It's hard to see this piece as more than a disrupted industry, frankly, whining over their diminished power in the new reality. I'm to believe that it's bad for anyone but publishers that books are cheap? Because people might buy books for the wrong reasons? Oh, humanity. ("it sends a confusing message that good books are worth less, and because it encourages buying based on something other than the quality of the book")
This bit is particularly disingenuous: "The hippie, black and women’s movements of the 1960s would not have been so successful in challenging authority without the bookstores, which made their ideas widely available and sympathetic in a way that television, for instance, did not."
Seriously? I mean, really, seriously, you just wrote that on a technology (wait for it) BLOG? The analogous movements of today has unprecedented access to spreading their ideas through blogs and websites and social media and petition sites and collaboration services and who knows what else - most of it available instantly and almost or entirely free. I don't think that if the occupy/tea party/anonymous/truther/conspiracy/pick-your-revolution-of-week movements have struggled for five minutes to make their ideas available, it was because of the lack of bookstores.
His statement is correct in a historical perspective that Walter Cronkite and the local newspaper had little interest in covering these movements (or at least not in a sympathetic or fair light).
His statement is humorous, as you point out, when used as a leg of his argument that bookstores are still needed for these social reasons.
I feel like this entire argument is less against Amazon and more against modern economics. The author attacks two trademarks of the Amazonian publishing spectrum: algorithmic pricing and a diminished sense of competition.
The first, I think, is difficult to make because you're saying "hey, this pricing scheme is arbitrary and capricious" when the current model of publishers setting prices for goods seems equally arbitrary. Books are art with little intrinsic value -- if you were to ask me to value a book in my collection, the answer would range from less than a dollar to thousands of dollars, with little in between. I'm not saying demand is a perfect proxy for value, but I think its better than the other options. (I feel the same way about clothes. Any pricing scheme where there's a systematic understanding that everyone is going to discount the hell out of the base price is, I think, a flawed scheme.)
The second, I think is much more valid overall but the same points could be made about Barnes & Noble or Borders, back in the day. (Remember You've Got Mail?)
A much bigger and interesting topic of discussion, I think, is what happens ten years from now when eBooks become the du jour method of literary consumption. Personally, I'm looking forward to the Bandcamp of poetry.
There is already an absurd amount of literary content freely created online by millions of people. And most of the sites offer some ranking system to filter the crap out. I think I bought my last book ever in college, considering I have an infinite supply of 15 - 25 year old Tolkein's works available that they put out for free because they just want people to enjoy their writings if I look hard enough.
I've acquired about five self-published books at a very low cost (including free) and they've all been shit. I have a hard time buying something these days that I don't think had an editor work through it, but I am concerned that editors will play a smaller and smaller role in the book business going forward.
“So do you raise the price, knowing they’re going to lower it, so that the price will then appear closer to what you need it to be?"
So, Amazon is paying the publisher the wholesale price regardless. Amazon's discounts cut into Amazon's profits, not the publishers -- or even result in Amazon taking a loss.
I think this publisher quoted has to tell us why he "needs" the price on Amazon to be a certain amount, when it does not effect how much he gets paid per copy -- the initial naive interpretation would be that if Amazon wants to cut their profits, so presumably more copies sell, while the publisher is still making the same amount per copy -- this would be good for the publisher, no?
It is a weird market (with Amazon appearing to routinely sell books at a loss), and is dominated by Amazon, which indeed isn't great for a healthy diverse bookselling market.
But publishers are saying some weird stuff, without explaining themselves.
It's been a couple of years, but I used to work at a place that published a number of books.
Usualy wholesale price was %40 off retail. Amazon demanded 55% at the time or they wouldn't sell the books. I can imagine some publishers would raise their prices accordingly so that they would still reach the minimum wholesale price they wanted/needed.
That make sense -- negotiating a higher wholesale price with Amazon, sometimes by raising your retail price cause of Amazon's fixed discount -- but is not what the publisher quoted appears to be talking about.
Again, "so that the price will then appear closer to what you need it to be?"" -- he's saying he cares what the retail price shown to customers is. That because Amazon is going to sell at less than his marked retail price, he's going to raise the marked retail price, to raise the price that appears to customers.
There might be a reason that matters to his business, but it's definitely not obvious, I wish he'd tell us what it was. He just doesn't want his product to look like it's a cheap bargain product?
If you're interested about the kind of harm Amazon can potentially do to the publishing ecosystem (or good, depending on your position), than definitely check out the Melville House Publisher's blog. They've famously fought Amazon numerous times over their terms and write frequently about Amazon issues.
I'm really interested to see how the Google Shopping Express [1] thing will play out. I really like the idea of challenging Amazon's control by enabling local stores rather than just trying to create another behemoth.
It seems like it's right up Google's alley, given their experience with long-tail markets in the advertising business. I hope it's a success.
I've been using Google Shopping Express (beta invite from a former coworker) for the past month now, and I love it. I ordered a toothbrush going into work yesterday, and the courier was at my desk by noon. I especially like that it includes a variety of local stores (including budget places like Walgreens and Target) so I almost always get the best price. A couple of potential flaws I see with the service are:
* The price point. Right now the beta gives me free delivery on everything. So I can order from numerous stores with tiny orders, which is great. But normally it looks like it will cost $4.99 for a one-store delivery, which may not be worth it for me unless I really need something urgent. Amazon Prime will almost always be worth it for me in that case, unless it's something I can't go two days without. Now, maybe if Google came out with a Prime-like one time annual fee for unlimited deliveries...
* The type of products available. Right now, you can't get a lot of the things you would normally go to the store for: perishable food items, alcohol, etc. That takes away a lot of the value of Same Day delivery. Amazon Fresh really has a big edge here, but I guess that's only available in Seattle.
I'm in the beta as well and the account section explicitly mentions an annual membership and the date that the trial ends and the membership starts. It would make absolutely no sense for them not to offer this as a subscription.
Publishers probably weren't complaining when Amazon would buy their book at wholesale and take a loss with massive retail discounting.
What publishers want is for Amazon to sell at low margin so they get volume and the publishers get each at a decent wholesale price.
As a seller on Amazon I have noticed that often people will pay more than the cheapest available, either they don't bother looking elsewhere or Amazon as a brand has grown to the point where people just find it easiest to use them all the time. If this effect holds for books then they no longer have the be the cheapest to drive decent volume.
In Germany we have a law that prohibits rebates on books. The prices are usually printed on the back. Selling books discounted is prohibited and may lead to huge penalties. (Of course there are loopholes, damaged books can be sold for any price and books can be damaged by stamping "DAMAGED" on them.) This eliminates pricing competition and will probably give the local booksellers a few more years to live. However: Amazons margin on books is probably the largest ever realized countrywide. Book wholesalers have the contractual right to get the largest discount granted to any customer. This is why basically no-one gets more than 50%. Except Amazon. They'll buy from wholesale, but the book will need 1-2 additional days to ship. To get 24h shipping, the publishers have to sell directly to Amazon at 50% rebate plus around 15% for handling and advertising. This way they realize lower sourcing costs than anyone else. It's ridiculous, but many agree to it.
Hmm, I got 24h shipping in basically every German bookstore way before amazon arrived on the market (to the store, of course, not to my home address). Did that change in the last few years?
I think one of the big factors of amazon right from the start in Germany (and probably Austria and France, too, both of which have similar price laws) was that you could get the books to your own address, and that pretty quickly. That combined with the browsing experience (part of which was the novelty) got them established, and later on the expanded product range and the recommendation engine cemented their foothold. So I would say it's not all just about the price, although I'd be very interested to hear about pricing arrangements with the publishers, especially in the early years where they didn't exactly dominate the market.
To me, the biggest boon of amazon was getting English books easily and without a big markup (straight USD/EUR rates, not some fairy tale wiggle factor). Programming books were quite a bit cheaper (German books were almost always hardocover only, and with a fixed price, of course), never mind novels (ages to translate and almost every trilogy becomes a hexalogy in German).
There is also one main difference between US and German book market.
Ordering a book in US took two weeks or even month, to ship the book to Boston, before Amazon disrupted the broken US book market. While ordering a book in Germany takes a maximum of two days to any bookstore.
One thing the article does not mention is the real price of ordering a book at amazon: Privacy. There had been lots of cases where CIA or FBI visited people because of the books the bought.
Unless you're paying cash for books and not using any sort of membership/discount card when you do, your privacy is just as gone at a physical bookstore as it is at Amazon.
Not necessarily; in most cases I would imagine only the book store themselves retain data about your purchase (details of the SKU(s) you purchased, images of you making the purchase on CCTV, etc.)
If you use an electronic payment method, only 'metadata' — to use an expression in vogue — about the transaction will be transmitted to third parties, not the details of the particular item(s) you purchased.
This confirms my theory that NYT would write anything as long as Apple pays them enough.
The picture painted here ignores the point of view of the customer completely. Whatever Amazon does is okay with me as long as they successfully exposes Apple + Big Four cartel.
Most books sold by Amazon are sold by 3rd party sellers, which are small businesses generally. They use SaaS apps to do repricing. Pricing is not, for the most part, done by a special Amazon algorithm.
No, in fact it looks like I was wrong. I based it off my buying of books which are mostly long tail. 3rd party sales appear to be 50% of Amazon sales right now, according to Google (on phone right now, hard to link) buy most of that is not media, so Amazon must be doing 50%+ of sales.
I am more to believe that those two quotes should have been reversed. I am all for the idea of publisher's being pushed out in favor of authors getting direct to customers, the same idea that would be so nice in music.
There really is no difference in the end, both can easily be delivered electronically and both have adherents to the old means of enjoying them; physical copies.
It's unfair to say the reverse when Amazon were only making a loss to monopolize the market.
However, Apple didn't care that book industry were gouging the consumer - no printing costs, no shipping costs, no packaging costs .. why should eBooks be the same price? Greed!
I don't buy eBooks on principle. If the price was reduced accordingly, so that the book industry maintained its profits - that would have been fair and equitable.
From my perspective, neither Apple nor Amazon had this goal in mind.
I have no opinion on which way round the Jobs statement should be, but judging by profit margins, Bezos seems to play a game which is more: I lose, you win, maybe sometime later, I'll win, maybe. He is nigh on impossible to predict and bottom lines don't seem to motivate him at all.
This bit is particularly disingenuous: "The hippie, black and women’s movements of the 1960s would not have been so successful in challenging authority without the bookstores, which made their ideas widely available and sympathetic in a way that television, for instance, did not."
Seriously? I mean, really, seriously, you just wrote that on a technology (wait for it) BLOG? The analogous movements of today has unprecedented access to spreading their ideas through blogs and websites and social media and petition sites and collaboration services and who knows what else - most of it available instantly and almost or entirely free. I don't think that if the occupy/tea party/anonymous/truther/conspiracy/pick-your-revolution-of-week movements have struggled for five minutes to make their ideas available, it was because of the lack of bookstores.