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More Amazon Pricing Horror Stories

February 22, 2012

I wrote a while ago linking to a story in which Amazon had arbitrarily reset the price of an e-book published by a self-published author.

Today, I’m linking to another such story, this by established, traditionally-published author Jim Hines whose self-published book of short stories has been given the Amazon pricing treatment.

The punch-line?  Amazon has added a term to their Terms of Agreement that specifically absolves them of any liability for their own mistakes

As Jim Hines says:

I’m not telling people not to publish through Amazon; I am telling you to go in with your eyes open, and to understand that despite what the cheerleaders might suggest, Amazon is not pro-author. They’re pro-Amazon.

Let me second that sentiment.  I’m a long way from being in a position to tell anyone how to publish anything – I’m a long way from being able to publish anything I’ve written.  And I’ve consistently said that I’m glad that these new publishing options exist, insofar as they change the publishing paradigm sufficiently to tip the balance of power ever-so-slightly towards the favor of writers.

But were I in a position to self-publish something now, while I certainly wouldn’t discount the market position of Amazon, I’d make sure I put in the effort to make my book available in as many non-Amazon venues as possible, and to promote those venues, in order to try to insulate myself from getting the Amazon treatment myself.  Because to keep the balance of power tipping back toward authors, a singular publishing hegemony must be prevented.

UPDATE:

Jim Hines has updated his thoughts on his experience with Amazon here.

And as Jim points out in the link above, it looks like Amazon has been in the news in other ways lately.  Here are some links of possible interest:

Amazon Removes Kindle Versions of IPG Books

The Author’s Guild on Amazon

UPDATE 2:

Writer Beware takes on some of the recent Amazon news

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8 Comments leave one →
  1. February 22, 2012 12:10 pm

    If you’re an artist, any kind of artist, nobody is in business to make you rich. Not club owners, gallery owners, record companies, publishing houses, or Amazon. But I agree that a monoply is the worst situation, and in any case the artist (and a lawyer) should ready anything before signing it. Remember, the guys who created Superman got almost nothing, becaue of a contract they signed when they were kids. (I’m going to write more about this on my blog soon, because I have a personal conection to those guys which I just figured out.)

    • February 22, 2012 2:57 pm

      That’s a truthful sentiment. And it can hurt writers who aren’t business savvy – which is a not-insignificant percentage of them. Even many of those who advocate for writers to be more business savvy apparently aren’t all that savvy themselves – either that, or they’re peddling bad business advice intentionally…

  2. February 27, 2012 5:09 pm

    I’ve never seen any so-called Amazon cheerleaders suggesting that Amazon is pro-author for the sake of authors. Anyone with a bit of business sense would know that’s not true. I think that when people say that Amazon is “pro-author” (if they do use that term) they mean that right now Amazon is extremely good for authors, which is true. But in order to take advantage of the new world of publishing authors need to smarten up and start acquiring some business sense. If you can’t think like a business person (considering Amazon a business partner, not a friend) then you’re just not going to do very well no matter how you publish.

    I can’t for the life of me imagine why authors have assumed that they would have entire control over the retail price of their books. Since when has anyone other than the retailer ever had complete control of the retail price of something (besides those in involved in price fixing schemes)? I just want to shake some authors and yell “Welcome to the realities of capitalism.” I mean, this is one of the things Amazon has always been famous for, discounting everything and taking a loss.

    It sounds like when Amazon discounted Mr. Hines’ book, they should have still been paying him royalties from the list price according to their policies. (I saw a blog post by someone else who had a book discounted by Amazon and they said Amazon is still paying them based on list price.) So there’s some kind of misunderstanding and he should keep at them until it’s fixed. It happens, you know? No need to judge the whole company based on a mistake.

    Also, that Author’s Guild post is idiotic. It just shows how little authors understand how business works. Authors really just need to educate themselves and stop being foolish.

    • February 28, 2012 11:29 am

      If you haven’t seen any “so-called Amazon cheerleaders suggesting that Amazon is pro-author” then I presume you don’t spend much time on the blog of Joe Konrath (i.e. the elephant in the room when we discuss “Amazon cheerleaders” when we’re not trying to name names)? Which is just fine, IMO… I don’t find much of what he has to say to be very honest. If you do read Konrath and somehow don’t have that impression… well… But just as a random check, here’s Konrath’s latest post. Rhetorically, this reads as a piece with Konrath’s running log line of anti-traditional-publishing vitriol. In this post he asserts that traditional publishers treat authors like excrement (he uses a choicer colloquialism) by running through a list of problems with traditional publishers (some of which are accurate and some of which are made up whole cloth), and he then asserts that he’s spent a lot of time talking to traditional publishers trying to get them to change those problems and they didn’t listen; whereas he’s spent less time talking to Amazon to get them to change some other things (which he does not enumerate in a list), and Amazon both listened and he profited as a result. He says: “If you’re an author who has worked with a legacy publisher, you know how demeaning it is when your ideas, pleas, and plans are ignored. And if you’ve worked with Amazon, you know how empowering it is to be listened to. To have your opinions and ideas count, and be implemented.” Later he says this: “As Blake Crouch said in a recent Tweet: Where are all the longtime authors jumping to the defense of legacy publishing? Surely, since legacy publishers treat their authors so well, there should be thousands of happy authors rallying behind their publishers, disagreeing with my points, telling the world how wonderful their legacy experience has been.” An assertion which is provably false – I’ve personally read many defenses of traditional publishers by traditionally-published authors, and I don’t have near enough time to read them all. So, yes… the elephant in the room. He makes a habit of claiming, disingenuously, that Amazon is pro-Author – if not directly then by comparison to traditional publishers via the logic that traditional publishers are anti-author and Amazon is the antithesis of the traditional publisher.

      Should authors take anything Konrath says at face value? No. They should be smarter than that, and develop a real business sense and not the pseduo-business bull-excrement that Konrath peddles. But he’s a big name in the business, and he is probably the preeminent voice on the side of being anti-trad-publishing and pro-Amazon, and he gets cited a lot.

      With regards to Mr. Hines’ experience: you’re right, that’s what they should do but that’s not what they did (if you read his account, they paid royalties based on Amazon’s sales price, not on his list price). And it’s not the first time that’s happened. (I’ve obviously blogged about it before.) Once is a mistake. Twice… starts to smell fishy. (What’s more, Jim’s experience directly contradicts Konrath’s recent assertion that Amazon “listens” to authors who publish with Amazon; unless Konrath meant his comment more narrowly to refer to that select group of authors who have signed Amazon-exclusive deals – if so, he played awfully coy with that one, as he doesn’t specify it at all. Any given digital self-publishing neophyte, then, obviously must need not apply.) And he has apparently kept after them quite a bit, and although they’ve rectified the pricing going forward, he’s apparently not gotten very far in getting recompense for the sales completed at the wrong price. So I don’t think this is judging Amazon based on one mistake. This is judging based on a pattern of behavior, of which this is merely the most recent example.

      I’m a little taken aback by your assertion that authors shouldn’t have an expectation that self-publishing means they can set their own prices. Well… under agency sales models that traditional publishers have with Amazon now, that’s precisely what happens. The publishers have the right to set the price for what their e-books sell for on Amazon. That’s the agreement they were able to negotiate with Amazon. But self-publishers? They apparently have no such right, it seems. Good luck negotiating with Amazon to get different terms for your own books.

      But your assertion is that authors shouldn’t expect to control the retail price of their books. That’s fine and good; you’re right that the typical retail model doesn’t work that way. So what if self-publishers were treated like publishers used to be treated by Amazon, before the big Amazon kerfuffle last year – and the way retail in general typically works? Well, then, self-publishers ought to set the price at which they sell the e-books to Amazon and then Amazon can sell it at whatever price they want. Or in other words… Amazon would pay a price to individual authors for each book sold which was set by the author, but then Amazon could sell the ebook at loss if they wished, or choose not to sell the book if the self-publisher set the price too high for Amazon. But that’s not how it works, either. Basically… self-publishing authors get the worst of both worlds, with regards to pricing of their books; they have only the illusion of control over their prices, but no more real control than does a traditionally published author. Seeing as how this is one of the selling points often cited by self-publishing cheerleaders for why one ought to self-publish rather than traditionally publish, I find it a tad concerning. (I’m sure you’re familiar with the argument that traditional publishers “don’t get it” with regard to ebooks and pricing, and are pricing much too high, and that this hurts authors because high-priced ebooks don’t sell in sufficient quantities, but if they’d bring the prices down that would be good because they’d sell more; and that’s why authors should self-publish, because then they can set their own prices and not be stupid dinosaurs like traditional publishers.) The fact is… the reality is, the modern “digital self-publisher” is not, in fact, self-publishing at all. They don’t control the entire publishing process, only selling their finished product to a distributor/retailer for final customer point-of-sale. Instead, they completely beholden to the whims and contract terms dictated to them by monopolistic retail giants. They are, in effect, doing piece-work.

      As for calling the Author’s Guild post “idiotic”… you’re entitled to your opinion, of course, though I don’t think that’s even a remotely fair characterization of the article. From the perspective of someone who’s not traditionally published, it might not be useful… for those who have (or intend to) “self-publish”, Amazon does have very favorable royalty rates, and they do have an overwhelming majority of the ebook market, so Amazon is the digital self-publisher’s bread-and-butter. Ergo, it’s easy to see from that perspective how this article might seem threatening. But for an established, traditionally-published author, I think there’s quite a lot of business savvy in that article that, say, a Joe Konrath obviously isn’t offering up (for instance, a realistic assessment of what the market looks like if there is a single monopoly/monopsony ebook provider, which Konrath actively cheers for – that maybe doesn’t seem terribly relevant to a digital self-publisher whose main revenue stream already comes through Amazon because, for all intents and purposes, Amazon already has a monopoly on their sales, and so they would see that as the ordinary course of affairs). The thing is, the Author’s Guild article isn’t written for an audience of digital self-publishers. It’s written for an audience of traditionally published authors – and clearly also for an audience that has benefited from the traditional model and expects to continue operating in the traditional model.

      What’s more, the Author’s Guild article is pretty accurate, historically speaking, on how some of Amazon’s business practices constitute “anti-competitive tactics”, which is the main argument of the article. Things like selling products at a loss (i.e. “Dumping“; although that term is typically applied to the use of the tactic in terms of international trade; see also “Predatory Pricing“) are classic anti-competitive tactics. But in the modern era, prosecutions for anti-competitive tactics have been fewer and farther between as regulation has grown increasingly lax. This is a factual analysis, and in that sense isn’t “idiotic” at all. These are considerations that a business savvy indidividual (such as yours truly, i.e. for having pursued my education both in the undergraduate level and at the master’s level in the study of business, and having earned an MBA) might already be aware of, but which an individual who presumably does not have a business background might be ignorant of. In that sense, again, this article is quite useful in providing a context of understanding that such individuals might otherwise lack. Point being: the article is an example of authors doing exactly what you assert authors should be doing, to wit: “educat[ing] themselves”.

      The article might go further and note that while predatory pricing tactics have not historically been successful (usually doing more harm than good to the firm that employs the tactic), there is reason to believe the case might be different with Amazon, which owes to the fact that (a) Amazon is very well capitalized (which enables them to employ the tactic for longer) and (b) Amazon has very low costs associated with the digital delivery of products, which somewhat mitigates the loss on individual sales and (c) Amazon’s competitors are already on a very tenuous financial footing, which makes driving them to bankruptcy a realistic possibility, and Amazon’s competitors don’t possess a significant plant or physical infrastructure – vis-a-vis the production, distribution and sale of ebooks – that would enable new competitors to rise from the ashes of the old, especially considering said infrastructure is extremely cheap and is not a significant barrier to entry and further (d) Amazon already possesses a significant and possibly overwhelming competitive advantage in the ebook market, to wit: market share.

      So… from the perspective of someone who sees the traditional model as inevitably doomed, perhaps this article was “idiotic” in the sense that it does not accept that inevitability, but is written from the perspective of assuming that the traditional model is both “good” (which it has been, to those who have been successful in breaching the traditional publishing gates; not so much, of course, for those who hav enot) and likely to continue. But that’s a question that warrants both debate and a certain reasoned gentlemanly disagreement, which a mere dismissive “idiotic” comment does not allow for.

      That’s a long way of saying… I disagree with you. As I’ve said before and will say again: I don’t begrudge Amazon playing a role in the marketplace. Insofar as they play fair, they can be a force for good and for innovation – and inasumuch as those innovations benefit authors and better enable authors to reach their audience, I particularly applaud that. What concerns me is Amazon’s track record of nasty and oft-times anti-competitive tactics, a pattern of behavior that betrays a certain contempt for authors, and for capitalizing on their superior market position to drive other competitors and other innovations out of the market – and also in attempting to drive out of the market businesses that provide a product/service which I personally value (for instance, good quality hardcover books, which Amazon is not in the business of producing).

  3. February 28, 2012 12:39 pm

    My main question about Konrath (other than why he’s so successful when he doesn’t write well — but I have that question about other writers, too 🙂 ) is how general his experiences are. Do a lot of independent authors have the same experiences he’s had with Amazon listening and responding to him? Or is that level of service limited to indie authors who are very successful and who relentlessly promote Amazon?

    My main question about Amazon — as I talked about on my blog — is that losing money to gain market share will only work for so long. B&N should try to hang in, since (as the Author’s Guild pointed out) they’re out-engineering Amazon by quite a bit, which I’ve also written about.

    • February 28, 2012 1:44 pm

      To hear Konrath tell it, his experience is indeed semi-universal among folks who self-publish. But anecdotally, at least, that’s not the case. I can’t say how common or not common, relatively speaking, his experiences really are, but most of the authors I follow who are trying to make a go at digital self-publishing aren’t seeing the kind of success he claims. To be quite honest, I would not be surprised in the least to learn there was a secret tit-for-tat arrangement in which Amazon promotes his books up in return for his talking up Amazon as a great place to publish books. Given the fact that although he sometimes has legitimate criticisms of the traditional Big-6 publishers he just as often seems to resort to making stuff up… that would be an explanation that at least makes logical sense. As for B&N, I’ve heard from multiple sources that the regular e-ink Nook, for instance, is far superior to the equivalent Kindle device. I can’t say… I’ve not really examined either, so I can’t make a fair comparison. If true, as you suggest, this gives B&N some hope… but Amazon has other clear competitive advantages: a larger scale and scope (selling a lot more than just books, movies, and video games), and presumably better market capitalization, which improves their ability to invest in capital projects or to burn cash in a war of attrition. Ideally, IMO, both survive and stay strong, and implement policies that help authors rather than punishing them.

      • February 28, 2012 10:26 pm

        My comparison of Nook and Kindle was the tablets, not the e-readers. I’ve never even held a Nook e-reader, but I know the Kindle is better for me (it has a browser, and the Nook doesn’t). The quality issues are with the Fire: http://u-town.com/collins/?p=3086. You’ll see that I also made the point about Amazon’s scale being to their advantage.

      • February 29, 2012 11:59 am

        I’m way behind my blog reading again, so I haven’t had a look at your comparison. I should head over there soon and check out your thoughts.

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