lay out the basis for why I favor Amazon in this battle. As for my motivations, I’m not really sure what you mean here — that I have ulterior reasons? That Amazon is rewarding me, or I’m trying to curry favor, that kind of thing? — but I’ve reached a point where I don't mind that much if people speculate about my motivations. It just seems to come with the territory, it can be kind of interesting, and I think anyone exposed to my opinions can probably decide how much credence they deserve or how much they ought to be discounted based on possibly questionable motivations.

You also asked whether I thought the banners tactic was appropriate. Look, business ain’t beanbag, to paraphrase the famous observation about politics. I’d call the banners a strong shot across the bow between two companies locked in a pretty contentious contract negotiation. I’m tempted to cite Lee here and note that pretty much anything Amazon does to Hachette can’t be *that* big a deal because Amazon needs Hachette more than Hachette needs Amazon. But I’d only do that to tease a little, because in fact I respectfully believe Lee’s got this one backwards. If he’s right though, it probably stands to reason that Hachette can take care of itself, even against a tough tactic like the banners.

Barry Eisler said...

to Ted (twliterary), continued...

The second thing you brought up was, "Delaying shipment of Hachette books. This is where your lack of experience in traditional print publishing shows.”

You’re right about my lack of experience in traditional print publishing, and I think it’s that lack more than anything else that’s kept me from opining on this aspect of the Amazon/Hachette dispute. If I’m wrong and I’ve ever take a position on it, please give me a cite and I’ll eat my words, but for all the back-and-forth commentary I’ve read on this topic — including in the comments section of this very post — I’ve never felt I really adequately understood what was going on. Since I try not to opinion on matters on which I feel I have an inadequate understanding, I’ve steered clear of this topic. Of course, as I noted above, if anyone wants to conclude that my silence is instead something partisan or otherwise nefarious, it’s okay. There’s probably not much we can do other than to point out our respective views, agree to disagree, and let other people decide for themselves.

I will say this: even if you’re right about what you’ve said in various comments here — essentially, that Amazon is in full control of paper fulfillment and could ship any Hachette promptly if it wanted to — I’d still classify what they’re doing as tough negotiating, and nothing beyond the pale. It does suck to be on the other end of someone else’s negotiating leverage (I know, having done eight books with legacy publishers!), but I don’t think the application of negotiating leverage is ipso facto the kind of thing so “egregious” that all good people must decry it lest they reveal themselves to be dishonest.

Of course, none of us is as objective as we like to pretend, and probably the fact that I think Amazon has been a tremendous force for reform in the publishing industry colors my perceptions of various things they do. I think this is natural and probably unavoidable, and I’m grateful to you and anyone else who takes the trouble to pressure-check my arguments because the only way I know of by which we can manage our biases is by trying to be aware of them. So sincerely: thank you.

You also said, "You both are masters of changing the subject as a way of keeping the (often appropriate) pressure on whoever you're debating. But let's stay focused.”

Possibly I’m flattering myself, but I feel like I always try to stay focused. Have I done so here to your satisfaction? If not, let me know where I’ve fallen short and I’ll try again. It’s been my experience that sometimes when people seem to be “shucking and jiving,” it’s not because anyone is being duplicitous, but just because they’re somehow talking past each other. It’s frustrating when it happens, but I wouldn’t call it automatic evidence of bad faith, either.

As for this alleged tendency to change the subject, that would indeed be an annoying and counterproductive way to engage. If I’m doing it, it’s entirely unconscious, and if you could point out someplace where it’s happened, I’d be grateful. Certainly if I’m a master of this technique as you say, it shouldn’t be hard to find at least a few instances of where I’m doing it!

Actually, I think Joe already asked you the same question. If you don’t respond, would that be a form of changing the subject? ;)

Okay, okay, just teasing on that last point. But kidding aside, if it does seem like I have a tendency to change the subject, let me know how/where so I can try to do better. Thanks again.

twliterary said...

Joe, now that you've acknowledged the facts you somehow managed to avoid answering the original question: 'Will you publicly criticize Amazon for this egregious behavior?'

Will you criticize Amazon for putting enticements to buy different books on top of individual authors' individual book pages? No one is questioning their legal right to do so; the question is do you think that was fair, appropriate, and demonstrative of a supportive attitude toward individual authors?

Barry Eisler accuses Amazon critics of "Amazon Derangement Syndrome" - I'm trying to ascertain whether you have the inverse syndrome or are you willing to call out Amazon when they engage in what can fairly be called jerkish behavior? (And note that Amazon themselves implicitly acknowledged this, by removing those banners after facing widespread criticism.) What say you?

Barry Eisler said...

Lee said:

"In our contracts we don't have: 'We reserve the right to change the terms of this agreement at any time in our sole discretion ... you are responsible for checking for updates.' That's hardly a contract at all.”

Hi Lee, I’d agree that such a thing would be hardly a contract at all if the author didn’t have the right to walk away from it at any time for any reason. That’s a pretty important distinction between a traditional publishing contract and a KDP contract, and probably worth mentioning.

"We're not overcharged 200,000% for delivery ... in fact we aren't charged at all.”

I’m not sure what you mean by the delivery charge, but I don’t think it’s accurate to suggest that anyone acquires publishing services for free. In the traditional world, an author pays a flat fee of about 85% of revenues and all services are (at least theoretically) paid for via that revenue split. And self-published authors typically pay 30% for access to a digital distribution platform. In neither case (indeed, in no case, as far as I know) are authors not being charged at all; the nature of the charges (and the services) are just different. More on this at the link below…

http://jakonrath.blogspot.com/2014/02/eisler-publishing-is-lottery-konrath.html

Big thanks to you and Ted (twliterary) for spending so much time engaging here. I think everyone benefits from the additional and different perspectives.

Joe Konrath said...

But kidding aside, if it does seem like I have a tendency to change the subject, let me know how/where so I can try to do better.

This reminds me of a story about baseball.

Chris Armstrong said...

Hi Lee - Yes, I agree that self-pubs stand to learn from trad pubs. If you look at most self-pub blogs, one of the cardinal rules is to make yourself indistinguishable from them - in terms of branding and quality - when it's done well.

I don't equate listening to the advice of trad pubbers with being silent and having nothing to contribute. Which is frequently implied. In the example you gave of Howey, so he's written a best-selling book, negotiated with trad pubs, and worked as a bookseller. But in the eyes of trad, he's still a nobody knowing nothing. This creates resentment, which I will try not and direct at you.

Joe Konrath said...

'Will you publicly criticize Amazon for this egregious behavior?'

Ted, are you reading my full responses?

I talked about this in an earlier blog post, and linked to it and repeated it upthread:

1. Should Amazon be allowed to do whatever it wants to on its own website? Sell what it wants to, for prices it wants to? Sell ad space if it wants to? Stock what it wants to? Ship how it wants to?

2. If a retailer isn't behaving like the supplier wants it to behave, should the supplier fight for better terms? Leave? Negotiate in good faith? Capitulate?

For some reason, Authors United believes that publishers have the right to tell Amazon, Bezos, and the board of directors, how to run their store.

I don't find this egregious, Ted. And even if I did find it egregious, like I do with Chik Fil A and Hobby Lobby (which I also mentioned upthread), I support Amazon's right to do this.

Joe Konrath said...

Barry Eisler accuses Amazon critics of "Amazon Derangement Syndrome" - I'm trying to ascertain whether you have the inverse syndrome or are you willing to call out Amazon when they engage in what can fairly be called jerkish behavior?

I've called Amazon on jerkish behavior. I've done so on my blog, and to Amazon directly. One instance that comes to mind is when Amazon removed reviews. I blogged about that repeatedly because I considered that wrong.

(And note that Amazon themselves implicitly acknowledged this, by removing those banners after facing widespread criticism.) What say you?

I'd say there's a precedent. They removed thousands of reviews because of that asinine No Sockpuppets Here petition. If they stopped doing ads on Hachette titles because they got flak for it, that makes sense.

Amazon isn't perfect. The 1984 fiasco really harmed the good will they'd built up. I talked to the man who actually made that call, and he regretted it. We've all read the stories of warehouse workers collapsing. I'm glad stuff like that is brought to light.

I'm only pro-Amazon in the sense that I'm pro-author. I don't have Legacy Publisher Derangement Syndrome, or Amazon Infatuation Syndrome, or any syndrome. When someone does something I see as harmful in the publishing world, I blog about it as a public service.

Barry Eisler said...

Ted (twliterary) said,

"Joe, now that you've acknowledged the facts you somehow managed to avoid answering the original question: 'Will you publicly criticize Amazon for this egregious behavior?’ "

Ted, maybe I’m being biased (again?), but I don’t think that’s a fair characterization. Joe told you why he had some doubts about the single screenshot you provided; you did a nice job of providing additional evidence; Joe immediately acknowledged the apparent un-impeachability of the follow-up and thanked you for it. I don’t know what’s to be gained by referring to an exchange like that as an attempt at avoidance.

"Barry Eisler accuses Amazon critics of "Amazon Derangement Syndrome…”

Well, just to be clear, not *all* Amazon critics, just some. That is:

"This is probably a good place to explain what I mean when I sometimes refer to “Amazon Derangement Syndrome.” I’m not referring to all criticisms of Amazon, or even to most. For example, I think Amazon’s cutting off Wikileaks from Amazon Web Services at Joe Lieberman’s request was pernicious, shameful, and cowardly. I’m glad there’s media scrutiny of conditions in Amazon warehouses. And while still far better than anything I’ve ever seen in the legacy world, Amazon Publishing’s contracts are showing increasing legacy-like lard and legacy-like author-unfriendly clauses. Certainly I don’t think these criticisms are deranged — after all, I’ve made them myself.

"Instead, I’m talking about a species of 'damned if you do, damned if you don’t' criticisms. A quick example: a few years ago, the Seattle Times ran a series of articles that I thought were, if not deranged, then at least seriously unbalanced. In one, the reporter observed that Amazon had purchased lots of downtown office space, but had nefariously hidden the purchases by choosing not to put Amazon signage on any of the buildings! I chuckled when I read it, because I was pretty sure that, had Amazon put out the nefariously missing signage, the headline would have read, 'Amazon Flaunts New Dominion of Downtown Real Estate.'

"What does that mean? It would seem to mean that no matter what Amazon does, it’s proof of the company’s evil. No matter what might be at issue (and again, with regard to Hachette, we don’t really know), if Amazon has a dispute with a legacy publisher, Amazon must be wrong and the legacy publisher must be right. And the only thing Amazon can do to become right in turn is to toe the legacy line."

"That’s not logical thought. It’s religious dogma. Probably not a coincidence, then, that Hachette defender Douglas Preston describes a business dispute with a 'blood money' religious reference, or that an unhinged Panda writer outright called Amazon’s offer '30 pieces of silver' with authors as 'Hachette’s personal Judas.' I’m not saying these people view Hachette authors literally as the apostles and Hachette literally as Jesus Christ. But they do seem to think the author/publisher relationship properly goes far beyond just business. For the references to be coherent, there has to be a perception of a substantial degree of intimacy, even of sacredness, in these relationships. Meaning, apparently, that by not buying into the faith, Amazon must be committing heresy…"

http://barryeisler.blogspot.com/2014/07/amazon-cancer-cure-stunt-to-

I don’t think a failure to decry what strikes me as tough but not unfair negotiating tactics between a retailer and supplier is like that, either qualitatively or quantitatively, but it’s also true our perceptions of what’s fair tend to be warped by who we favor in a fight, and some of that might be coloring my conclusions here.

Rob Gregory Browne said...

Amazon posting "Similar items at lower prices" does not seem like such a heinous act to me. In fact, as a reader, I look at it as a service.

This merely tells me that in addition to the book I'm interested in, I can find that same type of book at a lower price. So now, if these lower priced books appeal, I can buy more books in addition to this one and don't have to break the bank while doing it. Everybody wins.

Despite Amazon's supposedly "evil" motivation, I don't see this as harmful because these books aren't really competing with each other.

Joe Konrath said...

but it’s also true our perceptions of what’s fair tend to be warped by who we favor in a fight, and some of that might be coloring my conclusions here.

I think it is natural to give the benefit of the doubt to those who have treated us well.

But there's a line. It makes sense that Douglas Preston formed Authors United. It also makes sense that Lee Child supports it. They both benefit greatly from the legacy industry, and don't want Amazon to become the only publisher left standing.

Then there are the Bookholm Syndrome authors. They haven't benefited from the current legacy system, but they want to. I remember fully supporting my publisher when I signed my first deal. I was enamored with them, and my blog posts reflected that attitude.

Then, when things soured, I stayed neutral in public. I feared not ever being able to sign another deal if I was openly critical. So I remained positive and didn't say anything negative.

But once some competition to the system arrived, in the form of Amazon, I began to speak openly about shitty legacy practices.

I was one of the first (or the first?) to post my earnings and sales figures. Previously, that was only done in secret at conference bars.

I was one of the first to talk about coop money. One of the first to talk about unconscionable contract terms like rights for the author's life plus 70 years, low ebook royalties, poor reversion clauses, and non-competes.

Also, as I said in my previous post, I don't plan on relying on Amazon to take care of me.

Barry Eisler said...

Okay, gonna take a chance on being accused of changing the subject by pointing to this fascinating dispute between Netflix and some movie theater chains:

http://www.nytimes.com/2014/09/30/business/media/with-crouching-tiger-sequel-netflix-takes-aim-at-hollywood.html?_r=1

There is some serious negotiating hardball at work here, and though I generally favor Netflix's position because it aligns more with what customers want (no windowing), I wouldn't say the chains are being bullies, egregious, dishonorable, etc in banding together to refuse to show the movie Netflix is bankrolling in an attempt to protect their distribution network.

That's my general approach to business disputes, and I think I'm applying it reasonably impartially to Amazon/Hachette. But of course I could be wrong, too.

Andrew Shaffer said...

Happy to have been your first block on Twitter, Joe. And no, I didn't Photoshop the image of Amazon's banner advertisements. I don't know how long the banner ads were up for. It seems as soon as the Times and other sites picked up on the story, they disappeared. Maybe they realized how petty they looked; maybe they weren't converting sales as expected. In any case, they weren't technically pop-ups and they didn't "cover authors' pages." Amazon doesn't use browser pop-ups as part of their web design, so it would strike me as odd if they did so with authors' pages at any point in their standoff with Hachette. Hope this clears things up.

Joe Konrath said...

Hope this clears things up.

Well, damn, don't I look like an idiot?

:)

Thanks for stopping by, Andrew.

Andrew Shaffer said...

No, you're right to be skeptical. You can't trust anyone who makes things up for a living. I only stopped by because I read everything Lee Child writes -- including blog comments.

Joe Konrath said...

I only stopped by because I read everything Lee Child writes -- including blog comments.

Well, you're welcome to come back. I've been holding the opinion that you're a jerk, but right now you're changing my mind.

Broken Yogi said...

Joe,

If Amazon wants to speed the adoption of ebooks and sell a lot of Kindles, it makes perfect sense to want ebooks to be inexpensive.

Of course Amazon can pursue that long-term goal, but that's not a reason in and of itself to limit prices. It's an attempt to steer the rest of the industry in a direction the Big Five doesn't want to go. There's no practical reason that Amazon can't let the publishers sell their books at whatever price they want, even one above 9.99. The books belong to the publisher, after all, not Amazon. Amazon can certainly set the prices it likes on its own Apub books, but it really has no business setting the price on books published by others. Now, of course it can throw its weight around and try to do that for strategic reasons, but the justification for that doesn't seem sound. And when push comes to shove, Amazon simply can't do without the Big Five, so it will eventually have to cave, as it did in 2010.

Amazon also has massive amounts of data to show the sweet spot for ebook pricing (the point where profits and units sold meet for maximum revenue).

Yes, and sharing that information with publishers and KDP authors is very kind of Amazon to do. Really, I'm not being sarcastic, I think Amazon is probably very much right on these numbers. But that doesn't mean it's right for them to force publishers (including self-publishers) to limit their ebook prices to 9.99, with the threat of higher margins if they exceed that price. If publishers, for reasons of their own, in protection of their own interests, including protecting their print distribution, want to set higher ebook prices than the market numbers say is optimal, and use windowing if they like as well, that's their perogative, not Amazon's. Amazon is just a retailer, it isn't some arbiter of the entire industry. If they don't want to accept the Big Five's terms, fine, let them drop all those titles and see how they do. I think that would be incredibly stupid, but they can certainly do it if they like. But they simply can't expect the Big Five to price their own business model advantages out of existence. That's really asking too much. They can certainly make a case for lower prices, but not everyone has to follow along.

And apparently, they won't. Remember, Hachette wouldn't be doing this unless they had strong reasons to believe that the rest of the Big Five will back them up. So I think this will end badly for Amazon. I don't think it was smart of them to put themselves in this position, but I suppose they had to try, just to see if Hachette might quickly fold. Every indication is that they will not, which means none of the Big Five will. Which means that Amazon should stop wasting everyone's time and come up with a compromise that works for everyone.

Joe Konrath said...

There's no practical reason that Amazon can't let the publishers sell their books at whatever price they want, even one above 9.99.

Amazon became what it is today because of its ability to undercut everyone else on price.

It doesn't want to sell ebooks for the same price as iTunes. It wants to sell for less, as a loss lead if necessary.

This is what all the indie bookstores complained about when B&N and Borders got big discounts from publishers. They were being undercut.

Broken Yogi said...

I don't see where Amazon is doing that. As I understand it, the issue is that Big Pubs want to be able to control the price Amazon sells their ebooks for (while simultaneously complaining that they don't discount their print books enough). Hence the whole agency model kerfuffle.

Amazon's recent letter explicitly stated their view that ebook prices should be 9.99 or under. And they have often discounted more expensive ebooks down to that level, or at least close to it. The Big Five's view seems to be that they want to keep ebook prices considerably higher if they choose, and to limit discounting to those lower levels. We can't know all this for certain, but from the statements made by both parties, it's probably the best guess as to what is going on with the negotiations, or lack thereof. There's also some disagreement about gross margins, and sharing the costs of discounting and promotions, which are standard fare. But it's probably the pricing issue that represents the biggest stumbling block.

Lee Child said...

Joe, you say, "Amazon became what it is today because of its ability to undercut everyone else on price ... It doesn't want to sell ebooks for the same price as iTunes. It wants to sell for less, as a loss lead if necessary."

And that's the whole dispute, right there in a few words - to what extent should a supplier be expected to subsidize a retailer's private strategy?

Anonymous said...

Lee Child said: "my point about the poor is that if cheap print disappears then the poor will be disadvantaged."

ONION NEWS:

This just in. Rich white liberal millionaire bemoans about the plight of the poor. Thinks someone ought to do something about it. Goes back to sipping six dollar coffee and texting on $500 dollar smartphone.

Goes on to say: "I really can relate to these homeless people. I grew up having to wear my older brother's hand me downs. It was a day to day struggle."

Rich guy later went on to disclose he was thinking about running for public office. Thinks his ability to sympathize with the common man his greatest asset. That and his giant pile of cash.

In other news: Nation suffers massive eye strain epidemic. The cause reportedly due to the excessive rolling of eyes.

Broken Yogi said...

Amazon became what it is today because of its ability to undercut everyone else on price.

Yes, discounting has always been a serious part of Amazon's business model, I have to concede that. But it's also true that in most items it carries these days, Amazon does not undercut the competition on price. You can usually find a better price elsewhere on the Internet for just about anything in Amazon's stock. People shop there now because of convenience, shipping, customer service, and the fact that price is still pretty good, if not always the best.

So I wouldn't say that always selling their products at the lowest price out there is Amazon's business model any more. As long as they stay competitive, their store still has a massive edge against the competition. That's why I think a compromise with Hachette and the other Big Five is the best solution. Something that would allow them to do some decent, competitive discounting, but not rock-bottom discounting such as they would like to do. And safeguards against any other competitors being able to discount below Amazon's price. Something you might call a modified form of agency pricing. There's plenty of compromises that can be made, if the two sides will stop trying to shove their business model down the other's throats.

Lee Child said...

Barry, you said, "I’d agree that such a thing would be hardly a contract at all if the author didn’t have the right to walk away from it at any time for any reason. That’s a pretty important distinction between a traditional publishing contract and a KDP contract, and probably worth mentioning."

Like you, I love the nuance of language, especially as it is used to reinforce either negative or positive impressions. I agree Amazon allows opt-outs at every sole discretion change of terms, and you sound approving of it ... but it's the same as barking "take it or leave it," which isn't attractive.

(Likewise, I love how the statements "My publisher does nothing for me," and "Amazon gives me total control," are functionally identical in import, but one sounds good and one sounds bad.)

The 200,000% delivery overcharge ... I mean the nickels and dimes you are deducted whenever a file is downloaded. Telecoms experts say the actual cost is too small to calculate - some say the overcharge approaches 300,000%. Amazon is laughing up its sleeve at you over that one - you're paying their whole phone bill, and then some.

Joe Konrath said...

to what extent should a supplier be expected to subsidize a retailer's private strategy?

Can't it also be phrased:

To what extent should a retailer be expected to accept a supplier's demands?

It'll be interesting to see who flinches first.

Joe Konrath said...

You can usually find a better price elsewhere on the Internet for just about anything in Amazon's stock.

I literally got this email a few hours ago:

Greetings from Amazon.com.

You saved $6.20 with Amazon.com's Pre-order Price Guarantee!

The price of the item(s) decreased after you ordered them, and we gave you the lowest price.

The following title(s) decreased in price:

Exorcist: Complete Anthology [Blu-ray]
Price on order date: $34.99
Price charged at shipping: $28.79
Lowest price before release date: $28.79
Quantity: 1
Total Savings: $6.20

$6.20 is your total savings under our Pre-order Price Guarantee.

-----------------------------------------------

Thanks for shopping at Amazon.com, and we hope to see you again soon.

Lee Child said...

Anon at 9:32 - you say I'm a "rich millionaire." Is there another kind?

Joe Konrath said...

Rich white liberal millionaire bemoans about the plight of the poor.

So he pays for some of them to go to private schools?

I don't know Lee's charitable causes other than what he mentioned in this thread, but I have a feeling he's doing some good with his money. I'm guessing that because I also have charitable causes I don't crow about.

Broken Yogi said...

As to the issue of Amazon delaying fulfillment of Hachette orders by not stocking many of their books in their warehouses, I think Amazon's motivation for this is to demonstrate the value Amazon's shipping system offers to suppliers. A lot of people take it for granted, but Amazon's shipping is the best in the world, and almost impossible to duplicate. Amazon is trying to say, there's value there, that we should be compensated for. See how hard it is to ship these things yourself?

It's more than just a way of punishing Hachette, it's a way of reminding them of the added value selling through Amazon gives all publishers. And it doesn't come free. Amazon has invested billions in its highly computerized shipping system. It wants compensation from Hachette for that, in the form of concessions in their negotiations.

Lee Child said...

Joe asked, "To what extent should a retailer be expected to accept a supplier's demands?"

But ... the supplier isn't making any demands. The supplier would be delighted to continue as before. It's the retailer that has demands - private, internal demands, about its strategy to position itself in its sector. If Amazon privately, internally, for reasons benefitting only itself, wants to sell low, why should Hachette pay for that?

Joe Konrath said...

But ... the supplier isn't making any demands. The supplier would be delighted to continue as before

Of course they would. Too bad the DOJ won't allow it. ;)

Broken Yogi said...

Joe, I'm an Amazon Prime member, and I order most everything from them. But I also know that there's plenty of things I can get cheaper elsewhere. I don't sweat the small stuff, but on big purchases, I often end up ordering elsewhere. Computers, for example, I usually get at Newegg.com.

I do love Amazon's fulfillment system, and its discounting. I have no complaints about them. And I'd still order all my books through them even if they were available elsewhere at the same price, or even just a bit less. I'm actually pretty loyal to Amazon as a customer. Which is why I think they don't need to insist on offering the lowest price on all their items, including books. They can retain most of their business merely by remaining competitive.

Broken Yogi said...

Of course they would. Too bad the DOJ won't allow it. ;)

Actually, the DOJ does allow them to renegotiate on the same terms as before, just not as a cartel, but individually. The DOJ says that agency pricing is perfectly legal and not a violation of any law. And that's my rough prediction of the outcome, if Amazon takes it to the breaking point. Agency pricing once again, but with some leeway for discounting.

Broken Yogi said...

I've known a few people who were equity millionaires, but otherwise rather poor. In the old days, they were called land-poor. Not sure what the term is now.

Terrence OBrien said...

Can you explain in detail why the e-book market shouldn’t operate the same way as the ironing board market or the amplifier market?

OK. The ironing boards are sold in a different Amazon market. In that market, Amazon makes its money by actually selling a service. It sells merchandising services.

Ironing board suppliers are free to sell their goods for whatever they want. Amazon doesn't care.

People can also sell books in that same market, just like the ironing boards. Amazon will make its money from merchandising charges. Want to sell a book for $35? Go for it. Just put the book up for $35.

In this market there is no difference in treatment of ironing boards and books. Amazon is letting people price as they choose.

In this market, it doesn't matter if the product makes a profit. Amazon makes money from the service it sells.

Amazon has another market for books. In this other market, it wants to make money from the difference between what it pays for goods, and what it sells them for.

It's not selling services. It is buying and selling books.

It sets prices like any other retailer in order to mazimize revenue or profits.

So, Amazon offers exactly what you want. I suspect highly talented authors who have become outstanding successes due to their own talent and drive should be able to sell their books next to ironing boards for $35. Make your choice. Best of luck

Barry Eisler said...

Lee said:

"I agree Amazon allows opt-outs at every sole discretion change of terms, and you sound approving of it ... but it's the same as barking 'take it or leave it,' which isn't attractive.”

I guess you could also interpret it as “try it and see if you like it, no obligation.” Though I’m not sure if any of these interpretations is all that relevant. My point is that discussing Amazon’s ability to change terms without also mentioning the author’s ability to say "Fine, I’m outa here,” is tendentious. If you want to argue the author’s ability to leave at any time for any reason is just a fancy way of saying “Take it or leave it,” okay… but if you don’t mention the opt-out clause, I’d have to say you’re leaving out critical context, a clause essentially functions as a quid-pro-quo.

"Likewise, I love how the statements 'My publisher does nothing for me,' and 'Amazon gives me total control,' are functionally identical in import, but one sounds good and one sounds bad.”

I don’t think these are quite as interchangeable as you do. You’re probably more likely to hear the first when you’re paying your publisher 85% of revenues for a full suite of publishing services, and are getting less than you expected. You’re more likely to hear the second if you’re paying 30% for access to a distribution platform only, and are getting exactly what you expected.

"The 200,000% delivery overcharge ... I mean the nickels and dimes you are deducted whenever a file is downloaded. Telecoms experts say the actual cost is too small to calculate - some say the overcharge approaches 300,000%. Amazon is laughing up its sleeve at you over that one - you're paying their whole phone bill, and then some.”

I guess maybe… but what does any of that have to do with my point, which was, again, "I don’t think it’s accurate to suggest that anyone acquires publishing services for free.” If what you’re saying now is, “Okay, Barry, fair point, but self-published authors are overpaying and legacy-published aren’t,” that’s cool. But before you said, "in fact we aren't charged at all.” That’s not true and I wouldn't want people to be misled by it.

"But ... the supplier isn't making any demands. The supplier would be delighted to continue as before. It's the retailer that has demands - private, internal demands, about its strategy to position itself in its sector. If Amazon privately, internally, for reasons benefitting only itself, wants to sell low, why should Hachette pay for that?”

To the extent any of this is relevant (I don’t think “Party to negotiation tries to benefit only self” is exactly stop-the-press news), how is all of it not equally applicable to both sides? A contract expires and the two parties are negotiating a new one. One party demands new terms; the other demands the old ones. Demanding the old terms isn’t a demand?

By amusing coincidence, just a few hours ago I read this terrific Intercept piece: “New Intel Doc: Do Not Be ‘Led Astray’ by Commonly Understood Definitions"

https://firstlook.org/theintercept/2014/09/29/new-intel-doc-led-astray-commonly-understood-definitions/

Lee, you’re not secretly with DIA, are you? ;)

Terrence OBrien said...

Food-insecure means one or more family members probably going without food at the end of the week or the month, probably with disconnected power, no car, and meager public transportation. Such folks are not running to the library with their e-readers in hand. Again, this is an issue you can't bluff you way out of. It's real.

So, are they running to the used bookstore with their meager funds instead of the grocery store?

Alan Spade said...

Lee, thank you for giving me your thoughts about Hachette regarding this as a blank year when "judging" authors. The term "judging" is very telling. I would be happy to believe in the big publishers' sense of measure, fairness and equity, but unfortunately, the big publishers records of broken careers for bad reasons (hint: look at Joe's legacy career, but he's not the only one) is much too large for me to give Hachette the benefit of the doubt on such a matter.

To my knowledge, there has been no official statement by Hachette that they will be considering 2014 a blank year for their authors, so, for the moment, it's only wishful thinking.

Lee said: "This all should be a choice, not an ideology, and both paths are equally good and bad. My way suits me and many others - including newbies aiming high - and your way suits others."

If I were to make a comparison, Lee, I would say that you and other authors have accomplished great feats in climbing to the top of mont Cervin. You have all my admiration. But now it's no more mont Cervin. It's the Everest! So, the authors like you at the top of the Everest have a very good protection, because it's so easy, with all the facts that they do not control, for the other authors attempting to legacy publish to fall.

Maybe indie authors like me who once believed in the legacy dream have too much empathy for other authors sticking to that dream. Empathy is not always compatible with business.

I think business should be conducted with more empathy and respect for everyone, but I'll agree this is an ideological point of view.

Still, I think Authors United is not a good designation. Perhaps Real Authors United would do, in order to differentiate these authors from the fake authors we indies are?

Okay, being snarky here. All authors have a choice. Some indies like me would like them to make informed choices. Reading me, they will know I'm biased toward indies. Reading you, they'll know you are biased toward traditional publishing. But they have to get both sides of the equation, and that's why we have to react when Authors United spouts nonsense.

Gary Dobbs/Jack Martin said...

Mr Childs made a very good point with this - I’ll be particularly sad about poor people. Any e-reading ecosystem is entirely inaccessible unless you have a working credit card or a viable bank account for PayPal – which poor people don’t. They love used paperbacks – all worn and furry, found, traded, borrowed, bought for fifty cents. But hey. This is the modern world.

Elka said...

But ... the supplier isn't making any demands.

The supplier maybe not, at least not in public, but the supplier's content providers in their letters to the public cry about lack of pre-order button, that their ware isn't in Amazon's warehouses, and the lack of discounts. Since when are those perks something that suppliers are entitled too?
Between Hachette and Amazon, the business is going as usually, just without the perks, which it seems it's what doesn't suit AU. AU wants to through public pressure Amazon to give them back the perks, and they are trying to do that by painting Amazon as bad greedy monster, subtly (or in same cases quite openly; Stephen Colbert) demanding for customers to boycott Amazon. Amazon is one of the biggest earning e-retailer for self-publishers. If people start to buy the AU crap the pool of Amazon's customers is going to reduce and less people are going to buy books on Amazon. Of course, self-publishers are against AU portraying Amazon as the residential evil and are going to waste their time pointing the nonsense and stupidity of AU's claims.

I would like to address the 'Amazon delaying fulfillment of Hachette orders.' What Amazon has done is refusing to stock Hachette's books, which is their right. Their action has delayed the shipping of the books, but they are not the one delaying it. Or are you (general you) implying that, since it takes 2 – 3 weeks for a bookstore to receive ordered not-stocked books that bookstores are delaying the fulfilment of publishers' orders for the books not in their bookstore, too?

Paolo Amoroso said...

Barry, such a steep ebook delivery charge is indeed hard to justify given Amazon's huge network and cloud infrastructure. Buying data storage and delivery at the list prices of Amazon’s own cloud services is probably much cheaper.

If Google and Apple can afford not to charge developers for delivering to users the apps in their app stores, even monster free apps several hundred MB in size, so can probably Amazon. Especially now that they can afford to pay the astronomical network bill of the newly acquired game live streaming service Twitch.

Barry Eisler said...

Thanks Paolo. Again, my point wasn't about whether what Amazon charges self-published authors was a good value or not. My point was a more fundamental one: it's misleading to suggest self-published authors are charged while legacy publishers aren't, when in fact everyone pays for publishing services. Does that make sense?

But the "self-published services cost; legacy published services are free" fallacy aside, of course the question of value is a critical one, and Joe and I tried to address it in the post on publishing as a lottery/carny game I've linked to above.

As I said, I don't know that much about the delivery charge Lee brought up -- it's something I thought mostly affected large downloads, like a work of photography, and it doesn't seem to affect my revenues from KDP-published works, so I haven't really noticed it. From what I'm hearing here, the charge reminds me of how hotels charge separately for internet. That is, you pay, say, $200 for the room, and then the hotel hits you for another $10 for internet access. Which I always hate, because my attitude is, Hey, it's 2014, charging separately for internet is like charging separately for electricity or hot water! But at the same time, I figure mostly my objection is psychological, because though I'd feel better paying $210 for a room with free internet, in the end, I'd still be out $210.

Does my analogy work? Just trying to understand the nature of the objection to this charge. Is it more psychological -- like when I hate hotels charging separately for internet? Or is it more substantive, because without it authors would pocket more money? Curious to hear anyone's thoughts on this -- thanks.

Paolo Amoroso said...

Barry, this article may be useful for understanding the impact of the delivery charge: Make more money on Kindle by reducing your .mobi file size. This is probably much more than Amazon charges for equivalent cloud storage and file download services. It heavily affects image-rich nonfiction titles.

Other ebook retailers probably don't directly charge authors by the MB for ebook file delivery.

Lee Child said...

Barry, re your recent answers: I love your description of ADS upstream, and have no doubt a neutral bystander would agree 100%. But I think the same neutral bystander would gently point out there's a mirror-image: Defensiveness Syndrome, in which no weakness of KDP must ever be admitted ... in which "I haven't really noticed" is an answer. We could spend weeks arguing point-by-point (and I think the download fee is truly, truly cheesy) but I doubt I'd get anywhere, because of the faith-based doctrinal requirements.

Sarah said...

I am a poor person. I am able to afford to buy books for myself and my family BECAUSE of ebooks and Amazon. There is nothing more to say. Lee is just wrong.

Lee Child said...

Sarah, my point is getting lost here. I was responding to Joe's belief that print will disappear. Nothing to do with e-books or Amazon per se. The millions of people who read only via abandoned mass-market paperbacks will have to find alternatives, and I don't think the new ecosystem will be entirely friendly to them. Indeed, why would it be? Nothing else is.

Terrence OBrien said...

There is an odd notion that any fee should reflect only the marginal cost of the service. We see that on a larger scale when people tell us the marginal cost of producing a single pill is 25 cents, therefore any charge more that 25 cents is improper and an affront to human dignity.

We see the same when people try to compute the marginal cost of transmitting a computer file. They limit any consideration of the cost to the margin. They ask how much total expenditures rose to accommodate that single transmission.

Most businesses, including publishing, recognize that the point of delivery is where many costs associated with that service are recovered. These would include all the people and equipment necessary to provides the service, and all the development costs that went into creating the necessary infrastructure.

But I do look forward to my next taxi ride. I will be demanding a fare that reflects only the fuel necessary to transport 155 pounds across town.

I will inform the driver the charge is far beyond the cost of moving 155 pounds four blocks. When he balks, I will cite automotive engineers who concur with my assessment.

Sarah said...

Lee, it doesn't matter what your point was. It matters what you said. You're a wordsmith, you should understand that. If you can't say what you mean then don't say anything at all.

Furthermore, no smart indie thinks print will disappear (and indeed, Joe has already clarified that he doesn't either). Usually people say something to the effect of print becoming niche. One of the main reasons this will happen is because ebooks should be and often are much, much more affordable than print. This will help poor people, not hinder them. I'm an example.

You make a ridiculous claim about poor people not being able to have a credit card. Hello? Ever heard of a debit card? They process like credit cards but take money from your checking account. Anyone can get one.

Then you make an insulting claim about poor people "loving" used books "all worn and furry". Excuse me? Are you actually saying that poor people buy used books because they love used books as such? That they love worn out books with markings or torn covers or strange smells? You really think poor people wouldn't rather be able to buy books first hand, and benefit the authors they love?

And do you really think the used book market is something the publishing industry has any interest at all in preserving? They'd kill it in an instant, and libraries too, if they could. They'd make sure no one could ever buy a book without the majority of the money going to the publisher.

If you really care about poor people and their reading habits you should be championing this new world of publishing that Amazon has helped usher in. As a voracious reader, I certainly do.

James said...

Ursula K. Leguinn's comment is awesome:

"We’re talking about censorship: deliberately making a book hard or impossible to get, ‘disappearing’ an author… Governments use censorship for moral and political ends, justifiable or not. Amazon is using censorship to gain total market control so they can dictate to publishers what they can publish, to authors what they can write, to readers what they can buy.”

It's easy to see the imagination at work that makes such a terrific author. Her imagination is infectious. I find myself laughing, pondering the goings-on of megaconglomerates 'disappearing' authors.

It's bullshit, of course.

But it's really incredible how this idea has run away with my imagination.

There's no censorship because it has nothing to do with the content of the books. They're also readily available to anyone. All that's changed is the distribution route.

Sorry Ursula (huge fan that I am--and man, even this has my imagination swimming)... but it's not censorship when a delivery truck jackknifes on the freeway. It's not censorship that my DVD player plays region 1 DVDs and you're company only publishes region 2 DVDs. Limited access is not synonymous with censorship, yes, even despite how colorful the spy conspiracy disappearing author plots might be.

John Hindmarsh said...

Guys, guys, guys...

There are poor - food hungry and homeless - people in the US - surprisingly so. Whether they read - or want to read - paperbacks or ebooks - or can afford to do either - would require a major sociological study.

There are things that Amazon does that are questionable. Delivery charges might be one - another is the inflated price on ebooks delivered to countries where Amazon does not have a presence - and these are not reported to the author/self publisher.

Joe worked his gig in one country, Lee worked his in another - they had different results. Now Joe is a name in the indie world and Lee is a name in the trad world. Go figure.

The trad industry has dumped vitriol on self publishers - and the indie industry pushes snark at the trad publishers. Go figure.

A publisher who once colluded with other publishers on book pricing was taken to task by the courts. Sad, disreputable. Not a good way to do business. Illegal.

Amazon can at any time vary the amounts paid to self publishers - if it does, not a good way to do business. Legal.

Trad publishing has apparently some very onerous contracts - the comment that the author can negotiate or refuse to deal ignores the power of the trad publisher. Not a good way to do business. Legal?

Indie book prices typically run at $3 - $4 and that seems to optimize reader purchasing power - I buy lots of books in this range - none over $9.99 irrespective of author. Fact of life.

I am an indie writer - I've not tried to interest a publisher in my books - I like the flexibility currently available - e.g., of being able to release a book within days of completion of edit/rewrite, cover design, formatting, etc., compared with - three to six months shopping for an agent, an unknown time trying to find a publisher, and 12 - 18 months for the publisher to get the book into bookshops, etc. My decision.

I might submit to a trad publisher if some of those negatives [including the contract] were removed, who knows.

The debates - Joe/Lee, Barry/Lee make good although distracting reading. [I should be writing]. The AU letters and articles - not so much. They lack logic. At this point, I'm truthfully unable to say what Lee is supporting in that context. Maybe I have a comprehension issue?

I'm a Reacher fan - not ebooks tho - see comment above, about pricing. An ebook is a rental, not a something I can place on a bookshelf and say - that's mine.

I've read some of Joe's books and enjoy them. Ditto Barry's. And buy the ebooks. They are priced right. So end up generating more net income for them than I do for Lee - at least in ebook context. [Assuming various royalty rates, etc.] The point - the ebook sector will grow, the paper sector will shrink - a guess, I agree.

I'll continue to write and self-publish. I'll read more ebooks priced under $10 than over. I've substantially reduced my paper purchases - almost to zero.

If I am anywhere near typical - the trad guys need to watch their future closely. The indie guys need to reflect on the future possibilities of Amazon unilaterally changing conditions.

Apart from that, the sun is shining and the sky is blue. Have a nice day.

:-)

Jay Allan said...

The problem with this argument is that it boils down to a dispute between two businesses, and a huge percentage of what has been written is blatant, pointless spin (and AU is just about the guiltiest party in this).

Yes, authors are getting hurt, but the pain that an issue is causing is not relevant to determining a responsible party. Laying the blame at Amazon's feet, as AU has done, is pointless spin, a mindless promotion of "our team." A face painted in team colors and a giant beer in hand, and we could take this debate to a football stadium.

Intelligent debates require information, and the truth is, no one outside the negotiations knows what the parties are demanding. Not Douglas Preston, not the New York Times. The fact that this hasn't even been a speed bump in the fast and furious name calling by these parties (and many on the other side as well) is profoundly depressing.

There is certainly some bitterness in self-publishing circles toward traditional publishing, and no doubt that inflames views on that side. Similarly, there is a self-serving attitude on the part of mega-bestsellers on the AU side. It is perfectly reasonable to support you own self-interest, but if you stray into dishonesty to do it, you are still a liar. I wonder what an anonymous poll of ALL traditionally-published authors would reveal about their thoughts in this.

How can AU blame Amazon so publicly without knowing the specifics of the negotiation? How can you defend the whining about Amazon not offering discounts on Hachette books? Are discounts by the retailer some God-given right accorded to the publisher? If a publisher wants their books to be cheaper, no one can stop them from lowering the price. Demanding high prices and then crying because the sales venue won't take a hit to discount them isn't an argument that should generate a lot of empathy.

Don't you think Amazon differentiates suppliers of all kinds based on their relationships and the terms of their contracts? Would you be surprised if the cereal company offering better terms got more exposure on their site? Do you think it would be any different in a supermarket?

How can AU continue to lay all the blame for the damages to authors when they don't even know the exact details of the dispute? It is starting to remind me of a crazed mob rioting outside a courthouse, demanding someone's head without caring too much about actually establishing the guilt of the head's owner first.

I appreciate Lee Child's comments about the poor not having ereaders. However, I find this an odd defense of the side fighting to maintain higher pricing. I think maintaining $30 hardcover sales and over-priced ebooks so books can trickle along to mass market paperback release and ultimately get fished out of some 25 cent used-book bargain bin so a poor child can have a book to read is an enormously convoluted way to go about helping the poor to read books.

The point isn't that Hachette authors are being hurt. The place the logic fails is when groups like AU start banging Amazon solely for it. Doesn't Hachette have any responsibility to the authors it signed? Why is it OK for them to remain intransigent while their authors get hurt? Why is it evil for Amazon to stand firm on its position but perfectly acceptable for Hachette to do the same, particularly when Hachette is the only one with a direct responsibility to those authors?

Nirmala (free spiritual ebooks) said...

In response to Joe saying, "Amazon became what it is today because of its ability to undercut everyone else on price.
It doesn't want to sell ebooks for the same price as iTunes. It wants to sell for less, as a loss lead if necessary," Lee said "to what extent should a supplier be expected to subsidize a retailer's private strategy?"

I think you can turn that statement around to its exact reverse: "to what extent should a retailer be expected to subsidize a supplier's private strategy?" The publishers clearly have their own "private strategy": to protect their paper sales and their exclusive access to brick and mortar stores by slowing the adoption of ebooks through high prices. So how does that benefit Amazon? Not at all, and in fact it hurts their ebook business.

Hence the need for a negotiation over the terms of their new contract. Both sides have private strategies that affect them but not the other party, and ultimately both sides will probably have to find a way to compromise to get some of what they want, while probably never getting everything they want.

Nirmala (free spiritual ebooks) said...

Thank you Jay Allan. That was the clearest summation of all of the relevant facts and unanswered questions regarding this whole issue I have read yet.

I think the NYT should hire you to replace David Streitfeld :)

Joe Konrath said...

I was responding to Joe's belief that print will disappear.

I don't believe print will ever disappear.

I believe B&N and Books-A-Million will disappear, and that non-bookstore outlets (drug stores, Wal-Mart, airport stores) will stop selling books (or at least drastically reduce their stocks).

There are billions of books on the planet. They aren't going away, and lots of people enjoy them.

Last time I was in a B&N, I heard crickets. No book browswers.

But every time I go into a Half Price Books, there are a lot of patrons, buying paper. I've actually seen some of my POD titles in Half Price Books.

I believe print will become a subsidiary right for most authors. The system won't be able to sustain a midlist much longer, and that's a house of cards.

Indie bookstores, especially those that deal in used, will do fine, in the same way antique stores weren't wiped out by eBay, and used record stores still exist (but new record stores are rare, and CD sales in non-record stores have shrunk).

There are too many forces at play for the paper industry to recover. Ebooks, technology, the Internet, Amazon, younger people learning to read without paper, B&N shelf space shrinking, authors realizing they have a choice, publishers refusing to offer authors better terms; it's all pointing toward print becoming niche.

There will always be collectors. And there will always be a few dozen bestselling authors who get major print releases. But ebooks will win the format war for the majority of authors and titles.

Or maybe I'm wrong. But I haven't been yet when it comes to this topic.

Joseph said...
This comment has been removed by the author.
Broken Yogi said...

One other thing about the whole "blind luck" explanation for the success of big-time authors. I don't think anyone really knows why some books and authors take off big-time, but I think it's self-destructive to imagine it's all just blind luck, and for that reason alone I feel I have to reject that viewpoint.

For me, I have to believe that quality matters, and that if I write a really high quality book, it will find its market and sell. Whether it sells only a middling amount or hits the jackpot I don't know, and I can't write with such goals in mind. But I do have to believe that a well-written book will succeed, somehow. Joe and Lee both write well, and their books have found their audiences. So that proves my point. My guess is that most of the books that don't sell well, aren't as good. I don't know if that's actually true, but I have to believe it's true, otherwise, why bother writing well at all, other than out of foolish pride? Just write a lot of sloppy crappy books, and you increase your odds, because after all, it's just like buying more lottery tickets. Don't worry at all about quality. Do we care about the quality of lottery tickets? Of course not. They are just numbers. So why should we care about the quality of the books we write?

See, I just can't think that way. I have to believe in something, so I choose to believe in the value of quality. It's not always true, as books like 50 Shades proves, but I have to keep believing anyway.

Broken Yogi said...

To what extent should a retailer be expected to accept a supplier's demands?

It depends on what those demands are, and how much the retailer needs to carry their product.

If the retailer is Costco or Walmart, they have a lot of power to force concessions on pricing and margins and so on from the supplier, because they don't need to carry everyone's products, and so they have a lot of suppliers to choose from.

But as Lee points out, that's not Amazon's business model in publishing. They have always been the retailer who carries everything. If they want to maintain that business model, they have to carry the Big Five books, and also deliver them quickly and have pre-orders available on them and so on. Because that's who Amazon is. It's in the name itself.

The Big Five represents 85% of publishing sales. Now, it's true that they could probably survive without them, and rely instead on the other 15% plus KDP. But that's a very, very different business model, and I think it would be suicidal for Amazon to make that kind of move. In other words, it would hurt them more than it would hurt the Big Five in the long run, because it would force Amazon to completely change their business model, in a way far more dramatic (and worse) than merely conceding to the Big Five's agency pricing model.

That's why I think Amazon should just concede now, and try to get as many concessions from the Big Five on discounting power as they can. And other peripheral issues. They really need the Big Five. And while the Big Five need Amazon's selling power, they need to preserve their business model even more. So if they have to leave Amazon and seek out or create new retailing outlets, they'll just have to bite the bullet and do that. Because preserving their long-term business model is more important to them than short-term sales. As it should be for Amazon as well.

Broken Yogi said...

Barry,

You're right that the brunt of the cost of delivery charges for KDP is borne by books that have a lot of illustrations, photographs, children's books, or other art. For them, the delivery charges can mount up ridiculously high, and becomes a serious barrier to publication.

It's not like the $10 hotel fee for Internet usage, because it's not a fixed charge, it rises according to volume. It would be as if your hotel tracked your internet download usage, and charged by that, so that if you watch a youtube video, or a movie, the charges could leap to hundred of dollars.

It would be fine if Amazon just charged a set delivery fee for each book. But by charging by the Kb, it turns what is already an exorbitant minibar surcharge into sheer highway robbery. I really don't know why they do this, other than because they can. There at least ought to be a cap on this charge.

Even worse, for an author to price their book in a manner that recoups the charges, they have to still pay Amazon an extra 30% as their share of the retail price. So the sucking sound just gets louder until it's deafening.

John Brown said...

Lee said:If Amazon privately, internally, for reasons benefitting only itself, wants to sell low, why should Hachette pay for that?

Should? When does "should" enter into a business deal?

That question is like Amazon's BS letter stating that ebooks "should" be priced lower.

There's no should because there's nothing inherently moral about 9.99 versus 12.99 or 2.99, or whatever the prices are.

Lee, your excellent comments about ironing board and speaker prices make that point brilliantly.

This isn't about shoulds. It's about perceived value.

Amazon has something that publishers value. Amazon has named a price for that thing.

Likewise, Hachette has something of value to Amazon. They've named their price.

The question isn't what "should" happen. It's whether Hachette and Amazon like the value they see and can come to terms that allow both to feel they've both gotten good value for what they're trading.

There's no right or wrong with a Pope overseeing the calls. There's just satisfied or not satisfied.

Shoulds are nothing but red herrings in this matter.

BTW, your coming here and on TPV has been one of the best things to happen in this community since Howey published his Author Earnings. Thank you for making the time.

Paul Draker said...

Broken Yogi sez: The Big Five represents 85% of publishing sales...

You've mentioned this 85% a couple times.

What source are you getting that particular number from?

Because it looks wrong. Waaay wrong.

Broken Yogi said...

Paul, I've read that 85% number so many times, in so many places, I don't actually know where it comes from. I trust it because I've read it in a lot of honest places, including here and at Hugh's blog, and Passive Voice. And from the coverage of the collusion lawsuit brought by the Justice Department against the Big 5/6. But now that you mention it, I don't really know the original source, and a quick googling doesn't reveal any numbers at all. So if you think it's wrong, I'd very much appreciate a source that gives the correct numbers.

I'm just not sure why you think its Waaay wrong. Seems pretty standard to me, given the immense consolidation in the publishing industry.

Anonymous said...

Well, when they merged Random House Penguin was just over 50% of the market.

This is from 2009

http://michaelhyatt.com/top-ten-u-s-book-publishers-for-2009.html

I'm looking for something similar for 2013/2014

Anonymous said...

Theres also this,but its more an industry overview.

http://www.wischenbart.com/upload/Global-Ranking-2013_Analysis_Wischenbart.pdf

Edward M. Grant said...

It would be fine if Amazon just charged a set delivery fee for each book. But by charging by the Kb, it turns what is already an exorbitant minibar surcharge into sheer highway robbery. I really don't know why they do this, other than because they can.

I always assumed it was because of the 3G Kindles. You can download any number of books, any number of times, anywhere in the world that Amazon has 3G support. For one book sale, Amazon has to support downloads for as long as they continue to sell and support 3G devices.

At some point I'm sure they'll shut that off and only do Internet delivery. Until then, it's an open-ended cost, and it won't be anywhere near as low as the numbers people throw around for the cost of Internet delivery.

Broken Yogi said...

I did find this article in HP, with a very interesting graph in it:

http://www.huffingtonpost.com/mark-coker/10-reasons-self-published_b_4915694.html

Look at the light blue line, which is described showing the market share of all print and ebooks for "traditional publishers", which as of 2014 looks to be at or slightly above 90%. I don't know how they classify "traditional publishers", however, and if that is limited to the Big Five, or includes smaller presses also. Depends on one's definition, I suppose. Since I don't know what the non-Big Five traditional publisher market's numbers are, it's hard to interpret. But it's at least in the general ballpark.

Point is, whatever the actual numbers are, the Big Five is in a dominant position in the industry, and Amazon cannot get by (yet) without them. But if you look at the chart's projections out into the future, the story changes. When trad publishing dips below 50%, sometime in the early 2020s I gather, they are going to get pretty vulnerable. And the higher they keep ebook prices, the more vulnerable they will be.

Broken Yogi said...

I always assumed it was because of the 3G Kindles.

That may well be. But then it only raises the question of what is Amazon's actual cost for 3G downloads. I have a hard time imagine that cost being anywhere near to what Amazon actually pays. Plus those 3G Kindles cost more to begin with, which should offset the cost of the service. Also isn't that really just a marketing cost that Amazon incurs because it wants Kindles in everyone's hands, to buy their stuff with? Why should authors/publishers pay the brunt of those costs, when they don't pay for Amazon's free shipping of their books or other items on Prime (which the customer also pays extra for up front)?

Broken Yogi said...

The impression I'm getting about that 85% figure is that it represents the percentage of the Big 5/6's share of the traditional publishing market. Which not long ago, was close to 100% of publishing. Now, those numbers have probably changed a bit, due to self-publishing. But not too much in gross dollars. A good deal in terms of authors earnings in some markets, such as genre fiction. But that's not the case with the overall publishing market - yet.

And then there's the textbook and technical publishing market, which is dominated even further by the Big 5/6. And Amazon sells a lot of textbooks from what I gather. Not sure about technical books, but I know they at least carry them.

Either way, it's a very big share of the marketplace, that Amazon can't afford to lose or put on permanent disability status. Depending on current trends continuing, it may take a decade or more before the numbers drop down to the point where the Big Five are no longer dominant.

Paul Draker said...

Broken Yogi sez: I don't actually know where [that 85%] comes from. I trust it because I've read it in a lot of honest places, including here and at Hugh's blog, and Passive Voice. I'm just not sure why you think its Waaay wrong.

Yeah, one of the frustrating things about this industry is how little real industry-wide data is available. And how little of even *that* data turns out to actually be consistent and reliable.

I've learned to question the official-sounding numbers that publishing insiders like Shatzkin, Zacharius, et. al. throw around anecdotally without any support. If you look at those numbers closely, most fail even a basic sniff test.

The best recent numbers I've been able to triangulate put US trade publishing--not including indie books--at roughly 2.3 billion units and $15.5 billion dollars a year. The indie "shadow industry" adds roughly another 250 million units and another $750 million dollars on top of that, mostly in ebooks, mostly through Amazon.

Amazon (US) is moving roughly 1.1 billion books a year, of which 900 million are traditionally published--which lines up pretty well with PW's claim that Amazon represent 41% of all books sold.

I need to dig up the exact sources I cross-referenced to come to those conclusions, but they included a few Publishers Weekly articles, a PriceWaterhouseCoopers study, and the like.

And for the Big Five, I base my estimates on this article...

http://www.digitalbookworld.com/2014/how-much-money-the-biggest-publishers-actually-make/

So, if trade publishing is a $15-$17 billion dollar industry, then in dollar terms the Big Five account for maybe 60-65% of book sales... and in unit terms, they make up an even smaller percentage--maybe 50% of all trade books sold.

If anyone has any better numbers to share, we would all love to see them.

Jason Blacker said...

I'm with Lee and his compadres.

I think you've lost your way Joe, and the amount of snark is so strong from you and your tribe that I've only ever visited your blog to read what reasonable folks like Lee Child have to say.

I'm almost embarrassed to call my self self-published.

Jim Self said...

Lee, you asked:

"And that's the whole dispute, right there in a few words - to what extent should a supplier be expected to subsidize a retailer's private strategy?"

I'm not sure I get your point here. Discounting doesn't reduce publishers' income under a wholesale model, which is what Amazon wants. Under the current agency model, Hachette is complaining about a lack of discounting. So apparently both sides want discounting, but Amazon wants to be able to do it with their own money on the table, not Hachette's.

David List said...

I just wanted to say thanks so much to Joe, Lee, Barry and all you other guys and gals offering informed facts and opinions at no (direct) benefit of your own. This exchange has been enlightening, educational, and entertaining.
No sarcasm here, by the way. Thank you, sincerely.
I've found several new authors and blogs to follow because of this conversation.
I just wish political debates / discussions were so honest and cordial.

Daniel Kenney said...

Lee, thanks so much for coming on and engaging. Whether Traditional Publishing is fair or not or good or not or whatever...the one thing it's always been is a bit cloudy...at least for those of us on the outside. A ton could be done to make the financial aspect of writing and authorship a helluva lot more transparent. Joe and Barry and others have done a lot over the years to share what they know...and it indeed helps as a guide for us newbies. And Lee, you coming on and engaging in such a thoughtful way, that helps us well. Thank you for the discussion guys!

Joe Konrath said...

I think you've lost your way Joe.

And I think marshmallows are magic.

What? You don't believe my statement without me backing it up with facts and logic?

Well, that doesn't negate the magic of marshmallows, does it?

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