Thursday, July 31, 2014
Amazon Deliver A PR Bomb To Hachette?
The problem with any open confrontation is that often things that were really said in public have a habit of rising to the surface and becoming public. Public Relations people then try to put them back into the box, or rationalise the issues, but often the damage is done, or the public’s perception has changed. Propaganda is a powerful tool when communicated effectively.
Today’s standoff between Amazon and Hachette is becoming increasingly visible to the public. Some would say that the majority of book buyers are more concerned about getting the right price and service for themselves than they are about the trading terms between publishers and retailers. This makes sense and for many it is as if this battle is taking place on another planet. But then we introduce the emotive strings and issues that attempt to sway opinion. Not many care about the plight of the main protagonists, but introduce the authors and that changes things a bit. One side infers that authors are being exploited, and the other also says that they are being exploited or harmed by the action. Some would suggest that the author is are mere pawns in this battle.
We now have Amazon making a public statement ‘Update re:Amazon/Hachette Business Interruption’.
The statement is logical from Amazon’s perspective and makes arguments for lower ebook prices, which reflect the reduced usage rights, plant and distribution costs. They suggest a price point of 9.99, but also recognise some books will cost more. They put forward their revenue model split between themselves, publishers and authors and then say we’ll give you 70% and you guys can sort it out the division between yourselves. They argue that lower prices increase volume sales which in turn create greater revenues for all.
What Amazon have subtly done is drop a PR bomb into the publisher lap. They have questioned the royalty paid to authors, knowing that their suggestion is higher than what publishers gives. They have started to make the public more aware of the differences between the usage rights costs and pricing of ebooks, and in doing so promote themselves as consumer champions. This interestingly moves the debate into the public arena and starts to set the public argument and seize the public initiative.
Can the publisher respond effectively and seize back the propaganda war, or will they aim to muddy the waters and strike back with a fresh angle of attack?
What we are seeing can only benefit two people in the end, the author who will demand more and whose case is being strengthened by the day, and the public who will get cheaper books as the ebook RRP comes under pressure. Will it benefit Amazon over others, or will others benefit from the stance taken by Amazon? Will others step in and try to broker a deal or will Amazon simply and suddenly capitulate knowing that they have already scored their points and leave the fight for another day?