Authors United, allies, demand government intervention

[DiapDealer]

Originally Posted by Purple Lady

From what I remember when the big publishers went to agency, they left the smaller stores without a contract for quite a while. I remember Fictionwise selling Random House books but no other big publishers. It's hard to stay in business without having the products to sell.

You nailed it. Even though the Fictionwise's loyalty program (amassing credit to apply toward future purchases) had customers coming back again and again, the double whammy of Agency disallowing discounts (ones that effectively reduced ebooks below the Agency mandated price-floor anyway--which theirs did), coupled with their inability to sell the books customers most wanted to buy (due to BPH's leaving them contract-less for a year or more) was too much to overcome.

Fictionwise were already holding (and keeping) their own slice of the pie when Amazon's $9.99 for select bestsellers was in full swing. What finally killed them was not being able to continue their discount program (Agency), and not having books to sell (no contracts for BPH titles). Neither of which were the fault of Amazon.

[AnemicOak]

Originally Posted by fjtorres

The reports I saw back in the day were that they had trouble even getting the BPHs to start negotiating.

Except B&N (which Agency was supposed to help ) had the clout/muscle to get that done for FW, like they did for Nook, and didn't. So the same, but a bit different than BoB, Diesel, CyberRead...

[SteveEisenberg]

Originally Posted by DiapDealer

What killed them was not being able to continue their discount program (Agency), and not having books to sell (no contracts for BPH titles).

There are wholesalers for both paper and eBooks.

It's true that Fictionwise couldn't, for long, afford their spectacularly unsustainable business model unless publishers gave them tremendously preferential deals over what small bookstores get from Ingram and Baker&Taylor.

Fictionwise never had an IPO. It was purchased by B&N, fourteen months after it's biggest acquisition (Motricity eReader), for $15.7 million. That's quite a small sum by internet standards and suggests to me that Fictionwise churned through its venture capital without ever becoming profitable.

[AnemicOak]

Originally Posted by SteveEisenberg

It was purchased by B&N, fourteen months after it's biggest acquisition (Motricity eReader), for $15.7 million. That's quite a small sum by internet standards and suggests to me that Fictionwise churned through its venture capital without ever becoming profitable.

Is it a small sum? Remember we're talking before eBooks really took off as a large business (or were just starting to). Do we know what FW paid for eReader? What Amazon paid for Mobi a couple of years before? We're talking a small company where the owners wrote the code behind the store and often handled CS themselves.

Not saying you're wrong, but I'd be interested to know the scale of things money wise in the 2000-2008ish era. FW selling an estimated 1.5 million ebook content units in 2008 was pretty big at the time, but wouldn't be now. What did things in the eBook world go for back then, what were the economics? Also the FW sale was a buyers market which may have affected the $15.7M + earn out payments total. The Pendergrasts were looking to sell and eventually move on to a bio-tech venture with their other brother where they are now.


Basically B&N bought FW for eReader and started dismantling it for Nook just like Amazon did with Mobipocket for Kindle. Once they'd done that they saw little reason to keep FW & eReader around.

[TimW]

Originally Posted by AnemicOak

Is it a small sum? Remember we're talking before eBooks really took off as a large business (or were just starting to). Do we know what FW paid for eReader? What Amazon paid for Mobi a couple of years before? We're talking a small company where the owners wrote the code behind the store and often handled CS themselves.

Not saying you're wrong, but I'd be interested to know the scale of things money wise in the 2000-2008ish era. FW selling an estimated 1.5 million ebook content units in 2008 was pretty big at the time, but wouldn't be now. What did things in the eBook world go for back then, what were the economics? Also the FW sale was a buyers market which may have affected the $15.7M + earn out payments total. The Pendergrasts were looking to sell and eventually move on to a bio-tech venture with their other brother where they are now.


Basically B&N bought FW for eReader and started dismantling it for Nook just like Amazon did with Mobipocket for Kindle. Once they'd done that they saw little reason to keep FW & eReader around.

Here is a chart from mid-2010 showing figures from 2002 through 1Q2010. It's an interesting perspective, considering current annual sales are in excess of $3B and the sales in 2002 were only $5.7M. (These are U.S. sales, BTW)



http://epublishersweekly.blogspot.co...growth-in.html

[fjtorres]

When Kindle launched, the biggest ebookstore around carried 30,000 titles.
A year later, Kindle carried 90,000.
A year after that it was in the 300K range.
Today it's running 3.4 Million and will probably hit 4 million titles by the time the 8th anniversary of Kindle rolls along.

[Purple Lady]

Originally Posted by fjtorres

You remember correctly:

http://www.publishersweekly.com/pw/b....html#comments



Diesel had the same problem.

The reports I saw back in the day were that they had trouble even getting the BPHs to start negotiating.

I still don't understand how the publishers could have been so stupid to do something that obviously hurt smaller retailers. If they wanted competition against Amazon it was pretty stupid to get rid of competition. Did they really think Apple could gain that much market share?

[AnemicOak]

Originally Posted by Purple Lady

I still don't understand how the publishers could have been so stupid to do something that obviously hurt smaller retailers. If they wanted competition against Amazon it was pretty stupid to get rid of competition. Did they really think Apple could gain that much market share?

Apple and B&N probably, maybe Kobo, Google(?). Big publishers for the most part aren't that used to thinking of small bookstores (or individuals) as customers in that way. Their main customers are big stores that buy enough to go direct and distributors like Baker & Taylor and Ingram (where the other stores get their stuff) so places like Diesel and BoB weren't likely high on their list of things to do individually. Although I'm not sure if Diesel & BoB, etc would need a contact with each pub or if that would be handled through agreements with their distributors (OverDrive, Ingram/Lightning Source, etc.) It took OmniLit/AllRomance a long time to build their catalog back up and I'm not sure if they ever got back to having all big publisher titles or not.

[Fbone]

I suspect there were other reasons the smaller e-bookstores were left without a contract for so long.

[fjtorres]

Originally Posted by AnemicOak

Apple and B&N probably, maybe Kobo, Google(?). Big publishers for the most part aren't that used to thinking of small bookstores (or individuals) as customers in that way. Their main customers are big stores that buy enough to go direct and distributors like Baker & Taylor and Ingram (where the other stores get their stuff) so places like Diesel and BoB weren't likely high on their list of things to do individually. Although I'm not sure if Diesel & BoB, etc would need a contact with each pub or if that would be handled through agreements with their distributors (OverDrive, Ingram/Lightning Source, etc.) It took OmniLit/AllRomance a long time to build their catalog back up and I'm not sure if they ever got back to having all big publisher titles or not.

With Agency, every publisher contract had to be renegotiated individually.
I'm not sure they even knew how many small, growing Adept ebookstores were out there. Especially the specialty ones just ramping up in late 2009/2010. If they had done nothing, the market for hardware-only ereaders could have supported dozens if not hundreds of generic ebookstores from the larger indie pbookstores and epub interoperability could have quickly eroded Amazon's position. They would've been like Apple amidst a sea of PCs in the 80's.

The BPHs were so hung up and panicked by Amazon's mythical 90% market share (which was never real) they completely misread the market. If they understood technology even minimally they would've understood that market pioneers act as icebreakers; they start with 100% market share and then go down as challengers emerge and are noticed. They also had no faith in B&N or Kobo; they jumped straight into conspiracy even though they knew B&N and Borders/Kobo were getting into the game in 2010.

They never gave the market a chance to develop naturally, the way the PC market went from 100% IBM to one dominated by indies (clones) in less than 5 years.

Oligopolies and cartels really don't understand open markets which is why they wither away so fast when faced with one.

[Phogg]

Originally Posted by fjtorres

You remember correctly:

http://www.publishersweekly.com/pw/b....html#comments



Diesel had the same problem.

The reports I saw back in the day were that they had trouble even getting the BPHs to start negotiating.

These are factors always foremost in my thoughts when partisans of legacy publishers throw their little temper tantrums about Amazon's market share. The big publishers largely put the strongest competitors out of business.

[fjtorres]

Originally Posted by Phogg

These are factors always foremost in my thoughts when partisans of legacy publishers throw their little temper tantrums about Amazon's market share. The big publishers largely put the strongest competitors out of business.

But, hey, they helped Apple get in!
(They're heroes!)

Now, since Amazon's share never dropped from its pre-agency spring 2010 low of 54% and Nook never exceeded their 26% of that peak, guess where Apple's share came from?

Just like the way Indie bookstores were decimated by the BPHs favoring the chains in the 90's.

Those folks just don't like indies. Period. Not Indie stores and not Indie publishers. Too small to bother with. Not their kind of people, really. They like big chains (preferably HQ'ed in NY), big "literary" Agencies (ditto), big distributors, big lunch martinis in fancy restaurants. Why bother to answer the phone when rabble call?

[fjtorres]

Here's another even toned response:

http://observer.com/2015/07/with-low...s-fear-amazon/

The numbers are old and it misstates the Hachette catfight but it still makes the point.

Authors United would have a point if they could show that Amazon had ever shut down a publisher because of the content of what it was publishing, but there’s no sign of that. In fact, Brad Stone’s book, The Everything Store, is up for sale on the site now, and it’s probably the most critical and widely read critique of the company to date.

Yet, Amazon is happy to sell it to you.

In fact, Amazon “carries” (after one fashion or another) almost every title ever, not a boast than a traditional bookstore could have ever made. Those stores were constantly making choices about what not to stock. Was that censorship or shelf space? Amazon, with infinite shelf space, has gotten very creative about finding ways to carry as many titles as possible, vastly more than any seller could carry before the Internet.

The authors’ silence in that era suggests that the diversity of ideas or the health of the world of letters may not really be the driving motivation behind the Authors United letter. It might instead be fear of a future in which a small clutch of authors will not be able to enjoy the primacy they had in the bookstore world.

More at the source.

[Purple Lady]

Originally Posted by AnemicOak

Apple and B&N probably, maybe Kobo, Google(?). Big publishers for the most part aren't that used to thinking of small bookstores (or individuals) as customers in that way. Their main customers are big stores that buy enough to go direct and distributors like Baker & Taylor and Ingram (where the other stores get their stuff) so places like Diesel and BoB weren't likely high on their list of things to do individually. Although I'm not sure if Diesel & BoB, etc would need a contact with each pub or if that would be handled through agreements with their distributors (OverDrive, Ingram/Lightning Source, etc.) It took OmniLit/AllRomance a long time to build their catalog back up and I'm not sure if they ever got back to having all big publisher titles or not.

Maybe they thought the smaller retailers had enough epub stock built up that they would be alright for a while? I say that jokingly, but who knows.

[fjtorres]

This one is a bit odd.

Invited to a twitter chat to discuss "Wednesday Special: Authors United Against Monopolistic Bookselling", the AU, AG, ABA, AAR, etc sent... nobody...


http://the-digital-reader.com/2015/0...comment-908480

With a topic title like that you'd expect a friendly host, no?

Ably moderated by Judah Freed, the resulting 69-minute debate (it ran long) was as entertaining as it was one-sided. An ABA rep did speak up briefly and state that they were monitoring the discussion, but the active debaters were so clustered on one side of ...

Well, I would not normally describe such a diverse group of individuals as a single side in any debate, but almost all the participants in today's debate showed up with the intent of arguing against Authors United. You can blame the polarizing effect of Authors United for that.

While there were several authors who took the position of AU, the discussion was in fact so one-sided that Hugh Howey decided to play Devil's Advocate and argue the other side. This led to unfortunate situations where a few participants who were encountering Howey for the first time took his tweets seriously.

More at the source, including a link to a transcript pdf.

I'm wondering if the Axis of AU is even going to follow through and ever mail that letter.