The New York times recently published an article examining Amazon’s rise to the top of the publishing circles and its efforts to stamp out competition in the industry. The author attempts to take a balanced view, interviewing both people who have benefitted from Amazon’s ascent from online retailer to publishing giant, as well as those who have been hurt by Amazon’s increasingly dominant market share:
“All of this angst and arguing is pushing forward a question: Is the resistance to Amazon a last-ditch bid to keep the future of American literary culture out of the hands of a rapacious corporation that calls books “demand-weighted units,” or an effort by a bunch of dead-enders and snobs to forestall a future that will be much better for most readers and writers?”
Amazon survived the dot com bust by diversifying their products, focusing on slower business growth, and reading the desires of the market. One of these needs was a more merit-based system of publishing, which has since become a great boon to writers by providing a larger platform for distributing their work while requiring a significantly smaller rake of their profits.
In the previous model, large publishing houses would give minuscule contracts and advances to authors, and reap as much as 85% of the profit in exchange. Authors are now more certain than ever that the strength of their content, and not their connections within a small, insular industry, would carry their sales.
The author also talks about the practices that Amazon has revolutionized, beginning with their ranking algorithm. Prior to Amazon entering the publishing game, they would simply distribute the books from publishers and keep a ranking for how well the books were doing relative to each other — a small innovation, but one that ultimately proved to direct their business:
“A lot of [publishing houses] had been in business for 30 years,” he said. “They said [to Amazon]: This is what we’re going to publish, this is the price, you have no leverage, we control the content.
…
An author would see his ranking drop from 98 to 798, and the first thing he’d do is call his agent or publisher and say, ‘What happened?’ ” he said. “He held the publisher responsible and expected it to straighten this out.”
Amazon was once pushed around by these larger companies, who would withhold book supplies and prevent Amazon from selling their product. Ironically, it was their algorithm, (and not their publishing) that got them into the conversation. Nowadays, Amazon is attempting to use their considerable industry muscle to pressure publishing companies into giving them a higher kickback for promoting and distributing their products. With brick-and-mortar bookstores all but dead, the major publishers are forced to acquiesce:
“He noted that Amazon was also trying to squeeze a large publishing group in Germany,Bonnier, for better terms. And Germany has fixed-price laws for books. That, Mr. Pietsch said, ‘is evidence that Amazon’s margins, not lower prices for consumers, are the crux here.’”
One major business is accusing another major business of acting in the interests of higher profits. The author also speaks to representatives of Rutgers University Press to get a sense of how Amazon’s practices are impacting their business:
“We still pride ourselves on what we are doing — producing books that educate and create a public good,” Ms. Wasserman said. “To see that migrate into the hands of people who might not share our mission, or might not even be people, doesn’t say much for the future of American culture.”
Forgive me if I don’t shed a tear for university presses, who typically sell poor-quality textbooks for hundreds of dollars and subsequently eradicate their resale value by releasing new editions every other year. Note that these organizations are unable to advance any logical justification for their existence in the age of digital publishing. Their argument against a competitor devolves into a pseudo-intellectual soup of nebulous buzzwords such as “public good”, “sharing their mission” and their importance to “American culture.” As someone who spent hundreds of dollars a year on worthless textbooks in college, I will take the most pleasure when these dinosaurs are finished for good.
“American publishers and booksellers are looking longingly at France, where different rules apply. In late June, the French Senate unanimously passed a law forbidding free shipping on books bought online. It was called the Anti-Amazon Law.”
This sounds suspiciously like something out of an Ayn Rand novel — a government imposing sanctions on a profitable big business in order to artificially help a more entrenched but decaying industry. This is cronyism of the highest order, the kind that we have thankfully not (yet) seen applied to Amazon in the U.S.. The author closes with a hollow caution that Amazon may revert to the same profit-maximizing practices once they have stamped out the competition:
“Amazon looks so good because it has the rest of publishing to compete against. But if those publishers wither, maybe that would not be true.”
All in all, though the article attempts to present a neutral view of the situation in the publishing industry, it is clear that Amazon has been a boon for all but the most entrenched of authors. Is this a move of retribution by an industry giant against its formerly strong competitors? Perhaps. But if Amazon delivers more value to both authors and consumers, it’s difficult to argue that their ascension to the top of the industry is anything but a net positive. Amazon’s practices have helped to turn publishing and information dissemination into a merit-based, rather than infrastructure and credentialism-based, practice.
This article makes it clear that large publishing houses have ruled over their kingdoms with an iron first, rarely thinking about the future of the industry and instead clinging to an outdated business model as they chiseled authors for as much money as possible. That was their right because they were the only business in town, but times have changed. What we’re seeing now strikes me as the last gasps of an antiquated industry, one that is being rendered obsolete by a more consumer-driven and artist-driven model. Good riddance.
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