A bookstore, a lending scheme and an irate author all walked into a bar. . .

by Amanda S. Green

It’s November and that means writers everywhere are putting sanity, family and who knows what else on hold as they try to take part in NaNoWriMo.  Since I’m one of those, please bear with me as I try to pull together a coherent post today — no guarantees, especially since my brain is in full novel mode as I work feverishly toward the end of my current WIP so I can start the next novel on my plate.

Let’s start with news about brick and mortar stores.  Shelf Awareness reported Thursday that there is some good news on this front.  First, a couple of “Borders refugees” have opened their own bookstore in Rolling Hills Estates, CA.  Across the country in Massachusetts, Hugo Books is opening a new store in the space once occupied by a Borders Express.  BooksMN which has been an online store only, has now opened a brick and mortar storefront.  All three openings are, in my opinion, evidence that there is still a demand for “real” bookstores, store that are geared for their market and not forced to operate under the constraints of a purchasing model designed by bean counters in their grand offices in some faraway ivory business tower.  Here’s wishing good luck to these three new ventures and the others like them.

Next up is news that will soon have Amazon detractors screaming that the company is now trying to kill libraries.  If you don’t know what I’m talking about, late this past week, Amazon announced a new benefit for their Prime members who own kindles or have the kindle app installed on their smartphones, computers, etc. Basically, Prime members can borrow one book a month and, if I remember correctly, there is no time limit on returning this book.  Now, before you stampede over there to find that latest best seller to “borrow”, there is a hitch.  None of the Big Six publishers are taking part.

But there is more.  According to Publishers Weekly, some mid-sized publishers have declined to participate as well.  Why?  From PW:

Amazon’s statement in launching the lending program said it is either paying a flat fee to publishers to feature its titles, or paying the standard wholesale discount for each book that is borrowed.

What some of these smaller publishers are objecting to is that Amazon has apparently told them this flat fee must be allocated to the author.  GASP.  Money allocated to the authors.  How dare they!  Don’t they understand the publishers are more worried about making money for themselves and not the serfs they have chained to their computers putting out the product the publishers sell.

Finally, there’s a blog post that I first read about on Kris Rusch’s blog earlier this week.  She writes much more eloquently about it than I can, so please go check out her post.  But the gist of what gets to me is this:  Author puts book up on Amazon and sets a price and goes merrily on his way.  Author also puts up a sample of the book up on Barnes & Noble for free.  Same title.  Same description, at least in general terms.  Apparently the only thing that was different was the size of the download file.

Fast forward to Author suddenly seeing a spike in his sales on Amazon.  Author is thrilled.  Folks like his book and he’s going to get a very nice royalty check from Amazon before long.  Then he gets the surprise of his life when the monthly reports are available.  His book had been listed for free by Amazon.  What?  He didn’t tell them they could do that.  How dare they! Now he wants all the royalties he would have gotten had they not listed the book for free.

The problem?  Well, I have several with this scenario.  The first is the most simple, at least in my mind.  This author saw the sudden spike in sales and never thought to look at the book description on Amazon to see if there was a reason. A lot of heartache could have been avoided if he’d taken this simple step.

My second issue is that he is upset because he didn’t give Amazon permission to list his book for free. Okay, this isn’t quite as straight-forward as checking the product page to see if something showed up there to explain the sudden surge in sales.  When an author or small publisher signs up for the KDP program, they agree not to list their title(s) for a lower price anywhere else.  Amazon also reserves the right to match or beat the price of a title.  It’s no secret that Amazon has bots that check prices on other sites.  There’s a button on each product page where you can report a lower price.  The author might not have realized when he put his free sample up on Amazon without changing the title — even a little — he might encounter this problem.  His argument that Amazon should have realized these were two different items because of the difference in file size falls flat, at least to me.  Even if he’s right, I doubt big bad Amazon purposely set out to shaft him.

My final issue, and this is the big one, is his demand Amazon recompense him by paying those lost royalties.  For one, if he’s smart, he’s sitting at his computer, pounding out a new title as quickly as he can in order to take advantage of the exposure he’s received from the giveaway.  This is a lesson I’ve learned from Baen.  Free books equal bigger sales, unless the book absolutely sucks.  It’s also something we’re seeing at Naked Reader Books.  Frankly, it is about the best advertising you can have.

But there’s something else.  This author admits his sales before the book were much lower than the number downloaded when free.  Yet, if I remember correctly, he wants Amazon to pay royalties on each and every book downloaded while free.  That makes the assumption that he would have sold each of these books had it remained at the original price.  Nope.  That wasn’t going to happen.

So, someone made a mistake somewhere along the line.  Probably several someones, including the author.  Should Amazon pay the author anything because of what happened?  I don’t think so.  But that’s just me.  The author should look at it as a learning lesson — to better read contracts he agrees to, to be more careful in the titles he lists things under, etc — and should be writing as fast as he can to put more titles up.

You might ask why I don’t name the author or his book.  Well, just like the author who shot herself in the foot when she continually went off on reviewers who didn’t like her book, I don’t want to give them any more publicity than they’ve already received.  But, that’s me.  I don’t have much patience for whiners who could be using what happened into a strong positive.

But his tale is a good cautionary tale for all of us.  If you are even considering putting your books or short stories up for sale on Amazon or Barnes and Noble or Smashwords or any other venue, carefully read the contracts.  Look at the forums discussing the contract and how the venue pays.  Keep an eye not only on your daily sales but also on your product pages.  You don’t have to read the reviews if you don’t want, but you do need to keep an eye on the ratings.  If you suddenly have a collection of one star ratings, you’d best find out why.  You are now your own publisher and these online retailers are your distributors.  It is your responsibility to know what’s going on and to be proactive in dealing with it.

15 comments

    1. Looks at Sarah and taps foot. Short stories? Short stories? Where is the next Thena-verse novel? Or shifters? I want my shifters!

      ;-p

  1. I just heard about that author who went “off the deep end” about bad reviews. Reminds me of Eric Flint’s comments about why authors’ working envirnoment can drive them nuts.

    1. Paul, agreed. But this one went off the deep end and liked it there for much too long. I know reviews can hurt if they don’t love your “baby” as much as you do, but it is counter-productive to go around telling the reviewer and subsequent commenters to do things that are anatomically impossible.

  2. “… you’d think the one in back would have ducked.”
    (Sorry, reflexive response to that set-up line.)

    I’d have to agree that it’s unrealistic to ask Amazon to pay “lost royalties” on transactions which almost certainly would not have existed under status quo ante conditions. But I also think it would unreasonable even to try asking for “estimated lost royalties” based on past sales numbers, considering they didn’t get any revenue to pay royalties *from*. His response essentially amounts (imho) to demanding that other authors subsidize his error, by driving up Amazon’s operating costs. (Negligibly, granted, but I think the princliple remains valid.)

    I am beginning to get the feeling that we are evolving a “two-tiered” market-structure. Things that genuinely are as interchangeable as cans of beans are largely retreating from brick-and-mortar storefronts into the realms of Amazon and Overstock. But things that are highly subjective in nature seem to be producing a re-emergence of small, specialized “boutique”-type retailers. Almost medieval “family-business” type shops in some cases, like the honest-to-bog *record* shop down the street from me. The shop also sells (or can order) any modern CD or cassette tape you could want, but their real stock-in-trade is over 30,000 pressed-vinyl records, combined with the encyclopaedic music-history knowledge of the owner and his partner.

    1. Steve, I think we are going to see the brick and mortar stores becoming the specialty stores of old: mystery, sf/f, etc. They’ll order books their customers want, but have a basic theme to the store otherwise. And, as with the music store owner you mentioned, the owners and employees will know their stock AND their customers and treat the customer like someone important. At least I hope so.

      1. As the costs of electronic stuff drops, we may see POD setups in many stores. With catalogues and various agreements about who gets how much of each sale.

    2. But having gone *this* far down that particular hallway-toward-the-future, I now find myself wondering if Amazon has started making plans for the next phase. Remember my “Meet The Newbie” guest-post for Naked Truth, with the link to an article about 3-D printers? When we all have those (or the Star Trek replicators they make me think of) in our houses, and Amazon finds itself trying to compete with the price of the raw materials … they’ll be where the traditional retailers are now, more or less.

      1. Pam, there are already a growing number of stores — albeit still a very few relatively speaking — that have the expresso POD machines. However, until the cost of the machines come down dramatically, I don’t think we will see them in more than a handful of shops.

        Steve, you’re probably right. However, my money is still on Amazon. Unless something happens — and that is always possible — it’s shown a propensity for staying one step ahead of the changing market. Of course, that’s not to say something won’t come along that throws it off the tracks, down the incline and into the creek..

      2. Oh, my money is on Amazon too, until they change out all the original Board members/executives. (Remember that Lehman Brothers started out as two borthers named Lehman, who were brilliant. It was just the folks they sold the name to who turned out to be … not brilliant.) And I expect they’ll probably be looking at how to move *backward*, not the direction everyone else perceives as “forward”. Fifty years ago Heinlein wrote that the most important occupation of our generation would be “information synthesists”, people to save us from drowning in data. Just as the indie shops emerging now are trading on specialized knowledge, I expect Amazon to become the next evolution of the niche currently served by Google and Ask.com, as at least part of their next-gen business model. (Well, at least that’s what my notes for the next volume of the SF series say … lol)

  3. @Paul..oh my that train wreck was entertaining. all 41 pages of it. I wish the twit in question hadn’t deleted all her posts..I wish I’d thought to start archiving them all on my drive and then to a disk before she did that. Then I could put that up for posterity in the worlds longest UBER post. 🙂 oh well.

    1. Sean, part of me agrees with you. That sort of behavior can be entertaining — as long as you aren’t right next to the person as they implode. However, another part of me says “no, don’t give her any more publicity than she’s already gotten.” Shrug.

      1. I’m just as glad to have missed it. In spite of (or because of) my temper problems, I hate to witness (in person or on-line) other people’s fits of temper even if they aren’t directed at me.

  4. “What some of these smaller publishers are objecting to is that Amazon has apparently told them this flat fee must be allocated to the author. GASP. Money allocated to the authors. How dare they! Don’t they understand the publishers are more worried about making money for themselves and not the serfs they have chained to their computers putting out the product the publishers sell.”

    While I see what you’re saying, I really feel that the publishers have a right to make money from people reading the books. They’ve taken a risk by publishing them and they need to be rewarded for taking that risk or they won’t take it again on another book, and then no one will get published.

    I completely agree with you about the free-book writer. It’s pretty clear from all the info on the KDP site that if they find your book cheaper elsewhere, they’ll match it. In fact, from reading the posts in the Author forums, it seems that a lot of people are counting on this because it’s the only way to make books free on Amazon and, like you say, free books=exposure. He’s not entitled to any royalties. Not reading all the information when signing up to a website is like signing a document without reading it. Great post, and I’m following your blog!

    1. Isabella, Amazon isn’t keeping these publishers from making money. One of the options they are offering is, if I understand it correctly, that they will pay royalties based on previous sales for the length of the loan period. But the fact that these publishers refuse to recognize 1) that the prime loaning model is very good promotion for their authors and all books written by their authors and 2) this would be seen as a good faith step by these publishers by an increasingly frustrated buying public is beyond me. What we all have to remember is that we are talking about only a portion of Amazon customers — those holding Prime memberships. That, plus the limitations of only one book per month per account, etc., means this would be a negligible monetary amount to the publishers.

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