tag:blogger.com,1999:blog-35428618.post7006314856947812051..comments2024-01-20T00:59:08.689+00:00Comments on Brave New World: How Do We Compete With Amazon?Martyn Danielshttp://www.blogger.com/profile/02134633193540004531noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-35428618.post-79786645290774817532014-03-12T05:33:11.168+00:002014-03-12T05:33:11.168+00:00Interesting post. Yes, how does a small publisher...Interesting post. Yes, how does a small publisher deal with the heavy and controlling presence of Amazon? It is a bit scary that they can not only set percentages at will, but also set the selling price of audio books at will. <br />It will be interesting to see how this plays out with regard to narrators, as well as independent authors, who may not get anything back for all their work.<br />Perhaps an indie supporter such as Smashwords is for the written word, will come along for the audio book world. One can hope, or the current cycle of plentiful audio books will take a nosedive soon.Karen Wolferhttp://www.dogearaudio.comnoreply@blogger.comtag:blogger.com,1999:blog-35428618.post-79789140774394670952014-03-11T19:53:50.419+00:002014-03-11T19:53:50.419+00:00Unfortunately, I agree with most of your analysis ...Unfortunately, I agree with most of your analysis (and have blogged about it from a small publisher perspective on http://newlibripress.blogspot.com/).<br /><br />As a former Amazonian myself, I have a respect and fairly good understanding of them. Yet, as a tiny publisher I rail against them. <br /><br />My thoughts in the past have been around the "spin the flywheel" concept that Amazon utilizes, but to jump on your Amazon the river analogy, the river is mighty, but perhaps more fragile than someone at the end of the river delta might assume. Amazon's success is in part due to all the tributaries (in the flywheel metaphor they all add to the momentum of the flywheel). But the weakness (IF there is one) is the razor thin margins they operate on. The stock market/investors have been remarkably sanguine on Amazon and patient beyond belief. That too is a weakness. A series of stumbles MAY cause some rethinking on that. <br /><br />Still, just like the Amazon rainforest and the river system, it can take significant abuse and bounce back. But, it is not immune. As various tributaries are damaged, the entire system suffers. <br /><br />The white knight will be various NON-PUBLISHING tributaries getting hurt. Walmart is still larger (and more profitable) than Amazon and they have not given up on online yet. Netflix is still fighting for video (and the cable companies are not completely asleep) and various companies are partnering with Google. But, as you point out. Careful what you wish for!<br /><br />Just as authors (and I do that also) "wished" for easier access to the marketplace and the ability to simply compete--then many (and you simply do not hear too much from the "silent majority") realized that competing against hundreds of thousands in the market place itself is not necessarily easier than competing to get INTO the market place. A whole new set of skills is then needed.<br /><br />Long winded way of saying, good blog post.Stanislav Kasl Fritzhttps://www.blogger.com/profile/16260321391511260419noreply@blogger.comtag:blogger.com,1999:blog-35428618.post-68305046447364213002014-03-11T14:19:17.758+00:002014-03-11T14:19:17.758+00:00One of Amazon's strengths (that's also a w...One of Amazon's strengths (that's also a weakness) is its royalty payment scheme. Amazon pays less, often significantly less, that other ebook retailers. Those underpayments are enough that rough calculations suggest that, once costs are covered Amazon is using its market share to make about twice as much profit per sale as anyone else. It's all in their mislabeled download fees and complex variable royalties.<br /><br />Consider these common possibilities:<br /><br />1. 99 cent ebook. Amazon pays about 35 cents. Apple pays 70 cents.<br /><br />2. $2.99 ebook. Depending on the number of illustrations. Amazon might pay about $1.60 after that download fee. Apple pays $2.10.<br /><br />3. $19.99 textbook. Amazon pays $7. Apple pays $14.<br /><br />Note too that Amazon can send their lawyers after authors who set an ebook price for Amazon that gives them same royalties as that book gets on Apple.<br /><br />I know, it's hopeless to expect anything honest out of our current DOJ. But you would think that some enterprising lawyer, perhaps even a state AG would go after Amazon for this, particularly given its near monopoly position in ebooks. It'd be a slam dunk and might help open the ebook market to businesses in their home state.<br /><br />And you'd think that Apple might pull the same trick Amazon pulled with the DOJ lawsuit against it and encourage a talented and aggressive legal firm to go after Amazon on this one.<br /><br />The combination of a 70+% market share--over twice that of all it's competitors combined-- along with a 'most favored' restriction on pricing, and a royalty payment scheme that often half that of the rest of the market, should make for a powerful case.<br /><br />We also shouldn't forget that authors are being more than a little foolish here. Since Amazon sells more ebooks than its competitors, that Amazon check is going to be larger than any of the others. But it's not the check size that matter. It's the per-sale payment.<br /><br />And while they're waiting for the lawyers, authors could, at the very least, encourage fans to buy from other ebook retailers. <br /><br />Inklinghttps://www.blogger.com/profile/05272203500649628022noreply@blogger.com