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Amazon Asks Authors to Demand All eBooks Sell for $9.99 or Less

illo-Amazon-Letter

On Saturday, the Amazon Books Team sent an email to book authors registered with Amazon.com’s Kindle Direct Publisher program. That letter encourages authors to express the following points to CEO of Hachette Book Group, Michael Pietsch:

  • We have noted your illegal collusion. Please stop working so hard to overcharge for ebooks. They can and should be less expensive.
  • Lowering e-book prices will help — not hurt — the reading culture, just like paperbacks did.
  • Stop using your authors as leverage and accept one of Amazon’s offers to take them out of the middle.
  • Especially if you’re an author yourself: Remind them that authors are not united on this issue.

On Twitter, Australian book editor Simon Collinson had this to say:

The letter begins with the story of the rise of the paperbook book in the 1930s. The paperback was significantly less expensive, more portable, and more easily distributed than hardcover books that were the standard of the time. Of course, the lower price point made some publishers and authors–including George Orwell of 1984 and Animal Farm fame–unhappy. Nearly a century later, hindsight tells us that the objections of Orwell and his like-minded contemporaries were wrong; the paperback books did not harm the book publishing industry and what Amazon terms “reading culture”. Quite the opposite: smaller, lighter, cheaper paperback versions of books could be distributed in more outlets, more readily, and in greater variety. Their lower cover price meant that individual readers could purchase and consume more books. Publishers and authors earned more money than with hardcover sales alone because of the increased number of copies of their books sold, despite the lower cover price per unit. The paperback was a tremendous boon to the industry for all concerned.

Sub-ten-dollar ebooks, the letter argues, are the new paperback.

Many e-books are being released at $14.99 and even $19.99. That is unjustifiably high for an e-book. With an e-book, there’s no printing, no over-printing, no need to forecast, no returns, no lost sales due to out of stock, no warehousing costs, no transportation costs, and there is no secondary market — e-books cannot be resold as used books. E-books can and should be less expensive.

It’s unclear from the letter if Amazon believes that every ebook, regardless of length, depth, subject, or audience, should be priced at $9.99 or lower. Is that price ceiling intended only for mass market fiction or all types of books? Hachette’s catalog includes fiction and non-fiction. If it’s Amazon’s point that $9.99 should be the top cover price for all books, then I, as an author, object.

Does Amazon expect my publisher and me to sell my 500-750-page technical books for only $9.99? The print versions of those books are typically priced between $29.99 and $49.99, which is the average for similar books. Were we to sell the ebook versions for only $9.99, three things would happen. First, no one would buy the print versions. Next, both my publisher and I would be inundated with email accusing us of price gouging on the print versions. Again, $29.99-49.99 is the industry average for such books, and it’s a price range that pays a small amount to everyone involved in the production of the book (about 14 people per book, including myself). Many would-be readers, however, would perceive the ebook price as the actual value of the book and the print price as being inflated for no good reason. And, finally, $9.99 is simply not a fair price for a 500-750-page technical book on digital publishing, InDesign, Photoshop, Illustrator, or similar topic that took the author(s) a few hundred hours to research and write with similar time and effort investments from one or more technical editors, a developmental editor, a copy editor, an indexer, one or more layout artists, and a layout proofing team. Then, in addition to the team directly involved in producing the content, there’s the author’s literary agent as well as dozens of other people at the publishing company whose paycheck is fed solely by sales of books.

Amazon argues that 174 books are sold at $9.99 for every 100 sold at $14.99. I’ll have to trust Amazon on those figures. They make sense, but only in terms of books that have a very broad appeal across demographics. Readers of my books are a relatively narrow market–professional or semi-professional designers, photographers, and publishing personnel. It seems unlikely to me that selling Mastering InDesign for Print Design & Production for 1/5th of the print version’s cover price would generate 5X the sales. If it didn’t, then someone doesn’t get paid. Should that be the author (me), my dedicated tech editor, the publisher who has to make payroll for a few thousand employees, the layout artist who arranged my words on the page, or someone else? It would mostly likely be all of us because publishers simply won’t buy books on which they can’t make a profit.

If publishers don’t buy the books, readers can’t read them. Thus Amazon’s argument that setting a price cap of $9.99 only benefits, and can’t hurt, readers is naive and erroneous. As it is now, publishers are buying fewer and fewer books due in part to Amazon’s prior price-fixing, which leaves readers looking to self-published ebooks and the Web for very often substandard, error-laden, even completely wrong non-fiction and technical information from… (I have a hard time using the word “authors” here.) …writers who don’t always really know what they’re writing about. Say what you want about book publishers (I’ve got plenty of complaints myself), they vet their authors–before and during book writing–ensuring that authors actually know the subjects about which they publish.

As compelling as Amazon’s letter was, I’ll have to disagree: price-fixing, selling all ebooks regardless of length, subject, or audience at below $10 is not the best thing since the invention of the paperback for anyone but Amazon.

Read the entire letter from Amazon here.

Laura Dawson, the Product Manager for Identifiers at Bowker (read: the gatekeeper for U.S. ISBN numbers) chimed in on her blog, too, with the post Go Home Amazon. You’re Drunk.


Update: 2014-08-11, 1:30 PM EST

Michael Pietsch, Hachette’s CEO, did indeed receive “a few emails” apparently at Amazon’s urging. In a story on Digital Book World, Pietsch’s response email quoted in its entirety, including the following passage:

  • More than 80% of the ebooks [Hachette publishes] are priced at $9.99 or lower.
  • Those few priced higher—most at $11.99 and $12.99—are less than half the price of their print versions.
  • Those higher priced ebooks will have lower prices soon, when the paperback version is published.

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2 Responses

  1. Laura says:

    Please note that the blog reflects my own personal opinions and not those of Bowker. I don’t know what Bowker thinks, as an organization, because Amazon is not a customer of ours.