As I sit here waiting to have my shoulder worked on — again — I’ve been going through my usual routine of seeing if any blog posts, news articles, etc., caught my eye as fodder for today’s post. Unlike the last few weeks where nothing has really reached out and grabbed me, this morning was different. This morning, a number of different links, most of them all referring back to Amazon, popped up and grabbed me by the shoulders and demanded I write about them. Or maybe it’s just that I’m a bit of a troublemaker and I like stirring the pot and seeing how many of the “b-b-b-but Amazon’s EVIL” folks I can rile.
I guess we can put the blame for today’s post directly at the feet of Chris Kelsey. For those of you who don’t know Chris, he’s a great guy and a pretty damned good writer — if I could just get him to write some more. (Glares all the way from Texas to a country far, far away). He sent me a link to an article this morning from The Street that asks the question “Is Amazon Bad for Publishers?”. The article is in response to a review by Duff McDonald (NYT) of Brad Stone’s book The Everything Store: Jeff Bezos and the Age of Amazon. I’ll admit right now that I haven’t read the book. It’s on my to be read list but, being a writer and cheap, I’m waiting for the price to come down some for the electronic version.
However, it isn’t the book that I want to talk about as much as Felix Salmon’s post in the Street. He asks, “What’s the argument that says Amazon has proved itself to be a mortal, existential threat to the publishing industry?”
What is interesting is that he doesn’t buy into the argument put forth by so many that the initial $9.99 price for e-books on the best sellers list was meant to harm the publishers. Sure, publishers didn’t want to sell e-books at such a “low” price initially but they weren’t the ones taking the loss with those sales. As Salmon points out, it was Amazon. He also notes that Amazon’s ultimate goal was to sell as many e-books as they could and that, in turn, would turn a profit for them.
The only “harm” Salmon sees to the so-called publishing industry by Amazon’s practices is to bookstores. He notes, however, that it didn’t hurt the big box stores. If bookstores were harmed, it was the small, locally owned ones. Now, I’m not sure I agree with him. In fact, I don’t on one level because those same small stores were already in decline because of the big box stores long before Amazon burst onto the scene. Did Amazon’s lower prices help put the nail into the coffin of some of those stores? Possibly. But think about something else before condemning Amazon. At the time most of those stores were going under, we weren’t quite as “plugged-in” as a society as we are now. Online shopping was just coming into its own. So, the harm was still mainly coming from the big box stores that could offer the same books as the smaller stores but at a lesser price.
The one thing Salmon does point out, and that I do agree with wholeheartedly, is that Amazon has made it easier to find books. This is especially true of books that aren’t being pushed by the publishers. I’ve used Amazon to get copies of books my local big box store couldn’t or wouldn’t order and that my library would have to get on inter-library loan. That’s a sale for the publisher and the author would not have had otherwise.
So, basically, if you want to see what someone who is looking at the question of Amazon from the outside, go read Salmon’s post.
But that isn’t the only thing Amazon has been in the news for recently. To be filed under the heading of “Great idea but one that brings out the entitled” is Amazon’s new Kindle MatchBook program. Basically, if you have purchased a qualifying print book, you can then get the e-book of that title for $2.99 or less. When the program was first announced, there were lots of kudos aimed in Amazon’s direction, especially from those who had been whining over the years about Amazon not giving them the e-book when they bought the hard copy. (We won’t get into the idiocy of that since Amazon couldn’t give away the e-book without the publisher’s approval.) However, as was expected, once the program went live this week, the cries of “foul” have risen. Why? Because not every book everyone has bought over the years is included in the program. Folks aren’t reading that publishers and/or authors have to opt into the program. Nor did they listen when the first announcements of the program said Amazon expected 10,000 titles to be initially offered.
From an author’s standpoint, I like and dislike the program. I like it because it will encourage folks to buy both the hard copy and the digital copy. Even though I buy e-books almost exclusively these days, I know that having someone carry around the print version of my book is great advertising. However, the downside is that royalties on the e-book version are based on the lower price for the bundled e-book. Yes, I know I am basically getting double sales and getting free advertising at the same time. Together, I’ll make more in royalties than if that reader only bought the print or the digital version. So, my dislike isn’t all that reasonable but is knee-jerk and I’m working on it.
But that’s not all from Amazon. It has also announced a new “early access program“. This program offers “pre-publication access to Amazon Publishing titles to device owners. Through the program, Kindle owners can select one title a month for $1.99, while Amazon Prime members can select their title at no charge.” The titles will, at least initially, be selected by editors at Amazon’s different e-tailer divisions. Email notices will go out to those interested with recommendations. You can find more information about the program here.
And finally, Amazon has one more new program that should be of interest to both writers and readers: the Kindle Countdown Deals. These are limited time offers for titles that are exclusive to Amazon. This differs from the KDP Select free days in that the author/publisher can discount a book for a limited period of time. The potential buyer will see what the original price is and the time remaining on the deal will be displayed for the customer. It sounds like the countdown clocks they have on the Gold Box deals.
What really caught my eye on this is that the initial royalty rate for the title will be retained even if you lower the price to what would otherwise be a lower royalty rate. In other words, you can price your title for a limited time below $2.99 and keep the 70% royalty. (Now, a word of caution here. There is a transmission fee for the higher royalty rate and, if it remains when you put the title on sale through this program, you want to make sure you aren’t going to eat up all your royalties by lowering the price.) Also important from a marketing standpoint is the fact that Amazon has built a dedicated page for these deals, just as it has for the Gold Box Deals and others. That means it will be easier for customers to find the titles enrolled in this program and that is always a good thing. Finally, with this program, you can list your e-book at $2.99 (for example) on day one, $3.99 on day two and back to regular price of $4.99 on day three. The potential buyers will see the countdown and can choose which level to participate. For more information, look here. The only caveat I can see right now, and I could be reading it wrong, is that you must be in the KDP Select program to take part.
Now, all things considered, tell me how all of this hurts publishing? It may take a few bucks out of the hands of the legacy publishers but what is publishing? Isn’t it the general industry of getting books into the hands of readers? Just because innovation and new tech brings about a change in the landscape of publishing doesn’t mean those things are killing the industry. They aren’t. They are, in fact, responding to the demands of the reading public, something too many in legacy publishing have failed to do.
So, as far as I’m concerned, Jeff Bezos and Amazon can keep on keepin’ on. It is up to the rest of the players to find a way to either play the game or become even better innovators than “the big evil”.
Mad Genius Club 
38 responses to “On innovation, entitlement and change”
On the “evil” Amazon killing the small book stores, I remember when the “screams” were about the Big Bookstore Chains killing the small book store. [Wink]
Mind you, I didn’t completely buy the old screams.
re: Amazon killing book stores, I just heard that they have a program now where bookstores can sell Kindles, and get 10% from eBook sales going to the devices they sell.
I had heard that such a program was in the works, but hadn’t heard it was now in place. Of course, I can hear the naysayers screaming that it is just another “trick” to do in the bookstores. There really are some folks who can’t be satisfied.
Right now they aren’t screwing the “publishing industry” but they are giving it good and hard to the big N traditional publishers and the chain book store. Neither of those things is necessarily bad.
The one thing that worries me about Amazon is that in some respects their profit margins are too low despite the enormous volumes of stuff they sell. I’d need to go and read their full accounts for the last few years but IIRC they have a pretty low gross margin (5%?) and a net margin of below 0.
(see for example http://www.slate.com/blogs/future_tense/2013/10/25/amazon_earnings_jeff_bezos_is_like_king_midas_in_reverse_chart.html )
Now I’m sure there’s a bunch of accounting tricks in there so what I’d rather take a look at is cash flow and money in the bank. But given their expansion I’m kind of doubtful they have that much money in the bank. That leads to the question of how do they avoid bankruptcy. Because if they do go bankrupt they’ll royally screw the entire publishing trade, indie and traditional.
Okay. Now you’ve scared me!
Possibly, but I’ll still take Amazon’s financial survivability over legacy publishing’s right now. The main reason for this is because Amazon has so many more “stores” than just the kindle and book “store”.
A pity they’ll never publish anything worth reading.
To each his own, I guess. I’m assuming you mean Amazon, in which case you either have tastes that vary from that of a number of others or you simply haven’t looked at what Amazon is putting out under its own imprints. Of course, I could say the same thing about a number of legacy publishers who are more interested in pushing the message du jour than in publishing books people actually want to read.
I do mean Amazon. About the only thing Amazon Publishing is a raison d’etre for Lousy Book Covers’ existence.
Or rather “…is is a raison…”
too bad that you have nothing to go on but bile and a lack of intelligence. If you must troll here could you please find someone capable of doing it properly. Idiot children are boring
YES, INDEED! And the whole point of books is really snazzy covers, isn’t it? Nailed it one. I’d NEVER want to read a book, like the genealogy one I read last month, where the cover is just a photograph with terrible lettering because the mystery… is better than anything out of NYC in the last twenty years at least, for its genre and flavor. But the cover is bad, so, of course, it’s all worthless.
Do you do your trolling by rote? Do they give you cheat sheets? Or did you misplace your brain somewhere? I suggest you look behind the sofa cushions. Small things are likely to get lost there.
And a call rang out across the land…”Bring me the Troll Hammer!”
I believe that smack reverberated through the inter-tubes and back again.
To be honest, the stuff inside those books isn’t much better. In fact, most of the time, it’s even worse.
I don’t have numbers on Amazon’s publishing output, but I suspect you’d have to be reading an awful lot of books to back up such blanket statements.
Or you’re trolling by the (rather boring) numbers.
After seeing the previews of Amanda’s writing…
And why should I have to read thousands upon thousands of crappy books just to find the gems?
So trolling, then.
Clearly we should organize the publishing industry to cater to the specifics of your taste. Appreciate the clarification.
Oh, and implied insult of your hosts is a fine invitation to take yourself elsewhere. Or…go crap on your own lawn.
You know, I love how folks like you come swinging by, make general statements with nothing to back them up and then keep throwing out condemnations when the rest of us don’t agree. And, looking below, I see that the personal insults come in as well.
I also love how it seems that almost all trolls like you don’t have the guts to come in under your own name or with a link to an active blog or website. It’s amazing how “brave” you can be when you think no one can find out who you are.
However, you have yet to give any proof that there is an ounce of truth in your comments that Amazon publishes only stuff not worthy to be read and has only horrible covers. In your personal attack on me below, you seem to think 1) that I’m published by Amazon and 2) that I really care what you think. As for the first, Amazon is not and never has been my publisher. With regard to the second point, I could really care less. I’ll just laugh all the way to the bank with the money I make from my writing. Believe me, there are many more folks than you out there who happen to like what I write.
Now, consider this your warning. Everyone at MGC welcomes a good argument or discussion. But you haven’t posted anything that comes close to that yet. If you continue to post these idiotic blanket statements without any attempt to back them up with facts, figures or at least an indication that you want to discuss the issue, you will be banned — and this isn’t just my decision.
So, go back under whatever rock you crawled out from under, try to convince yourself that you showed us poor infidels the error of our way and that you insulted me because you apparently don’t think my writing is worth your while. It takes much more than that to insult me.
Ah, I knew the post couldn’t go without at least one Amazon-hater showing up. We’re more than happy to discuss the issues with you — if you give us anything to discuss. But simple blanket statements that are, on their face, nothing more than knee-jerk rhetoric don’t rise to that level.
However, your comment about bad covers is, frankly, laughable. Especially when you can look at covers being put out by legacy publishers these days and see the increasing use of stock photos, different books using the same covers and worse. Don’t believe me, go visit the Smart Bitches, Trashy Books blog and do a search for covers. They periodically put up covers that are so bad it’s hard to believe they were actually used. And, yes, they come from “real” publishers.
Here’s a truth for you. Folks have bitched and moaned about covers for as long as there have been books. It certainly didn’t start with Amazon and it won’t end with them.
Do you also post on the Passive Voice?
Nope, however I do often read and refer to PG there. He doesn’t pull punches and he looks at the publishing business without the prejudice against indie and small press that so many who have bought into the legacy publishing (Baen and a few others excepted) bs do.
” Together, I’ll make more in royalties than if that reader only bought the print or the digital version. So, my dislike isn’t all that reasonable but is knee-jerk and I’m working on it.”
You know they probably have self-help books for that.
Probably, but a good knee-jerk is exercise. Right? 😉
Hmm. I think you get the percentage for the MatchBook that goes with its NON discounted price, that is, the ebook all on its lonesome. I have one data point 😉 Someone got the MatchBook for my Bureau of Substandards collection, and while I set the price to free, the sales report shows “70%-promo” as the rate. This was discussed on the KindleBoards, too.
Sabrina, you may be right. I need to go through all the documentation with a highlighter and take notes.
I think you have the correct read on the countdown deal. I’m trying to figure out a strategic starting point to using it. Not a grand strategy, just where to stick the handle so I can grab it the first time, figuring I’ll make a few mondo big mistakes before I figure it out.
M
I’m running a countdown deal from Wednesday night through Saturday night on Calmer Half’s first book, as we hadn’t used any promo options this period… and the 3month period runs out on Saturday. I figure it might help, might hurt, but at least I will have a baseline to judge the next promotion when we publish the third book.
In this brave new world of publishing, all mistakes are experience to help us do better next time!
Ya know it’s weird. Where I come from, offering better service to increase one’s customer base is called COMPETITION and it’s a good thing. Also, selling two copies (print and digital) as opposed to only one SHOULD make publishers more money. Sillye. There I go looking at things from a realistic standpoint again.
I’m starting to wonder if the Big Publishers think they are functioning in an alternate universe where lower sales to fewer readers mean higher profits, so long as the book makes the NYT bestseller list or wins a literary award.
Maybe they fell through the rabbit hole straight into the Twilight Zone, or maybe the Outer Limits. Nothing else could explain their business plans.
Their appeal has become more SELECTIVE.
There you go with the logic again, Jim. You ought to know better than that where publishers are concerned.
You know, I figure I gotta be missing something. All the ‘smart’ folks are talking about Evil Amazon and taking advantage and ruining the industry and panties on fire!! Before (and still) it was all the same stuff about Evil Wal-Mart. Who’d they pillory before that?
And here’s silly, little, oblivious, ol’ me thinking: Interesting business idea. Smart. Lotta risk in there. Low margins are scary. But smart. Money seems to be coming in. Customers seem to be coming in. Employees seem to be coming in. Time to analyze and figure out what I can stea- uh, borrow for my own ideas.
So, I gotta be missing something right? ‘Cause surely all the ‘smart’ people aren’t whiny, ungrateful, little…uh…ingrates? Right?
Hm.
They might be jealous, and or hating the idea that someone else’s successful business model might show their own shortcomings.
They just wish they were as brave.
This “hurts publishing” is just odd. Amazon is publishing, too.
Who’d they pillory before that? The “Robber Barons” are a great example – open up a continent despite struggling against government-subsidized competition, drastically increase service and reduce prices for transport by steamship and by rail, and what do you get? Tarred in every history book, because you made ickle filthy money and didn’t give it all to the whiners and critics.
James J. Hill
[…] week it was Amanda’s turn – she had the temerity to suggest that Amazon was a good thing. Um. DUH. Speaking as someone […]