Wednesday, May 28, 2014

Amazon Vs. Hachette: Amazon Speaks

For the last few months, trouble has been brewing in the publishing world. According to Hachette, it began with Amazon slowing delivery of their products and setting the retail price of Hachette's books to full list price. (The price Hachette suggests for their books - Any discount below this is given by Amazon, and therefore comes from Amazon's pockets.) Ironically, it wasn't that long ago that Hachette and the other big publishers were complaining about Amazon reducing their prices. In fact, they joined together to demand that Amazon allow the publishers to set their own retail prices, regardless of the fact that publishers still recieved their full percentage. It seems some people will complain no matter what you do.

The final straw came when Amazon recently removed the "Pre-order" buttons from Hachette books due out later this year, only allowing customers to buy books that have already been published. (Funny, my readers never get the option to pre-order my books. How's it feel, Hachette?) Naturally, this all came down in the midst of a tense contract negotiation. So last week, Hachette decided to take their negotiations public. The company released memos stating that Amazon had singled them out unfairly, that Amazon was trying to damage their brand and their authors, and so on. Naturally, the authors hurried to their blogs to spread the news to their fans. (Some have noted that if one of those authors happened to be in negotiations with Hachette and took his complaints public, he would almost certainly lose his contract. Double standard much, big publishing?)

Today, Amazon finally published a statement. The most direct way to read the entire post is at The Digital Reader. Most of the article reads about as I expected it would:

"A retailer can feature a supplier’s items in its advertising and promotional circulars, “stack it high” in the front of the store, keep small quantities on hand in the back aisle, or not carry the item at all, and bookstores and other retailers do these every day. When we negotiate with suppliers, we are doing so on behalf of customers. Negotiating for acceptable terms is an essential business practice that is critical to keeping service and value high for customers in the medium and long term."

That quote pretty well sums it up. Amazon is bargaining, and doing so quietly and respectfully. Like a business. Hachette on the other hand, is making a whole lot of noise. I've heard speculation regarding this; that perhaps it's because this is the first new negotiation between Amazon and a big publisher since the recent ruling (where the publishers were found guilty of price fixing). That sounds likely, although I can't quite understand what it is that Hachette wants out of all this. The court of public opinion will not change Amazon's goals of delivering products at the most competitive price possible. The publisher's motivation is made even more obscure by their own backpedaling regarding their apparent desired outcome. If I were to spend a few minutes in a critical thinking exercise, I might reach the conclusion that Hachette is not being as forthcoming or truthful about their desires as they appear. But again, this may be a negotiating tactic, and as any fan of "Wall Street" knows, business is war.

For a more indepth study of the situation, I defer to those more qualified and articulate:

 From The Passive Voice (Passive Guy's comments are always spot on, and it's well worth the time reading the comments below the articles):
amazon-derangement-syndrome-characterizes-dispute-between-amazon-and-hachette

amazon-v-hachette-dont-believe-the-spin

hachette-frenzy-vs-author-earnings

And of course, the most outspoken Indie author in the universe: Joe Konrath

As an Indie, I can speculate as well as the next guy (or gal) without worrying too much about my slice of the pie. Honestly, it seems to me that if the big publishers keep fighting for the right to set their own prices and win, it will only benefit me in the long run. I can set my prices as low as I want. They Can't. 

It is possible, although not terribly likely at this point, that I'll end up working with one of these publishers some day. I might even end up grateful that they put up a fight now, rather than conceding. I'm not sure what circumstances might lead me into that situation, but I try to keep an open mind. At the moment, all if this is interesting, but it doesn't seem to have much relevance to my life or my future in publishing. For now, I'm just going to grab the popcorn and wait. 2014 might turn out to be a very interesting year...

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