Really twisted logic here

confused_guyAs I’m sure many are doing, I was contemplating the coverage of the whole Amazon/Hachette thing, and I think I twisted myself up with the logic of certain people writing about the issues. Walk through this with me and see if it tracks.

Authors such as Douglas Preston are publishing or signing open letters complaining that Amazon is “Refusing to discount the prices of many of Hachette’s authors’ books.”

It seems a reasonable assumption that the Amazon/Hachette disagreement has something to do with Hachette wanting a return to agency pricing. The assumption is supported by the recent move by Macmillan and S&S filing a brief in opposition to Judge Cote’s final order to Apple. According to The Digital Reader, who was reporting on an article in Publisher’s Weekly:

Lawyers from two of the 5 publishers were back in court last week, objecting to the terms of Apple’s settlement. In appeals filed last week, lawyers for Macmillan and S&S argue that Judge Denise Cote’s 2013 final order against Apple made it virtually impossible for the publishers to successfully negotiate new agency model contracts which included retail price maintenance.

Granted, Hachette wasn’t one of the two, but do you really believe they feel differently?

In case you’ve forgotten, agency pricing means that Amazon (and other retailers) are prevented from discounting.

So, assuming the Hachette authors (and others) who are speaking out against Amazon get what they want (for Hachette to prevail), they will likely guarantee they will receive exactly what they are complaining about: No discounting.

This makes sense how?

Oh, and let’s just assume, for fun, that Hachette is encouraging its authors to speak out. That makes this really twisted.

Am I missing something here?

9 Comments on Really twisted logic here

  1. Sounds to me like you’re not missing a thing, Juli! And isn’t it nice to know that what with the Internet being forever and all, we’ll be able to continue to poke fun at the twisty logic long after Hachette, Douglas Preston, et al wish it long forgotten.

  2. Yes. Only hachette are currently not being discounted, in the publishers ideal world nobody would be discounted. In the current situation there is price competition between discounted and non discounted books. If books are like widgets and not special snowflakes this will cut the sales of Hachette books. And demonstrate that books are just another widget.

  3. Yes, you are missing something. See what at http://www.bobkohn.com

  4. William Ockham // July 3, 2014 at 10:24 pm //

    The publishers want (actually are completely dependent on) Amazon’s discounting of paper books, but despise discounting of ebooks. And they have set up their contracts with authors do provide the same incentive. The publishers are desperate to minimize the price spread between paper and ebooks. The real question is why. I am not satisfied with any of the proposed answers.

  5. Deborah Smith // July 3, 2014 at 10:42 pm //

    When Amazon discounts books under the current system it destroys competition from booksellers, wholesalers, other online retailers and publishers’ own direct sales, BECAUSE AMAZON IS WILLING TO LOSE MONEY ON BOOKS IN ORDER TO SELL OTHER MERCHANDISE. When you accept that simple fact maybe you’ll stop demonizing publishers and anyone else who isn’t selling books the way Amazon does (as bait, at a loss). Comeon, it’s really not that difficult to comprehend, is it? Amazon does something that others can’t do: it throws book prices down a toilet because it doesn’t depend on the profits. UNLIKE publishers and booksellers and book wholesalers. Amazon pimps books to sell toasters. Get it?

  6. It’s called “loss leading,” Deborah. Same thing Best Buy does when it prices TVs below cost so it can sell a bunch of expensive cables to people who come in to buy them. Amazon sells a very few e-books at or slightly below wholesale cost to get people interested, and once they’re interested they might buy several older titles, which are priced well above the (paperback-equivalent) wholesale cost and make a profit that way.

    The Department of Justice investigated Amazon while it was preparing its case against Apple and the five price-fixing publishers and found no evidence of predatory pricing practices, which by the legal definition require the entire line of goods to be running at an overall loss. (Unless, of course, you’re a publisher, in which case “predatory pricing” is not a term with a strict legal definition, but instead any pricing practice you personally don’t like.) Amazon representatives have testified under oath that its e-book business is “consistently profitable.”

    I’m firmly convinced the publishers were aware all along that they didn’t have a legal leg to stand on. They could compare prices on backlist and frontlist titles the same as anyone else, and their lawyers would have told them that they’d get laughed right out of court. That’s why they never tried to take legal action over this putative “predatory pricing.” They took some illegal actions instead.

  7. @Bob Kohn: Aw, c’mon, Bob, if you’re going to rebut a post here, actually rebut it, don’t just drop a URL. You could at least draw us some pictures.

  8. Juli Monroe // July 4, 2014 at 8:02 am //

    @Deborah. I wasn’t discussing whether discounting is good or bad. Authors now are protesting that Amazon isn’t discounting their books. We know publishers want to disallow discounting. So if Hachette succeeds in their negotiations, no discounting will be in effect. The author campaign has the potential to backfire on them.

  9. Deborah’s fear and anger are understandable, if misplaced.

    I happen to know and talk to some of her Belle Bridge-published authors. Their books were badly overpriced by their publisher, despite poor sales, to the point that within a few months of publishing my own first two books, I had significantly outsold and outearned these highly talented authors. Our conversations have gone from “My publisher knows the business side better than me” to “I think I’m going to give self-publishing a try with my next book.”

    I’m posting this anonymously for their sake, not my own.

The TeleRead community values your civil and thoughtful comments. We use a cache, so expect a delay. Problems? E-mail newteleread@gmail.com.

wordpress analytics