It’s hard to know who’s virtuous in the publishing industry.
Some people have a favorite publishing house (e.g., Crown, HarperCollins) and everyone seems to be ready to go to war on behalf of Apple, but many of the former publishers recently partnered with Apple in a dubious economic cartel they call “agency pricing” in a bid to make an end-run around Amazon’s more successful model and to avoid competing with them quite so much. The whole model is under fire in US Courts, with 13 outstanding cases in which opponents allege the conglomeration is conspiring to set prices and thereby racking up antitrust violations.
And there was a time when independent booksellers were a fact of life, but having a comparatively poor selection of inaccessible and often niche titles was not enough to keep most of them afloat in the war with mega-booksellers like Borders and Barnes & Noble, and later with online sellers.
Perversely, as the shift toward ebooks continues to empower online sellers and erode the already weak grip of brick-and-mortar megastores, online sellers like Amazon are viewed with growing suspicion while many circle the wagons around, oddly enough, surviving megastores like B&N. When independents started folding due to the encroachment of megas, who would have thought the next step would have seen the latter entities closing up shop and eliciting the same pity and outrage as the former? But often, truth is stranger than fiction.
For its, part, online seller Amazon has come under fire for its practices. Many allege that Amazon sells its $9.99 ebooks at a loss, hoping to recoup those losses on sales of its reader, thereby employing a loss leader strategy which has been banned in some states alleging the practice is predatory. But research company iSuppli points out that Amazon already sells its $79 Kindle for about $5 less than it costs to make, so they’re not recouping losses on sales of its most popular device (though they could be making up the money on ads displayed on the device). Otherwise, Amazon has been under fire for years by those alleging they don’t pay their “fair share” in sales tax.
And now, after Amazon made strides to carve out an even bigger advantage by starting its own publishing operations, competitors like Barnes & Noble have issued bans on any Amazon-published books in their store. B&N alleges that anything else would be inappropriate, considering Amazon’s own attempts to gain an edge by getting writers, agents, and publishers all to sign their own exclusivity agreements in which the works would only be available on Amazon or by its partners. And it’s not a fledgling program: Amazon has reeled in names like Deepak Chopra, James Franco, Penny Marshall, Ron Paul, Ian McEwan, Tim Ferris and Stephen Covey in such deals. And while they’ll continue business as usual on their website, B&N won’t be carrying any such Amazon-sourced titles in their physical locations. The CS Monitor reports:
“Barnes & Noble has made a decision not to stock Amazon published titles in our store showrooms,” Barnes & Noble’s chief merchandising officer, Jaime Carey, wrote in an email. “Our decision is based on Amazon’s continued push for exclusivity with publishers, agents and the authors they represent.”
“These exclusives have prohibited us from offering certain eBooks to our customers. Their actions have undermined the industry as a whole and have prevented millions of customers from having access to content,” Carey continued.
“It’s clear to us that Amazon has proven they would not be a good publishing partner to Barnes & Noble as they continue to pull content off the market for their own self interest.”
The move is intended to make those in the literary industry think twice before signing Amazon-like exclusivity deals, for fear they won’t be carried in megas. After enjoying a minor bump from the Borders liquidation and the holiday boom, Barnes & Nobles still seems to be sinking—but they still have over 700 stores, and they intend to leverage them against Amazon’s advances.
So who’s the good guy here? It’s hard to know, but it seems like the answer changes every 3-5 years.
