The Amazon/Macmillan blow-up: An e-book lover’s appeal for understanding

Update: Tobias Buckell has linked to this piece, too. Thanks for the follow-up and the kind words, Tobias! And welcome to all the readers who come here from there!

The 'nuclear' option? Over the last few days, the angry Amazon/Macmillan rhetoric has been flying fast and furious from several positions. Recently, we posted an impassioned piece by Ficbot with the attention-grabbing headline, “Maybe we should be hurting the authors,” which was linked in a post on author Tobias Buckell’s blog and has brought us a great deal of traffic today (not to mention the liveliest comment thread we’ve seen in some time).

There seems to be a perceptual disconnect, or maybe several perceptual disconnects, between the authors/publishers on one side and the e-book readers on the other. There are many voices on both sides, both reasonable and less so—and to each side, the loudest voices on the other side become that other side’s entire argument.

And so we have on one side e-book fans absolutely convinced that publishers and authors unjustly hate them (or worse, don’t care at all). And on the other, there are writers who plaintively wonder, “How did the American public get hoodwinked into believing that the suppliers are the bullies rather than the retailers?”—and some who actively belittle the e-book fans.

It’s the kind of misunderstanding that makes it so, so seductive to write a response, because “someone is wrong on the Internet” and you’re just sure that if you make that one more post, say that one more thing, you’ll get through to them somehow. You know beyond any doubt that you’re right, and you’re sure they’d agree too except they’re just misunderstanding you, and you have to make them understand.

I’m halfway afraid that this post is going to be just another iteration of that. But all the same, I’m going to try to unpack some of the issues on the readers’ side and explain why this issue is so incendiary for long-time e-book fans.

One of the biggest misunderstandings is that this is all an overreaction to Macmillan taking “perfectly justified” steps to avoid Amazon monopolizing the e-book market and driving everyone else out of business. That’s part of it, but it’s actually just the smallest part of why most readers are so mad—the straw that broke the camel’s back.

“Let Them Eat Cake”

Part of the problem, and perhaps the part that made it blow up fastest, has been some of the rhetoric coming out of the other side.

From Macmillan’s side, with John Sargent’s ads/open letters, it’s a classic case of corp-speak right of the original Cluetrain Manifesto. Sargent addresses his letters to “authors, illustrators, and literary agents.” He says, “Amazon has been a valuable customer for a long time, and it is my great hope that they will continue to be in the very near future.”

E-book fans, dedicated readers, comb through his letters for any reference to themselves—and find none. The letter is not meant for them; it does not mention them. There is no other open letter from Sargent that is meant for them.

Amazon is addressed as Macmillan’s “customer,” rather than a distributor or retailer. Consequently, it becomes a lot easier for e-book fans, the people who feel they should be considered the publisher’s customers, to believe the publisher simply doesn’t give a damn about them.

Then there are some of the authors siding with Macmillan in discussions of the situation. In particular, there is one who is loudest among them: John Scalzi. Now, I greatly admire Scalzi’s writing, and have several of his books. I even like much of his blogging.

But Scalzi has shown a consistent pattern of behavior in his comment threads: when someone brings up concerns from a reader’s perspective that contradict his point of view, he responds with sarcasm rather than any serious attempt at dialogue. Now, granted, some of these people are nothing but rude, but even the polite ones get this treatment.

Neither of these is necessarily something on which to base a rational argument, but emotionally they’re a sure goad. It’s as if they’re smirking, “Let them eat cake.” It’s hard to blame e-book lovers for jumping up on the barricades and yelling, “Viva le revolution!” in response. Nobody likes to be told they don’t matter; it’s infuriating.

But as I said, this is only the straw that broke the camel’s back. In fact, many e-book lovers feel they have been told they don’t matter for more than ten years now.

A Long Time Ago, in an E-Book Store Far, Far Away

E-books have been sold by eReader and Fictionwise—first separately, then as part of the same store, then as part of Barnes & Noble—for over ten years. Over that time, e-book fans have seen a consistent, systematic pattern of missed opportunities and mishandling by publishers who seemed either not to care about or to actively despise e-books.

The books are wrapped up in restrictive DRM. They are often rife with typographical errors—errors which one ex-eReader employee said the e-book companies are not even permitted to correct (or at least weren’t when he worked for eReader), as they are contractually required to publish the book the way it came to them!

Many of the most egregious of these errors never get fixed. Even the Lord of the Rings series had them, and some feel they only bothered to fix those because it was such a popular book. (Trying to get errors fixed but having her requests fall on deaf ears is one of the issues that led to Ficbot’s immense frustration.) “Pirated” e-books are sometimes better-made than “legitimate” ones, because the “pirates” actually care about quality!

Often books in a series are published haphazardly, or not available in particular formats. Their pricing is inconsistent with print editions (more on that in a minute). And in the last year or so, the e-book stores have suddenly started enforcing geographic restrictions on e-book purchases on top of that, leaving many of their former best customers (such as Ficbot, who lives in the UK Canada) fuming.

And this has been going on for as long as these stores have existed.

The Price is Wrong

One of the biggest issues relating to e-books is the issue of price. It’s a thorny issue because it’s actually several issues at once, and even e-book enthusiasts often conflate the issues themselves.

The biggest issue that it is not about, despite some people yelling about it, is the popular slogan, “E-books have zero marginal cost to produce, therefore they should be much cheaper than paper books!”

Many e-book fans do believe this—in fact, it’s one of their great rallying cries against publishers, who they see as The Man who wants to keep them down. It’s probably not as true as most adherents think, but it doesn’t really matter in this argument because most of the people who believe it think even $9.99 is too much to pay for an e-book, so they would have been upset no matter what Macmillan did.

A related matter is the idea that e-books should be cheaper than paper books because you can’t do as much with them. I won’t argue with that idea, but how much cheaper is a matter of debate even among the people who agree in principle.

For some, a $15 e-book might be enough of a discount off of a full-price hardcover to make it worthwhile. Others will point out you can generally get discounted real hardcovers from the same place for the same amount. Again, it doesn’t really matter too much because in the end, those who think it costs too much just won’t buy it. But they sure do like to complain, don’t they?

No, the biggest issue is a matter of trust, and it has to do with Macmillan’s plan to implement variable pricing.

A Matter of Trust

Many people on Macmillan’s side are assuming irate consumers are just mad at suddenly having to pay $15 instead of $10. (It doesn’t help that some of them are mad for that reason, and even those not primarily motivated by it are not exactly pleased about it.)

These Macmillan partisans might point out that hardcovers cost more not because of their inherent hardcoverness—they may seem sturdier, but they don’t cost appreciably more than paperbacks to produce—but because they’re the earliest way to get the book.

“Why, then,” they might ask, “shouldn’t e-books be the same way? Even Baen sells its E-ARCs at $15 for the first three months, after all. Macmillan’s just going to do the same kind of thing with its new-release e-books—and will end up coming down to even less than $9.99 after a while. Is that really such a bad thing?”

On the face of it, the logical answer would be no, indeed that isn’t such a bad thing. $14.99, while not the psychologically tempting $9.99, is still at least five to ten bucks less than a hardcover. If you don’t want it at $14.99, you can just wait until the price drops, just as you’d wait to buy a paperback if shelling out for a hardcover didn’t appeal to you.

But the reason this is likely to send a lot of e-book fans off into incoherent rage is that it doesn’t take into account the history of e-books before Amazon came along.

Publisher Price Control…In Theory

For as long as eReader and Fictionwise have been selling them, even back when eReader called itself Peanut Press, the pricing on e-books has never been consistent at the smaller e-book stores.

The agency model might be new to Amazon, but at least one person holds that Fictionwise has always worked under such a model, where the publishers set the prices of their books. On the other hand, someone who works for Macmillan says they don’t, so I don’t know what to think.

Regardless, I definitely remember hearing in long-gone conversations with store employees that under their arrangement, publishers were supposed to drop the prices on e-books to maintain parity with the least expensive print format. When a hardcover goes to paperback, the price of the e-book should drop accordingly.

But somehow, it quite frequently never ended up happening. I no longer have URLs or exact references to point to—they’re probably still buried in the E-Book Community Mailing List archives if anyone wants to trawl through them for proof—but I seem to remember from the aforementioned conversations a consensus that it was like pulling teeth to get publishers ever to re-adjust their prices.

Invariable Pricing

This hasn’t changed much in ten years. Yesterday, to prove a point, I searched on different price ranges of Macmillan books at Fictionwise. I discovered that only 285 (about 15%) of the 2032 Macmillan titles on Fictionwise are priced at $9.99 or less. 857 (about 40%) are priced at $19.99 and up.

I then surveyed each of the 25 titles on the first page of $19.99+ search results, checking against print editions in on-line bookstores and determined that 7 out of those 25 were available as $7 to $9 mass market paperbacks. (See the link above for specific details.)

If I assume it’s a valid random sample and cross-multiply, 7/25 = 240/857. That would mean 240 of Macmillan’s titles—over 10% of their entire Fictionwise line—would be mispriced—or as I like to put it, “invariably priced”—in relation to their paper versions.

My gut feeling is that’s actually a lowball guess; some of the books on that first search were obviously just-added titles they were trying to push so I suspect there was a higher-than-average number of newer, hardcover books than usual—there’s no way that a publisher is going to keep 30% of its entire back catalog exclusively available in hardcover. And that does not take into account titles priced between $19.99 and paperback range, or ones from other publishers.

There are probably thousands of “invariably" priced books on Fictionwise now. And there always have been.

Conspiracy Theories

Are these mispricings simply a matter of the publishers not caring enough to keep them updated, or because of the bureaucracy required to get each price updated? In at least one case, it has been confirmed that “invariable pricing” is intentional on the part of the publisher: someone from Digital Mac said that $14 is the “correct” price of an e-book of a book that has been out in $7.99 paperback for several years. No explanation available yet.

This “invariable pricing” is perhaps the most bitter pill for e-book fans to swallow. Is it just neglect? Misunderstanding the market? Intentionally sabotaging e-books to protect the print market?  Who knows?

The human mind looks for patterns; that’s why we see shapes in clouds. It’s also why conspiracy theories are so popular. It’s much more satisfying to believe that the publishers are out to get you than it is to believe they’re apathetic or just clueless. But even some published authors believe that publishers want e-books to fail.

And of course, someone not aware of how much of this frustration has built and festered over the last ten years will just assume those people have gone off the deep end.

Flashpoint

So in Fictionwise and eReader, you have e-book stores full of $26 e-books of $7 paperbacks. Now suddenly Amazon comes along, and you can suddenly buy $10 e-books of $26 hardcovers. Is it so hard to see why so many e-book fans so passionately embraced it, even with the DRM and restrictive terms and geographical restrictions and typographical errors?

It was because, finally, someone “got” e-books. They knew e-books were “supposed” to be cheaper than paper books. And, perhaps more importantly, they’re selling them cheaply to them.

It didn’t matter that Amazon was selling them below cost, or trying to build up a monopoly, or anything like that. E-books that were “supposed to be” $26 were instead $10. E-books that were “supposed to be” $7—well, I haven’t had time to research to see if they’re $7 or $10, but I suspect that even if they weren’t $7, $10 would still have been a lot better price than the $26 the publishers made Fictionwise charge.

And this is the world that Apple marched into with its agency pricing scheme, and the ominous declaration that, even though the books were going to be $13 to $15, the prices would be “exactly the same as in Amazon”. And then Macmillan made its ultimatum and Amazon pushed the button.

There’s been a lot of noise since then, about price-fixing, monopolies, loss leaders, and so on. Macmillan partisans complained about Macmillan books being pulled from Amazon (except for used copies which didn’t earn them anything). E-book fans complained about Macmillan blackmailing Amazon. Macmillan partisans called e-book fans entitled crybabies, and e-book fans called Macmillan partisans greedy profiteers.

Some e-book fans (including me) have been upset because the agency model amounts to resale price maintenance, a form of price-fixing that is inherently anti-competition and thus anti-consumer. Some Macmillan partisans have responded that Amazon was misusing its size advantage to monopolize the market. The flamewar continues.

But I suspect that all of these issues would largely go away, or at least become largely unimportant to most e-book fans, if it were not for that matter of trust I’ve been talking about.

Trust Busting

The heart of the matter is that Macmillan now claims it, and other publishers, want to implement variable pricing.

Make no mistake: if they could, it would be a great thing. As Baen has shown, $15 isn’t necessarily too much to pay for an e-book if you must have it right now (though given that Baen’s $15 “e-ARCs” won’t have print versions available in libraries or sit-and-read bookstores at the time they’re being sold (they’ll have fallen to $6 by then) and Macmillan’s e-books will, I suspect Macmillan won’t sell as many).

Others can wait until the price comes down, just as they do if they’d rather buy a paperback than a hardcover. By and large, we want to give publishers and authors our money—but a fair amount, not paying through the nose.

The problem is that e-book fans look at the ten-year history of invariable pricing at eReader and Fictionwise and doubt Macmillan can be trusted to do it.

Some of these skeptics believe Macmillan is outright lying and planning to destroy e-books by “discovering” nobody wants to buy them at $15 so there must not be a market after all (that “conspiracy theory” idea again), and others doubt Macmillan’s competence rather than its motives—but either way, it amounts to the same thing. If Macmillan couldn’t get its act together in ten years, why does anybody think it can be trusted to do so now?

Over at Making Light, Bruce Baugh thinks that it can because Amazon is a whole different ball game:

Fictionwise says they move about 16,000 volumes a month. Amazon moves…just a few more than that. It’s worth a publisher’s while to make something routine given the extra volume, and I would be slow to take their behavior with regard to a really niche venture as indicative of how they’d like to deal with the single largest sales point in the whole market.

On Tobias Buckell’s blog, Ed Greaves suggests,

It’s a perceptual disconnect. I’ve read several good blog posts about how that’s the silliest idea in the world, that publishers know that ebooks are the future, and they want to get into them, but that the current miasma is causing nothing but chaos. I believe that.

Still, even if Macmillan does come through with variable pricing, I’m a little worried that maybe Macmillan will implement it for Amazon…but it still won’t be worth the time to do it for Fictionwise and eReader, which will keep on selling those $26 paperbacks until they go out of business altogether. I rather hope not, as that’s where I buy most of my books.

Conclusion

So in the end, we have a great deal of anger and frustration on the side of e-book enthusiasts—perhaps as much from not being understood as from the pricing and other quality issues relating to e-books. As a comment from “Thiago” this morning put it:

I’m amazed at how surprised most authors seem to be by the anger of ebook readers, as if it is something that started from the Macmillan/Amazon feud. The fact is ebook readers are mad at Macmillan (and other publishers) for its general mishandling of ebooks (delays in releasing, gaps in series, the general lack of titles, the “variable” pricing and much more) for quite some time now, time during which they have essentially ignored these consumers. The apparent cluelessness of authors on these issues seems to imply authors themselves were just as ignorant.

And in Ficbot’s case, add “geographic restrictions” and “unresponsive customer service” on top of that. It isn’t any wonder that she and others on Mobileread are turning to the one-star “nuclear option”—they feel they’ve already tried just about everything else, and it is the only way they can think of to get attention. (On the bright side, it is at least less destructive than egging cars or painting graffiti.) Maybe authors don’t have a lot of influence over publishers, but if the stores and publishers are powerless to do anything, who else is left?

I’m not sure what the solution is, if there even is one. This whirlwind is made up of ten years of publisher-sown wind (or perhaps more accurately “hot air”). The Macmillan partisans who seem puzzled by the intensity of readers’ reactions, and especially those who berate or belittle them for having what the readers feel are legitimate concerns, only make things worse.

It would be nice to have a little more understanding on both sides, and attempts to engage and communicate, rather than the ridicule and anger we’ve seen so far. It seems particularly needed on the Macmillan side of things—e-book readers (at least the ones who aren’t extremists) have some valid concerns, and it’s annoying getting pigeonholed as entitlement-ridden cheapskates. (Probably almost as annoying as it is for authors to get pigeonholed as greedy, uncaring misers.)

It would also be good if someone could convince the publishers to update their pricing on Fictionwise and eReader, bring it into line and demonstrate the sort of “variable pricing” they would like to bring to Amazon.

But maybe I shouldn’t expect miracles.

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84 Comments on The Amazon/Macmillan blow-up: An e-book lover’s appeal for understanding

  1. Alan Wallcraft // February 6, 2010 at 1:40 am //

    As another example of Amazon understanding ebooks and its customers, they typically reduce the price of Kindle ebooks to be in line with the paperback even when the publisher keeps the ebook list price high.

    What would help is a statement from the big publishers that variable pricing includes a commitment to never price an ebook higher than the least expensive paper offering.

    The agency approach is going to produce a world of hurt for publishers if they don’t get their act together. Their first test is repricing all their existing ebooks by mid-March. If Macmillan’s ebooks are still priced higher than the paperback by the end of March, many readers are going to have all their doubts about this publisher in particular confirmed.

  2. Yes, as then people can put out the Big Fat Liar Macmillan booklist. :)

  3. The answer, as I see it, is pretty simple — stop buying ebooks. Period. Full stop. It makes no economic sense to pay hardcover prices for an ebook when that product comes saddled with all sorts of restrictions, and the hardcover version does not. The ebook SHOULD be cheaper than the hardcover — much cheaper — because such restrictions make it a less valuable product than the hardcover edition. Publishers don’t seem to understand this, or simply don’t care. The economically rational alternative is to purchase good second-hand copies of the paperback edition. Same content, lower price, and no restrictions.

  4. fradiavolo,

    “stop buying ebooks” is the totally wrong approach. All that does is send the message to everyone that ebooks just don’t work.

    No, buy ebooks. Lots of ’em. BUT. Only from publishers/retailers that “get it”.

    Like http://www.webscription.net/

  5. I’m not really worried about how Apple, Amazon or Macmillan or anyone else prices books in the future. I don’t have any problem going to Betterworldbooks or Alibris and searching for paper books for less than $5 (and that often includes shipping) that are either hard cover or paperback. My problem is one of disposing the refined trees that reside in my house. The Big Brown truck stops by fairly often to deliver our family the books that some say “nobody reads anymore”. We’ve always purchased our reading material at the “best price” or simply borrowed it at the local public library. But if the “best price” is an e-book, I’ll purchase that version always.

  6. I expect it won’t be long before the comments heat here up, too. Before it does, I will say you’ve done a masterfully diplomatic summary of the issues, history, and the emotions behind the “debate”, Mr Meadows. Kudos.

    Only thing I can add it to point out this particular survey at Mobileread and the percentages for the options:
    http://www.mobileread.com/forums/showthread.php?t=72538
    (Gives something to think about if this is the breakdown of the early adopter community, no?)

    Well, and to highlight that as the ebook reading hardware (single purpose *and* general purpose) drops in price and gets mainstreamed, ebooks will stop being a market for book lovers and early adopters (ergo, a niche product) and draw in a much younger and even more tech-immersed demographic than the current audiences and thus join the other digital media markets that are exposed to market forces, consumerist pressure, and *government oversight*.
    (Shoes *will* drop.)

    For the past decade ebook tech was a backwater; that day is done. From here on out change is coming fast and furious.

    Think of it as good or bad depending on your leanings, but in such a high visibility environment, cartel-like behavior *will* be challenged, regardless of what the letter of the law may or not say.

    Ebook pricing and distribution is *not* going to be a matter solely for publishers and distributors, authors, agents, and illustrators. It *will* be a matter of (strong) consumer interest.

    The prologue is over; the main narrative begins.

  7. How does “shelf life” (a la The Long Tail) impact a book’s cost? I’m assuming unless a book is a block-buster it will have a rather short shelf life in a brick and mortar store. The storage cost of an e-book is minuscule and can be maintained in a digital store indefinitely. Granted, the sales will be small but as someone who would love to see Allen Drury’s political novels in “print” again, I wish someone would educate publishers and authors on the long tail concept.

  8. You’ve nailed it. If ebook prices really were to drop when the paperback comes out, I’d consider that fair; I’d buy a few ebooks at the higher prices to read them sooner, and most ebooks at the lower prices, just like I do now with hardcovers and paperbacks. (In fact, I’d be more likely to pay $15 for a new ebook than $25 for a hardcover.) But based on what I’ve seen of ebook prices so far, I just don’t see it happening.

  9. Apart from – literally – a dozen or so exceptions I have bought all of my ebooks from Baen. I have of course got a load of free ones too – from Baen, PG etc. etc.

    Totally I have hundreds of ebooks (e.g. a year ago I discovered I’d bought 120 from Baen in 2008 – http://www.di2.nu/200902/06a.htm ).

    I don’t buy from fictionwise because I hate the confusing pricing schemes they offer and my experience of other places is worse – some won’t let me because I’m “foreign” – others charge even more that fictionwise for the same pile of electrons. Almost all of the books are crippled with DRM and the layout is frequently poor.

    I do buy from Baen because they make the process painless and (relatively) cheap – although my recent weakness for eARCs kind of holes that point. Baen seem happy with the model, their authors seem happy (I’ve seen recent comments from Dave Freer, Sarah A Hoyt, Tom Kratmann and Michael Williamson stating their contentment) and their readers are happy. It is in fact a win-win-win situation.

    I flat out do not understand why publishers are unable to replicate the Baen model. They don’t need Fictionwise or Apple or Amazon or anyone else, they can perfectly well sell the books themselves (Harlequin does so it’s not just Baen). This whole agency model thing is bogus and is purely because they have decided they don’t want to talk to their readers which is, to put it bluntly, nucking futs.

  10. From someone who has been buying/reading ebooks since the Peanut Press days:

    Well done, Chris!

  11. Let’s imagine that the publishing focus is currently on sale of print products. They could be wary of e-books as they observe reverses in other industries that have focused on electronic equivalents for previously mechanical features or products. Automotive costs of electronic hardware and software are now nearly as much as purely mechanical components and the downside of brake or acceleration failure is endless. Touch screen voting, electronic finance, and electronic music delivery have all had adverse effects on their parent industries. Is it any wonder that print publishers may have seconds thoughts over electronic delivery? Print publishers may actually be the visionaries.

    Such a perspective may be another of the missing topics in this debate. Why assume that the e-book is viable? Or, if it is, that it is consequential? There are many attributes of screen reading but they don’t necessarily convey to e-books. There is also the challenge, exclusive among electronic communications to the e-book, of outright attempted mimicry of attributes of the print book. Publishers know a bit about this.

  12. Chris, thanks for this post but I’m pretty pessimistic it will achieve any understanding. The sad thing is that readers and book lovers like you and me are really on the same side as the authors.

  13. Excellent post. Thank you.

    I’ve been wondering.

    Why are the NY Times Bestsellers always *less* expensive than other books? And — why are publishers even freaking out about what Amazon was doing in the first place? Borders and Barnes & Noble have been deeply discounting the Bestseller list in *print* for *ages*. Amazon just picked that ball up and started running. Why isn’t there a low-price, introductory period for e-versions of, say, six weeks to get book-buying people to risk the unknowns (not the Sandfords, Pattersons, Graftons, Roberts, etc.); then when it becomes apparent that a new author/title is going to break big, the price could go up to its highest possible point, and remain there while it’s still selling well. *Then* over time it could drop. Given the current state of things, the whole ‘hardcover model’ publishers keep invoking really seems like a huge fib.

    And — I love how the common perception is that at Amazon e-books are ten bucks. Not even the entire NY Times Bestseller list is always pegged at that price; and just do a spot-check of the titles that *aren’t* bestsellers. They run USD 12-16, generally. Yes, many older titles are far less expensive. But not all. At least Amazon is purported to have an automated system that calculates price based on sales and other factors.

    Anyway. Concerns over whether publishers will really drop e-book prices over time are well-placed. Some pretty ancient titles are in the USD 10 range at Amazon, even though the mass-market paperback versions may be USD 6-7. And: *No Way* should the e-book version of a title that’s been out for eight years cost more than the mass-market paperback. Get a book designer involved in e-book formatting and layout, and ‘we’ll talk’. Maybe.

  14. A great recap, Chris (small correction though, I live in Canada not the UK). I agree that $14 and ‘variable pricing’ would be fair IF a) we could actually have faith they would do it and b) if the ridiculous practice of geographical restrictions was resolved and all ebook fans could buy the book at either stage of the price point.

    For me, one of the problems is, I don’t have the space to store every book I might want to read. So if they sabotage ebooks into oblivion, it will mean I will not buy them anymore at all. 10% of the market might not seem like much, but if that 10% is encompassing hundreds of thousands of people, and if those people are avid customers who spend a lot of money, isn’t it worth it to provide them with decent service, especially when their needs (a ‘buy’ button that lets them make a purchase being the first one) are so simple to meet?

    If I didn’t care, I;d be on the darknet. I blog about this because I do care about getting this right, about making sure that people like me can continue to BUY ebooks and authors can continue to profit off of me. But preventing me from buying the book by not making it available, or making it available in a DRMd version three times the price of the cheapest paper option, means nobody profits because I just won’t buy.

  15. 1) In general, the default assumption should be “occasionally someone is _correct_ on the Internet”. 😉 Congratulations on a well-thought-out, rational post.

    2) On the other hand, one of my most treasured mementos of my college newspaper days was a Herblock cartoon showing 3 leprechauns. One was sitting on a toadstool with a smoking Mauser, speaking, one was standing looking up, smoking a pipe, listening, and the third was draped over another toadstool, apparently gut-shot and expired. The gunman says, “There we were calmly discussing peace in Northern Irish politics, and up he comes in favor of it.” (roughly, it was years ago)

    Don’t expect a lot of gratitude for your rationality from the hordes of partisans loudly proclaiming.

    3) On the gripping hand, I’d encourage more people to use my rule of thumb. Where there is no DRM, buy the ebook. Where there is, buy the dead-tree version and when you’re done with it, get your lick into the publisher by dontating it to the local library.

    Regards,
    Jack Tingle

  16. Great summary and commentary. I believe people are so passionate on both sides because nobody wants to see what happened to the music industry happen to publishing. But the only way for that to happen, IMO, is for the publishers to be cool and “get it,” like http://www.Baen.com does.

    People want fair (low-ish) prices, no DRM, no geographic restrictions and open formats so they can “own” their ebooks and read them on a variety of devices.

    But there is a “third way” in this matter — buy from the publishers and authors who “get it” like Baen.com, BooksforaBuck.com, Smashwords.com, SteveJordan.com. Go out of your way to support them — and let mainstream publishers and authors know this.

    Support ebook distributors and manufacturers who support open formats without DRM instead of buying into proprietary software formats and DRM.

    Readers need only remember: You folks *have* the money. All the content in the world is useless if no one will pay for it. You are in control if you choose to be.

    I’ve posted on my blog about this:

    http://billsmithbooks.blogspot.com/2010/02/authors-love-their-publishers.html

    http://billsmithbooks.blogspot.com/2010/02/does-macmillan-have-right-to-dictate.html

    It took the industry a long time to embrace non-DRMd, reasonably priced MP3 downloads and by the time it actually happened, the music industry had been Napstered.

    Book people are supposed to be smarter than the average bear. I hope the industry wises up before it is too late.

    Bill Smith
    http://www.BillSmithBooks.com

  17. Good post, but my one complaint? Don’t bother looking at MacMillan on Fictionwise. No matter what else they are, they are relatively new to the e-market. Macmillan is making a lot of mistakes. As an author, I support their right to make those mistakes, but I hope they learn the lessons soon, because this unrest is not good for the market, as a whole.

    No, the pricing is not consistent in indie presses, and it shouldn’t be. They’ve had 15 years (in some cases) to learn what readers are comfortable with paying. That comfort level will vary from reader to reader and, for a single reader, from author to author and publisher to publisher. THAT is free market. That is the publisher twiddling until they find a good balance and sticking to it. In some cases, that means the price drops from $7.50 for a novel-length e-book to $6 for the same length. For others, it means raising the price on a short from $.99 to $1.49, where the publisher in question found it sold in higher numbers. Strange but true.

    Is Macmillan less responsive to readers? Possibly, but it’s up to the readers to make themselves heard to change that. Readers are undoubtedly the final customers for the books. Believe me, Amazon (as a distribution channel) isn’t reading them.

    BTW, why do you say e-ARC? Just a nit for me. An ARC is the unfinished copy, the last version before final galley pass, in my experience. Though some e-books are badly presented, it should be an e-BOOK not an e-ARC, when it’s in its final sale condition.

    A couple more quick thoughts here…

    The first is that many conglomerate publishers that are producing print titles first and putting them into e-book seem to produce substandard e-book. This floors me. The cover is made. The book has already been edited. How could someone produce such a lousy e-copy of an existing print book? If it’s OCR scanned from the print, I would say they need a proofing pass to find OCR errors, but I’m being told some of these books aren’t even OCR scanned. They are supposedly made from the same base files the print was. How do you make such sloppy errors?

    The second is one of the fallacies of the reader side. Even you hinted at it. The misconception is that all e-books are secondary products to a primary print edition. Even for NY conglomerates, this is not always the case. Carina Press and Spice Briefs (both from Harlequin) are e-book lines. In indie press, it is more likely to find primarily e-book than a primary print or simultaneous print and e-book setup. Since e-books are quite often a primary product…and sometimes the ONLY product, they are not just piggybacking off the investment in the print book. It takes money to produce an e-book, even in a primary print system (though much less than in a primary e-book system).

    It’s not that authors don’t like readers. Most of us love readers, and I personally love that my books would never run afoul of Amazon’s $9.99 line, by far. You say readers want to pay less for e-books and to have a larger percentage go to the authors. I agree. But that is up to the readers to make happen.

    Complain to the publishers, when you feel e-book prices are too high to help drive them down.

    And, purchase direct from publisher sites (when possible). I know some NY conglomerate author contracts give percentage of cover price, but many authors have a percentage of net contract. What does that mean? If you purchase the e-book at the publisher site (where they aren’t losing 50% or more to a distribution channel), the author makes double the royalties he/she would on the same book, sold at the same price, from a distribution channel…money that would have gone to the distribution channel. If necessary, window shop at the distribution channels and then go back to the publisher sites and buy there. The reason we use distribution sites is that readers want to buy there. If we could sell off the publisher sites and make what we do from distribution, which do you think the publishers and authors would prefer?

    Brenna

  18. The “John Sargent’s ads/open letters” were originally printed in the publishing trade press where only those folks addressed should see it, NOT in the open press where readers should see it, so saying it’s an insult to readers not being included doesn’t really cut it.

    I certainly agree that conglomerate publishing ignore the readers’ feelings and ideas, but, then, they ignore the authors, editors, and other small fish in the food chain so that’s typical business as usual.

    I doubt that will change, and most of what readers are saying will remain so much white noise. The only way to get their attention is through their wallets. If you don’t like what they are doing, don’t buy the books. Even they notice that.

    However, things should improve as far as faster pricing changes, etc., now that the big publishers are finally paying attention to ebooks because of the rise in profit through the Kindle and the entry into the market by Apple.

    A major reason this whole mess with Amazon started is that the big guys have started paying attention and realized that Amazon was controlling the game, not them.

    Now that ebooks are a definite revenue stream, the big publishers may flounder around trying to figure out pricing, distribution, etc., but they will not be able to kill the market, nor will they want to. Money is money.

    As to Scalzi, he has just announced he is running for president of SFWA so his blog and comments are no longer aimed at readers. Those who don’t want to be cannon fodder for his politics should be advised.

    Aspalt, the lower price of paper bestsellers is part of the standard “loss leader” strategy for most booksellers. They figure you’ll buy something else when you buy the latest Dan Brown, plus they want bragging rights to having the lowest price.

    The publishers aren’t happy with this although they get the same price for the book whatever the price it is sold at. In other words, they have the same feelings about both underpriced paper and ebooks, but you’ve not been aware of it because you don’t read the trade press, and few readers follow the paper news as those here follow the ebook news.

  19. Marilynn:

    The “John Sargent’s ads/open letters” were originally printed in the publishing trade press where only those folks addressed should see it, NOT in the open press where readers should see it, so saying it’s an insult to readers not being included doesn’t really cut it.

    Yet, as I said, there were no other communications out of Macmillan aimed at consumers—no attempts to smooth over the waters or clear up misunderstandings. So either way, the consumers are left with the impression that the publisher doesn’t care enough about them even to try to address their concerns.

    I certainly agree that conglomerate publishing ignore the readers’ feelings and ideas, but, then, they ignore the authors, editors, and other small fish in the food chain so that’s typical business as usual.

    I doubt that will change, and most of what readers are saying will remain so much white noise. The only way to get their attention is through their wallets. If you don’t like what they are doing, don’t buy the books. Even they notice that.

    Yeah, I got that impression, and I look forward to a lot of not-buying of e-books at the $15 price point.

    The thing that gets me, as Ficbot has said elsewhere, is that there are a lot of readers who really want to support authors with their money. But the publishers won’t make it available in a form in which they can use it.

    Now that ebooks are a definite revenue stream, the big publishers may flounder around trying to figure out pricing, distribution, etc., but they will not be able to kill the market, nor will they want to. Money is money.

    We can hope, anyway.

  20. Brenna:

    BTW, why do you say e-ARC? Just a nit for me. An ARC is the unfinished copy, the last version before final galley pass, in my experience. Though some e-books are badly presented, it should be an e-BOOK not an e-ARC, when it’s in its final sale condition.

    Because Baen does. Their “electronic Advance Reader Copies” are exactly that: the unfinished copy of the last version before the final galley pass. They’re offered three months in advance of the first printing of the paper book at a $15 premium as a “sneak peek” for those readers who just can’t wait to see what happens.

    For instance, in the last few days Baen released its e-ARC of the next Honor Harrington book, Mission of Honor, and the discussion forums over in the Baen Bar are all abuzz about it.

    For all I think they’re generally a waste of money, I must confess to buying one of them myself. But then, it was by P.C. Hodgell. :)

  21. Okay…so e-ARC is specifically for that type of release. Indies don’t typically do an e-ARC unless we have a reviewer that demands an early copy…and not always then. Even when we do offer one, we typically make sure it’s in good condition and “book like.”

    Brenna

  22. “But that is up to the readers to make happen. ”

    You are not listening. We’ve tried. It isn’t working. We need authors to work together WITH the readers, agents or whomever on this one. Authors need to take MUCH more agency in this than they have been. Start a union or something, I don’t know. But the readers who have tried are getting nowhere on this. Getting someone to take my money should not be this much work.

  23. A bit of an expansion on the BAEN ebook practices:

    In addition to the occassional $15 eARCs, they sell individual titles from their own back catalog at $4 each and monthly bundles of 4 new releases + 3 reissues for $15; these are the “webscriptions” of fame.

    They also sell (quarterly?) bundles from Nightshade Press featuring 5-8 titles at essentially $4 per bundled title and individual Night Shade titles for $6.

    They carry an assortment of books from e-reads typically running $6 each, including (I just noticed) a bunch by Harlan Ellison. (??!!!)
    All DRM free.

    In other words, the Baen model is simple and straightforward: skip the distributor, skip the retailer, price the book at reasonable sub-paperback prices, bundled and unbundled, keep it on sale forever.

    Looking at the composition of their webscription bundles it is easy to see there is *some* competence in how the bundles are structured to ensure buyers get a decent mix of genres and author styles; contrary to circulating misinformation, their catalog isn’t composed solely of “right-wing-libertarian shoot’em ups”. Not even from authors that do play in that arena. They do feature content from all the genres of the field, from adventure and space opera to fantasy and character-based drama, with the occasional caper, romp, and even SF Comedy of Manners. On any given month a webscription will offer a fair value to most buyers regardless of their preferences.

    In other words, they offer their customers a choice of content and pricing and they offer their author’s access to readers who might not otherwise sample their efforts. And, as they point out, they trust their customers not to upload their books to 10,000 of their closest friends on the internet.

    This may not necessarilly work for everybody, but everybody doesn’t get to be King or Patterson, either, and Baen’s being doing it for over ten years now and their operation seems to be growing in scope regularly so it seems to be working well enough for all involved parties.

    As to quality, which is another sticking point with ebook buyers: other than their habit of using straight quotes ( 😉 ), I find nothing really wrong with their ebook releases, which seem to come straight from the final production edit, not some poorly-ocr’ed paperback scan, even for those titles that are 50’s and 60’s classic reissues.

    The only question I have is why the SFBC (or some other book club) doesn’t lift this model straight up. They’re cherry-picking the core of the SF market, after all, and generating a steady stream of repeat bundle buys; I doubt I’m the *only* reader out here who’s bought all the books released in their bundles.

  24. I actually find the whole thing somewhat encouraging, aside from Amazon’s tactic which hurt authors who I want to read. I ONLY read ebooks, and 99% fantasy/science fiction. The problem is of course the biggest publisher of the books I read, has had very inconsistent pricing (as outlined above). For a variety of reasons I don’t use Amazon Kindle format unless I have too, I’ve found that if I navigate the somewhat confusing shoals of Fictionwise sales, I can do better than $9.99 for most ebooks (even the overpriced Macmillan ones).
    While I might end up paying slightly more cash up front, I would appreciate a rational pricing scheme from Macmillan, especially if it applies to locations other than Amazon. If they actually made the same books available to Fictionwise that Amazon carries, I would be very happy, especially if they stopped asking a $25 list price.

    Of course the BEST thing would be if they opened a Baen style direct publisher ebook outlook, but I’m not holding my breath on that one.

  25. Thanks for this, Chris; it’s good to see someone laying down the historical roots of this schism from the ebook reader PoV. As I’ve been reading the recent posts here, the comments and links, it’s clear there’s grounds for discontent and distrust of Macmillan. I think that if you tune out the white noise of offense taken and given on either side, there’s a valuable conversation to be had. For what it’s worth, I think there’s points of similarity that might help people see where the other side is coming from. (The one thing I think is misguided in your article, btw, is casting us as Macmillan partisans. Hopefully I can clarify why here.)

    Take the Sargent letter, the fact that it wasn’t addressed to consumers. From the writer’s side, think of what the absence of any communication even remotely comparable from Amazon says to us — especially in context. Even for a writer like myself *not* directly affected by it, having a whole group of friends and colleagues have their books de-listed with no reason given whatsoever (still no official statement a week later, indeed,) is… man, it’s like a shop-keeper hearing that the landlord came in the night to 1/5 of your neighbours on this long commercial strip you all rent outlets on, and evicted them with no reason given as to why. This may sound like overstating it, but the discriminatory closing down of businesses like that is the stuff of dystopian fiction.

    I think for a lot of writers who quickly found out the reason from the Sargent letter, this was sufficient to decide their sympathies. It wasn’t a matter of supporting Macmillan but of rejecting Amazon’s tactics. Think of the scenario a while back with Orwell (talking of dystopia) being recalled from people’s Kindles. Now imagine that it’s a fifth of users who have their entire collections *completely scrubbed* because they’d been accessing via one of five wireless providers — i.e. instead of AT&T you have AT&T, BT&T, CT&T, DT&T and ET&T; Amazon have a trade dispute with ET&T about their deal and decide to put a gun to their head by cutting off any users who connect via them.

    You’d be up in arms, right? And it wouldn’t really matter in the first instance *what* they were arguing about; it’s the tactics that are just plain out of order. Again, imagine no reason given at all by Amazon. ET&T has to contact these users and explain how they’re the victims of Amazon’s action against *them*. Where would your sympathies lie?

    I’m not trying to persuade you to see Amazon as the bad guys here, btw, just to make it clear why authors would default to that before the actual details of the dispute are even factored in.

    Similarly, just as ebook readers have serious past history with Macmillan over Fictionwise, writer response is/was similarly informed by its own experience of *Amazon* behaviour in the past — to wit, the previous “AmazonFail” over LGBT titles. The particular sub-community of (largely) SF/F writers and readers that backlashed against the Macmillan de-listing is largely the same group that was up to their elbows in that mess — and Amazon has never really adequately quelled suspicions. For a lot of writers that left Amazon looking ethically bankrupt in a way that’s worse than just your usual corporate grifting; it left them looking like they were willing to pander to right wing homophobic lobbyists and only happened to get caught out due to their incompetence in doing so. I can understand the ebook reader’s simmering fury at Macmillan over prices. Hopefully, you guys can understand the utter lack of faith I know *I* have in a company that was punting “cure your child of their homosexuality” texts as the *only* thing returned by an inventory-search on “gay”.

    The point is that in the same way ebook readers had their reasons for siding *against* Macmillan (rather than *for* Amazon,) writers and the readers wired into their conversations over the blogosphere had their reasons for siding *against* Amazon (rather than *for* Macmillan.)

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