images.jpgThis is an update to the earlier Amazon plays hardball to keep lower pricing option which gives a lot of details with sourcing of statements.

Today, FAIR (a media-watch organization established in 1986) comments on the New Yorker article by Ken Auletta titled “Publish or Perish: Can the iPad topple the Kindle, and Save the book business?

That title will give a clue to the focus of the New Yorker Magazine’s article (or maybe The New Yorker itself, which is sharing the financial plight of other publishing organizations).

Can they… CAN they? “topple the Kindle” (Keep Hope Alive?) followed by, can they also “save” the book business – the two thoughts in tandem there. But the idea of toppling another type of device came before the idea of saving the industry (or in connection with it).

Already, many columnists have pointed out that the iPad and Kindle are two different animals — one is a dedicated e-reader and the other has a multiple focus with an altogether different technology, dazzling for multimedia, but with an e-book reading display that many feel can fatigue the eyes in the long-form, serial reading area (from direct light to the eyes, not from refresh-rates), not to even mention the variance in Size and Cost.

But these are factors raised by other authors when writing about the possibility of “toppling” another, altogether different device.Note also that it’s not even “Will they” (a fair question) but “Can they” as if that were a hoped for result.

Even if the headline was done without thought, word-choices are often good indicators of underlying thoughts.

The New Yorker’s Conclusions

I’ll get on to’s, as usual, informative and to-the-point commentary in a minute, but The New Yorker, as FAIR points out, gives a detailed history of the e-book pricing battles and then goes on to paint the publishers and Apple’s Steve Jobs (even pulling in the cancer card of all things — and as a survivor myself I think that was cheap) as rather saintly in their hopes to save publishing from Bezos.

Apparently, from Auletta’s telling, their main focus is to help authors, which is why they are pricing e-books 30-50% higher. Well, there does have to be a way to try to justify the much higher pricing, which is causing e-book audiences to write in several device forums that they are not interested, thanks.

The closing few paragraphs in the article actually quote mainly “Apple insiders” and they’re quoted for the ending conclusions.

As detailed by others and in my own (b)logged history of events ((1) Hardball and (2) Steve Jobs role), this is a rather rich, purple battle between ‘ruthless’ protagonists on all sides.

They all want what’s best for them (if it also benefits the consumer, that’s appreciated by consumers). That’s what’s missing from this article.

But the story uses hearsay (no source) to paint only one of the three as “ruthless” while the others are just hoping to help authors and to ‘survive.’ They are of course victims doing their best.

WILL the Agency plan “save” publishing” ?

Let’s ignore that raising prices that much in THIS economy will help no one survive.

The key is ‘selling’ a book at all, and the current prices that the publishers and Steve Jobs have decided on will not be helpful.

Pricing Difference Example

One example of what is going on here (and this is a repeat of the actual $-situation with regard to money going to publishers from which they are then able to pay authors — although authors have had to take a percentage cut recently from some publishers):

‘ On a $26 publisher-set-list price book on a book that’s currently a NY Times bestseller, the traditional wholesaler arrangement would have meant about $13 (approximately 50%) going to the publisher EVEN when the bookstore/retailer charges only $10 for the book as Amazon did, which treated bestsellers on the NYTimes list as loss-leaders.

As Steve Jobs inserted into his Agency agreements with the Big5 later, he later wanted, after all that, the ability to sell the ‘hottest’ books (apparently the first 10 of the NYT bestsellers) for only $10 and did get that. In other words, he did want to ‘devalue’ those (in the publishers’ eyes, $10 was a devaluing) and got it.
All bookstores would want guarantees from the publishers that if they went with Apple’s agency plan (70% of bookstore selling price to publishers) other stores would not get the ability to sell lower.

So, now the Big5 publishers, on the $10 e-books, receive $7 with the Agency plan instead of the $13 that Amazon did pay them under the wholesaler arrangement, meaning there was MORE money for the authors from the older non-agency arrangement as they affected the most popular books.

Control is the issue, of course, and the publishers hope Apple will always give them this, despite remembering history. The latter needed to get a foothold in the e-books area and this way they did. Who benefits or loses from this? Probably consumers and authors.

Yet the publishers carry on about wanting the authors to get more.

FAIR.Org’s Commentary

FAIR’s headline is (deservedly so) even more scathing than my words.
“Unlike Amazon, Publishers Understand Authors–and How to Rip Them Off”

Jim Naureckas recently analyzed the New York Times article about a “threatening” Amazon in his piece NYT Exposes Amazon’s Fiendish Plot to Sell Books for Less Money.

In the current article,’s Naurecka writes:

‘ Amazon is depicted as controlling and mercenary… [with examples]

Publishers, on the other hand, are remarkably altruistic: “Publishers’ real concern is that the low price of digital books will destroy [brick and morter] bookstores, which are their primary customers,” Auletta writes. But they’re equally concerned about the well-being of authors ‘

However, Auletta’s piece is, as I said, a nicely-detailed one, but the closing paragraphs, practically written by “Apple insiders,” paints Bezos as wanting to destroy publishing altogether and take it all over by himself and Steve Jobs is just wanting a ‘win-win’ situation, because now he is aware mainly of his ‘legacy’ and his ‘vision.’ However, as magazine negotiation reports have mentioned, publishers are trying to get Jobs to ‘win’ less now that they’re talking details.

Auletta does end, after all that publisher/Jobs image polishing, with the words from a “skeptical literary agent”

‘ Asked about publishers’ efforts to raise prices, a skeptical literary agent said, “You can try to put on wings and defy gravity, but eventually you will be pulled down.” ‘

Nicely put, just as long as those are not painted as angel wings.

Editor’s Note: This article is reprinted, with permission, from Andrys Basten’s A Kindle World blog. PB.


  1. Amazon’s Goal is to sell books – they don’t really care about the format.

    Apple’s Goal is to sell hardware – they make content deals simply to make their hardware more attractive to the consumers.

    Publishers are in a precarious position these days. They serve as disintermediators for things that don’t really require disintermediation anymore, it is just that the legacy systems they are a part of haven’t died yet.

    Either Amazon or Apple will soon be able to cut the publishers out of the loop by simply making deals directly with the authors. It isn’t a question of if, just when. They are just waiting for the market for e-books to mature a bit more. They can make the move at the time of their own choosing.

    Trying to play Apple against Amazon is a losing strategy, but they may as well, because there is no winning strategy.

  2. Agree that there’s a possibility for Amazon/Apple to go directly to some of the big-name authors (e.g., Dan Brown, Stephen King, Nora Roberts). Their names are the brands and Apple/Amazon could pocket the money. What I don’t see happening is Amazon/Apple hiring staffs of editors to assess submissions, nurture books through the rewrite process or actually bring up new authors. Which is what real publishers do.

    Rob Preece

  3. Quote: “Publishers are in a precarious position these days. They serve as disintermediators for things that don’t really require disintermediation anymore, it is just that the legacy systems they are a part of haven’t died yet.”

    This is true only part of the time. Publishers and the editors they employ do often turn a good book into a great one. There are numerous authors who can vouch for that. They also often provide the money and the encouragement that an author needs to finish a book that otherwise would never see the light of day.

  4. Agree that there’s a possibility for Amazon/Apple to go directly to some of the big-name authors (e.g., Dan Brown, Stephen King, Nora Roberts).

    Now, Nora Roberts has publicly said on both Dear Author and Smart Bitches (sorry, not gonna go find the links) that she will NOT do this because she doesn’t care about doing any of the back-of-the-house biz-type stuff that goes along with cutting a publisher out of the equation. In addition, she has an (for lack of a better word) “inventory/backlog” of manuscripts at her publisher’s and she’s conservatively four or five books ahead of the publishing process. All she cares about is sitting down and writing. Period.

    For her to do this would require an AGENT who knows how to cut distribution deals or IOW, knows how to direct her career from an ENTIRELY NEW PARADIGM than how it’s done right now.

    So I have to conclude there she can’t be the only huge-name author out there who wouldn’t go for that, one who makes an enormous amount of money under the old system and sees no reason to change for a few bucks more. I’m willing to bet that the biggest names would be of the same mindset.

    King? Maybe. After his half-assed attempt and his dissatisfaction with not-insignificant-to-the-rest-of-us sales, but his willingness to at least have experimented with it when it totally wasn’t cool makes me think he’d try again.

    What I really think is that it’s going to be the solid midlisters who make it happen because they’re going to get tired of being caught between Scylla and Charybdis. It’s the upper-tier midlisters that’ll kill the publishers, though. They aren’t making King’s and Roberts’s money, but they have solid sales. But they have no rights and their royalties aren’t going up and they’re going to start looking at the kind of control over their work they DON’T have, and start wondering what the publisher actually does for them that they can’t do themselves.

    If I were Roberts and King and Brown, I’d think the publishing industry was just fine, too. I would see absolutely no reason to change anything, much less put myself to the trouble of taking on the entire job and becoming my own contractor.

  5. An update.
    Ken Auletta had the scheduled “Ask the Author” live chat with The New Yorker readers on April 19.

    The Q&A transcript for that is at and gives some context indicating a bit of his own perspective on all this as well.

    One thing I’d forgotten to add from reading the March 18 New York Times article by Motoko Rich — which I quoted quite a bit in the “Hardball” link above, noting her word choices when reporting quotes from publisher reps leaving negotations to give her info on their unhappiness with what they called Amazon’s “threats” to them — was brought back to mind by one of Auletta’s replies, which made sense because he probably had not read that article.

    — “I don’t believe that Apple is offering self-publishing services aside from people submitting apps.”

    I went back to Rich’s article, remembering what she wrote about a job position Apple had posted. I then added that part to the post-chat comments which The New Yorker allows.

    Mitoko Rich’s NY Times piece of March 18, 2010 included this:

    ‘Apple is not likely to give up on smaller publishers. A new job posting on its Web site is for an “independent publisher account manager, iBookstore.”

    The posting says the person would be “responsible for building and growing relationships with small- and medium-size book publishers, self-published authors and other content providers for the iBookstore.”

    The mention of “self-published authors” in the job posting was interesting, I thought. I think they’re all brass knuckles when opportunity knocks. Why not. No one party is, alone, “ruthless” in the e-book pricing/control wars.

    Note that with small publishers (same article), Rich writes:

    “…Apple, which has effectively said that any publisher that wishes to sell its books on the iPad must offer the same terms to all booksellers.
    In other words, to do business with Apple, publishers must export Apple’s business model to all retailers. Amazon, by contrast, has not promised to adopt the agency approach for any but the largest publishers. ” {Ends the quoting of NY Times’s Rich]]

    But read the Q&A if you have time, as it certainly adds a bit more to the article.

  6. Apple’s own intent to chase authors is a focus of the Kindleworld article on The New Yorker live chat of 4/19. Auletta had not known that Apple had plans to do that (job posting found by NY Times), nor did the publishers seem to know, or they knew but were ignoring it while in understandable fear of Amazon’s plans for direct contact with authors. This was an interesting wrinkle.

    That’s at

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