As deadline is extended for Google objections, today's pot and kettle award goes to Amazon.com

As the deadline for objections to the proposed Google settlement is extended by a few days to Tuesday 8th September, today's pot and kettle award goes to Amazon.com.

In a 50 page legal document filed on September 1st, Amazon said the agreement was "unfair"to rights holders as it gave Google "an effective monopoly" over scanned works that would create "a cartel of authors and publishers". It also questioned the legitimacy of the "class action" and warned the court that it was being asked "to exercise powers that it does not have" stating that the agreement "restrains competition in ways that ought not be sanctioned by this court".

I detect a large slice of mirroring in relation to Amazon's own actions last year when they effectively forced US print on demand publishers to use their own printers or have their buy buttons removed.

Amazon state in relation to the proposed settlement:

"It is anti-competitive and violates anti trust laws because it provides Google an effective monopoly in the scanning and exploitation of millions of works whose copyright holders cannot be located or choose not to involve themselves in this class action."

"It also creates a cartel of authors and publishers - the Books Rights Registry - operating with virtually no restrictions on its actions, with the potential to raise book prices and reduce output to the detriment of consumers and new authors or publishers who would compete with the cartel members."

In Amazon's favour, it is true that they have only scanned books where permission has been obtained from the rights holders, but I cannot help feel that these are empty words from a retailer that bemoans others from basically doing what they have done themselves - what the hell they feel like! I am not the only one to notice this, since the Authors Guild in the US have published a letter online accusing the retailer of what they term as "breathtaking hypocrisy".

Amazon denied right to dismiss anti-trust law suit

Amazon may have been in the news recently regarding charges levied against publishers for 'rejected deliveries' and the launch of the Kindle electronic reading device in Europe, but one story that seems to have escaped the British publishing press which pays little heed to most stories that affect then print on demand sector, is that in a 26 page order on August 26th, Chief US District Judge John Woodcock Jnr has denied Amazon's right to dismiss an anti-trust lawsuit brought against them by US print on demand publisher Booklocker. What this means is that the case against them can now go ahead.

This is a monumental victory for the little man against the mighty giant, and although there is still a long way to go, this is the first step towards what will hopefully be a victory for common sense, which sends a strong signal that what has been popularly regarded as bully boy tactics will not be tolerated.

The full report can be read here (PDF).

My own initial post regarding this can be read here

Positives and Negatives

I had been planning to write a little more about Amazon tonight, as I see from the Bookseller, that Angela Hoy of Booklooker in the United States, has now lodged a complaint against them in the US courts. Her website goes into much more detail than I could regarding the ins and outs and the whys and wherefores. It is not much that has not been said many times before, and I wish her well in her endeavours. I think it may be a while before this is over yet.

Several things have happened for me in the last few days - mostly concerning the imminent release of the new Indiana Jones film - Indiana Jones and the Kingdom of the Crystal Skull. My book, Genesis of Man began life as a thesis on crystal skulls, and Coran and I are still guardians of around 20 of these wonderful objects, which we work with from time to time, perhaps not as consciously as we might. A lot of the skull material has since been taken out, but I kept it carefully filed away for future reference, and I am glad that I did, as it has enabled me to begin using this new film as a springboard to increase both interest in and sales of my own book.

I got the ball rolling by sending an email out to everyone on my own mailing list. One of these is a man called Cris, whom I met around six years at a conference on the Knights Templar. Cris and I got talking and exchanged contact details, and have been in touch by email ever since. He is an interesting man, as he happens to be a personal friend of the late Anna Mitchell Hedges, who was of course the adopted daughter of real life Indiana Jones, FA Mitchell Hedges, and the discover and guardian until her death in 2007, of the Mitchell Hedges crystal skull. Cris has bought a copy of my book, which Coran posted me for today, and has hinted that he may be willing to put a link on the Mitchell Hedges site to my own website. He also informs me that the skull is due to visit the UK in June, and has promised to send me the details as soon as the dates are announced.

I have experienced the skull many times during meditation, but it would be truly wonderful to have the chance to see this fantastic object in the flesh, and also of course, to meet up with Cris again after all these years.

Out of this came a new crystal skull section on my website, followed by an amendment to the email to those on my mailing list, and the circulation of said email to every Waterstones in the country. This was rapidly followed by the posting of some press releases on various free PR sites, and this morning an email to all Blackwells stores.

A copy of the email was sent to both Richard and Paul, and Richard has replied to say that he loves what I have written, and will try and see if the journalist who picked up the news feed on the Shakespeare book that Richard had such success with, is interested enough to get in touch, and if I am lucky, and God is willing, take this to the next level.

The emails seem to have having some success, since on Sunday night when I sent them around, Gardners had 36 copies in stock, and tonight, 2 days later, they have 28. This means that 8 copies have gone out in the last 2 days, which is more than I have had for a while. It will be interesting to see over the weekend, once they arrive in store, which branches of Waterstones I can now add to my list of stockists.

Amazon hits the non publishing press

There is not much to report re Amazon, as one would expect at the weekend, except for an interesting discussion on my favourite writers forum, My Writers Circle, which has dragged me back into this in some ways. It is difficult not to get too involved in this, and start getting angry all over again, but I can't help but feel that Amazon have made a big mistake that will come back to haunt them in the night.

Marion Webb de Sisto feels the same way, as she sent me an email today with a link to The Times website which she entitled Karma for Amazon. Marion, like me, is a spiritual writer, so she knows about these things. The article, which is written by reporter Dalya Alberge, the Arts correspondent is entitled Amazon furious after publishers undercut its book prices online. Personally I say tough titties - they publish these books and bore the financial risk, so they are damned well entitled to charge any price that they like. If Amazon don't like it then tough !

Dalya reports as follows:

"An online price war for books has broken out, pitching Amazon against some of Britain’s biggest publishers.

Amazon is angry that Penguin, Bloomsbury and others are discounting titles on their websites, encouraging customers to buy direct instead of using the online retailer.

Penguin’s online store has reduced a boxed set of 20 Penguin Epics from £100 to £55. Amazon sells the collection at £98.64. Bloomsbury offers a 25 per cent discount on all its books, with free postage and packing on British deliveries over £20.

There are fears that Amazon may retaliate by regarding a publisher’s online price as the recommended retail price and applying its trading terms to that. If a publisher discounts a £20 book to £15 online and Amazon has a contract for a 50 per cent discount on the full price, Amazon would pay the company £7.50 instead of £10. Publishers say that this would be unfair and could ultimately drive up prices.

Amazon also faces increased competition from high-street booksellers, including Waterstones and Borders, who are stepping up their online activities. Such is the power of Amazon that several publishers did not feel able to talk on the record yesterday. One senior executive said: “It’s very serious. I can’t believe they’d be allowed to get away with it under competition law. Forcing people to increase prices seems to me entirely wrong.”

Others accused Amazon of having become particularly aggressive lately. One source claimed that the online seller recently removed the “buy buttons” from a book on its website to prevent users from being able to purchase it. “They then went to the publisher and said, ‘Give us an extra 2 or 3 per cent or we won’t put the buy buttons back’,” the source said.

An Amazon spokesman said: “It is speculation. We never talk about discussions with suppliers.” He declined to comment further.

Discounters have brought huge price advantages to book buyers, but the discount businesses do not have to bear the risks associated with investing in new authors or new titles by established authors. Until the Net Book Agreement was scrapped in 1995, it offered some protection to publishers, by ensuring that retailers sold books at the recommended price.

Roger Tagholm, of the trade paper Publishing News, believes that Amazon sees publishers as manufacturers, who should not be setting prices.

But Simon Juden, chief executive of the Publishers Association, which represents up to 140 publishers, felt that Amazon was on shaky legal ground. He said: “Terms of trade will have been set up upfront, when contracts were signed. Neither side can unilaterally change those. In my view, Amazon would be in breach of contract if they tried to do this.”

Ursula Mackenzie, chief executive officer and publisher of Little, Brown and chair of the Trade Publishers Council, said: “Our discount to Amazon is based on a notional RRP (recommended retail price), an agreed formula that we work to. For them to suddenly decide they will take a different view of what that RRP was means that the price on the publisher’s website effectively becomes the RRP. They can’t do that unilaterally. What is going to exercise people is that we can all see the growth of Amazon, which is startling and rapid, so they will increasingly have considerable power and there is no real competition to them. That’s the concern.”

There are fears that the latest development could affect authors and independent booksellers. Mark Le Fanu, of the Society of Authors, said: “Discounts demanded by the big retailers have been rising relentlessly, squeezing authors’ royalties. We hope that publishers will resist any pressure to increase discounts still further.”

One publisher was found to be broadly supportive of Amazon, although he also preferred to speak off the record. “I can’t see that it’s a major problem. Amazon sell their books at all sorts of discounts. That’s the nature of the market. They’re free to sell them at whatever price they like.”

I still find it very interesting how this is forcing the commercial presses into the equation, so that they have to look at how their own arguably equally aggressive slant on pricing and discounting comes back to haunt them. They may not be directly involved in setting such policy, and to some extent the abolition of the net book price agreement has rendered them powerless, but they have been complicit in allowing discounts to become greater each year by stealth, and many of them as well remain hostile towards self published books issued via print on demand, while at the same using the technology for their own ends. This is a double standard. Understand that this is more of an observation than a criticism, as like I said yesterday, I have to try and remain detached from this situation and not get too emotionally involved.

Nadine Laman from My Writers Circle sent me an interesting link to the Finance pages on AOL, which keeps track of Amazon's share price. Nothing much seems to be happening at the moment, but there is also a link on that page to some comments written by former hedge fund manager, television presenter and and self publisher Timothy Sykes. Timothy says that Amazon have proved through their actions that they care little for those who helped make their billions, which let's face facts- are the readers, writers and publishers.

The article states:

"Amazon bullying raises monopoly and business concerns

In the last few days, book selling giant Amazon.com Inc (NASDAQ: AMZN) has made a few more enemies in the publishing world by forcing the little-known group of print-on-demand (POD) publishers to either submit to using its POD subsidiary, Booksurge, or risk being prohibited from selling on its industry-leading website. No matter the cost and complications of breaking off relationships with other vendors, re-formatting books and a host of other problems, Amazon laid down the law, saying convert - and do it quickly - or face the consequences.

What's more disconcerting is that an official press release was made public only after smaller publishers like Angela Hoy of Booklocker.com started writing publicly about blackmail-type phone calls from Booksurge representatives. Fearful of losing their businesses literally overnight, many POD publishers such as iUniverse and Lulu have capitulated while strong willed publisher PublishAmerica refused to give in - and was quickly made an example of when Amazon disabled the buy buttons on their book titles!

As an author selling my own critically-acclaimed POD book An American Hedge Fund on Amazon, outrage has compelled me to write about how unethical and more importantly, monopolistic this all is.

In a short-term business sense, Amazon is right to use its massive size to gain market share for Booksurge and squeeze out the smaller players, but the problem is this goes against what made it great - offering the lowest prices and widest selection, basically like an online Wal-Mart Stores Inc (NYSE: WMT). To authors and publishers, Booksurge is known for its poor product quality and high cost structure, supremely inferior on both fronts to rival Lightning Source (LS) -- trust me, I did the research and that's why I chose LS - the POD subsidiary of Ingram Industries, the leading book wholesaler and the company on which Amazon has clearly declared war.

So, by making Booksurge the only POD option, relegating quality-loving publishers and authors to much smaller websites of Borders Group (NYSE: BGP) and Barnes & Noble Inc (NYSE: BKS), Amazon proves it no longer cares about its customers getting the widest selection at the cheapest prices - oh yes, even publishers that give into Amazon's demands will be forced to raise their prices - it cares more about its own profits.

Until this latest development, I believed Amazon was the future of book selling. It was making money, as were the publishers and customers who received the cost/quality benefits, but when a company happily alienates its suppliers whose hardships will inevitably be felt by the company's customers, I cry foul. Authors, readers, consumers and businesspeople unite! Sign THIS petition and let Amazon know what it is doing is wrong. That it is only a retail giant because we, the consumers, say so. We, not it, have the power here. While POD publishing is just a tiny niche, it's a slippery slope; if you let Amazon get away with this, it might be your business and industry it comes after next."

Amen to that.

UK authors safe from amazon's threat - for the moment ...

British based print on demand authors can for the moment at least, breath a collective sigh of relief, as after almost a weeks silence, Amazon have finally confirmed that they have no plans to implement their controversial print on demand policy within the UK.

Graeme Neil reports on The Bookseller, that the decision to tell publishers of such titles in the United States that their print on demand titles would have to be printed at Amazon's own facilities in order to be directly available on amazon.com has caused a storm, raising fears that Amazon are trying to squeeze competitors out of the print on demand market.

He goes on to say that "one observer said that the move could be seen as 'the thin end of the wedge'. 'Will they eventually say to HarperCollins for example 'We don't want your physical books anymore. Instead we will print them at our centres'? If you look at what they have done with e-books, they are selling them in their own format. Where do you draw the line?"

Angela Hoy, co-owner of print on demand services company BookLocker, who raised the first objections, said: "From the p.o.d. publishers we've talked to, and from our own experience at BookLocker, we could all be looking at a dire and immediate threat of revenue cuts if we refuse to sign the Amazon/BookSurge contract. 'PublishAmerica said that it had been told that if it did not comply, the "Buy" button would be removed from all of the publisher's listings. This demand would force PublishAmerica to submit 60,000 separate book files (text and cover), and redo each of them in order to conform to Amazon's complicated technical specifications."

Graeme goes on to cite the now notorious open letter from Amazon, before confirming that the company has no plans to implement this strategy in the United Kingdom. No mention however is made of his this impact print on demand books by British authors which are printed by Lightning Source in both the UK and US for these respective markets, and whether the US editions will be withdrawn from their sale. At the time of writing my own book is still live, and until I hear any differently I can assume that these titles too are safe.

In the meantime, Jerry Simmons has dedicated his entire newsletter this week to the unfolding events, which are rapidly becoming well, the biggest thing since print on demand first came to the UK.

I print his newsletter here in its entirety for the benefit of those who are not on his mailing list, and with the recommendation that you consider joining.

"Due to recent events I’ve decided to focus this entire newsletter on the Amazon situation. In my opinion, this is the first step toward the complete elimination of the books by self-published, print-on-demand, and small publishers that refuse to use Amazon’s BookSurge and largely depend on Amazon for sales. This is vertical integration at it’s worst and illustrates what big companies can do when they are allowed to strong arm the smaller ones. It’s time to take a stand, now or forget about it. Forever remain at the mercy of the big booksellers.

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IN CASE YOU HAVEN’T HEARD -

POD Publishers Told to Sell Directly Through Amazon, They Have to Use Booksurge.
Amazon has tried a number of tactics to push the print-on-demand services of their Booksurge subsidiary and now the company is using its leverage in the marketplace to drive that business. For the past month the e-tailer has been explaining their new policy to publishers who use print-on-demand: To have a direct "buy" button that lets customers purchase POD books from Amazon rather than from third-party sellers featured on the site, those books must be printed and fulfilled by Booksurge. Spokesperson Tammy Hovey tells the WSJ, "It's a strategic decision. What we're looking to do is have a print-on-demand business that better serves our customers and authors. When we work with some other publishers, it's not truly a print-on-demand business." She "declined to provide specifics," according to the Journal, but "said she doesn't consider the move an ultimatum.

"The new policy was first brought to light through a coordinated blogging effort by some of the affected POD publishers. Co-owner of POD publisher BookLocker.com Angela Hoy has the longest post on her WritersWeekly zine. She reports on a conversation with a Booksurge salesperson who "admitted that books not converted to BookSurge would have the 'buy' button turned off on Amazon.com, just as we'd heard from several other POD publishers who had similar conversations with Amazon/BookSurge representatives."There are no accounts yet of the policy being imposed on traditional publishers that also use Lightning Source or other print-on-demand vendors; by the current accounts the moved is aimed at independent publishers whose focus is POD books as well as self-publishing competitors to Booksurge such as Lulu.com. (Separately, Amazon has been working since mid-2006 to get mainstream publishers to use Booksurge for print-on-demand books sold through the e-tailer, for traditional purposes out of print books; large print; etc.--as well as to fulfill "demand spikes" when a regular title is temporarily out of stock.) Ingram and their Lightning Source operation have worked closely with Amazon in the past in a variety of ways, including packing orders with Amazon packages and labels.

MY REACTION AND QUESTIONS -

This is an outrageous strong arm tactic by the largest online bookseller in the world. There are forces at work behind the scenes that will only complicate this for anyone that doesn’t buckle under to the demands of Amazon.

Why haven’t the same demands been made of traditional publishers?
Because they all subsidize Amazon through a variety of fees and discounts, completely outside the ability of the small publishers and authors, it’s about money.

What happened to the free market concept of price, service and reliability?
Why bother when you have the muscle to force this upon your customers.

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More From Amazon on POD, and Toasters
Amazon's Patty Smith spoke to Computerworld further about their new requirement that POD-based small publishers and self-publishing companies print their titles through Booksurge if they want the books sold directly by Amazon. "When we publish a print-on-demand title in our own fulfillment center, we can then marry that on-demand book with a regular book, or a toaster, if that's what the customer ordered in the same box and ship it the same day to the customer. And that print-on-demand book that we printed is also eligible for free shipping."She reiterated that companies that don't wish to use Booksurge can still sell their POD books through Amazon's Advantage program ($29.95 per year plus 55% of the list price of the book) and other third-party marketplace seller programs.BookLocker.com Angela Hoy says she will not use Booksurge. "We would [rather] take an initial significant hit to our revenues, and we estimate that Amazon comprises about 30% of our revenues."

MORE REACTION AND A QUESTION -

First of all the excuse that marrying titles to other products is the reason behind this move is ludicrous, it’s an excuse.

If marrying products with books is the reason behind the move why not impose the same on traditional publishers who use offset printing?
Because Amazon doesn’t own an offset printing company, YET!

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Ingram on Amazon
Ingram chairman John Ingram issued a brief statement on Amazon's recent move to drive POD publishers to use Booksurge if they want their books sold directly by the e-tailer, noting "it clearly is alarming many of our publisher partners." At the same time, Ingram reports that "so far we've been unable to get a response directly from Amazon.com."He says, "We all live in a world where decisions are made about insourcing and outsourcing, and free choice is important. At Ingram Book and Lightning Source, we are going to work really hard to continue to be the compelling choice as publishers make their outsourcing decisions.... At Lightning Source, we produce a great product and thus do justice to our publishers' valuable titles. There is no question that we provide the highest print quality, the fastest turnaround speeds, and the most comprehensive portfolio of channels for a publisher's books."

FINAL REACTION AND QUESTION -

I find the lackluster response by the Chairman of one of the largest print-on-demand facilities puzzling and at the same time alarming.

Why do you find the response alarming?
I worked in New York with big publishers long enough to know that John Ingram’s reaction to Amazon’s move is entirely too nonchalant and basically it was a non-reaction. That smells of collusion to me and you can bet, Ingram isn’t budging an inch when it comes to the demands of Amazon. They need each other!

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QUESTIONS OF THE WEEK -

The following interview was conducted by Author Marketing Experts for their blog post which can be found at their web site http://www.amarketingexpert.com/ .

AME - What’s the real outcome going to be from this Amazon decision?

JDS - The publishers impacted will follow the demands of Amazon and print their books with Book Surge. The wider implication is that Amazon strengthens their position with these publishers and creates a monster with their vertical integration. This leaves each one of those publishers vulnerable to new demands by Amazon. What’s next? Higher discounts. Right now these publishers have been forced to change vendors, it might have cost them a bit more money, but remember, they market to writers not consumers. So if they are unable to place their authors’ books on Amazon, it looks bad in the eyes of their customers, the writers. These publishers don’t have the courage to say no and take a stand. And it’s not about the fact they sell a ton of books on Amazon, it’s about their customers’ view of them and their ability to market their own books.

AME - How do you predict the long-term effects of this as it relates to the small author and publisher?

JDS - The long-term effects for the author and publisher are devastating. With Amazon strengthening and securing their place in the distribution and sales channel, they can do anything they want. The next move will be to squeeze these small authors and publishers for placement fees, advertising fees, and eventually higher discounts. When you give in once, it never stops, this is the way of the publishing world and booksellers. It will get to the point where they start to lose money on each book sold. Only then will Amazon back off, but you can bet they are going to push authors and publishers to the wall and take every possible nickel out of the equation.

AME - What can an author/publisher do to “fight back?” -

JDS - Draw the line with this decision, pull their books from Amazon, create a new online market for selling their books, a central location for all self-published, print-on-demand books that has no alliance with any publisher or printer. Again, it’s not about selling books, it’s about how they are seen in the eyes of their customers, the writers. They are concerned about their own pipeline for new business drying up and that is much more important than giving in to Amazon’s demands. Each one of these publishers could switch all their allegiance to B&N.com today, but they haven’t, and the reason is that in the eyes of the writer, they feel they must be on Amazon to be successful. Short term it hurts business and they are more concerned about that than the longer term impact which is going to be a continual erosion of their profit margin.

AME - What alternatives do authors and publishers have besides selling their books on Amazon?

JDS - It’s time for the self-published, print-on-demand companies and small publishers to begin creating their own marketplace, totally and completely separate from all the online platforms that sell their books. I strongly believe that the website http://www.nothingbinding.com/ is a solution, and for full disclosure, it is a site that I founded. But here is the key, if you are not part of the traditional world of big New York publishing, from which I spent 25 years, then authors must realize it is fruitless to continue to struggle to become part of something dominated and controlled by the largest publishers in the world. Amazon is clearly inside the traditional world, and they are setting restrictions on anyone outside that wants to be part of their world. This will never end! It’s time now to create your own community and establish a voice in the marketplace. I’m confident that Nothing Binding can fill that void, becoming the community and voice for Independent publishing. The name alone signifies a non-alliance with any publisher or printer. A social networking website that allows authors free placement of their books with links to outside sources is a perfect way for authors to separate themselves from the traditional world of big publishing; in fact, it’s the only way to create a market and achieve increased sales they so desperately want and need.

AME - Do you think this was a bad decision on Amazon’s part and if so, why?

JDS - Obviously Amazon weighed the profit from the sales of all these POD books versus the additional revenue of printing AND sales. They made a calculated gamble and it appears they have been right. Now there is no stopping them on their demands. It won’t happen overnight, but they will make new rules and continue to do so until it negatively impacts their own revenue stream. Giving in is a monumental mistake for the author and publisher, if the POD companies had taken a stand against the decision and risked short-term profits, they would have been much better in the long term and more respected by their own customers in the marketplace. Why do you think Amazon did this only for the print-on-demand books and not books that are offset printed? They claim they did this so it would be easier for them to marry books with other products that customers wanted, combine the package and shipping for convenience and cost savings. What about all the other books that are offset printed? They have the same problem with marrying books and products, but they don’t own an offset printing company, yet! If I was running any company that does a substantial amount of business with Amazon and saw what they were doing with books, I’d keep a close eye on what other parts and manufacturing companies they purchase. Vertical integration in this case is good for Amazon, no, great for Amazon, but bad for the publishing business and possibly very bad for other product lines sold on Amazon.

AME - Since AuthorHouse/iUniverse and Lulu have signed the contract with Amazon, does this change the playing field for the other publishers, or is it irrelevant (and if so, why)?

JDS - With Author House and Lulu agreeing to Amazon demands, it puts pressure on the other companies to follow suit. None of these companies can risk their own business drying up and even though it’s doubtful they lose a ton of sales if they dropped from Amazon, it would be the negative perception their own possible customers would have, i.e. the writer, and of course their competition would use this as leverage in their own marketing as “being the one company still doing business with Amazon.” These writers don’t really understand the implications, yet, all they see is that their books are or are not on Amazon for sale; that’s all they care about.

In the survey of writers I completed long before NB was started, I found that virtually 98% felt they must have their books on Amazon, and clearly 70% hated the fact they had to give a 55% discount to them. When asked if Amazon went away tomorrow, how much would it impact sales, only about 15% felt they sold enough books on Amazon to make a difference. They must be there, they hate being there, yet it doesn’t really make a big difference, so what’s the point? Once Amazon raises the effective discount, or asks for ad or placement fees, and the publisher passes this along to their authors, they might wake up. But who knows, right now, all the author cares about is making sure their books are still listed and for sale on Amazon.

Fighting back should be done gradually and not a knee jerk reaction. I think if these authors and publishers set a deadline for Amazon to reverse their decision or else they would pull all books, they could get positive media attention to this, they will have capitalized on this in a way that would draw attention to them and their books, and in the long run they would be out from under the thumb of a very big online retailer. The analogy I use is that if the U.S. had been serious about alternative fuels back in 1973 during the oil embargo, we wouldn’t be in the mess we are today, 35 years later. Of course you can’t compare oil to books, but the fact remains, this cave in to Amazon is a very steep and slippery slope and it won’t take anywhere near 35 years for them to realize their mistake, maybe 35 months!

AME - If authors seek out other platforms to sell their books – how will they compete with the “comfort level” consumers feel with Amazon?

JDS - There is no way to compete with the comfort level of Amazon and that of course is a problem, but a short-term one. Solutions will create short-term discomfort, but I strongly believe people buy books on Amazon because it’s all they know. If there was a viable alternative, then I think consumers would welcome it. The responsibility is on the shoulders of the publishers to counter this strategy with cover price discounts, until the consumer starts to feel comfortable again and then you can readdress the price issue. These publishers will have to make some short-term concessions to attract their consumers, but it beats what they are going to have to endure when they cave to Amazon. There is no easy solution, there is no silver bullet that will make everything okay tomorrow, there will be some issues that have to be worked out, but if all these authors and companies would combine forces, create a new online market for themselves and their books, in 35 months they will be glad they did. Eat it in the short term for long term gain—that is the answer to the Amazon problem. Because Amazon is going to do nothing in the future to help the POD companies’ bottom lines, they are going to continue to eat away at their margins in a number of ways while at the same time squeezing them on price and discount. It’s a no win situation for the authors and publishers and it doesn’t appear that they really realize the situation they put themselves in by giving in to Amazon’s demands.

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MY PRESS RELEASE RESPONSE –

An Amazon Monopoly?
Authors shut out of Amazon; one site offers a solution

SAN DIEGO, CALIFORNIA – The little guy has lost another battle but this time, it’s the book industry that’s taken a hit. It was a shot heard round the publishing world in record time when Amazon announced that any small press or print-on-demand publisher doing business with them would need to print books through their publishing arm: BookSurge. Insisting it’s just “good business,” the terms of this deal feel more like a monopoly to those affected.

Jerry D. Simmons is a former Executive with the Time Warner Book Group who left there in 2003 to build one of the leading social networking sites for Independent authors, NothingBinding.com, says: “The long term effects for the author and publisher is devastating, with Amazon strengthening and securing their place in the distribution and sales channel, they can do anything they want. The next move will be to squeeze these small authors and publishers for additional fees and eventually higher discounts. When you give in once, it never stops.”

So what can an author or small publisher do? Penny C. Sansevieri, President and CEO of Author Marketing Experts, Inc., whose company specializes in Internet promotion says: “It’s time for authors to realize that Amazon is not the only game in town. They need to expand their online marketing to include social platforms like http://www.nothingbinding.com/. A site that can give their book exposure and then link the book to a store other than Amazon will help them fight and hopefully win this new war Amazon has decided to wage against the little guy.”

Can Amazon be stopped? “It’s doubtful,” says Simmons, “the wheels are already in motion, now the only thing the smaller publisher and Independent author can do is look for alternatives. This is a sad day for Independent publishing. Now it’s time to show Amazon they can’t win.”

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AMAZON DISCUSSION ON BLOG TALK RADIO -

You can hear my new blog talk radio show hosted by myself and Penny C. Sansevieri of Author Marketing Experts, Inc. Friday 10:00 am MST, Noon CST, and 1:00 pm EST. Simply cut and paste the link below to your web browser and tune in:

http://www.blogtalkradio.com/ThePublishingInsiders

If you would like to listen to last weeks’ show, cut and paste to your browser or click the link below:

http://www.blogtalkradio.com/ThePublishingInsiders/2008/03/28/The-Publishing-Insiders-1

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SUBSCRIBE TO MY BLOG -

Beginning yesterday April 2nd, I’ve started my blog on Nothing Binding. You can subscribe via rss feed at the site, here is the link:

http://www.nothingbinding.com/blog/jerry

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A RECOMMENDATION FROM OUR FRIENDS IN THE UK -

From Author June Austin, April 1, 2008

I would not normally do this, but some issues are just too important to ignore, and this is one of them. I and others in the publishing industry, are calling on as many people as possible to boycott amazon.com (and co.uk if they copy what .com are doing). The following article, which I posted on my blog site yesterday, explains all, and more to the point, why. THIS IS NOT A HOAX.

To read what I have to say, go to http://juneaustin.blogspot.com/

In short though, amazon.com are trying to force print on demand authors and publishers in the United States to switch printers, from market leader Lightning Source, to Amazon’s own recently acquired operation, Boksurge. They are threatening to remove any books printed by Lightning Source from their website if they do not sign agreements with Booksurge by tomorrow. This is no April Fool, but deadly serious.

Please circulate this to as many people as possible on your own mailing lists, as the more people that know about this the better. At the moment I am unsure as to how this will impact authors and publishers outside the US (Lightning Source also have a printing plant in Milton Keynes where my book is produced along with millions of others). My editor has today emailed their CEO and is awaiting a reply.

This is not a hoax, but a very real threat facing all publishers and authors who use print on demand methods, whether through self publishing or otherwise. Don't take my word for it though, but see for yourself here:

http://www.thebookseller.co.uk/news/55688-amazoncom-tightens-printing-rules.html

http://writersweekly.com/the_latest_from_angelahoycom/004597_03272008.html

In the meantime, I would urge you all NOT to order any books from Amazon at all until this is resolved satisfactorily.

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FINAL COMMENTS -

I spent 25 years in New York publishing, I’ve seen just about all there is to see. I’ve personally experienced the pressure a large bookseller can apply to a publisher for more money. The first time you give in to those demands, it’s over. These companies will continue to apply pressure in a number of ways to get what they want.

In the case of Amazon, I predict that this is just the first step. I realize that publishers have caved to the demands, but as authors you still have an opportunity to take a new direction. Create your own online marketplace for your books! This is the only chance you have to be successful via the web. A single location where you can direct traffic away from Amazon is your only hope if you ever want to maintain an online presence and have any chance of selling books in numbers that will make a difference.

Amazon was never your solution, they are part the traditional world of publishing, and will always be a part of that world. You aren’t invited and they don’t want you, they’ve made that obvious by their actions. If you don’t start a movement now, today, this weekend, away from Amazon onto another completely free and unaligned website, you are going to be stuck in the mire and deceit of someone like Amazon until the day they kick you to the curb.

Make your move to http://www.nothingbinding.com/, before it’s too late!

Jerry D. Simmons
April 3, 2008"

The boss at my own publishing company, Authors OnLine Ltd said in an email to me this morning that he is somewhat concerned at the lacklustre response to this threat that has been made by Lightning Source, and I have to say that I agree. It makes one wonder if there is more to this than meets the eye. He goes on say "I have to say I haven't got to grips with the complete story of this. The reason I say that is we don't actually deal with Amazon at all. It's Lightning Source that deal directly with them, we don't even know what Amazon have bought from us until after the event! And LS are saying in their statement (now on our front page) that "All your titles continue to be available to all of our channel partners, including Amazon.com, with immediate availability for shipment within 24 hours." Now that is a very understated response to say the least and, unless I have totally misunderstood the situation, rather odd for a company who's basic business is directly threatened.

Take the small self-publishing guys like us out of the equation for the moment and look at LS's core business. Most of it comes from making traditional publishers books into POD, their main client being Cambridge University Press. They print over a million books a year for them alone. Now are Amazon going to refuse to sell such mainstream publishers POD titles only through BookSurge. Now that would be interesting! Ok AuthorHouse and Lulu are big players but minnows compared to the amount of POD done by traditional publishers - and increasing very steeply annually."

Amazon.com tries to force out the POD competition

A disturbing rumour has been circulating around the Internet regarding amazon.com that I first read about on The Bookseller. It was one of those small snippets hidden within plain site that you could have almost blinked and missed, but one that nevertheless has disturbing implications for the publishing industry as a whole, not just within America either.

The article which was posted on Friday 28th March, and picked up from no less than the Wall Street Journal, states that amazon.com in the United States have notified publishers who offer print books on demand that they will have to use their own on demand printing facilities (Booksurge) if they want their books to be sold directly on Amazon's website. According to the newspaper (The Wall Street Journal), this move signals that Amazon is intent on using its position as the premier online bookseller to strengthen its presence in other phases of book selling and manufacturing. In other words (this is my words), they are prepared to use bully boy tactics in order to destroy the competition, thus strengthening their own position.

When I first read this I wondered whether the Wall Street Journal had got the date wrong and printed this a few days ahead of April 1st, but sadly it seems that this is no hoax. Within hours of me reading this article, concerned authors began to post on the various networking sites, on both sides of the Atlantic, that I am a member of. A link on one of these, the Book Marketing Site led me to Writers Weekly which is one the largest and best known sites for reporting publishing news within the United States.

Here I found an article written by one Angela Hoy, co-owner of POD services company BookLocker.com and publisher of WritersWeekly.com. Like many others, Angela states that when she first read this news she did not believe it either, but it is in fact very real.

Angela states that she emailed an Amazon/BookSurge representative who had been trying to get in touch with her by phone. John Clifford of Amazon/BookSurge called her back at 12.30 pm on Wednesday, March 26, 2008 at which point Angela relayed the rumours to him. Initially he tried to deny the rumours, but was forced to recant when he realised that Angela already knew too much for it to be denied.

As expected, print on demand authors and publishers across the length and breadth of America are up in arms at these heavy handed tactics, which are designed to force such companies to do business on Amazon's terms. Of course what they don't tell you is that their own printers, Booksurge, offer a far inferior service to anything offered by Lightning Source, the largest print on demand printer in both the US and the UK. If you type their name into Google you will find a myriad of author complaints about this company. This is not to mention the cost and inconvenience of converting files and changing publisher. After all, not all print on demand providers work with Booksurge, who are an entity in their own right.

Furthermore, since Amazon/BookSurge do not offer Ingram distribution (Ingrams being the US equivalent of Gardners), which is considered essential in order to stand any chance of being stocked in book stores, any company or individual who accepts the Amazon/BookSurge deal and wishes to maintain Ingram distribution will need to maintain two separate files - one for Ingram and one just for Amazon, and in effect, two ISBN's. This incurs certain costs, as the author is effectively forced to publish twice, maintaining two different versions of the same book.

This is to say nothing of course of the way in which their competitors will be affected. The knock on effect will be tremendous and not just for self published authors, since in the US like the UK, print on demand is becoming more and more mainstream, being utilised even by the large publishers to maintain their own back lists.

It seems to me then that in line with the recent debate re celebrity books that I talked about on here last week, this is all part of the divine plan, as there are clearly more things at work than at first it seems. There are two things happening here - firstly, print on demand is being debated openly in the general press as opposed to just the publishing press, thus opening up a discussion and dialogue on these issues that the reading public can see and respond to. The other thing which is perhaps more important, is that the large publishers who had previously dismissed print on demand as vanity press are seeing their chickens coming home to roost, as for the first time they are seeing and experiencing these issues and the prejudice that print on demand authors have to face through their own eyes. They therefore realise that both mainstream and self published authors are facing the same issues and the same battle. It is ironic in many ways that this had to happen before they could clearly see the consequences of their actions - that for every action there is an equal yet opposite reaction.

It is unclear at the moment as to how this will affect non-American authors and whether Amazon plan to use the same strategy on their other sites - of which co.uk is by far the largest. Bear in mind as I write this that they could easily try and do this, as Lightning Source also have a printing plant in Milton Keynes.

As Clive Keeble points out, on the Writers Weekly site, "As an opinionated independent UK book dealer I tend to follow the ongoing manner in which Amazon is enforcing terms and conditions on their suppliers. Thankfully I have had the good sense never to list, either directly or indirectly, on Amazon: and thankfully have never purchased anything from them.

I think that your readers should be aware that amazon.co.uk has in recent months withdrawn the 'Buy New' button here on "hard print" titles, the best documented case was with independent publishers Bloomsbury. It was several days before the 'Buy New' button was reinstated: neither publisher nor Amazon gave a printable quote to the trade press stating why the 'Buy New' button was withdrawn or re-instated.

At the time Benazir Bhutto's "Reconciliation" was published the 'Buy New' button mysteriously disappeared on Amazon, only to be re-instated two days later with the Amazon discount increased to 50 percent. I am unaware of any direct press comments - on the book world grapevine it was referred to a "just a little technical glitch" (believe that if you want). In my opinion, Aamazon is a dangerous predator and needs to be treated as such."

I am thoroughly confused I must say though and at a loss to understand what Amazon think they are playing at, as to my mind this is commercial suicide. Yes, Amazon are the largest online retailer and Internet sales are going through the roof at the moment, increasing year on year, but Lightning Source have printed over 33 million titles in the UK alone in the few short years since they started their operations here. Can Amazon really afford to lose this amount of business - somehow I think not. They need to realise that they are not the only Internet retailer out there, in the US or the UK - and there will always be someone willing and able to fill their shoes. They would be wise to remember the old adage, the bigger you are the harder you fall ...