Tuesday, January 24, 2012

Books Like Whoa: Book Business and Amazon's $$ Losing Strategy Explained (aka Winter is Coming)

This is the best postulation behind why Amazon is so willing to slash their margins I've seen:


I'm conflicted about this, because I don't hate Amazon the way a lot of people do. I think that anything that makes reading and book ownership more accessible and affordable for people is a step in the right direction. And while I love indie bookstores, let's get real - most people cannot afford to pay retail on hardbacks, or even some paperbacks. The indie bookstore is purveying luxury items, essentially, whereas Amazon is selling books as commodities. I'm okay with the idea that Amazon becomes Walmart and indies become Whole Foods or boutique boulangeries. (I guess B&N becomes Target or Giant in this equation?) So far as this goes, I'm mostly okay with the fact that Amazon is willing to accept very low margins, if the tradeoff is that book ownership is affordable. And, hey, I'm a book addict, so they are basically pushing my drug of choice on me at a rate that I can afford. The question becomes, "At what price?"

I see a lot of people bashing the Big 6 publishers, especially in the self-pub world, acting like they are evil embodied and they are seeking to systematically deprive authors of every last cent, run away with their wife, and kick their dogs. They are big businesses, so this is no doubt true on some level. But I'd rather have a variety of soul sucking businesses to choose from than arrive at a place in the market where there is only one soul sucking business to deal with for both book selling and book publishing. And make no mistake, if we accept that the Big 6 are evil, Amazon is as evil as the Big 6. It is making life good for a lot of authors and readers right now, but that won't last if things continue as is. It seems that the idea is to fatten us all up like Hansel and Gretel and then to roast us once all infringing huntsmen in the forest have been killed off.

To sum up for people who aren't weird book nerds with business degrees, and thus a little nuts about this topic, we're basically in the literary equivalent of WWII. Amazon is Germany, fighting on 2 fronts: Book Selling East and Book Publishing West. Except in this case, they aren't really facing a whole lot of competition on either front. Borders is out of the way, so now their big competition to the east, B&N, hasn't found a way to combat Amazon's disruptive pricing (http://www.thepassivevoice.com/01/2012/average-ebook-prices-kindle-vs-nook/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+ThePassiveVoice+%28The+Passive+Voice%29). And the Big 6 allies to the west haven't figured out how to launch their own D-Day to stem the tide of Amazon rising. A dramatic metaphor perhaps,* but helpful, I think, in illustrating that Amazon is not just trying to be the only store in town for book selling - they also want to be the only supplier in town for book publishing (whether through their own imprints or self-published folks).

Amazon is not your friend. The Big 6 are also not your friend. B&N isn't even its own friend. They are all big businesses that are driven by profit first, love of books second (if at all, in some cases... sadly). The great thing about indies is that the order is tied or reversed for the most part. And what I'm really hoping is that the Big 6/B&N will be able to hold off Amazon long enough for some people who are equally motivated by profit and love of books to innovate in a big way- to make a disruptive move that can ebb the slow but steady march towards a monopoly that we are on right now. I really hope that happens.

Maybe you don't care that much about books and are wondering what's the problem with a monopoly? What's wrong with having a single place where you get all your books? The problem is that books aren't like soda or clothes or makeup or oil. Books are our cultural heritage and food. And it's not that awesome that one entity would be responsible for curating that cultural history and access to nourishment from it.

Anyways, that's my little soapbox moment. If you're an eBook reader and you want to support a non-large business, I'd recommend http://www.indiebound.org/. Kindle owners are a little out in the cold on this one (surprise, surprise), but everyone else should be able to get books through this service. A lot of individual indies can sell you eBooks through their own website, so support whichever one is near you. You could also try http://redroom.com/, which allows authors to sell directly to you. The thing is, even if you can only patronize indie occasionally, it all counts. All of it stems the tide.

What do you think of Amazon, Big 6, and B&N? Does the idea of a monopoly bother you? Is there a way to keep books accessible but diverse in sourcing?

*please don't write me angry emails about how Amazon is not the equivalent of the Nazi state - I don't mean in their principles or morality; I'm only trying to describe the marketplace "battleground," which I see as being analogous to the military quandary that Germany found itself in during WWII (Napoleon and France would be a similar situation- moral of the story, kids, don't try to take Russia. Be happy with the Baltics and Poland and get on with your dictatorial life)

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