Amazon removes Hachette buy links from its stores.

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K.B. Parker

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Let's see. When my books published by a mid-sized independent press were still in print, Amazon got a 50% discount and I was paid 10% on net revenue.

This meant that for every book sold on Amazon, Amazon received $4.00 and I received $0.40. These figures (or at least percentages, since the Amazon price is less than $8) hold true for the e-books.

What's the difference between Amazon getting a 50% discount, and a brick and mortar store getting a 50% discount? There is none.

Colour me unimpressed. I don't see why Amazon should get 10 times as much as I do, when I wrote the books and all Amazon does is host the files and electronically process payments.

I'm confused as to why you single out Amazon. The entire system isn't exactly fair to the author, IMO.
 

HistorySleuth

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thothguard51

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Amazon looses money for every Kindle they sell. They have to make it up somewhere...

Seriously, this has been a long time coming with Amazon, and I do suspect the agency model will die and that Indies will have to accept less in the future...
 

Torgo

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Hachette, as well as the other Big Dogs, are pricing their ebooks too high in an attempt to make the same amount of cash as they would on their print versions. They set the MSRP at $14.95, for example. Amazon would then purchase the title, or stock it, paying 60% of cost. Then they set the price as they wish. Many book prices are slashed to less than $9.99, leaving very little profit for Amazon.

Amazon clearly don't care about their profit margin at this point in history; they care about their market share. The more books they sell, the more their corner of the garden grows. It's enclosure, with the hedges being their DRM ecosystem. So yes: they'll sell ebooks at a loss in order to force the value of ebooks down and make Kindle the only game in town. At a certain point, they'll have run out of publisher margin to squeeze and start squeezing author margin so that they can actually start making money, and they'll do this in relative peace and quiet because the DoJ isn't looking out for anyone but consumers, who want to pay basically nothing.

This is the argument we've been making forever, and hey, check out Amazon subsidiary Audible lowering royalties for publishers of audiobooks recently...
 

thothguard51

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What's the difference between Amazon getting a 50% discount, and a brick and mortar store getting a 50% discount? There is none.

Bingo...

And if Amazon lowers royalties to 25% for indies, that is still almost twice what authors get from the big five...
 

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Define "accept less".

Even if Amazon drops it's royalties to the 25/40% numbers people have been throwing around, isn't that still better than 12.5% with the trade publishers and the Agency model?

Also, considering this is coming from Smashwords, Amazon's arguably biggest ebook distributing rival, I take the whole thing with a grain of salt. Particularly the last half which reads almost like an ad for Smashwords.
 

K.B. Parker

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Amazon clearly don't care about their profit margin at this point in history; they care about their market share. The more books they sell, the more their corner of the garden grows. It's enclosure, with the hedges being their DRM ecosystem. So yes: they'll sell ebooks at a loss in order to force the value of ebooks down and make Kindle the only game in town. At a certain point, they'll have run out of publisher margin to squeeze and start squeezing author margin so that they can actually start making money, and they'll do this in relative peace and quiet because the DoJ isn't looking out for anyone but consumers, who want to pay basically nothing.

This is the argument we've been making forever, and hey, check out Amazon subsidiary Audible lowering royalties for publishers of audiobooks recently...

Assuming Hachette gets what they want, presumably the agency model, what's to stop Amazon from cutting the percentage the publisher receives? What's to stop the publisher from setting their books at $14.99 at Amazon, and $4.99 at BN? When exactly has the producer/publisher/creator been able to set the retail price as they see fit? As a retailer, cutting prices is perfectly within Amazon's rights.

The big five charge too much for an ebook, pricing them within cents of print editions. That's bullshit, plain and simple. They don't have shipping costs, warehousing costs or printing costs. So when you're talking about pushing prices down, that isn't a bad thing when consumers are being ripped off.

Publishers can't survive on .99 titles, I get that. Anything under $4.99 probably isn't profitable enough for the big dogs, especially for newer titles. It's a problem when you start asking $14.59 for an ebook when the print version goes for $14.99.

EDIT: As a future self publisher, I'm not raving about Amazon. Quite the opposite. I think the select program has the potential to be damaging, given the terms that require exclusive rights. I think it's important to expand the distribution of your titles into Itunes, Kobo, and Nook. I understand that so much power in the hands of one entity isn't ideal, but Amazon isn't doing anything wrong in my eyes. They're just the best at the game, and I think the problems the Big Five are facing with Amazon is a battle they've created by deeply over-valuing their electronic products in an attempt to slap a bandaid on their print sales bleeding.
 
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Just on this:

The Hugo packets decision was a bad one and it hasn't been properly justified by Orbit, in my opinion. Charlie Stross has made it clear he disagrees. But he's also made it clear why he disagrees with Amazon on a lot of things.

He's also made it clear that if people complain to Orbit on his behalf he might suffer the consequences he doesn't want.


It seems odd to suggest he's being disingenuous w/r/t publishers but not w/r/t retailers, especially when both are crucial for selling your book.

Retailers, yes. Publishers, not so much these days. IMO publishers are less important than they think they are, but more important than some SP's think.

Data point: Stross is able to negotiate DRM-free and CC-licensed releases for his work despite Big 5 publishing being extremely leery of the idea. This suggests he isn't cravenly withholding criticism of his publishers out of fear for his contracts.

Again, 1995 thinking with the DRM. It doesn't work. It never will. All it does is slow down those who want to get the book for free.

Dav
 

K.B. Parker

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Mark Coker has done wonderful things for the self publishing community, even though I think Smashwords is a deeply flawed, outdated system. I read that article though, and it comes off as nothing more than thinly veiled propaganda.
 

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Assuming Hachette gets what they want, presumably the agency model, what's to stop Amazon from cutting the percentage the publisher receives? What's to stop the publisher from setting their books at $14.99 at Amazon, and $4.99 at BN? When exactly has the producer/publisher/creator been able to set the retail price as they see fit? As a retailer, cutting prices is perfectly within Amazon's rights.

Wasn't that kind of what the DoJ short-circuited? In the UK we used to have the Net Book Agreement...

The big five charge too much for an ebook, pricing them within cents of print editions. That's bullshit, plain and simple. They don't have shipping costs, warehousing costs or printing costs. So when you're talking about pushing prices down, that isn't a bad thing when consumers are being ripped off.

Pop quiz: why does a hardback cost twice as much as a paperback? That's the answer to this conundrum.
 
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shadowwalker

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Define "accept less".

Even if Amazon drops it's royalties to the 25/40% numbers people have been throwing around, isn't that still better than 12.5% with the trade publishers and the Agency model?

Only if you sell as many books as you would with a trade publisher behind you (plus the advance, of course).
 

JournoWriter

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Pop quiz: why does a hardback cost twice as much as a hardback? That's the answer to this conundrum.

Was that supposed to be "twice as much as a paperback"?
 

K.B. Parker

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Only if you sell half as many books as you would with a trade publisher behind you (plus the advance, of course).

Blue is mine. Certainly though, with that sort of cut, it would make a trade deal seem much more ideal. As far as the advance, since it counts against royalties, it doesn't exactly factor in to monies earned if you're expecting to sell enough books to earn out.
 

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Only if you sell as many books as you would with a trade publisher behind you (plus the advance, of course).

Except what does that even mean anymore? I've been seeing more and more people claim that they have to do their own marketing these days, even being trade published. There also isn't that much of a difference anymore between where you can get books on your own and where they can get books. As far as ebooks, you can upload yourself to iTunes, Kindle, and Nook, all at better royalties than a trade publisher will ever give you. If you choose your POD publisher properly, you're not really limited in physical copies either. It's become where all a trade publisher really has to offer is to slap their seal of approval on your book (after mandated changes and their choice of cover) in the form of their brand name. And for that, we give them somewhere around 50% of the profits?
 

shadowwalker

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Blue is mine. Certainly though, with that sort of cut, it would make a trade deal seem much more ideal. As far as the advance, since it counts against royalties, it doesn't exactly factor in to monies earned if you're expecting to sell enough books to earn out.

The advance is money up front, no matter how many books you sell. And yes, it does factor in because most books don't earn out, so you're getting most of your royalties up front, with the possibility of desert later on (not to mention time snot pent on the publishing end). But this is an old discussion, covered extensively elsewhere...
 

shadowwalker

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Except what does that even mean anymore? I've been seeing more and more people claim that they have to do their own marketing these days, even being trade published. There also isn't that much of a difference anymore between where you can get books on your own and where they can get books. As far as ebooks, you can upload yourself to iTunes, Kindle, and Nook, all at better royalties than a trade publisher will ever give you. If you choose your POD publisher properly, you're not really limited in physical copies either. It's become where all a trade publisher really has to offer is to slap their seal of approval on your book (after mandated changes and their choice of cover) in the form of their brand name. And for that, we give them somewhere around 50% of the profits?

People may claim they're doing their own marketing - possibly true with indie publishers. And POD publishing isn't often (if ever) accepted by bookstores, where a good share of people do their browsing and buying, not to mention the costs involved. And trade publishers do a hell of a lot more than slap a seal of approval on a book - just look at the difference professional editing gives a book, and professional cover design - well, again, as above, this is an old discussion and covered elsewhere. But if you really believe trade publishers don't do anything an SP can't do, you haven't learned enough about trade publishing.
 

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People may claim they're doing their own marketing - possibly true with indie publishers. And POD publishing isn't often (if ever) accepted by bookstores, where a good share of people do their browsing and buying, not to mention the costs involved. And trade publishers do a hell of a lot more than slap a seal of approval on a book - just look at the difference professional editing gives a book, and professional cover design - well, again, as above, this is an old discussion and covered elsewhere. But if you really believe trade publishers don't do anything an SP can't do, you haven't learned enough about trade publishing.

And if you really believe SP authors can't do anything a trade publisher can do, you haven't learned enough about self-publishing.

I can hire the exact same editors and cover artists that the trade publishers use freelance. Formatting isn't a complicated issue. My local bookstores may not keep a dozen copies stocked, but they have no problems with ordering two or three POD books at a time.

I also recently read Off Season by Jack Ketchum as an ebook. The name of the main character was either Carla or Carta. I honestly don't know because it bounced back and forth like that by about a 50/50 margin, even several times in a single paragraph. So you can't say trade publishers make a book more professional either. They occasionally put out garbage on the same level as some of the SP authors do.

Is Amazon going to turn on authors eventually? Probably. Change happens. Change is a constant. Eventually, something else will pop up that will turn Amazon into the last dinosaur struggling to pull itself out of the tar pit it's sinking into and it will throw everyone and everything it can under the bus to save itself.

Let's be bluntly honest though. This is nothing more than a diversion by Hatchette. What should we be more worried about? The change that could be five, ten, twenty years down the road? Or the present battle being waged by those in the present vs the ones who want things set back to the way they were five, ten, twenty years ago?
 
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