Steve Weber, author/publisher tells his experiences with Amazon

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Editor's note: I received an email from Steve Weber, a writer/publisher, about his experiences recently with Amazon. It was most interesting and I asked Steve if he could "pontificate" a bit more for publication on TeleRead. Well, he did and here is experience in the front lines of Amazon bookselling/publishing. By the way, Steve did not include any url to his own site, so I had to find it myself. Says something for his credibility: For the past 10 years, I've earned a good living by writing about Amazon.com and selling books on its Web site. Without Amazon, I could never have quit my job to pursue two hobbies -- operating a bookshop, and building a self-publishing empire from my basement, using a $200 PC. Unfortunately, I may be forced into early retirement. By offering the widest selection of books and the world's most innovative, competitive marketplace, Amazon nurtured me and thousands of other independent writers and hobbyist booksellers. Recently, however, the company has taken a series of steps to stifle competition and consumer choice. I believe it's time for antitrust regulators to consider Amazon's practices, particularly in the emerging areas of electronic books and digitally printed paperbacks. Partly because of the worldwide exposure Amazon has delivered, I've been able to give away thousands of my books at popular Web sites such as Smashwords.com, Feedbooks.com, Manybooks.net Scribd.com and others. My motives aren't entirely altruistic. Like many other forward-thinking authors, I believe that giving my words away generates an even bigger market for those ideas and, ultimately, profits for Amazon. So I was alarmed when Amazon recently censored a book review on its site for my new title, "ePublish." Amazon's staff edited the reviewer's words to obscure the fact he had obtained the book free. This reader from The Netherlands, unbeknownst to me, downloaded a complimentary copy of "ePublish" from Smashwords.com, then reviewed the work on Amazon.com. After Amazon's censorship the review now reads, "I downloaded the e-bBook version of this book from [...] and couldn't stop reading until I finished it." http://www.amazon.com/dp/0977240657/ Was this merely a hamfisted antic by a low-level Amazon employee? Perhaps, but it fits the context of recent changes at Amazon to restrict competition in publishing, resulting in less choice and higher prices for the reading public.

The same week Amazon censored that book review, it was buying up other e-book delivery channels. Despite having introduced its own, similar product just weeks earlier, Amazon bought out the other major product Americans use to read e-books — the Stanza iPhone software from Lexcycle.

Did Amazon buy Lexcycle to assist in its marketing, or to shut it down? Well, consider what happened the last time Amazon bought a leading e-book technology provider, Mobipocket. Overnight, Amazon eliminated all competing e-book vendors and formats from its Web site. Yet, incredibly, Amazon never rolled out Mobipocket books. Instead, Amazon introduced an even more closed, proprietary system — Kindle.

How likely is it that Amazon will allow Smashwords, Feedbooks, and other emerging content providers to provide free and low-cost content through Stanza and iPhone? Don’t bet on it. Meanwhile, Amazon has made it nearly impossible for publishers to provide their content on Kindle without Digital Rights Management encoding, preventing readers from sharing or reselling content they’ve bought. Even as it slashes its warehousing, inventory and shipping costs thanks to e-books, Amazon is squeezing publishers, grabbing an even bigger portion of the selling price of digital books compared to paper.

Amazon is also meddling with the emerging digital-printing industry, known as print on demand (POD). Thousands of small publishers like me, who are too small to attract national distributors or wholesalers, survive from our Amazon sales. But recently Amazon has been trying to strong-arm us into its BookSurge self-publishing subsidiary.

But instead of attracting entrepreneurs to BookSurge by offering us good deals, Amazon is threatening to break our kneecaps — by removing the “buy” button for our books on Amazon.com. Take it or leave it — no discount to buyers, no distribution outside Amazon, less money for me and other publishers, and higher prices for consumers.

In essence, Amazon is telling publishers, “Pay us to print your books — or else.” When Amazon announced this POD policy last year, the reaction from publishers (never folks to agree on much) was unanimous: stunned incredulity.

Perhaps mindful of the fact that this behavior might be considered anticompetitive in some quarters, Amazon has been careful not to put any of these “offers” into writing, but discussing it only via telephone. And that is why I have been careful not to answer my telephone when Amazon’s BookSurge representative has repeatedly phoned me.

What does it say about the competitive landscape of book retailing when a “salesman” from the world’s largest retailer feels entitled to call an independent publisher, demanding to become your sole manufacturer, distributor and seller? The deal would cut my income by more than 50 percent. Sorry, but I would rather go out of business than knuckle under to that.

If Amazon wants to enter more segments of the publishing business, it should earn new clients by offering attractive terms, winning business on the merits. Amazon shouldn’t be allowed to get even bigger by threatening to put the little guys out of business.

Amazon’s anticompetitive steps in e-books and POD will put many thousands of smaller publishers and booksellers like me out of the business instantly. But these policies threaten the entire publishing industry. E-books are one of the few bright spots for big, traditional publishers who employ hundreds of thousands of professionals. And a growing number of big and mid-sized publishers are using POD to keep backlist titles in print.

Amazon’s recent moves run counter to what made the company great, the spirit of open competition that makes our society the most informed and vibrant in the world. Unfortunately, as it has become more profitable, Amazon is throwing its weight around in publishing, just as Microsoft did in the mid-1990s when it grasped for a stranglehold on desktop computing.

Now, however, the stakes are even bigger. This isn’t just about software or PCs, but the freedom of information and the viability of a free press in our nation. Amazon has achieved profitability partly by clobbering local Mom & Pop brick-and-mortar bookstores. Its campaign to grow still larger by putting scores of new publishers out of business isn’t only wrong, but amazingly shortsighted.

16 Comments on Steve Weber, author/publisher tells his experiences with Amazon

  1. I know it irritates y’all when I do this, but…

    Amazon has never demanded to be the “sole manufacturer, distributor and seller.” They’re desire was to be able to print POD books in their warehouses, thus eliminating the necessity of stocking copies as had been done in the past. In their usual ham-handed manner, they screwed up the process of handling the process.

    We print with both Booksurge and Lightning Source, working through printer services at the former. Although Booksurge/Amazon takes a larger percentage of the cover price than we give LSI, the cost of production comes from their side, not ours. As a result, we earn about double per copy sold at Booksurge than we do at LSI. We no longer have to purchase books and pay to ship them to Amazon. Correct me if I’m wrong, but isn’t that how “print on demand” is supposed to work?

    3. Prior to their purchase of Mobipocket, Amazon obtained their ebooks from Lightning Source. They decided to develop their own format, build an ereader and sell their own stuff, thus maximizing their profit on sales. When did that become illegal?

    Most independent bookstores refuse to stock my books because we won’t allow returns. Do I thus have grounds to sue them for restraint of trade?

    Yes, Amazon was the most welcoming vendor for the plethora of small publishers, myself included, who have arisen since on-demand printing was perfected. They were also losing money when those same publishers listed short discounts of 30, 20 and in some cases 10 percent to maximize THEIR profits.

    What Amazon is guilty of is letting too many people lose sight of the fact they’re a business. More important, they’re a publicly held business, which means they have stockholders to answer to. Stockholders expect returns on their investment. They aren’t required by any law I know of to be a charity for struggling publishers. Or even non-struggling ones.

    Might they have “neglected to mention” the publisher services option at Booksurge when they initiated their campaign last year, thinking they could optimize their return by having publishers sign up for the higher-priced subsidy or CreateSpace programs? Probably. Having had my own battles with them, I don’t harbor any delusions they care about anything but their bottom line.

    So what else is new?

  2. ‘I downloaded this book from […] and I couldn’t put it down’

    Maybe, just maybe, this ‘low-level Amazon employee’ was unaware that you had authorized free ecopies. Maybe Amazon has a standing policy to prevent reviewers from pointing readers to pirate sites to download illegal and unauthorized copies.

  3. “Amazon has made it nearly impossible for publishers to provide their content on Kindle without Digital Rights Management encoding, preventing readers from sharing or reselling content they’ve bought…”

    Doesn’t the TOS (from ebook sellers) and/or copyright law on ALL ebooks prevent the buying from reselling ebooks? I agree that DRM harms consumers by locking the content to a single device (sometimes) but I didn’t think reselling ebooks was legal either way….

  4. Methinks teleread has become the headquarters for the Amazon Conspiracies Club.

    Elizabeth has already addressed/refuted many of the silly claims that continue to pop up here.

    As far as removing a URL that links to a free version of his book well….

    Right there in the “Customer Review Guidelines” Amazon says this:

    “While we appreciate your time and comments, we respectfully request that you refrain from including the following in your review:”

    and one of the items that follows in that list is this:

    # Availability, price, or alternative ordering/shipping information.

    Golly, a private company kindly asks folks not to come onto their site and leave comments instructing folks how to go elsewhere to get items for sale cheaper or for free.

    If I were to walk around Best Buy with a sign telling folks they can get that tv cheaper down the road at Costco would it be fair for me to whine about being told to leave?

  5. Incredible. Both amazon’s practices as well as the blind reactions.

  6. Elizabeth,
    Why on earth were you “buying from LSI and paying to ship those to Amazon”???

    With LSI distribution, Amazon pays for shipping, and you never personally send your books there.

  7. I am getting very tired of the imbecilic tendency to use the ‘it was just a ham-fisted error’ excuse for Amazon’s actions. It doesn’t matter what the company’s review guidelines say. If you allow people to post reviews and then edit them to eliminate any outside url that might be of importance to the review, you are censoring and have no business claiming to offer reviews on your site. Amazon is trying to lock publishers down. Also, their recent debacle with censoring gay-themed books was not a ‘ham-fisted error’ as so many seem to want to claim. If you think that explanation works, I certainly hope you are not in the publishing industry because you are not capable of rational thought.

    We need to shut Amazon down by not buying from them.

  8. Let me begin by reiterating that I am not an Amazon fan and am not an Amazon customer. Having said that, and having in the past criticized Amazon’s policies on POD and on the closed format Kindle, I am prepared to say that there is merit to both sides of the arguments as evinced in the main article and the previous comments to it.

    Amazon is a business and it is acting just as a business should act on behalf of its shareholders. OTOH, I do not have to like it and I do not have to support it. For the consumer the best result would be increased competiton. Let Barnes & Noble take on Amazon in the ebook world.

    For publishers, the best result would be to recognize that Amazon is a business and that its business is not to ensure your survival but to ensure its survival. Consequently, you should be searching for and even helping to create alternatives to the Amazon gorilla. What would it take, for example, for small, independent publishers to make use of the Publisher’s Marketing Association (at least that was what it was called when I was a member years ago) and every small publisher put up $500 to invest in an Amazon-clone but one that is more publisher and consumer friendly? Get it started and then invite larger publishers and booksellers to join in.

    Amazon is the only game in town because we all have allowed it to be. Consequently, Amazon is able to throw its weight around — for good or bad — with little fear.

  9. I see reviews censored all the time on Amazon – they enforce the policy of not allowing reviewers to say they acquired something elsewhere or how much it costs at another vendor. Although I’m rather alarmed with some of Amazon’s latest steps to tie up the ebook market, there’s nothing to see here. Move along.

  10. Would someone please elucidate to me again how Amazon’s purchasing a start-up ebook company qualifies as tying up the ebook market? HELLO!!! Fictionwise has been around since 2001 and was purchased by BARNES & NOBLE. There are hundreds of independent ebook publishers who sell directly from their websites, and most offer Kindle format–along with most if not all of the other major ebook formats–and usually without any form of DRM whatsoever.

    Here’s a news flash, people. Harlequin/Silhouette did NOT invent the ebook. Nor did any of the other major publishers belatedly realizing they’ve been missing out on a fairly decent revenue stream. There have been a good dozen ebook readers before Amazon made the Kindle, and some of them are actually better. The main selling point on Kindle is the ability to browse and purchase books anywhere you can access wi-fi then instantly download to your reader.

    Which you can also do from eReader.com on any smartphone for which Fictionwise has developed the reader software.

    I’ll disagree with the statement that Amazon is “the only game in town because we all have allowed it to be.” Small presses, especially those that use on-demand printing and won’t accept returns, are at the mercy of the traditional system that demands returns. If you want to gripe about market limitations, yell at Barnes & Noble, which refuses to list any book in their online store as available if it’s not listed with Ingram.

    To respond to D. R.: prior to establishing their policy that only books from publishers signed with Booksurge would be eligible for full Amazon distribution, Amazon paid LSI to drop-ship orders of POD books in their database. My understanding is that they no longer do so, but someone else will have to verify that.

    Currently, a publisher who has on-demand books printed elsewhere has two avenues to Amazon: Advantage and Marketplace. Under the Advantage program, they must ship copies to Amazon for stocking. They are responsible for the shipping cost.

    In any case, our books ARE with Booksurge, so I don’t pay anything other than the required discount when my books are ordered from Amazon. Don’t have to, since the books are printed in Amazon’s warehouses.

  11. As other people have mentioned, no matter what product is being reviewed, Amazon doesn’t let reviewers steer potential buyers to other retailers who carry the same item. Seems perfectly reasonable to me.

    I’d like to add that they DO indicate reviews by Amazon customers in the Vine program. This is where freebies are sent out to Amazon customers like me, who in return simply have to review 75% of our freebies to keep getting more. They could hide this fact, making it look like the book is more popular than it really is. Instead, they are out front in letting people know they are reading a review from, well, a shill. (Perhaps Steve Weber should look into offering some free copies of his books through Amazon’s Vine program…)

  12. Amazon’s Vine Program costs around $1500 to join. The ROI is rarely worth the exorbitant cost for an independent publisher. The high cost of joining the program appears to be meant to keep just any old publisher or author away.

    Amazon may be acting like a business, according some of its defenders here, but it’s a business without ethics or morals. A business with some of the poorest customer service regarding its vendors in the History of Man. In the 90’s when Jeff Bezos was crying for help, threatening that Amazon might go out of business, who saved him? Publishers and authors went out of their way to entice the customers to his site. How does Amazon reward this? Strong-arm tactics. It’s highly telling that none of these BookSurge folk want to discuss their proposals in writing, in email, but only over the phone. That leaves Amazon/BookSurge the wiggle room for plausible deniability, or reasonable doubt should these “tactics” and others come to court. Why do you think they won’t put their “offers” in writing?

    I know, it’s hard for some of you to believe Amazon plays dirty and is getting dirtier, but it is. I caught them at the first of this year fiddling with my Kindle sales, not paying me for what their own spreadsheet said I was owed. And now again, they have just only posted my company’s Kindle sales for February. February, for heaven’s sake. This from a company that until June of last year reported and paid as they said they would, once a month for sales made in the previous month. I have yet to receive payment for February and expect to have to email again and wait months for a reply, and then go around and around over what amounts to basic math.

    This slow and getting slower reporting on sales, let alone payment at a snail’s pace, plus the closing of warehouses and the layoffs indicates one thing to me, and you may call me an idiot or whatever you want for saying this, but all is not so rosy financially at Amazon as they would have the world believe. In my opinion, Amazon is having serious cash flow problems and if word of this were to get out, their stock would tank in less than a day.

    I think their cash flow problems started sometime last year. Remember when the Kindle was out of stock, and not just a month or so, but months on end? What company with a so-called hot-selling item is going to remain out of stock that long unless something else was going on? You can say perhaps it was a supplier of some component, but then you look at other companies who use the same components and they weren’t out of stock, or if they were, it was briefly, if that. One reason, and again this is merely my opinion based on decades of employment in production-type businesses, is that Amazon was what we all call a slow-pay. Slow enough pay that finally they were put on pre-pay. Now, granted, they gave us all a lot of newspaper quotable excuses why they couldn’t keep the Kindle in-stock, but they’ve never released even ball park sales figures for the device. If the Kindle or even its successor, Kindle 2, were selling as well as they claim ad nauseam, why wouldn’t they use the sales figures as a marketing ploy? Every other business in the world that has a product whipping the competitions’ butts releases its sales figures, and uses those sales figures to market.

    If any publisher or author here had a book that sold in excess of 100,000 copies, not one would let that marketing angle go to waste. Amazon wouldn’t either–unless the truth might affect the price of their stock in a negative way.

    Why aren’t they more transparent when it comes to Kindle sales? Do the math. Withholding even one sale from every Kindle version offered is a tidy monthly sum and wouldn’t be missed by publishers and authors who are given no possible way to check other than Amazon’s “take our word for it.” And why does Amazon feel a need to have their BookSurge people call instead of write or email, especially if their offer is so great or their methods wholly legal?

    Nuh-uh. Not for one minute do I believe Amazon’s intentions are honorable, business or otherwise. Defend the company all you want, but don’t turn your back on them, not for one second. They have no qualms about shooting anyone or any business in the back to achieve their monopoly.

  13. @mari – i tend to agree with your assessment… i’m no fan of amazon, despite having nearly two dozen books sold through the site since 1997…

    at first i was elated, especially when a few titles took off (beat Grisham in ranking once – well, for a least a couple days)…

    :-)

    however, the evil started quite soon – in fact, as soon as one of my titles would appear after making its way from the print warehouse, amazon would list a link for a used title right next to my new book! of course, authors get screwed on used sales (no royalties as you all know), so here i was, watching my new book appear for sale for this first time, and a ‘used’ copy would be available!

    as an author, i will *never* *ever* allow one of my books to be available on the Kindle (or in any DRM’d format for that matter)

  14. Francine Saint Marie // July 24, 2009 at 12:30 pm //

    Steve, Mari and Willie, you are right–Amazon speak with forked tongue. Currently, the day I am writing this post, all independently-produced print titles listed on Amazon say: “In stock but may require an extra 1 – 2 days to process.”

    francinesaintmarie@yahoo.com

    (Steve, I’d like to get in touch with you regarding Amazon, but can’t find your e-mail address. Can you send me an e-mail, please, to which I can respond? Thank you in advance.)

  15. I know this is an old discussion, not commented on since July 2009. I hate to be the on dusting it off and breathing life back into it, but there is something the author of the original article and a few of the folk writing comments seem to not understand. The conversion of outsides links to […] is an automated process. It happens immediately, whether the review is reviewed by Amazon or not. Write any review to test this out… stick in one or more external links… even to something like product specifications on the manufacturer’s site, and the link will convert into […].

    Amazon is, in my experience, a consumer centric company. Their customer service, in my experience, rocks. They don’t claim, nor prove themselves to be, a publisher centric business. Quite why, I do not know. I would have thought it important to keep both sides of the supply chain happy. Seems they think otherwise. Such is life. It is their choice, after all, how they conduct their business. As a publisher and author, which I am, I have to choose to what degree I wish to participate in Amazon’s way of conducting business. If it some point I feel Amazon is detrimental to my endeavours I see it as my responsibility to create another means to my ends.

    I’ll will quietly lay down this dusty old blog article back where I found it, and close the door behind me.

    Best wishes,
    Jonathan

  16. You accuse Amazon of not caring about anything but “the bottom line.” Well, why shouldn’t they? Amazon is a business not a nursemaid to ingrates like you who have done very well off of them.

    Now you’re angry because you didn’t get your review published and are demanding anti-trust laws kick in against Amazon. I hope your books aren’t as silly as you make youreself sound.

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