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Publetariat Dispatch: Amazon vs. Small Indie Booksellers

Publetariat: For People Who Publish!

In today’s Publetariat Dispatch, we offer a roundup of opinion on Amazon’s moves into publishing and its sometimes aggressive moves in the marketplace.

There’s been much commentary about Amazon’s new KDP Select program, as well as about its one-day price comparison app promotion, some of which we’ve been sharing here on Publetariat. The debate rages on, and now branches out into the question of the impact programs like this and mega-bookseller Amazon have on small, independent booksellers. Surprisingly, there are well-considered arguments on both sides.

Independent Bookseller Bob Spear quotes from an open letter American Booksellers Association CEO Oren Teicher, written in response to Amazon’s one-day, bricks-and-mortar price comparison app promotion:

Despite your company’s recent pledge to be a better corporate citizen  and to obey the law and collect sales tax, you created a price-check  app that allows shoppers to browse Main Street stores that do collect  sales tax, scan a product, ask for expertise, and walk out empty-handed  in order to buy on Amazon. We suppose we should be flattered that an  online sales behemoth needs a Main Street retail showroom.

Forgive us if we’re not.

We could call your $5 bounty to app-users a cheesy marketing move and  leave it at that. In fact, it is the latest in a series of steps to  expand your market at the expense of cities and towns nationwide,  stripping them of their unique character and the financial wherewithal  to pay for essential needs like schools, fire and police departments,  and libraries.


Over on Slate, Farhad Manjoo  takes the controversial position that buying books on Amazon is better  for authors, better for the economy, and better for you, because (in his  opinion) small, local booksellers aren’t really doing consumers much of  a service by comparison:

…I was primed to nod in vigorous agreement when I saw novelist Richard Russo’s New York Times op-ed   taking on Amazon’s thuggish ways. But as I waded into Russo’s   piece—which was widely passed around on Tuesday—I realized that he’d   made a critical and common mistake in his argument. Rather than focus on   the ways that Amazon’s promotion would harm businesses whose demise   might actually be a cause for alarm (like a big-box electronics store   that hires hundreds of local residents), Russo hangs his tirade on some   of the least efficient, least user-friendly, and most mistakenly   mythologized local establishments you can find: independent bookstores.   Russo and his novelist friends take for granted that sustaining these   cultish, moldering institutions is the only way to foster a “real-life   literary culture,” as writer Tom Perrotta puts it. Russo claims that   Amazon, unlike the bookstore down the street, “doesn’t care about the   larger bookselling universe” and has no interest in fostering “literary   culture.”

That’s simply bogus. As much as I despise some of its recent tactics,   no company in recent years has done more than Amazon to ignite a   national passion for buying, reading, and even writing new books.


In a rebuttal to Manjoo, on Flavorwire, Judy Berman explains why she feels he’s giving small booksellers short shrift:

I find it sad, actually, that Manjoo — a generally sharp and smart   technology writer — finds clicking around on Amazon to be more fun than   browsing the shelves of a real-life bookstore where (gasp!) one might   actually interact with other book lovers. It also seems specious to   argue that Amazon customer reviews are more useful than the advice of an   independent bookstore employee or owner, who presumably has more   knowledge of and enthusiasm for literature than your average unknown   dude typing angrily in his parents’ basement. A bookseller, for example,   would probably not opine that Jane Eyre is “a longer story of 456 pages in which really could have been written well in half the length.”


Mark Coker believes the KDP Select program is wholly predatory, and bad for authors, publishers, and booksellers alike. As he writes in his blog post on the matter:

Impact on authors:

  • Forces  the author to remove the book from sale from the Apple iBookstore,  Barnes & Noble, Sony, Kobo, Smashwords and others, thereby causing  the author to lose out on sales from competing retailers.
  • By  unpublishing a title from any retailer, the author destroys any accrued  sales rank, making their book less visible and less discoverable when  and if they reactivate distribution to competing retailers
  • Makes  the author more dependent upon Amazon for sales.  Do you want to become  a tenant farmer, 100% dependent upon a single retailer?  As some of you  history buffs may know, tenant farming, and the abuses of power by  landlords, was a primary contributor behind the great Irish potato famine.


Author LJ Sellers, on the other hand, feels her decision to offer some of her work through KDP Select was merely a formality since most of her sales come through Amazon anyway:

…I don’t want to see Amazon become a monopoly or have it be the only  place my books are available. I want readers to have choices. Still, to  survive financially, I may have to climb on board the Amazon train and  let go of the idea that I’m an independent author.

Two issues are on deck for me right now. First, is the lending library that everyone’s buzzing about and some are calling predatory. Amazon called me two weeks ago to pitch KDP Select  to me personally. Surprised by the contact, I assume it’s because I  have ten books on the market and sold quite a few on Kindle last year.

My only concern was the exclusivity issue, but in the end, I decided  to enroll two of my standalone thrillers. Which means I had to pull  those books from all other e-readers. I wasn’t making enough money on  them from any other sources for it to be a financial decision. My  hesitation was based only on my commitment to give readers full access  to my books.

But the promotional opportunity Amazon offered—a five-day giveaway of  the books—was hard to resist. The exposure could be invaluable. Right  now, The Suicide Effect  is being downloaded in record numbers. Because I have nine other books  for new readers to buy, this could turn out well for me. I’ll know in  the next month or so.

Bookavore examines the corporate culture and business practices of Amazon, as they trickle down to readers:

At this point I am thinking one or all of the following must be true:

  1. The company culture at Amazon is in some part developed on the  back of a scrappy underdog mentality that can only, given their current  dominance, be furthered by deliberate business decisions that allow the  company to feel like a misunderstood victim
  2. The marketing department has hard data showing that given the  general miasma of free market exhortation in modern political discourse,  consumers respond enthusiastically to offers that deliberately and  overtly screw over competition, in large enough numbers to make any  negative press a moot point
  3. This is all part of an elaborate campaign to make decisions that  compel Amazon’s competition and detractors to come out in numbers ruing  their predatory and unethical practices, which given the reactive nature  of the Internet will give Amazon’s defenders endless chances to label  the detractors as old-fashioned, elitists, nostalgia-hounds, and/or  Luddites, further cementing the “Amazon vs. the world” brand story
  4. Amazon has studied the possibility that they could make more money  long-term by gaining the loyalty of customers who would be swayed by  more ethical business practices, but has also realized it wouldn’t be  worth the investment




Amazon Strongly Supports Enactment of Enzi-Durbin-Alexander Federal Online Sales Tax Bill Called “Marketplace Fairness Bill”

If you’re wondering where Amazon stands on the collection of sales taxes for your online purchases, here’s the scoop. Amazon issued a press release yesterday confirming its support for federal legislation introduced this morning by United States Senators Richard Durbin (D-Illinois), Mike Enzi, R-Wyo., and Lamar Alexander, R-Tenn., known also as the “Marketplace Fairness Act.”

The bill would close a legal loophole that allows online retailers to avoid paying state sales taxes that brick-and-mortar stores must remit. But the bill exempts online retailers with less than $500,000 in annual sales.

Amazon has opposed legislation in several states to collect online sales taxes because of the complexity created by a state-by-state approach.

“Amazon strongly supports enactment of the Enzi-Durbin-Alexander bill and will work with Congress, retailers and the states to get this bi-partisan legislation passed,” said Paul Misener, Amazon’s vice-president of global public policy, in a statement. “It’s a win-win resolution — and as analysts have noted, Amazon offers customers the best prices with or without sales tax.”

Here’s the guts of Amazon’s press release:

SEATTLE, Nov 09, 2011 (BUSINESS WIRE) — Amazon.com, Inc. (NASDAQ: AMZN) today confirmed its strong support for the federal bill introduced this morning by United States Senators Enzi, Durbin, and Alexander, that would create a constitutional framework for collecting sales tax online.

“Amazon strongly supports enactment of the Enzi-Durbin-Alexander bill and will work with Congress, retailers, and the states to get this bi-partisan legislation passed,” said Paul Misener, Amazon vice president, global public policy. “It’s a win-win resolution – and as analysts have noted, Amazon offers customers the best prices with or without sales tax.” 

 If enacted, the Enzi-Durbin-Alexander bill will allow states to require out of state retailers to collect sales tax at the time of purchase and remit those taxes on behalf of customers, and it will facilitate collection on behalf of third party sellers. Thus, this bill will allow states to obtain additional revenue without new taxes or federal spending and will make it easy for consumers and small retailers to comply with state sales tax laws.

Is It Apple Forcing Down Apple’s Hardware Prices, or Amazon?

Apple’s Lower Prices Are All Part of the Plan,” ran the headline for an interesting piece yesterday by Nick Wingfield of the New York Times.


Wingfield believes that Apple, “once known as the tech industry’s high-price leader,” is carrying out a major strategy change to the point where it is now competing with, and often beating, its rivals on hardware prices.

I’ll have to admit that despite some interesting anecdotal pricing comparisons made by Wingfield, I’m not feeling him. Yes, Apple has certainly shown some signs that it is pulling back some on its hardware prices, and those prices could soon collapse by 30% or more due to forces entirely outside Apple’s control. We’ll get to that, but it is unlikely that such a collapse would reflect Apple’s strategy.

To conclude that Apple has a real commitment to competitive pricing in its corporate DNA, we’d have to see a lot more evidence of significantly  lower prices on mainstream hardware items like the iPad, the iPod Touch, and the various workhorse Macs (as opposed to boutique products like the MacBook Air or carrier-subsidized products like the iPhone.)

It could happen. But to suggest that Apple management will be in the driver’s seat applying the gas on such a strategic transformation is to ignore a number of powerful forces that leave Apple few options.

For starters, let’s look at the tablet market, which it is entirely fair
to say was created through the innovative brilliance of Apple and its
late leader Steve Jobs. The brilliant success of the iPad — both in its elegance and in its acquisition rate by the public — made fierce competition inevitable. So while iPad sales continue to grow dramatically quarter over quarter, iPad’s overall tablet market share fell from 95.5% a year ago to 66.6% in the third quarter of 2011, FierceWireless reported Friday. Nothing truly stunning there; it’s a pattern one could expect to see in any new market as it begins to mature.

A little more of a jaw-dropper is that the market share for the various Android tablets on the market — including devices from HTC, LG, Motorola, Samsung, Acer and Dell — grew from 2.3% to 26.9% in the same period.

Now, in the fourth quarter of 2011, the Android market share is likely to grow even more dramatically with the launch of the Kindle Fire tablet, priced at $199 and capable, Amazon clearly believes, of doing everything an iPad can do except for the things that only a few people really care about.

If the Kindle Fire hits the hardware sweet spot once people have it in their hands, it could quickly become the single most coveted holiday gift for smart grownups this year at that $199 price, and that price and popularity would constitute a very powerful if traditional pressure on the $499-to-$829 iPad price structure.

But there is another set of pressures forming just now that could totally pull the rug out from under iPad prices. As we reported last week in our post Interested in Trading Up for a New Kindle Touch or Kindle Fire Tablet? Pull Your Clunker In to Amazon’s Super Lot, Amazon is now investing website real estate and an aggressive marketing campaign to create its own secondary marketplace for virtually all tablets and ebook readers. If Amazon can succeed at enticing thousands of the customers whom it shares with Apple to trade in their iPads and iPod Touches for the 30% to 40% offers now on the Amazon website, those trade-in units could stake Amazon or its “Warehouse Deals” subsidiary to an off-price inventory that might, in time, create an entirely new form of downward pricing pressure on Apple.

What’s really going on here? Obviously, an important part of Amazon’s motivation is to give its customers as much incentive as possible to buy its latest-model Kindle Touch and Kindle Fire units, and regardless of what you paid originally for an iPad it’s a compelling proposition to be able to trade it in now for a brand new Kindle Fire and actually have money left over.

But there could be another mission for Amazon, one that could well influence the economics, the retail pricing, and perhaps even the share price for a competitor such as Apple over the next few years. It’s easy at this point to think that Amazon’s new two-way hardware market will be dwarfed in scale by Apple’s front-door production and retail power.

But Amazon knows better than anybody the effects that its Amazon
Marketplace secondary market for new and used books had on competing
booksellers and publishers over the past decade. Some in the publishing
industry believe that Amazon’s customer-friendly innovations actually
destroyed billions of dollars in corporate wealth
, even if it also
fueled tens of thousands of small and often home-based businesses.

“Some companies,” Amazon CEO Jeff Bezos is fond of saying, “do everything they can to raise prices for their customers. Other companies do everything they can to lower prices for their customers.”

It is clear that Amazon has always been the latter kind of company, and equally clear that Bezos feels that Apple has been the former kind of company both generally and in its activities with the Big Six publishers to create the “agency model” to fix ebook prices at higher levels than Amazon wanted to charge.

If Apple now seems to be in a state of transition from the former kind of company to the latter kind of company, it remains to be seen whether the transition is “all part of Apple’s plan” or, at least in some significant part, the result of an impressive array of economic pressures that Amazon’s innovations are bringing to bear on Apple.

Note: it happens every 90 days or so, and this afternoon Amazon will report its quarterly earnings after the close of the markets, with the usual conference call scheduled at 5 pm Eastern. Apple reported its earnings last week and apparently disappointed investors. Amazon may well do the same in the short term, but the company’s commitment to low margins could well be leading it to a promised land in which it could gain as much as 50% of the U.S. trade book market by 2013.

Amazon Announces Kindle Cloud Reader, Ready Now for Online & Offline Reading Anywhere With Safari on iPad, Safari on Desktop and Chrome

Introducing Kindle Cloud Reader
Read over 950,000 Kindle books in your web browser – no download or installation required
Based on HTML5, Kindle Cloud Reader optimizes for the platform you’re using and automatically stores your latest book locally for offline reading
Instant Books – no waiting for a download, start reading the book immediately, offline or online
SEATTLE, Aug 10, 2011 (BUSINESS WIRE) — 

(NASDAQ: AMZN) – For over two years, Amazon has been offering a wide selection of free Kindle reading apps that enable customers to “Buy Once, Read Everywhere.” Customers can already read Kindle books on the largest number of the most popular devices and platforms, including Kindles, iPads, iPhones, iPod touches, PCs, Macs, Android phones and tablets, and BlackBerrys. Today, Amazon.com announced Kindle Cloud Reader, its latest Kindle reading application that leverages HTML5 and enables customers to read Kindle books instantly using only their web browser – online or offline – with no downloading or installation required. As with all Kindle apps, Kindle Cloud Reader automatically synchronizes your Kindle library, as well as your last page read, bookmarks, notes, and highlights for all of your Kindle books, no matter how you choose to read them. Kindle Cloud Reader with its integrated touch optimized Kindle Store is available starting today for Safari on iPad, Safari on desktop and Chrome at www.amazon.com/cloudreader.


“We are excited to take this leap forward in our ‘Buy Once, Read Everywhere’ mission and help customers access their library instantly from anywhere,” said Dorothy Nicholls, Director, Amazon Kindle. “We have written the application from the ground up in HTML5, so that customers can also access their content offline directly from their browser. The flexibility of HTML5 allows us to build one application that automatically adapts to the platform you’re using – from Chrome to iOS. To make it easy and seamless to discover new books, we’ve added an integrated, touch optimized store directly into Cloud Reader, allowing customers one click access to a vast selection of books.”

Features of Kindle Cloud Reader include:


  • An immersive view of your entire Kindle library, with instant access to all of your books
  • Start reading over 950,000 Kindle books instantly within your browser
  • An embedded Kindle Store optimized for your web browser makes it seamless to discover new books and start reading them instantly
  • New Kindle Store for iPad is built from the ground up for iPad’s touch interface
  • Your current book is automatically made available for offline use, and you can choose to save a book for reading offline at any time
  • Receive automatic software updates without the need to download new software
  • Select any book to start reading, customize the page layout to your desired font size, text color, background color, and more
  • View all of the notes, highlights, and bookmarks that you’ve made on other Kindle apps or on Kindle
  • Sync your last page read across your Kindle and free Kindle apps so you can always pick up where you left off


Kindle Cloud Reader is available for Safari on iPad, Safari on desktop and Chrome starting today. Kindle Cloud Reader on the iPad is optimized for the size and unique touch interface of iPad. Without even leaving the app, customers can start shopping in the Kindle Store and will find a unique and immersive shopping experience built specifically for iPad’s Safari browser.

Kindle Cloud Reader will be available on additional web browsers, including Internet Explorer, Firefox, the BlackBerry PlayBook browser, and other mobile browsers, in the coming months.

Amazon.com customers can start reading their Kindle books immediately using Kindle Cloud Reader atwww.amazon.com/cloudreader.


It’s 7 pm EDT June 10, 2009 – Kindle DX Release Day – Do you know where your Kindle DX is?

Today is Kindle DX Release Day for Amazon, and anxious Kindle DX buyers have been checking their emails all day for those “Your order has shipped” messages. My DX will arrive tomorrow, and I am sure I will have impressions to share. Meanwhile, Engadget has posted a nice 29-photo gallery of an early Kindle DX unboxing, and Steven Levy of Wired.com has posted a balanced review of his test run.

Get your order in now and you can still get your Kindle DX this week with 1-day shipping.

Following a Successful Author’s Experience with New Publishing Technologies

Sunday afternoon

He calls it “A Newbie’s Guide to Publishing“, but don’t think for a moment that Joe Konrath hasn’t been to Night School. As I have already discussed in the Kindle Nation newsletter, Joe is my eye idea of an author who is working hard at connecting with his base of readers. As a direct consequence, that base is expanding by leaps and bounds.

Most recently, due in part to some nice symbiosis between Joe and Kindle Nation, “his” novel Serial has soared to the #1 bestseller position, among 290,000 Kindle books, in the Kindle Store. (Why the quotation marks around the word “his”? Because Joe’s the human behind the Jack Kilborn pen name.)

Joe is also the successful author of the Jack Daniels suspense-with-an-edge series, hold the garnish and the little umbrella, that began with the 2004 publication of Whiskey Sour.

If you are an author or independent publisher who wants to learn how to work the new technologies to find your readers, here are two suggestions:

Kindle Blog headcount approaches 5,000, but … Readers? That’s another story

The explosive growth of the Kindle Store’s Blog selection, following the launch of Amazon’s Kindle Publishing For Blogs Beta Program about ten days ago, continues apace. We’re approaching 5,000 as I post this morning, up from about 1,500 prior to the beta:

Of course, nobody knows if any of the new blogs are gaining any traction, since — because of Amazon’s convenient 14-day free trial for all Kindle Store blogs and other periodicals — they won’t show up in publishers’ sales reports until at least 14 days after they go live. I can tell from my Amazon Associates report that a couple of hundred people followed the link in my New Kindle Blogs for Your Consideration post to check out the page for this blog, but that doesn’t tell me if any of them were moved to click for the trial once they got there. We’ll see. What we can tell — based on the fact that no Kindle blog ranks in the top 18,000 titles overall in the Kindle Store — is that nobody, not even Ariana, is living in the lovely world envisioned by the GeekMBA360 post to which I linked a few days back:

Let’s say that you can attract 5% of the overall Kindle user base, which is 50,000. The total monthly revenue from your blog would be $100,000. Amazon will get $70,000 while you get $30,000. You get paid at a rate of $0.6/user.

To put it another way, my considerable experience with the relationship between Kindle Store sales rankings and actual units sold says that there are fewer than a handful of all Kindle blogs that are currently averaging more than 1 or 2 sales per day. I wish I could put this more sweetly.

There are various reasons for this:

  • On the way to becoming the upload society we may have forgotten, or left ourselves without sufficient time, to continue fulfilling our responsibilities as the download society. It’s just another wrinkle in that old curveball epitomized in the widely observed notion that we have more poets than poetry-readers.
  • Blogs, they’re just not that into you. Blog reading isn’t nearly as big a deal as book reading for most people, or, more precisely, for Kindle owners.
  • Then there’s the one that makes you say “Duh,” or, perhaps, if you are a Kindle blogger, “D’oh.” Blogs are free everywhere else but in the Kindle Store, and you can get them pushed to your Kindle via the services that work with RSS feeds and other aggregation processes. While I have tried to make the case that it can be convenient in various ways to have them pushed to your Kindle in something close to real time, it would be insane to think that people will beat down the doors of the Kindle Store to pay for something that is free everywhere else.

Maybe there’s one more thing that we as Kindle owners and readers can influence in a positive way. While it is true that the 14-day trial takes the financial risk out of checking out a blog in the Kindle Store before we invest 99 cents a month, that does not address the perhaps more significant risk that we might waste our valuable time reading stuff that we don’t care or need to read.

Unfortunately, there is little for us to go on in terms of the kind of reader feedback that often helps us connect with interesting or distinctive or simply very good work among books in their Amazon store incarnation. As of this morning when I took the above screen shot, as you can see, there were only 221 customer reviews for all of the 4,915 blogs in the Kindle Store. There’s a customer feedback system that is not working.

So, I suggest that we as Kindle Nation citizens might want to exercise a bit of civic responsibility rating and writing brief reviews of blogs on their Kindle Store pages when we have something to say about them. A couple of lines, or a couple of minutes, is really all it should take. You’ll find a link to read or write reviews near the top of any blog’s detail page, just below some pithy line such as: “The Kindling point for thousands of Amazon Kindle owners.”