The Amazon/Macmillan fracas: the flaw in both arguments

As many of you know by now publishing world giants Amazon and Macmillan fired salvos at each other over the weekend, resulting in authors, pundits, corporate captains, and the public tossing about comments, criticisms and invectives.
To synopsise, as I view it, Amazon had its corporate knickers in a knot over Macmillan’s pricing policy (eBook prices over $9.99.), and yanked Macmillan’s titles from their online catalogue. Macmillan responded, as did its authors and the world, that Amazon exercised unreasonable and predatory practices.
Last I looked we lived in a free market economy. That means Amazon can do whatever it pleases within the law. Amazon does not have to capitulate to corporate demands. Having said that, Amazon very much has to please its patrons, or face an economic decline of their own. Most often pleasing customers means having good selection, good service, and good prices. For the most part, you have to admit Amazon delivers on all those counts. Their cutting of retail prices has only benefitted book-buyers.
Has Macmillan passed those basic consumer tests? Sure, Macmillan has an enormous range of books on their list. Customer service – well, that’s a bit difficult to determine, given they deal on the corporate level, not the consumer, for the most part. Good pricing – ah, now here is the core of this entire dust-up.
Macmillan insists eBooks should be priced similarly to mass-market paperbacks. Strange, I don’t see printing costs, shipping, warehousing, or most of the usual publishing expenses factoring into the determination of a retail price of an eBook. Once an e-Book is formatted correctly, that data is uploaded to your distributor or retail partner. That’s it. Product delivered. Once and forever.
Given the economics of eBooks, one would have to say its Macmillan who practices predatory practices. And in this matter I feel I have some credibility to speak to the issue, given I am a publisher, albeit microscopic by comparison to the giant that is Macmillan.
Now, unless Amazon’s taking a huge piece of that $9.99 retail price, as in beyond the customary 45-55% wholesale discount, there’s enormous room for profit there, more so than print. It would seem, however, that extra margin of profit isn’t enough for Macmillan. Like every other corporate hog they’re bellying up to the consumer trough, whining about piracy, and eating themselves out of credibility and a place at the publishing table.
And while the noise in the sty reaches critical levels, the ones this whole issue truly affects, the consumer, the avid reader of all things, will find other ways to obtain the material they desire. Piracy will increase. Predatory pricing will increase. The indie, micro and small presses will be given a second glance simply because in order for us to gain entry to the banquet we price our product reasonably, so that consumer, retailer, author and publisher all benefit. And in the end we all enjoy the bounty of the board.
My great-grandmother had a saying: pigs should be seen and not heard.
Barbeque anyone?

1 Comment

  1. Lorina, as I understand it, it's Amazon who wants to fix the price at $9.99; Macmillan wants the prices to be flexible, fluctuating from about $14.99 (coinciding with hardcover release) to $4.99 or $5.99 in response to demand or time or other considerations. But you're right, it's ultimately the consumer who will decide what they're willing to pay, and how they'll get the books they want to read.

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