Printing, ca. 1568. Public domain.

“Right now, bookstores, libraries, authors, and books themselves are caught in the cross fire of an economic war. If this is the new American way, then maybe it has to be changed — by law, if necessary — immediately, if not sooner.” – James Patterson

I haven’t blogged about ebooks and independent publishing lately. Over the last few years, it’s become clear they are here to stay. Success breeds acceptance, and the “vanity press” stigma is gone. In olden days (ca. 2011), I found a kind of “blows against the empire” satisfaction in promoting ebooks, writing reviews, and encouraging Indie authors. The evil empire was big publishing. This was the time of the little guy.

I still like Indie authors, though the “righteous cause” fantasy is gone. Now suddenly, at least to a casual observer like me, the situation appears reversed, with Amazon in the role of bully-boy, and those same publishers (perhaps) fighting for their existence, and with them (maybe) hangs the fate of a lot of remaining brick and mortar stores.

I first learned of the Amazon-Hachette duel from Michael Koryta, a favorite action-adventure writer I follow on Facebook. On May 19, Koryta reported serious problems pre-ordering his new book, due out June 3, from Amazon. He said the situation goes far beyond the interests of one author, and provided some of the links posted below.

On May 29, USA Today quoted James Patterson as saying “the future of our literature is in danger.” Patterson says that “Amazon wants to control book buying, book selling and even book publishing,” and laments that federal anti-trust laws no longer have teeth.

Here are several editorials on the situation:

Amazon vs. Hachette: When Does Discouragement Become Misrepresentation? From the NY Times Blog

Amazon said to play hardball in book contract talks with publishing house Hachette The Washington Post

AAR Calls Out Amazon in Hachette Dispute, From a statement sent by Association of Authors Representatives to Amazon.

And if I was only going to read one account of this dispute, I’d chose this one by Mark Coker, founder of Smashwords and early champion of ebooks, who believes in the vitality of a diverse writing and publishing world: Amazon’s Hachette Dispute Foreshadows What’s Next for Indie Authors

I’ve heard Coker speak on several occasions, and he’s a keen observer of a complicated landscape and future. His predictions on publishing tend to be right. In this post, he explains that the conflict centers on “agency pricing,” and who gets what profit margin for ebooks. Amazon is demanding a greater share. Here is what is at stake, says Coker:

“Books represent only one of hundreds of layers of icing on the cake of Amazon. Amazon can lose money on books while still operating a profitable business. Pure-play book retailers – Kobo and Barnes & Noble for example, must earn money from book sales. Unlike Amazon, they don’t have the financial resources to sell books at a loss forever…If Amazon can abolish agency pricing it will have the power to put its largest pure-play book retailing competitors out of business. This will make the publishers even more dependent upon Amazon, which further weakens their power.”

That’s the bad news. The really bad news, according to Coker, is that next they’ll come after Indie authors, just as they have in their audio book division, Audible. Gone are the 70% margins for authors that the agency model protects. Instead, exclusive Audible authors get 40% while the non-exclusive rate is 25%.

Coker winds up with with advice for independent authors, who, he says, are “the future of publishing.” It’s well worth reading the details in his article, but here are his main suggestions:

1. Choose your partners carefully.
2. Favor retail partners that support the agency model.
3. Avoid exclusivity.
4. Support a vibrant ecosystem of multiple competing retailers.

Remember the vibrant ecosystem of multiple competing book retailers? Though it is on the ropes, it’s not yet extinct. That’s worth thinking about and will be the subject of my next post.