Unless you live in a glass bubble, you had to have heard about the Justice Department’s Antitrust lawsuit against the big 5 New York publishers and Apple. I am not a lawyer and I don’t pretend to understand it all, but I’ve been thinking a lot about how if affects me ever since I first heard the announcement. Here’s my take on it. I may be way off base and would welcome any clarification if I am wrong.
In 2008 in an effort to market their Kindle, Amazon lowered prices on some ebooks, sometimes even taking a loss. Apparently, they thought people would rush out and buy the kindle if they could download books at a lower price. No matter how you feel about that, you have to admit it was a pretty good strategy, and it worked.
Sometimes in early 2008, Steve Jobs contacted the NY publishers , and they had “secret” meetings trying to come up with a way to deal with this. They were losing money on their hardback covers and Apple was getting ready to introduce the iPad to the world. They came up with something called the “agency” model that set the prices for ebooks, preventing Amazon from lowering them.
Now here’s where I have a conflict with myself and my own opinion. My publisher was one of those who will not allow my ebooks to be discounted. While I am grateful that people are willing to pay the full amount to read my story on an ereader, I wonder how many more readers I would have reached if they could have gotten it cheaper. Who doesn’t love a good sale? I have several friends who saw their numbers skyrocket when their books were discounted. Granted, it may not have translated into bigger royalties, but still….
Then I remember my dismal income from writing last year, and I wonder if we are selling ourselves way too short by allowing our books to go so cheaply. I don't know about you, but it takes me a good 9 months to write a book. Couple that with promotions and other expenses, and I am probably in the tax bracket where I could receive food stamps.
Last week, after the DOJ filed the federal antitrust lawsuit, three of the five publishers chose to settle. I won’t even try to explain it. You can read it below and from your own opinions.
Under the Federal settlement, Harper, HBG and S&S promise for two years not to "restrict, limit, or impede an e-book retailer's ability to set, alter, or reduce the retail price of any e-book or to offer price discounts or any other form of promotions to encourage consumers to Purchase one or more e-books." They also "shall not enter into any agreement with an e-book retailer relating to the sale of e-books that contains a price MFN" during that period. Technically, it is at the retailer's option to cancel current agency contracts. All three are required to void any ebook contracts with Apple signed prior to the filing of the complaint within seven days, so presumably either their ebooks will exit the iBookstore or they will need to resign with Apple under some other business arrangement.
Best selling author, Scott Torow released a statement basically saying that by allowing Amazon to sell ebooks at a loss only hurts all of us. Read it here.
And here's PW take on it. It only adds to my confusion.
So what does that mean to me? I am fortunate enough to write for THREE houses. Berkley, Midnight Ink, and Liz Lipperman, LLC. Will it affect that somehow? Actually, I have no idea, but I do know that I won’t give up my choice to write for more than one publisher. Maybe my books won’t reach as many people, but it doesn’t matter. Today’s writer has many more avenues to get their stories out. We are no longer chained to what NY thinks will sell. I, for one, love the new publishing world we live in. I adore all three of my publishers and hope my relationship with them continues until I am so old I can no longer write. That's why I am watching what's going on out there and trying to figure out what my next move will be--or even if I need a next move.
So, what about you? Any thoughts? I would love to hear your take on all this.
An addendum: I just noticed JA Konrath is talking about this today, too. He explains it so much better that I do. Go here to see.
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18 comments:
I don't have any idea how the ruling will effect the publisher I'm with, Astraea Press (AP), if at all. AP does market the books not at a discount price but at a price that is consumer friendly.
What I don't understand is why or how a major house can retail a book, in print and ebook at the same price.
I know, Lindsay. They give the argument that an ebook still needs a cover, copy edits, marketing, etc.
Funny, I saw on FB where JA Konrath is talking about the same thing today. He seems to think the agency model can only hurt the author. I;m leaning his way right now. Check it out.
http://jakonrath.blogspot.com/2012/04/agency-model-sucks.html
Lots of changes on the publishing table. And I don't think it's done yet. I'm with smaller houses, so I don't see it directly affecting me NOW but we shall watch and see, I guess.
I often see ebooks priced more or the same price as the print book. That's crazy. There is so much wrong with this. Speaking as a reader, I only buy books that cost this much if they're friends or if it's a favorite author. Otherwise they lose my sale. So I do think the agency pricing is not helping the writer.
My hardback is $16.99. My e-book (set by the publisher) is $10.99. Amazon discounts the hardback by 29 to 32%, depending if it's on one of their thousands of bestseller lists in the previous few hours. So the e-book, set by the publisher, is still cheaper.
Wouldn't it be interesting if the Big 6 said they weren't going to release books as e-books for a year or so after the initial release if they can't set the price.
Untimately, I think the writers are going to take the worst hit.
M
Liz, my publisher now is Amazon Montlake Romance, so I tend to be preferential to Amazon both as a writer and as a reader. I'm one of those who loves a good bargain, but I can see both sides. I just don't have a clue how this will all turn out.
Liz, my publisher now is Amazon Montlake Romance, so I tend to be preferential to Amazon both as a writer and as a reader. I'm one of those who loves a good bargain, but I can see both sides. I just don't have a clue how this will all turn out.
there are a lot of changes, Sasha. I guess the only thing we have any control over is our own writing. It's just so hard not to be distracted by all the news.
Congrats on your cover reveal today. Medusa, A Love Story now has a great cover to go with the great story.
Hey, Edie, thanks for chiming in. I have mixed feelings about this whole thing and change my mind every time someone comments!!
Oh, gosh, Marilyn, that would be awful. I am one of those people who fought like crazy NOT to go the digital way, but I now have both an iPad and a kindle and love them both.
Anita, since Amazon doesn't have to play by the agency model rules with itself, it will be interesting to see how they discount your new series.
Let me preface this by saying I receive so many offers for free e-books on Twitter and Facebook, and have such a backlog of freebies waiting to be read (more than 200 on my Kindle), I can't imagine actually paying for an e-book whether it be $1 or $50. I do still buy (and prefer) print.
Is it worth it to give, or almost give, an e-book away to increase "numbers" and build readership? For the author and publisher, probably not, because there is such a glut of cheap/free e-books on the market, how can a writer compete? These days when an author excitedly offers me a free e-book, my heart sinks a little for both of us. I add the book to my Kindle and move on.
Amazon's goal in the past has been to get more books into the hands of readers and therefore sell more Kindles. They aren't concerned about what books are sold, what the price is, or whether author loyalty is established. Perhaps this will change now that they're also a publisher. We shall see.
I keep thinking that if my cut is a percentage of the cover price, then having a price war will hurt me as an author.
At the same time,it would be great to have e-books priced more reasonably.
I dunno. I have to say this move can only help Amazon, though. Lara
You raise good points, V.R. I guess we'll just have to wait and see. Particularly intriguing is your question about Amazon changing their tune now that they're a publisher.
Lara, I believe a lot of contracts say the author gets a certain percentage of the net rice--which would be the 50% even if Amazon chooses to sell it for $.99. I'm gong to pull out my Berkley contract and see how it reads.
I'm not sure I can exactly put it into words, but I think keeping the digital version very high hurts your sales.People buy your paperback, read it and may will end up at the used bookstore. Your book sold there does NOTHING for you.
With digital, if it's priced at a reasonable price, even it's it competitive with the price in a used bookstore, they'll buy the digital.
Who is going to be hurt is brick and mortar stores and used bookstores. As an author, I'd rather see my digital books sell for $5-$6.99 instead of finding my used book in a store where I'm getting nothing for it's sale.
Make sense?
My point is:As an indie I need to know ow much I get as royalties.The agency model, as you call it, does this. When retailers are allowed to discount, I never know how uch will end inmy pocket.
I just had it with one book soold in France: Amazon discounted and calculated the royalties on the discounted list price instead of the one, I'd set. Not a big amount, yet. And inone case they also calculated on a lower list price for a book sold in germany, though discounting is not allowed tehre. I hve the impression, Amazon is alredy playing with the fact, that three o the sued pulsihers gave up. It#Shurting us authors. I completely disagree with Konrad, because for indies it doesn't work like that.
As a consequence we have to raise our prices to be sure about the minimum outcome. And this will hurt readers of course.
Great post, Liz. I am very confused muself. This new publishing world is exciting, yet intimidating. So much to think about...
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