Amazon vs Hachette

[Spockydog]

You may have heard of the ongoing ruckus between Amazon and Hachette. It's been rumbling on for a couple of years now, and Amazon has recently escalated things by removing the ability for readers to buy and pre-order some Hachette titles.

The dispute seems to be that Amazon want to be able to price e-books as low as they want, in many cases taking a financial hit in order to drive customers to their online store. The publisher is against this, despite both author and publisher receiving full-price royalties even if Amazon essentially gives the e-book away for nothing.

Why, you may ask, is Hachette so against this? Probably because they do not want a huge differential between the price of e-books and that of physical copies, effectively stifling the e-book market so they can still shift loads of dead trees.

I'm not sure how I feel about this. Who has the moral high ground here? On one hand, Amazon appears to be bullying the publishing industry, whilst grinding their book-selling competitors into the dust. On the other, many readers feel that the price of e-books should be lower than that of physical copies, so you could say that Amazon is just trying to serve the needs of its customers. Also, it's difficult to feel too much sympathy for Hachette due to some of their dubious business practices.

There's no doubt that Amazon has become a bit of a monster, a monster that some within the publishing industry fear might one day devour them. Yet it strikes me that the publishers have only got themselves to blame for this. Like the recorded music industry before them, they have failed to properly react to the dawning of the internet age, and are still clinging to their outdated business models, whilst failing to recognise that DRM does more harm than good.

I guess the real losers here are the authors caught up in the middle of this. Things are hard enough for some of these guys. For their sake, as well as ours, as readers, I hope it gets sorted out soon.

[Darth Richard II]

Hachette? Is that a UK only thing or are they one of those companies that owns like 300 imprints?

Of course I could just google it myself, but thats boring.

[Zorral]

They are eviLe, i.e. they are monopolists, who always screw you once they get what they want.

Monopolies are not good for anyone.

Hachette here -- if you read sf/f they likely publish some of your favorite authors.

[Darth Richard II]

Oh, Orbit. Well shit.

[emberling]

The "dubious business practices" you linked was just another part of the whole ongoing drama. Amazon was throwing a bunch of weight around and aggressively building up market share with steep loss leaders. I think this is around or shortly after they delisted Macmillan books for a while. So publishers got together and decided to change the pricing model so that Amazon couldn't undercut smaller stores with less ability to eat losses. Amazon retaliated with a lawsuit, as you do. Because it's terrible anticompetitive behavior when five firms set price structure for the market - but if it's just one firm dictating the market apparently it's okay.

Not that price collusion is warm and fuzzy, but don't sell it as if it's some separate issue that diabolical evil Hachette & friends came up with out of nowhere. It's just part of the same mess.

I don't see any reading of the current scenario where Amazon is not completely in the wrong. Fucking over your customers and providing poor service on specific goods is not a valid negotiation tactic. If a company is in the position where it's actually a sane negotiation tactic - where their hold over their customers is so absolute that it can absorb that kind of bullshit for the sake of a better supplier price - then that market is broken.

And what the suffering fuck does any of this have to do with publishers being slow to react to the Internet age? How is DRM a mark against publishers here? Kindle books are DRM'd, last I checked. But many publishers distribute non-DRM'd books to other stores.

[Spockydog]

And what the suffering fuck does any of this have to do with publishers being slow to react to the Internet age? How is DRM a mark against publishers here? Kindle books are DRM'd, last I checked. But many publishers distribute non-DRM'd books to other stores.

In case you didn't know, Amazon began life as an online bookstore.

Like millions of e-reader owners, I love my Kindle. But, due to their aversion to paying Corporation Tax, I don’t particularly relish doing business with Amazon. If there was an alternative, a quick, convenient way of buying e-books that I could read on my device, I would use it. You would have thought that, by now, the Big Four publishers would have pulled their heads from their arses, and realised that the easier you make it for consumers to buy your product, the more product you will sell.

Perhaps this dustup with Amazon will help. Perhaps not. Perhaps the publishing industry will wake up and smell the coffee that the record industry has been drinking since 2009, when the major labels allowed iTunes to remove DRM from the vast majority of their music catalogue. Since then, research suggests that sales of recorded music have increased, by as much as 40%.

I realise that the DRM issue is not necessarily what is driving this dispute. But it’s clear that, for whatever reason, Hachette prefers physical sales over digital. Otherwise, why would they object so strongly to Amazon’s heavy discounting of e-books?

[Larry.]

For what it's worth, Hachette is a French company and there are some interesting things that the French government has passed, with the approval of both the publishing companies there and the majority of the public, that has foiled some of Amazon's policies. Then again, considering where Amazon.fr is actually located (Luxembourg), that's just part of the fascinating global struggle that is taking place.

Interesting what one discovers when one tries to purchase certain e-titles written in French and the prices charged.

[unJon]

Cheaper ebooks? Go amazon.

[Linsox]

The publisher position as I understand it is that Amazon's prices will drag them down industry-wide the way Steam and the iPhone have in the gaming industry. $10 ebooks threaten a business model that charges ~$20 for hardcover, then releases paperback however many months later. And look at the way Amazon "chose" to allow publishers to turn off text-to-speech.

Like millions of e-reader owners, I love my Kindle. But, due to their aversion to paying Corporation Tax, I dont particularly relish doing business with Amazon. If there was an alternative, a quick, convenient way of buying e-books that I could read on my device, I would use it. You would have thought that, by now, the Big Four publishers would have pulled their heads from their arses, and realised that the easier you make it for consumers to buy your product, the more product you will sell.

This is something to take up with Amazon, not them. Amazon is the one selling tablets at a loss to lock people into their ecosystem. You might want to ask for non-rooted epub compatibility and Google Play.

[Errant Bard]

I don't think that selling things for a profit and not being a monster being able to sell stuff at a loss is an "outdated business model".

I don't like what "traditional" publishers do with eBooks, or their philosophy when it comes to DRM or piracy, or what they actually do against smaller competitors, but this is not the subject. The subject here is that Amazon is using internet to evade commercial laws, become an unfair competition and grow into a monopoly. Enjoy your eBooks sold at a loss right now because when there is no more competition, they all will be sold for a profit.

Amazon can not even pretend that it is fighting for the people with their DRM-ed content only readable on kindle.

The ones caught in the middle are not authors, but buyers of eBooks, and small publishing companies.

That being said, publishing companies should get their wit together, and offer non-overpriced eBooks without DRM somewhere, but it's like the internet freeze them in fear.

[Lummel]

Surely this is just another battle in Amazon's campaign to effectively become the market, the interface between producers and consumers. In which case it will effectively replace, drive out of business, or simply drastically restrict the business operations of all publishers.

I wouldn't what to call the traditional publishing model outdated or Amazon's business model particularly viable. Publishing has long been extremely flat, very flexible, largely outsourced. Amazon is a big beneficiary of avoiding taxation by operating in multiple jurisdictions and in parts of Europe at least maximising the use of temporary contract labour to reduce costs - ie the business model depends on taking advantage of the lack of political will among taxation jurisdictions - and in the mean time gaining market share by offering low prices.

And this is quite deliberate, Amazon isn't a significantly profitable company at this stage nor does it want to be. Massive turnover is used in pursuit of market share. Eventually we'll be in the position in which effectively Amazon is online retailing in the non-foods sector and large parts of associated activities also such as logistics and media.

[Seli]

Amazon is actively hurting authors in what appears to be an attempt to increase profitability. Which is pretty normal for big businesses, but a horrible prospect for readers. The big problem to me seems to be that Amazon seems to care about individual authors even less than the big publishing houses (who at least seem to have people in love with books at the lower ranks), and is more interested in pushing volume.

Interestingly since Amazon is a publisher as well as a store this seems to be perfect case for anti-trust legislation to be brought down on them. I am not holding my breath though, although the EU might pleasantly surprise me.

[Spockydog]

So I thought I'd have a look around the interwebs to see what my options are for buying (non Amazon) e-books in the UK.

First stop was Waterstones. The only e-reader they are selling is the Kindle. They've got a nice, shiny page outlining all the different types of Kindle I can buy from them. Yet, staggeringly, none of the e-books that they sell is compatible with it.

With the major players in the book-selling market making business decisions like this, no wonder Amazon has the monopoly.

I think I'm going to buy a Nook from Blackwells. They're currently selling the Simple Touch for only £29. Looks like a bargain to me.

[Pirtti]

Amazon is a big beneficiary of avoiding taxation by operating in multiple jurisdictions and in parts of Europe at least maximising the use of temporary contract labour to reduce costs - ie the business model depends on taking advantage of the lack of political will among taxation jurisdictions - and in the mean time gaining market share by offering low prices.

And this is quite deliberate, Amazon isn't a significantly profitable company at this stage nor does it want to be. Massive turnover is used in pursuit of market share. Eventually we'll be in the position in which effectively Amazon is online retailing in the non-foods sector and large parts of associated activities also such as logistics and media.

Good. Taxation is legalized robbery and should not be supported.

[Ormond]

I haven't yet read up enough on this to be sure if I think Amazon or Hachette is more at fault in this particular instance -- though I tend to find the anti-Amazon arguments in this thread a bit more persuasive.

However, I think it's interesting that here in the USA I just got an email from BooksAMillion, (where I have a discount card and so get regular email ads from), which says that they have Hachette pre-orders 30% off online for select titles. So in the USA there's at least one other retailer who's trying to take advantage of the situation.

http://promo.booksamillion.com/save/noi/noi-2014-05-23-hachette.html?&ad=AD01405232

[Linsox]

My relatives in Canada use Kobo. A quick search for Kobo UK turned up this from a few years back, which mentions Hachette as a late backer.

[Darth Richard II]

Good. Taxation is legalized robbery and should not be supported.

o.O

hail hydra?

[Sparrowyn]

You guys can't slam Amazon... and then turnaround and purchase products from them?.. but we all do. I've bought everything from books to an electric lawnmower off of Amazon, get the best price, don't pay taxes on the purchase, and usually get free or almost free shipping... and have never had a problem. I've also found on Amazon special editions of books, some really cool books that had very short press runs that no brick-and-mortar bookstore would ever have.

Amazon carries the mass market titles, but they also carry little known books you'd never find elsewhere. Time for the publishing industry (what's left of it) to modernize their business model and sell digital editions at half the price (and hopefully much less) of the hard bound edition, and allowing it to be read on all your digital devices.

[Errant Bard]

You guys can't slam Amazon... and then turnaround and purchase products from them?

And why not? Criticism should be a synonym for boycott now?

[Ormond]

I don't think I've bought anything from Amazon in the last three or four years EXCEPT when someone has given me an Amazon gift card. I don't spontaneously spend my own money there.

And the idea of buying something like a lawn mower online from anyone just boggles my mind. I guess I live in a very different world than Sparrowyn.

And most brick and mortar bookstores will be happy to order a book for you if they don't happen to have it in stock right away. So though at this point they can't compete with Amazon on convenience or taxes the I don't really think there are many in-print items that Amazon has that other booksellers absolutely couldn't get for you.