

Why my books are no longer for sale via Amazon - ajdecon
http://www.tobiasbuckell.com/2010/01/31/why-my-books-are-no-longer-for-sale-via-amazon/

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patio11
_But Amazon pretty much, right now, has a monopoly on online bookselling.
They’re huge. As a result, this becomes nearly a form of de facto price
fixing._

This is not a reason to prefer Macmillan over Amazon. Amazon might arguably
have something that is almost a monopoly on online bookselling, allowing them
to de facto dictate the price of books purchased online (though not offline,
except to the extent that price wars dictate that competitors charge less).

Macmillan has an _actual_ monopoly, guaranteed by Congress, on producing
Macmillan books. Macmillan is telling Amazon to engage in _actual_ price
fixing. Macmillan has told Amazon that if Amazon does not set their prices to
_exactly_ what Macmillan says they should be, when Macmillan says this should
be, Macmillan will use its _actual_ monopoly to forbid Amazon from
distributing their books.

Macmillan is doing this to avoid channel conflict -- i.e. establish actual
price fixing backed up by the power of law to forbid there to be price-based
competition among the various outlets who sell their books.

It turns reality on its head to portray Macmillan as the pro-consumer champion
of a vibrant, competitive market here.

~~~
cgranade
At the same time, it also turns reality on its head to portray Amazon as being
pro-consumer in this case (where's the good old Amazon that helped force Apple
out of music DRM by launching Amazon MP3?). In this struggle, it seems that
both sides are trying to price-fix, but to different prices, and without much
concern for either the consumers or the authors that are so directly affected
by their falling-out.

Other good perspectives:

* [http://scienceblogs.com/principles/2010/01/the_amazon_kerfuf...](http://scienceblogs.com/principles/2010/01/the_amazon_kerfuffle.php)

* [http://whatever.scalzi.com/2010/01/30/a-quick-note-on-ebook-...](http://whatever.scalzi.com/2010/01/30/a-quick-note-on-ebook-pricing/)

* <http://malkingrey.livejournal.com/577241.html>

~~~
felixc
The difference is that Amazon is trying to price-fix a _ceiling_ , whereas
Macmillan is trying to price-fix a _floor_.

~~~
cgranade
The question of which is ultimately better for the consumer is non-trivial to
my mind. Not to mention that, because publishers tie author royalties to the
physical cost of production, the authors stand to lose a lot in this struggle.

~~~
Retric
How can any price greater than 0 be the best price for a _consumer_.

~~~
alex_c
If something won't be profitable to make, it won't be made. The best price for
the consumer is the lowest price at which the item desired by the consumer can
still be produced.

~~~
Retric
If something can't be made it's price is infinity. If it's custom but possible
to create it's price is high. If it's mass produced it's price drops. If it's
pubic domain it's free.

PS: Saying people will not make it at some price just means it's actual price
is higher.

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ximeng
Bing cache (Google didn't have cache):

[http://cc.bingj.com/cache.aspx?q=why+my+books+are+no+longer+...](http://cc.bingj.com/cache.aspx?q=why+my+books+are+no+longer+on+sale&d=246522576906&mkt=en-
GB&setlang=en-US&w=5cdaaa1b,c8bd6c71)

~~~
oliveoil
Always makes me smile when people apologize for using Microsoft when they (in
theory at least) could have used someone else. (this is general, nothing
personal intended ximeng)

------
skolor
I haven't really been following this situation, and I'm far from an economics
expert, so I have a few questions for anyone who understands this stuff better
than I do:

First off, I'm not quite sure about what the issue is. I seem to remember that
Amazon said they wanted a hard ceiling, no books selling for >$10. The article
claims that what the publisher wants is the ability o change book prices based
on demand. Correct me if I'm wrong, but I thought that all Amazon was saying
was "You know the $10-15 range you wanted to price eBooks at? You can't do
that."

Second is more of an economics question. The article mentions Price Fixing in
relation to gas prices, and how fixing the prices caused gas prices to go up
due to hoarding. How does that work in a Monopoly, where the publisher not
only controls the only source of the books, but can also make more of a single
work at a negligible cost? (Yes, I understand that there is an outlay at the
beginning, but after that the cost of producing additional copies of the eBook
is nearly non-existent. You don't have to keep a stock of the eBooks that you
can potentially lose money on, you don't have to pay in advance to have each
copy produced. This changes things, but I don't know how.)

~~~
llimllib
> I thought that all Amazon was saying was "You know the $10-15 range you
> wanted to price eBooks at? You can't do that."

What do you mean by "all Amazon was saying"? That's the crux of the issue:
whether publishers will allow themselves to be told by Amazon that they cannot
sell over a certain price in their market, or whether they will be allowed to
sell at whatever prices they choose.

It's a fundamental question about how the online book market, so dominated by
Amazon, will work.

Your second paragraph doesn't have a clear question; what exactly do you want
to understand? I'll try anyway:

The marginal cost of producing eBooks doesn't really effect the price-fixing
problem. The OP's point is that publishers need the flexibility to try out
pricing schemes on the Amazon marketplace to discover what works, but Amazon
won't let them. Ultimately, he claims, this will lead to worse results for the
consumer because Amazon will be an inefficient marketplace due to the
inability of the publishers to recoup costs on books with high initial prices
which they can then follow with low prices later.

~~~
skolor
The "All Amazon was saying" is because, reading the article with little-to-no
outside information about the situation, the author makes it sound like Amazon
isn't setting a price ceiling, but an absolute price. I was trying to verify
that that was the case, since the article seems to be saying that the only
price point will be $9.99.

I seem to remember a price point being thrown around in one of the threads
here that The Publisher/Author share 30% of the price of the book, the
distributor takes ~40%, and the marketplace (Amazon, bookstore) takes 30%.
From what I've read from these posts, it seems like the Publishers were
fighting over the wrong thing entirely. If Amazon is acting like both
Distributor and Marketplace, they currently take 70% of the sale price of an
eBook. Why are Publishers arguing about the total price, rather than their cut
of it?

Looking at the recent move, Amazon now offering 70% to the publisher, with the
requirement that they get the lowest price point, and that that price point is
less than $10, it seems like that should have been what the publishers were
fighting for the entire time. If both distribution and selling of the book are
being by the same company, for the same effort as just selling the book,
there's no real reason for them to be double-dipping and taking that huge of a
portion of the sale price.

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petewarden
His ebook costs breakdown is pretty revealing. $3000 for an original cover? I
hardly realize my Kindle books have covers, since they auto-open to the first
page. $1000 for a designer? Use a standard font and template.

Book publishers have crazy overheads, with authors typically receiving only
10% of the cover price. Editors and proofreaders make sense, but it's hard to
see how everything else adds value. The current publishing model seems to be a
big part of the problem here.

~~~
waterlesscloud
The Kindle book cover would also probably be used for the Amazon thumbnail
image, as well as other marketing purposes. Standard template sure, but little
things do make a difference, and tweaking is a smart thing to do.

There will be room for quality design in e-publishing, just like there is in
print.

$3000 would be a lot for self- or niche-publishing, but if I were making a
mass market attempt, I could see spending that much. It makes a difference.

~~~
petewarden
Marketing is worth spending money on if it brings in more money than you pay.
I'd agree that it might be worth it if you're shooting for a bestseller, but
the author lays it out as an unavoidable expense.

I love books, and being a writer sucks as a way to make a living even for very
talented people, but the solution has to involve radical change to the
publishing model. Big publishers seem to take a massive cut without improving
the quality of the end result. I'm a big supporter of authors looking at
alternative models, like Peter Watts with free downloads in the hope of
donations:

<http://www.rifters.com/real/Blindsight.htm>

------
ajdecon
Submitted for having a pretty good explanation of the economics of ebook
publishing (through major publishers), and discussion of the recent Amazon-
Macmillan dispute.

~~~
ajdecon
Specifically, the big point I thought interesting: at the moment ebooks seem
to have a pretty small demand which falls off fast, so they sell more like
limited editions than mass-market. This _might_ make it difficult to justify
releasing to ebook without higher prices.

(I don't have a strong opinion on who's right or wrong here, as I can argue it
from both sides. But I'll admit I generally sympathize more with authors than
anyone on this, and they seem to have the least amount of control in the
publishing process.)

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BCM43
>Right after I was laid off the $4 difference between $9 and $14.95 was a bit
much.

I think he means the $6 difference.

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johnl
Amazon real issue may not be the price issue but that Amazon isn't dictating
what the price shall be, someone else is. Amazon may think that if they loose
control over price, they loose control over their site.

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prakash
surprised to see no mention of books on bingo :-)

