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What Is The Authors Guild’s Endgame in Its War With Amazon?

In case you’ve been living under a publishing rock for the past few weeks (and, seriously, who hasn’t? They have great wifi!), a number of groups, including The Authors Guild, Authors United, and the Association of Authors’ Representatives, have taken up arms against Amazon. (Yes, that’s a staggering number of “A”s in one sentence. Damn the torpedoes! Full alliteration ahead!)

A lengthy letter has purportedly been sent to the Department of Justice in the wake of last year’s contract dispute between Amazon and publisher Hachette, calling for the DoJ to investigate the online retailer for “derail[ing] the benefits of a revolution in the way books are created and sold in America” among other things. Never mind that Amazon was at the forefront of the revolution in question.

There’s an excellent dissection of these organizations and their motivations in this article on TechDirt. I think it’s pretty clear, despite having “Author” so prominently in all of their names, that these groups truly have only a small number of actual authors among their constituency. Namely, those authors whose interests align with the Big 5 publishers.

The Authors Guild states, on a page devoted to the Hachette dispute (bolding mine):

It is to protect this value of books that we have spoken out against Amazon’s tactics in the Hachette dispute, its monopoly in the book market and its unfair treatment of independent authors. At the same time, we have also challenged the major publishing houses to revisit the parsimonious stance they’ve taken on authors’ e-book royalties. Though the Amazon-Hachette dispute was resolved in November 2014, the issue of fair compensation for authors remains a central concern.

Again, never mind that Amazon attempted on three different occasions to compensate the affected authors during the dispute. Saber rattling is an effective tool for drowning out logic, isn’t it?

Interesting is the attempt to include and welcome Indie authors under the AG’s umbrella of its actions. Indies have been vociferous in their defense of Amazon against the AG et al. They see a window of opportunity with the recent change to the Kindle Unlimited payout method, which has had many Indie authors up in arms. Maybe the AG is looking to boost its membership since they begrudgingly agreed to start admitting Indie authors who can successfully jump through a number of barrier-to-entry hoops.

But that can’t really be their endgame in all this. So, what do they hope to accomplish? Lee Child offered some insight in a comment on The Passive Voice blog recently:

The end-game I would like to see is a gentle nudge to remind them [Amazon] to behave like a fabulous retailer – equal and normal (by all means tough, combative and adversarial) treatment of all book suppliers, without the weird Gazelle Project agenda in the background, which is explicitly designed to bankrupt incumbent players to Amazon’s advantage.

The Gazelle Project he refers to comes from a book published in 2013 by Brad Stone, called The Everything Store. In it, Stone described Amazon’s attitude toward small publishers.

Mr. Bezos said Amazon “should approach these small publishers the way a cheetah would pursue a sickly gazelle.” A joke, perhaps, but such an aggressive one that Amazon’s lawyers demanded the Gazelle Project be renamed the Small Publishers Negotiation Program.

Many would view that as harsh, or ruthless, but those qualities are also often admired in business circles.

Child also says, in another comment from the same blog:

This isn’t about how Amazon treats products, or my book vis-a-vis yours. This is about a specific antitrust obligation that says a dominant retailer who chooses to also become a competitor must henceforth negotiate within an altered framework when dealing with a pre-existing supplier of now-competing goods.

The competition he refers to isn’t Indie authors, but rather Amazon’s own imprints — subsidiaries operating as essentially autonomous publishing companies in their own right — which include Thomas & Mercer, 47 North, and Montlake Romance, among others. These subsidiaries seek out and acquire books in much the same way that other publishers do, although, by all accounts, they offer much better contract terms to their authors than the standard New York fare. Child’s argument, or worry, seems to be that because Amazon is a direct competitor, as well as the largest single retailer, that their dealings with the Big 5 and other, smaller publishers, falls into a different category than it did before 2009 or 10 when Amazon started establishing itself as a publisher.

The concern is a valid one, I think, and something worth looking at, but if that is what the AG et al are really after, why not say that?

Here’s the list of main concerns from the Authors United letter to the DoJ from July 13, 2015:

In recent years, Amazon has used its dominance in ways that we believe harm the interests of America’s readers, impoverish the book industry as a whole, damage the careers of (and generate fear among) many authors, and impede the free flow of ideas in our society.

    • Amazon, to pressure publishers over the past 11 years, has blocked and curtailed the sale of millions of books by thousands of authors;

    • Amazon, during its dispute with Hachette in 2014, appears to have engaged in content control, selling some books but not others based on the author’s prominence or the book’s political leanings;

    • Amazon has used its monopsony power, and its ability to threaten punishment, to extract an ever greater share of the total price of a book from publishers, which has resulted in less revenue to support midlist authors and certain kinds of books, effectively silencing many voices;

    • Amazon routinely sells many types of books below cost in order to drive less well capitalized retailers — like Borders — out of business. This practice, known as “loss-leading,” also harms readers by reducing the amount of revenue available for publishers to invest in new books.

    • Amazon routinely uses its market power to steer readers toward its own books and away from books published by other companies;

    • Amazon dictates pricing to self-published authors, requiring them to price their books within a specific range or be subjected to a 50 percent cut in royalties.

Six items there, the first five of which are directly related to how publishers and Amazon’s competitors are treated by the company, with authors only obliquely mentioned. The last bullet point, about how self-published authors should price their books sold on Amazon, neglects to mention that the “50 percent cut” still comes out to be about twice the royalty offered in the standard Big 5 contract to their authors. Point five hints at Mr. Child’s objection, but is more of a complaint about unequal advertising and promotion rather than concern about how the company treats with someone who is a competitor as well as a supplier.

The last several paragraphs of the letter drone on about Amazon somehow controlling the flow and content of ideas on the Internet (really?) and ends with:

…no temporary price cut can compensate for the costs to free expression and the health of America’s book industry that have resulted from Amazon’s abuse of its dominance in the world of books. Accordingly, we respectfully request that the Antitrust Division investigate Amazon’s power over the book market, and the ways in which that corporation exercises its power, bearing in mind the very special constitutional sensitivities that have historically been applied to any business that has established effective control of a medium of communication.

Price. Amazon is pricing books, and more specifically ebooks, too low for the tastes of AU/AG/AAR/ABA/and all the other “A”s (read Big 5 Publishers). The biggest book seller on the planet, who got to that position by selling books at lower prices and making more money for publishers and authors in the process than they’d seen for the previous two decades or more, has somehow become the bad guy to several groups who claim to have the best interests of authors at their heart. Come again?

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But let’s get back to my original question: what’s the endgame? What outcome do Authors United and the Authors Guild see as a benefit from the DoJ presumably finding Amazon guilty of some, or all, of the nonsense they proposed?

The two antitrust cases I can find that even remotely correlate to this (one of which AU mentions in its letter) are Standard Oil and AT&T. In both cases, the government decreed the break up of the companies in question into several smaller companies. In both instances, however, years later, through mergers and acquisitions, the end results were nearly the same as when the whole process started. Technology disrupted the phone industry and Exxon eventually gobbled up many of the Standard Oil pieces to become one of the largest corporations in the world.

If Amazon was broken up into a number of smaller companies, would that enable and foster more competition? How would that even work for books? Would they propose splitting it up by fiction and nonfiction? Maybe by genre? I know! Let’s have a separate store for each section of the Dewey Decimal System!

Coming back to pricing, which we must because that’s the real cornerstone to the house of cards the AG and AU have constructed, control, and even fixing, is the desired result here. They can’t come out and say that, of course, because price fixing is illegal and is essentially what got the Big 5 in trouble, in cahoots with Apple, a few years ago. Publishers regained some control over pricing in this last round of negotiations with Amazon, resulting in higher prices for many ebooks and subtlety denoted by Amazon on its site by the “price set by the publisher” appellation which now appears on thousands of books. Evidently, whatever control they wrestled away from Amazon wasn’t enough, otherwise I’m sure Hachette would be quietly advising Doug Preston to pipe down and go sit in the corner.

The bottom line is: all these people want you, the reader, to pay more for books. And especially ebooks. Because reasons, and logic, and, and, and because they said so, dammit!

My personal take? Don’t trust any group with the word “Author” in its name. None of them speak for all, or even most, of us.

Preston Responds

In the last blog post I wrote a letter to Mr. Preston and Authors United, which I also emailed to the contact address on the AU website. Surprisingly, to me at least, Doug replied with this: (Note, I’m posting these because I don’t believe he said anything in the emails that he wouldn’t have said publicly anywhere.)

“You’re making the situation far more complicated than it is. We’re simply asking Amazon to stop hurting authors and impeding the sale of their books as a negotiating tactic. We’re not for Hachette or against Amazon. We’re not taking sides. We’re not for or against cheaper ebooks. We have made no statement on book pricing.

We have every right to protest Amazon’s targeting of 2,500 Hachette authors, driving their sales down and hurting their ability to support themselves through writing. Amazon is hurting writers, Mr. Tucker. It’s that simple. Your justification of why it’s okay for a gigantic corporation to hurt writers to gain advantage in a dispute with another large corporation is a steaming pile of sophistry.”

I replied: I do sincerely appreciate you taking the time to respond, but I’m left wondering if you read the letter.

You absolutely have every right to protest Amazon. I in no way dispute that. In fact, I understand it. I said as much in the letter.

Nowhere did I bring up ebook pricing. Hachette has every right to ask whatever they want for the books they sell. That said, anyone can refuse to buy the books if they feel the price is too high, including Amazon.

Would you prefer it if Amazon simply removed all of Hachette’s books from their store until the dispute is resolved? Because I can’t see any way for Amazon to get Hachette to negotiate a new contract that doesn’t harm those authors. If you can, I’m sure a lot of people would like to hear it. You dismissed Amazon’s three different efforts to remove the injured authors from the equation, but offer no alternatives as to what would be acceptable besides just agreeing to Hachette’s terms. How is that not taking sides?

I don’t have a horse in this race. Honestly, it would probably be better for me, personally, if the dispute continued ad infinitum. But I also care about my fellow authors and frankly, they are being shafted by Hachette and the other large publishers far worse than anything Amazon is doing. I understand my saying so isn’t going to change your mind, but I wanted you to know where I’m coming from.

To his credit, Doug replied again: I appreciate you taking the time to contact me as well. I think we just see the issue differently. Amazon is the one that leveled the sanctions on us—not Hachette. That’s the bottom line. Of course Amazon, one of the largest companies in the world, has negotiating tools at its disposal besides hurting authors. For one thing, they have an outsize voice, hundreds of millions of loyal customers, and a respected corporate brand. The offers Amazon made were entirely disingenuous and lopsided, which would have devastated Hachette financially without affecting them much. Why should we help Amazon load its guns against Hachette?

I didn’t bother responding again because it would have been a complete waste of my time. The delusion is complete and pervasive.

This interview/debate with Authors Guild President Roxana Robinson and Bloomberg Contributing Editor Paul Kedrosky is more proof of that. Her refusal to acknowledge that books are products, coupled with her bristling at the term “special snowflake” shows these people have absolutely no understanding of the world outside their own sheltered bubbles. Publishing is an entirely different experience for them than it is for the rest of the writing community and we have no common frame of reference it seems to even have a discussion.

Books — all literature — are an art form and a vehicle of entertainment. As such, they are no different from movies, television shows, games (be they card, board, or video), sporting events, music … the list goes on and on. All these things are consumed to occupy leisure time. They all have their place and their fans and none deserve special attention or government regulation or subsidies. If the writers of Authors United can’t accept this basic premise, how can we — much less Amazon — ever hope to have a reasonable discussion with them?

A Letter to Doug Preston and Authors United

Dear Mr. Preston, et al,

You don’t know me. Still, I feel like we have something in common: we love books.

I’ve been a voracious reader ever since I was a little boy. I read detective stories, science fiction, and fantasy novels by the hundreds. While I haven’t read any of your books, I have read many of the writers listed in the Authors United letter and I’ve greatly enjoyed the vast majority of those. I feel confident in assuming that they, too, love books. I’ve found it’s a largely universal reason why writers write.

Yet, it is here, with that very love of books, where the disconnect begins.

Along with loving books, you, Mr. Preston, also love your publisher — and why not? Your publisher has made your tremendous prosperity possible. In your shoes, I’m sure I would love and admire the entity that gave me such an opportunity just as strongly. If I felt they were being wronged, I would come to their defense, just as you have done. I understand your feelings and the actions that resulted from them.

What I don’t understand is this: equating books with publishers.

Why do I make that leap, you ask? Let me explain. The letter you originally penned claimed you were not taking sides in the debate between your publisher and Amazon, even though you only called on Amazon to take action to stop hurting authors. However, when Amazon made proposals to compensate the injured authors, the first of which MacMillan agreed to after their heated negotiations with Amazon a couple of years earlier, you dismissed them as being unfair to the publisher. You even called the idea “blood money”. Suddenly, the focus shifted from authors being harmed to the publisher. The underlying idea becomes what’s good for the publisher is good for the authors and their books.

Is that really true?

The big publishers have recorded larger profits for the last year or two. Random House even gave bonuses to all their employees because of the success of the Fifty Shades novels. Did authors get better terms in their contracts across the board? Was more money spent in marketing the slower selling titles because of the windfall publishers received from strong ebook sales at high profit margins? Were a larger number of new authors taken on to grow and nurture during this time of prosperity? The answer to those questions is no. You might point out that some authors, like yourself, received bigger advances for upcoming work and that is certainly true. At the same time, however, advances for new authors have shrunk to shockingly low levels. Would you sell your book to a publisher today for $5,000, paid over the course of a year or more? It would take more than twenty such advances to pay for the ad Authors United placed in the New York Times recently. Think about that. Twenty new books that those authors toiled over for months or even years. I submit that the economic gulf between you and the authors in harm’s way you purport to advocate for is much wider than you realize.

Mr. Preston, Amazon is a business. So is Hachette Book Group. This fact does not make either of them good or evil, sinners or saints. It simply means that both are trying to win a deal they feel is best for their company. End of story.

Now, I could ask you and your organization to use your influence and champion better contract terms, royalty rates, and accounting procedures for all authors from big publishing, but I won’t do that because it’s not a cause you believe in, as evidenced by your words and actions to date. What I will ask is for you to be truthful. Quit hiding behind straw men and come out and say what you really mean. The dispute between Hachette and Amazon is hurting your sales and you want it to stop. Accept your, and every other Hachette author’s, role as the child in a messy divorce case where there are no winners, only losers. Authors United has taken a side, despite your protestations of not doing so. Own it. By not asking Hachette to be equally culpable in settling their differences with Amazon, you have sided with your publisher. Your stance is emotionally understandable, as I stated earlier. Stop acting as if you’re championing authors everywhere by wielding your fortune and clout to rail against Amazon.

I love books. Books are created by writers, not agents or publishers. Certainly, editors, illustrators, and proofreaders can make a book better, but the book itself is written by a writer. Who, out of all the people I just listed, should receive the lion’s share of money from that creation? I think anyone who loves books will have a similar answer to that question.

I’ll say again, you don’t know me. I’m nobody. You’ll probably never see this letter, but if you do, I hope you’ll take into serious consideration some of the things I’ve said. Books don’t need publishers to exist, in fact, it’s the other way around. It seems to me publishers have forgotten that fact. Maybe you have too.

Sincerely,
Alan Tucker, Lover of Books
(written in response to the Publisher’s Weekly article “Authors United Preparing New Amazon Initiative”)

The Indie Authors’ Guild, or Cat Herding For Fun & Profit

Like thousands, or maybe even millions, of others, I received an email from Amazon explaining their side of their dispute with book publisher Hachette this morning. In it, Amazon tells us they’ve set up a website called ReadersUnited.com (I imagine in response to the “Authors United” group, championed by Douglas Preston, et al) and ended with a call to action of emailing the CEO of Hachette to voice our opinions regarding ebook pricing and two or three other issues.

I have my views about this dispute and have posted them here in the past, but I’m not going to talk about this latest salvo in the Amazon vs. Hachette heavyweight bout. More accomplished pundits than I will hash it out in blogs and forums over the coming days. And I have no doubt that you are capable of forming your own opinion regarding this latest letter and the dispute overall.

No, I wish to expound on an observation I made while reading initial reactions to this letter over the last couple of hours. (Time I probably should have spent outlining the back half of my next book, but the Internet is soooo SHINY!)

Until now, this debate has largely fallen along “party” lines. Established, traditional authors (like Preston, Patterson, and the signatories of the Authors United letter) have tended to side with Hachette, while the Indie rabble rousers (Konrath, Howey, and many others, who forged their own letter at Change.org) have tended to side with Amazon. On first blush, one might assume the Indie author group would, by and large, embrace this latest tactic of Amazon’s to reach out for support from the Kindle community.

That reasonable assumption, however, would be dead wrong.

In perusing my Facebook author groups, a blog post from the Passive Voice, and the first ten pages of comments from the Writers’ Cafe thread about this on the Kindle Boards, I saw a surprising diversity of reactions from my peers. On display were everything from abject apathy, to disgust, to disappointment, to unabashed outrage. Mixed in with these were also voices of support, both modest and wholehearted. After recovering from my initial shock at the huge range of opinions and emotions on display, my thoughts turned to another subject which has been bandied about in these same forums over the past several weeks and months: that of an Indie Authors’ Guild.

An organization calling itself the Authors’ Guild has been in existence for over 100 years, yet it is anything but what its title purports it to be. Often, it has been a mouthpiece for publishers, rather than authors, and is arguably more selective in its membership than the Augusta National Golf Club. Many Indie authors have expressed a desire for either the current Authors’ Guild to reform and allow Indies membership, or to create a new organization which is Indie friendly. Such an organization might provide legal advice, help in finding independent contractors for things like editing, cover design, etc., and be an advocate for the thousands of Indie authors if companies like Amazon or Barnes & Noble ever changed the terms of their distribution agreements to be less than favorable. All of these sound like laudable and worthwhile objectives.

Yet, I feel it’s workable in ideal only. After seeing the multitude of reactions today to Amazon’s plea — a company that has almost single-handedly given writers an opportunity to make money doing something they love and many never thought possible — how on Earth can anyone expect this diverse, opinionated group to come together to form a cohesive guild, union, or treehouse club? There’s not enough money in the world to pay someone to head up such an organization. You’d have more success herding ten thousand cats without the use of milk, tuna, or catnip. Every decision would be lambasted by some, lauded by others, and greeted with disinterest by still more.

I do think a directory listing site for those contracted services, along with some educational help for those new to self publishing, is doable for someone willing to put in the work to gather up that information, but I just can’t see a unified voice ever coming about for a group who, by definition, are a bunch of free-wheeling mavericks who march to the beat of their own drums.

What do you think? Is establishing a cohesive Indie Authors’ Guild an achievable goal? How would you go about it? I’d love to hear your thoughts.