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February 9, 2010

Amazon, fully pantsed and in a fetal cower under the principal’s office window, blows sobbing snot bubbles of shame

Who’s your daddy, Beez? Who? Say it… SAY IT! That’s right. Macmillan’s your daddy. Say it again. Good. And don’t you forget it. There’s a new sheriff on this here playground, muchacho, and you best be listening for the sound of his approach, you get me? Now run along and fetch me a sasperilla. And keep your yap shut unless you’re spoken to, you hear, lessen you be wanting a cuff on the ear? Now skeedaddle! (On a side note: does anyone see a chance that Apple is Osama Bin Laden to Amazon’s Taliban? Be sure not to loan him those nukes, eh…?)

Vaguely narrative timeline of stories I missed yesterday:

Da-yam! When that last clod of dirt thrown by the enraged crowd of formerly abused publishers hit Amazon in the face, you could totally see the blood spray out like in a video game…
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13 comments on “Amazon, fully pantsed and in a fetal cower under the principal’s office window, blows sobbing snot bubbles of shame”

  1. michael says:

    I am curious why Amazon is evil if it decides not to sell something. Are retailers required to sell every book from every publisher? Should retailers support publishers that seek to change the business model, a change that could cost the retailer much profit? Amazon exists to make Amazon money not to support publishers or the book format. The reaction to all this silliness seems to forget people buy books from other places than Amazon.

  2. Robert J. Wiersema says:

    You’re proceeding under a whole lot of misinformation, Michael.

    To take just one small part of your post: the new pricing model Macmillan is advocating will MAKE Amazon money, not cost them. At this juncture, by selling new release titles at $9.99, Amazon is losing about $5 per transaction — that will change with the new model.

    What it WON’T allow Amazon to do is to use the books as a loss leader to spur Kindle sales, a process which, if left unchecked, would have resulted in a lot of ereading folks yoked to a particular device and unable to shop elsewhere, and subject to Amazon raising their prices once they had solidified a large enough market share to do so. Loss leaders don’t last forever…

  3. Lilian Nattel says:

    This is a good thing, isn’t it? I haven’t been following closely–snowed under with the end of draft 9. (Nothing like research and interviews at the 11th hour!)

  4. Julie says:

    This is really ridiculous. Slamming Amazon as the big bad corporation is extremely short-sited in this situation. Not only did Amazon do an amazing amount of good for e-books in general with the Kindle, it also is fighting against price-fixing and being bullied around by apple now that they’ve decided e-reading is worth their time (though, have you seen the iPad? it doesn’t seem that exciting to me).

    I guess I just don’t understand why everyone is so excited that e-books will cost more. They aren’t as expensive to make as print books, so they should cost less. Period. Are publishers going to make less money? Yes. However, if they keep driving this business model in which they charge such a high price for an e-book, people are just going to start pirating them and downloading them for free. It’s all part of the wonder of the internet.

    More of my thoughts on this here: [see link above]

  5. Robert J. Wiersema says:

    Of course, Julie — completely “short-sited” on my part. Amazon clearly only has the good of the public in mind. That’s why they’ve been giving those Kindles away! And selling ebooks for only $9.99! And stripping ALL the books of a publisher who dares to negotiate with them regarding price? Why, that’s the very definition of “fighting against price-fixing”!

    You’re absolutely right! Thank you for pulling the scales from my eyes!

  6. sunflower88 says:

    What it WON’T allow Amazon to do is to use the books as a loss leader to spur Kindle sales, a process which, if left unchecked, would have resulted in a lot of ereading folks yoked to a particular device and unable to shop elsewhere, and subject to Amazon raising their prices once they had solidified a large enough market share to do so. Loss leaders don’t last forever…

    Exactly.

    There was an interesting part in How Markets Fail by John Cassiday that notes how a market can tilt in the direction of a singly product, and once this happens, even if
    a rival offers a cheaper or better good, it’s impossible for them to get a foothold in the market. Happens a lot in the tech industry — IBM over Apple, Microsoft vs. practically every company they’ve come up against. All Amazon is
    trying to do is grab the e-book market before anyone else does.

    And does anyone think it’s weird that people would be willing to drop a couple of hundred dollars for an e-reader… but (gasp) more than $9.99 for an e-book,
    that’s criminal, they’re practically forcing us to steal.

  7. sunflower88 says:

    They aren’t as expensive to make as print books, so
    they should cost less. Period

    How much less?

    Here’s the breakdown of expenses for a book based on a list price of $27.95 (figure from Money magazine)

    $3.55 – Pre-production – This amount covers editors,
    graphic designers, and the like
    $2.83 – Printing – Ink, glue, paper, etc
    $2.00 – Marketing – Book tour, NYT Book Review ad,printing and shipping galleys to journalists
    $2.80 – Wholesaler – The take of the middlemen who handle distribution for publishers
    $4.19 – Author Royalties – A bestseller like (John) Grisham will net about 15% in royalties, lesser known authors get less. Also the author will be paying a slice
    of this pie piece to his agent, publicist

    You think you can cut out pre-production, but a book that’s not properly edited or typeset is a slog to read.

  8. michael says:

    Robert, my point is Amazon has the right to run its business the way they want. If they don’t want to deal with a supplier it is their right.

    As for loss leaders they are very successful. I worked for Tower Records. I spent a dozen years working in their video and book departments (Among other things I was the Product Supervisor for Books at Tower in Sherman Oaks,CA.). I watched the lost leader sales of video by computer stores such as Best Buy destroy Tower’s sales in the product.

    I am not saying Amazon was right in what they did, I am saying it is their right to run their store anyway they like. Even if you don’t approve.

  9. michael says:

    Oh, just read at ereads.com that Random House has sided with “evil” Amazon over the pricing issue.

  10. Andrew S says:

    It is the right of Macmillan to set the terms under which they sell to Amazon.

    And it is the right of people who disagree with Amazon’s choices to express that disagreement.

    Now that we’re finished with this cheap and foolish rhetoric of rights, do you have any real contribution to add, Michael?

  11. michael says:

    I thought the two statements you mentioned were “real” contributions? Certainly they rise to the same level of most of the discussions I have read on the internet regarding this issue. Sorry if I bothered you with my fake contributions such as Random House announcing today that the publisher plans to side with Amazon and not the new agency publisher model that caused this non-event. My bad.

  12. Robert J. Wiersema says:

    I have no problem with Amazon not selling certain products — of course that’s they’re right.

    But when you’re in the middle of negotiations, it IS bullying to remove the links to ALL the products from the party you’re negotiating with, not just the products in question. It was muscle-flexing, the way Amazon has done in the past, but this time their bluff was called.

  13. Robert J. Wiersema says:

    er, “their” right.

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