e-books: May The Battle Commence!

Daily Finance this morning takes an insightful look at the imminent war in the world of e-book retailing. If we are to believe Sarah Weinman, Publishing Industry Reporter for Daily Finance, then the coming months may very well define who the biggest playmakers are going to be, and crucially, whether publishers can maintain control on pricing and the development of e-books in the marketplace. There are some pretty big playmakers on stage at the moment, like Amazon, Apple and Google, and these guys play hard and fast. They have built their corporate monoliths by never standing still, identifying and seizing on opportunity, creating new markets through innovation and technology, and running organisations were adopting flexibility and change is the oil for the engines of their development. Each one of these corporations has the same invisible motto written over their front doors for intending visitors—it’s our way or the highway.
The publishing industry may learn a lot this week. They will need no reminder of what is at stake for them and how they lost all grip and control on physical book products over the past twenty years to large high street retail chains—an act of commercial complacency they cannot repeat with a content format set to become the primary and leading edition of a book in the not-too-distant future. Weinman talks much about uncertainty and speculation on what is going on behind the closed doors of the big six publishing houses in New York. If we believe even a scintilla of speculation, that HarperCollins are lunching with Apple (the company – not the fruit), that Amazon are also pounding the New York pavements to the doors of several publishing houses and in no uncertain terms insisting simultaneous e-book release of new titles and pricing are king, then publishers are in for a rough ride. The battle to control and dictate the terms of digitization and e-book products is no longer being fought on the turf in publishers’ backyards, but on the highways and byways of the cyberworld. For a very long time publishers have been the self-appointed gatekeepers of literature—not any more. The advent of digitization in the print industry and the internet have made the dissemination and publishing of material for the ordinary person a global reality. The voices once silent can now be heard. The choice is now the same for authors as it is for publishers—what platform to chose?

“Which is why the timing of Amazon’s newest initiative — upping the royalty rates for authors who self-publish e-books through its Kindle Digital Text Platform to an eye-popping 70% by June 30 — is highly suspicious: a move that would appear to fire another shot across the bow, both on asserting its e-book market dominance and saying to publishers that their way is the only way.

The conditions of these new royalty rates tell the story. Self-published authors get the 70% rate as long as they ensure that their books are available in every conceivable format Amazon offers, including text-to-speech capabilities; can be sold “in all territories where the publisher or author holds the rights”; and, most tellingly, is priced between $2.99 and $9.99. So to get that shiny new royalty, “books must be offered at or below price parity with competition, including physical book prices,” and in particular, the digital list price must be 20% below the lowest possible physical price.”

Sally Weinman, Daily Finance.

Weinman is right to point to Amazon’s rigid restrictions on its new royalty initiative for authors and publishers, something authors may have a great deal more difficulty adhering to than they first might have thought on the wave of elation that greeted the announcement this week. The task for publishers to be the kingmakers in their own industry may be ultimately beyond them, but if there is one certainty on the rocky road ahead—publishers need authors on their side, and that includes the authors not on their lists, because the successful authors of tomorrow may very well turn out to be the self-publishing authors of today. That means publishers accepting they are no longer in charge of the keys to the gate. In the wake of a changing industry and the way we see publishing, with corporations like Amazon and Apple flexing their muscles, publishers need to embrace new models and platforms of publishing without dropping the ball. To retract to the stubbornness of attempting to apply an old model of business on to a new platform you don’t even own or control is tantamount to handing the industry to the wolves. To become a wolf – you must live with the wolves. May the battle commence…

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