Amazon putting the squeeze on POD publishers!!

What a heartbreak, Abe. I can't say I would have been able to leave that one alone. Too bad you couldn't have negotiated with PA and then passed it on to the libraries. I think I would have been sick.

Amazing that the folks you think that you could negotiate with won't flex at all...Abe I hope you had lots of jelly beans then to console yourself with. And if they were the nastier variety, I would recommend chucking them at the windows of the PA offices, one or two at a time, like torture...

When you realize that you are dealing with people with no business sense and who refuse to listen to reason or common sense, it is futile. I think you can understand that I will do nothing in support of PA, while at the same time, I will do nothing to destroy them. They are already on a road to self-destruct.
I have a book that was published and had spent much time and effort to promote it. Without support, the effort does not bring the results it should. Right now, I'm taking a "wait and see" approach while learning about my options.
I think we must remind ourselves that it is "we," "us," who spent much time writing the damm books and that the publisher is making money off our efforts. When you consider that on a Retail price of $21.95 we can wind up with a net royalty of $1.50, (depending on the discounts and methods of sale), it just isn't a fair deal for the author. So to continue to support that kind of greed just isn't worth my while.

Abe,

The other thing to consider that $24.95 which is the cost of my book from PA is a great deal of money to pay for a paperback book! That alone puts people off purchasing them. I sat in Barnes and Noble in Dayton, Ohio (I'd arranged the signing to coincide with a holiday in the USA) and lost count of the number of people who said to me "I'd buy it, if it didn't cost so much." PA does a disservice to it's authors in setting the price and refusing to offer a reasonable discount to bookstores.

As an aside - they still haven't responded to my email. As you say, how can you do business with people like that?

Jenny,
you're right of course. When people first saw the price of the book, they said, "well, for a hard cover, I suppose it's not too much." They were not too pleased when they didn't get the hard cover. That assumption was made by others as well. At the bottom of PA's book page, there was an option for hardcover or paperback. Of course there never was a hardcover and most likely was just a gimmick intended to fool.
Many more books would be sold if the price was reasonable. I have often heard the comparison of price for a "known" author from a major house versus an unknown author from a (you fill in the blank) house. Yes, there are those who will buy the book regardless of price because they know you, or because the title grabs them and they really want it. But as far as "impulse" buying, you can forget it.

Another response to Amazon's decision:

An interview with Jerry D. Simmons, regarding the far-reaching implications of Amazon's announcement that any small press or print-on-demand publisher doing business with them would need to print books through their publishing arm: BookSurge. Jerry is a former Executive with the Time Warner Book Group who left there in 2003 to build one of the leading social networking sites for Independent authors, NothingBinding.com.
What's the real outcome going to be from this Amazon decision?

The publishers impacted will follow the demands of Amazon and print their books with Book Surge. The wider implication is that Amazon strengthens their position with these publishers and creates a monster with their vertical integration. This leaves each one of those publishers vulnerable to new demands by Amazon. What's next? Higher discounts. Right now these publishers have been forced to change vendors, it might have cost them a bit more money, but remember, they market to writers not consumers. So if they are unable to place their authors' books on Amazon, it looks bad in the eyes of their customers, the writers. These publishers don't have the courage to say no and take a stand. And it's not about the fact they sell a ton of books on Amazon, it's about their customers' view of them and their ability to market their own books.

How do you predict the long-term effects of this as it relates to the small author and publisher?

The long-term effects for the author and publisher are devastating. With Amazon strengthening and securing their place in the distribution and sales channel, they can do anything they want. The next move will be to squeeze these small authors and publishers for placement fees, advertising fees, and eventually higher discounts. When you give in once, it never stops, this is the way of the publishing world and booksellers. It will get to the point where they start to lose money on each book sold. Only then will Amazon back off, but you can bet they are going to push authors and publishers to the wall and take every possible nickel out of the equation.

What can an author/publisher do to "fight back?"

Draw the line with this decision, pull their books from Amazon, create a new online market for selling their books, a central location for all self-published, print-on-demand books that has no alliance with any publisher or printer. Again, it's not about selling books, it's about how they are seen in the eyes of their customers, the writers. They are concerned about their own pipeline for new business drying up and that is much more important than giving in to Amazon's demands. Each one of these publishers could switch all their allegiance to B&N.com today, but they haven't, and the reason is that in the eyes of the writer, they feel they must be on Amazon to be successful. Short term it hurts business and they are more concerned about that than the longer term impact which is going to be a continual erosion of their profit margin.

What alternatives do authors and publishers have besides selling their books on Amazon?

It's time for the self-published, print-on-demand companies and small publishers to begin creating their own marketplace, totally and completely separate from all the online platforms that sell their books. I strongly believe that the website [You must be registered and logged in to see this link.] is a solution, and for full disclosure, it is a site that I founded. But here is the key, if you are not part of the traditional world of big New York publishing, from which I spent 25 years, then authors must realize it is fruitless to continue to struggle to become part of something dominated and controlled by the largest publishers in the world. Amazon is clearly inside the traditional world, and they are setting restrictions on anyone outside that wants to be part of their world. This will never end! It's time now to create your own community and establish a voice in the marketplace. I'm confident that Nothing Binding can fill that void, becoming the community and voice for Independent publishing. The name alone signifies a non-alliance with any publisher or printer. A social networking website that allows authors free placement of their books with links to outside sources is a perfect way for authors to separate themselves from the traditional world of big publishing; in fact, it's the only way to create a market and achieve increased sales they so desperately want and need.

Do you think this was a bad decision on Amazon's part and if so, why?

Obviously Amazon weighed the profit from the sales of all these POD books versus the additional revenue of printing AND sales. They made a calculated gamble and it appears they have been right. Now there is no stopping them on their demands. It won't happen overnight, but they will make new rules and continue to do so until it negatively impacts their own revenue stream. Giving in is a monumental mistake for the author and publisher, if the POD companies had taken a stand against the decision and risked short-term profits, they would have been much better in the long term and more respected by their own customers in the marketplace. Why do you think Amazon did this only for the print-on-demand books and not books that are offset printed? They claim they did this so it would be easier for them to marry books with other products that customers wanted, combine the package and shipping for convenience and cost savings. What about all the other books that are offset printed? They have the same problem with marrying books and products, but they don't own an offset printing company, yet! If I was running any company that does a substantial amount of business with Amazon and saw what they were doing with books, I'd keep a close eye on what other parts and manufacturing companies they purchase. Vertical integration in this case is good for Amazon, no, great for Amazon, but bad for the publishing business and possibly very bad for other product lines sold on Amazon.

Since AuthorHouse/iUniverse and Lulu have signed the contract with Amazon, does this change the playing field for the other publishers, or is it irrelevant (and if so, why)?

With Author House and Lulu agreeing to Amazon's demands, it puts pressure on the other companies to follow suit. None of these companies can risk their own business drying up and even though it's doubtful they lose a ton of sales if they dropped from Amazon, it would be the negative perception their own possible customers would have, i.e. the writer, and of course their competition would use this as leverage in their own marketing as "being the one company still doing business with Amazon." These writers don't really understand the implications, yet, all they see is that their books are or are not on Amazon for sale; that's all they care about.

In the survey of writers I completed long before NB was started, I found that virtually 98% felt they must have their books on Amazon, and clearly 70% hated the fact they had to give a 55% discount to them. When asked if Amazon went away tomorrow, how much would it impact sales, only about 15% felt they sold enough books on Amazon to make a difference. They must be there, they hate being there, yet it doesn't really make a big difference, so what's the point? Once Amazon raises the effective discount, or asks for ad or placement fees, and the publisher passes this along to their authors, they might wake up. But who knows, right now, all the authors care about is making sure their books are still listed and for sale on Amazon.

Fighting back should be done gradually and not a knee jerk reaction. I think if these authors and publishers set a deadline for Amazon to reverse their decision or else they would pull all books, they could get positive media attention to this, they will have capitalized on this in a way that would draw attention to them and their books, and in the long run they would be out from under the thumb of a very big online retailer. The analogy I use is that if the U.S. had been serious about alternative fuels back in 1973 during the oil embargo, we wouldn't be in the mess we are today, 35 years later. Of course you can't compare oil to books, but the fact remains, this cave in to Amazon is a very steep and slippery slope and it won't take anywhere near 35 years for them to realize their mistake, maybe 35 months!

If authors seek out other platforms to sell their books - how will they compete with the "comfort level" consumers feel with Amazon?

There is no way to compete with the comfort level of Amazon and that of course is a problem, but a short-term one. Solutions will create short-term discomfort, but I strongly believe people buy books on Amazon because it's all they know. If there was a viable alternative, then I think consumers would welcome it. The responsibility is on the shoulders of the publishers to counter this strategy with cover price discounts, until the consumer starts to feel comfortable again and then you can readdress the price issue. These publishers will have to make some short-term concessions to attract their consumers, but it beats what they are going to have to endure when they cave to Amazon. There is no easy solution, there is no silver bullet that will make everything okay tomorrow, there will be some issues that have to be worked out, but if all these authors and companies would combine forces, create a new online market for themselves and their books, in 35 months they will be glad they did. Eat it in the short term for long term gain-that is the answer to the Amazon problem. Because Amazon is going to do nothing in the future to help the POD companies' bottom lines, they are going to continue to eat away at their margins in a number of ways while at the same time squeezing them on price and discount. It's a no win situation for the authors and publishers and it doesn't appear that they really realize the situation they put themselves in by giving in to Amazon's demands.

I'm sorry to say that while PA is showing a strong opposition to Amazon's decision, they have little reason to fight--except Amazon was a strong lure to writers. But PA can now push more books to their authors, saying "Promote! Promote!"

That's evidenced by their latest offer to the authors. With special rates, of course.

The publishers impacted will follow the demands of Amazon and print their books with Book Surge.

Not so sure. I sure as hell wouldn't. You don't give into that sort of stuff or they'll eat you alive.

I would start working around them. I'd start doing third party sales, as I've suggested above for one thing. A publisher should be able to do swing that pretty easily.

This is the first I've heard about Lulu signing up with them. I'm going top have to go and check this out.

brb...

Jenny, thanks for the article! I think that Jerry Simmons is saying what several of us have done here - writers unite! Get your books written and then publish otherwise. I do think that we can achieve some powerful marketing in the grass roots sense and then actually interfere with Amazon in enough of a way to, if nothing else, be bloody irritating. And I for one, am okay with that--my kids have told me before that I am bloody irritating anyway :pirat:

Pam, "bloddy irritating?"
Sounds gruesome. Don't match your beautiful smile.

I also appreciate the report that Jenny posted. "Time wounds all heels" or will it be "Time heals all wounds?"

Ron Kruger just passed this along to me:

Today Publisher's Weekly announced a simply stunning partnership between On Demand Books (owners of The Espresso Printing Press technology) and Lightning Source (the giant print-on-demand company owned by distribution giant Ingram Inc.)

What this partnership means is On Demand Books will have access to data at Lightning Source, allowing Espresso owners to print any book in Lightning Source's catalogue. Any book. Printed in minutes. For a fraction of the cost of conventionally published books.

Now, agreed you won't find Espresso machines in your local Starbucks, Chapters or library. At the moment there are only a few in commercial use:

- University of Alberta Bookstore in Edmonton, Alberta, Canada;
- the Internet Archive Office in San Francisco, California;
- the Northshire Bookstore in Manchester, Vermont;
- the Bibliotheca Alexandrina at Alexandria, Egypt;
- and there will soon be EBM’s at the New Orleans’ Public Library in New Orleans, Louisiana,
- The University of Michigan Library in Ann Arbor, Michigan and at
- DA Information Services in Mitcham, Australia

This news becomes even more remarkable in light of Amazon's recent move after purchasing the print-on-demand company, BookSurge, requiring their POD publishers to use Amazon's services or face delisting of their books.

It would appear Amazon, in its blatant attempt at monopoly, is flying in the face of a revolution in publishing that will, eventually, leave them staggering. The Espresso and Lightning Source's visionary partnership will do everything to energize not only bricks and mortar stores, but libraries and other walk-in business who want to cater to readers, but small publishers and independent authors.

I can see these thing sitting next to, or replacing, the magazine racks in grocery stores. Thousands of books and perodicals at your fingertips, searchable in every way now available on the internet.

Maybe Amazon's move was an effort to get as much of the pie as possible before being pushed away from the table.

Whoa! That's visionary, all right. I always thought this was the real future of this stuff. (The Internet should mean getting rid of the need for truck drivers)

I always thought it would happen to music: have little booths where you could pick songs and have them put on a record or tape for you. Well, that one happened really different, and eliminated all of the brick-and-mortar linkup.

This is pretty amazing. I would say Starbucks is looking right now at having this thing in their stores. It's really natural. I could see bookstores having it, actually, limited to POD books and lines they don't carry.

I could easily see amazon being in the position of RIAA on music ownership...fighting a rear-guard battle against the future that even some of the new recording execs are starting to see as futile.

Gee, wonder when they came up with this idea?

Abe F. March wrote:

Now, agreed you won't find Espresso machines in your local Starbucks, Chapters or library. At the moment there are only a few in commercial use:

- University of Alberta Bookstore in Edmonton, Alberta, Canada;
-

That's my former school. Hmm. Neat.

It would seem that Amazon just executed the perfect knee jerk now get kicked in the butt later move.

Lin given that you had great premonitive vibes on the era of ipod and mp3 I cannot wait to see what other ideas you have about this! I am completely excited about the idea of someone walking in, putting their (multiple) loonies in the slot and walking out with my book under their arm. No need to wait until the book arrives in the mail for those who don't visit the bookstores...

And Abe my kids - and two ex's - will contend to the bloody irritating when I call it up. Mostly though, I really am smiling all the time.

Lost two husbands? As only Lady Bracknell could say: how careless of you! LOL!

Shelagh, I know where they are, poor sods, so they aren't lost. I am on one side of the continent and they are quite nearly on the other and both of them seem to like it that way.

Shelagh, since this thread is already highjacked, I'm wondering if you checked "Lost and Found" for Pam.

Abe, sometimes being a continent or an ocean away from an ex is the best way to maintain a relationship. Isn't it, Pam?

BTW, I've heard Amazon has hesitated in their buy button removal campaign. Maybe they're seeing too much backlash. Or competition.

I spoke to lightningsource this morning.

They say they have a partner agreement with amazon and as far as they know it's business as usual for their books.

Good news Brenda and lin! Abe, I found this:

[You must be registered and logged in to see this link.]

Thanks Shelagh. I took a peek but couldn't find any distraught ex's.

Kinda suggests the ex's aren't distraught Abe.

You are all too funny. Fortunately, I have no idea where any of my ex's are. We are all happier that way.

Has anyone read this article from the London Times:

[You must be registered and logged in to see this link.]

I saw it this morning, and found it of interest.

Shelagh, that link is a real kick!!

[You must be registered and logged in to see this image.] <--here I am! Tucked away, but not lost.


Looks as though Amazon is ready to back pedal. I don't think that will hurt us in the least! Bunch o' big bullies! Take this [You must be registered and logged in to see this image.]