When titans collide…?

I’m assuming anyone reading an author’s blog will have heard something about this, but in case you’ve been hiding under a (oh, let’s just say it) a Super Bowl rock the last couple of weeks: Amazon and Macmillan have been having a bit of a, well, tussle over a few minor issues.

Okay, they’re actually really freaking upset.

The problem stems from an issue over pricing. For some time Amazon, the undisputed king of E-books to this point (though that’s likely to change rapidly, as I’ll talk a bit more about in a minute), has held the line on E-book prices–requiring publishers to stick to an artificially flat rate around $9.99. I say around because there’s some variation on price…but not much, and that’s precisely the issue to which publishers have objected. Keeping the price that low, goes the argument, cannibalizes hardcover sales, particularly when E-books get released at the same time…and besides, publishers should have more control over prices, relating them to overhead in some way.

The system has worked so far for two reasons: first, Amazon has been paying the publishers
a substantial amount of the money from each E-book sold, taking a loss each time (which isn’t good enough from the publishers’ point of view–they’re getting money now, but once Amazon corners the market they’ll be able to raise prices to whatever they want…and lower payments to publishers at the same time). Second, Amazon has been kind of all there is for the E-book market. Certainly there are other E-book sites and readers, but no one has matched availability with distribution and a solid E-reader the way Amazon has…so publishers reluctantly went along with the system.

About a week ago that all changed. The precipitating event was Apple’s official announcement of their HUGE IPHONE iPad, which linked to their iBooks store threatens to blow the doors off of E-publishing as anyone currently understands it. Apple was already in discussions with publishers (including Macmillan) about pricing, and clearly they were happier with Apple’s terms. Macmillan told Amazon it wanted to start setting prices or it would delay E-book releases six months or more and all hell broke loose: Amazon pulled all Macmillan books off its virtual shelves–even the print ones–and for at least a week accusations of greed and worse flew back and forth.

Amazon finally relented, and the books are now back for sale, but for many the damage has already been done. Publishers are furious with Amazon (and there are rumblings that others are going to follow Macmillan’s lead). Authors everywhere are furious, mostly at Amazon–lost sales cost money, and there’s no question that sales were lost during the spat. And customers are furious at everyone…because their prices are about to rise, and there’s not much they will be able to do about it (at least not legally).

I’m a bit hesitant to wade into this muck, but a couple of things keep striking me about this episode:

1. Amazon screwed up badly, twice. Whatever one’s opinion about the E-book price issue–and I don’t think it’s nearly as cut and dried as some of my colleagues seem to–Amazon’s behavior seems to be shortsighted at best and utterly juvenile at worst. Pulling links to E-book versions of Macmillan books would have been justifiable, if aggressive; pulling links to physical books seems petty and vengeful in the extreme. But if you’re going to take such a stance, you better stick with it and refine your “this is all for the customers” pitch. Instead Amazon folded like a cheap suit, showing weakness at best and total incompetence at worst. Big companies which act like petulant children don’t usually do well in the court of public opinion. And given the fact that Amazon is going to be facing serious competition very shortly–from Barnes and Noble and, of course, Apple–you’d think it would be trying to keep its public image as squeaky clean as possible.

2. Macmillan may indeed be fighting the good fight. But it’s hard for me not to wonder where this righteous zeal has been over the last few years, and hard not to question the timing of this newfound commitment to fairness in pricing. Moreover, it seems to at least partially reflect this (to my mind incorrect) view that E-books are exactly the same thing as a physical book…and they’re not. They’re not physical objects, which can be traded from one to another freely; they don’t have weight, heft, or other aesthetic qualities that hardcover or even paperbacks do (how likely are you to marvel at a beautiful E-book cover?); and even the content differs from that found in physical books, with more errors, often problematic formatting and other such problems. Which leads to the most important

3. Authors are fully justified in feeling angry; their sales have been hurt, their reputation unfairly tarnished, and (as usual) they’re getting the short end of the stick here. What I don’t understand is letting that anger spill over towards readers, particularly those who don’t agree that E-books are exactly the same as any other kind of book. When authors have this to say

“The entitlement and the butthurt and the paranoia and the refusal to engage in a reasonable discussion is just getting to me.”

–we’re all in trouble. Attacking your customer base is a bad, bad idea (for an example, please see Industry, Music), and said customers may have a reasonable point in asking why they should pay identical money for a non-identical product. Even if they don’t, attacking them as “entitled” and “paranoid” is the quickest way I can think of to send them to the pleasant world of piracy. None of this is to suggest that Amazon or Macmillan were right, or that reasonable people can’t disagree. It is to suggest, however, that anger ought to be focused in the right direction–and that enlisting readers as allies of authors, which they really have been since the earliest days of print, makes a lot more sense than treating them like enemies.