Saturday, June 07, 2008

And So It Begins . . .

Sorry this post is so late, but high winds here in North Texas knocked out my phone service yesterday afternoon, including my DSL. It wasn't until after the Belmont Stakes were run this afternoon that the service was restored.

Back in late March and early April, I took a lot of flack from people who thought I was overreacting to Amazon's announcement that they were going to force small publishers and e-publishers to use their proprietary POD press, BookSurge. I made my case here and here and asked readers and writers to sign a petition here to Amazon protesting the move.

I got two pages of patronizing comments from the boys' club over on A Writer's Life here and a lot of apathy from everyone else, although agent Nathan Bransford was kind enough to draw attention to my blogs on the subject here.

When I found myself boring even me, I decided to quit talking about the issue and wait for Amazon to make their next move--which I was quite confident they would.

Since then, I've occasionally alluded to the subject as I did in my blog of April 18th when I quoted an excerpt from Publishers Lunch:

One persistent topic at the London Book Fair was Amazon's aggression towards publishers selling books directly from their own web sites at modest discounts. In a blog post, Tim O'Reilly expresses his own larger concern: "As Amazon's market power increases, it needs to be mindful of whether its moves, even those that may be good for the company in the short term, are ultimately destructive of the ecosystem on which they depend. I believe that they are heading in that direction, and if they succeed with some of their initiatives, they will wake up one day to discover that they've sown the seeds of their own destruction, just as Microsoft did in the 1990s."

And again on May 16th when I quoted an excerpt from Mike Shatzkin's speech at the London Book Fair:

About three weeks ago, Amazon declared a new policy that they would no longer ship as Amazon-sold product books printed on demand by another supplier . . . The legality of this approach is not yet clear, but many of the marketplace implications certainly are. Amazon has a commanding position among online book purchasers and they can use that as leverage to compel publishers to conform to their desires . . . This latest policy is a shot across Ingram’s bow -- at the very least; maybe it is a missile into the wheelhouse -- but it is also a sober reminder to publishers that their now second-largest vendor has a whip hand and will use it.

In the past two weeks, I began to see the signs I'd been waiting for. The UK's The Bookseller has had two articles, and this week Publishers Weekly also had a short piece.

Tomorrow's Scotland's Sunday Herald has a lengthy article here titled, Amazon Accused of Squeezing Publisher. Here's an excerpt:

A MAJOR battle has erupted between Amazon and the UK's biggest publisher in the most public fallout yet between the powerful online retailer and the book world.

Amazon has removed several key Hachette Livre UK titles from sale on its British website in an effort to pressurise the publisher to give it a greater percentage of its profits, according to Hachette's group chief executive.

According to an article in The Bookseller two weeks ago,

Amazon conducts yearly negotiations with publishers over the discounts it receives. The Hachette tussle comes in the wake of a similar dispute in January, when a number of Bloomsbury titles were temporarily removed from sale through Amazon's main channel.

I went looking for information on the Bloomsbury dispute and found it in an undated article in the UK's Publishing News:

Publishers are reacting angrily to what one senior executive described as a “crude” attempt by Amazon to increase its discount. “It is going from publisher to publisher with extortionate demands, and if it does manage to get a figure from one publisher it is then going back to the first house and saying x has agreed to such-and-such”. . .

What we see is Amazon attempting a strategy of world domination. In the US, we've already seen them demanding that publishers use their facility for print-on-demand. It seems that the only people who benefit in the value chain are Amazon. They already have 15% of the market in the UK.”

It is estimated that if Amazon carries on growing at this rate, it will have 30% in three years, and publishers believe there is a real danger that bookshops will start closing as a result. “Amazon will be in a position of such dominance that they will be able to dictate terms and destabilise the market” . . .

Bloomsbury rec­ently had a terms dispute with the bookseller which resulted in Amazon removing the 'Buy Now' button from certain Bloomsbury titles on its site.

I did find an article in The Bookseller that said:

Amazon and Bloomsbury's dispute over terms appears to have been resolved, with titles that Amazon had removed from sale now back on offer from the online retailer.

Amazon had previously removed the "Buy New" button on a range of Bloomsbury titles . . . The titles, which earlier this week were only available via Amazon Marketplace [Note by MR: the third party market, mostly used books], are now all available to buy new on the site.

The move follows a letter sent by the Society of Authors to . . . outlining its concerns about the situation.

Neither Bloomsbury nor Amazon would comment on the news. An Amazon spokesperson said: "We won't comment on rumour and speculation. The books mentioned do have Buy buttons. We won't comment on relationships with our suppliers."

See my blog for tomorrow for the rest of the story along with my predictions.

1 comment:

nancorbett said...

I'm glad you quoted Tim O'Reilly here. Of all publishers, he is bound to be the most in the loop on the ways Amazon will position itself as a technology-based business. I wonder how he is regarded by the conglomerate presses. They'd do well to listen to him.