Amazon, MacMillan, Now Playing Nice, Sorta…

(Amazon sounds like a spoiled little kid. MacMillan is sick of being told what to do. Amazon is ruining what goodwill it has going for it. Consumers just want simplicity.)

Did you ever agree to take your little brother and his buddy to the movies, in exchange for being able to go with that girl in your math class? And then you got into a big, raging fight with your little brother because he wouldn’t see the movie you and the girl wanted to see? Then you got so angry that you told him you weren’t going to take him. And then your mom or dad heard about it (I wonder how?), and you ended up giving in? But of course, that wasn’t the end of it. You spent the whole time, on the ride to the theater, in the lobby getting popcorn, and even after the show, going on and on about what a dork he was (among other insults)? Only later (albeit maybe 20 years) did you realize what a little jerk you were being?

Now read this, a message from Amazon:

Dear Customers:

Macmillan, one of the “big six” publishers, has clearly communicated to us that, regardless of our viewpoint, they are committed to switching to an agency model and charging $12.99 to $14.99 for e-book versions of bestsellers and most hardcover releases.

We have expressed our strong disagreement and the seriousness of our disagreement by temporarily ceasing the sale of all Macmillan titles. We want you to know that ultimately, however, we will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books. Amazon customers will at that point decide for themselves whether they believe it’s reasonable to pay $14.99 for a bestselling e-book. We don’t believe that all of the major publishers will take the same route as Macmillan. And we know for sure that many independent presses and self-published authors will see this as an opportunity to provide attractively priced e-books as an alternative.

Kindle is a business for Amazon, and it is also a mission. We never expected it to be easy!

Sound familiar? I don’t want to be too hard on Amazon, though. First, I buy a bunch of my books through their site. And I actually love some of their practices. The prices. The recommendations. The hassle-free shipping. The selection. The option to buy used version, or alternative formats like Kindle, hardcover, softcover, different edition, etc. I’m not much of a Kindle fan, but that’s not the point of this entry.

The point is that Amazon sounds just a little crazy in this press-release. (And to maintain the fighting brothers metaphor, you can read MacMillan’s side of the story here.) This is not about prices and customers. This is about power. This is about MacMillan’s willingness to assert some control over the pricing of its products. I can understand Amazon’s concerns and frustrations. It’s got to do something about the soon-to-ship iPads. Already, they’ve got Apple beat on eInk technology, battery life, highlighting, making notes, and content selection. But those are becoming less important as  battery life increases across the board, screen technologies improve, and Apple strikes deals with all the people who sell already with Amazon. One factor that will always be a factor is price. So, naturally, price is going to matter, probably forever.

What’s unfortunate here, for Amazon, is that one thing they have going for them that Apple doesn’t is a “relatively” pedestrian persona. Yeah, they put local bookstores out of business. And I mourn those losses. But $35 for a new hardcover book? And very difficult roads to finding used or out of print books? The book store model is predicated on something we’re not willing to pay for as local consumers. Amazon gives us what we want at a price we want it. Cheap books. Easy. Despite its entry point, so does the Kindle. And MacMillan threatens that. Both the “cheap” and the “easy.” On the flip side, Apple offers easy, but not cheap. Nor do they really appeal to the pedestrian (or female, or non-white). High design you have to pay for. Amazon? Quick, cheap, easy. But now, it might feel just a little more like you’re getting that deal from a petty, money grubbing, and bitter older brother.

Consider the early (and now past) effectiveness of Apple’s iTunes store. One song? $.99. An album? $9.99. A television episode? $1.99. Doesn’t matter who made ’em. You knew the price, and you could just buy what you want, rather than having to decide on content AND price. Now that Apple has the market share it wants, it has changed things a bit (dangerous). But not until after market share.

Weirdly enough we, as consumers at least, are attracted to simplicity. In a marketplace that bombards us with conspicuous and incessant advertising, competitive pricing, and constantly changing products, we’ll cling to almost anything that makes the whole place a little more simple. Hello iTunes. Hello Kindle books (well, sorta, if you’re into best sellers, anyway). And now, MacMillan threatens that.

What’s important here, I think, is the ways each of these companies reveals they way they seem themselves as players in the market place. How they see they power they each hold. The different ways they each miscalculate that power. They ways they talk about each other. I guess what frustrates me the most is that even when they’re ostensibly talking to us consumers, they’re using it as an opportunity to stick it to their competition.

All that does is leave us feeling like the older brother’s date who gets stuck listening to him complain, like EVERYONE complains, about their little brother. Who is starting to look like he’s gonna grow up to pretty good looking himself.

This article has 3 Comments

  1. You might be interested to read this take on it
    http://www.fastcompany.com/blog/kit-eaton/technomix/amazon-revealed-it-hates-you-and-it-hates-publishers

    Also, I think that it’s a shame that after your last post about people only being treated as consumers, that you bash independent bookstores in favor of the convenience of buying online. I would hate to see a city with no bookstores or music stores. They are more than merely a place to buy goods.

  2. Hey, Amanda. Thanks for the link. I read the article, and you’re right. It’s pretty interesting.

    I’m not sure that I agree with your characterization that I “bash” independent book stores. I actually like independent book stores. I buy from them locally. I attend readings they host. I buy coffee from them. My point in the last post is that this business model isn’t working. I spend several hundred dollars every year on books. I can usually save at least 30% when I choose amazon on a regular basis. That’s hundreds of dollars every year. And yet I still do choose to visit the small book stores and used book stores to make purchases. But the service they offer doesn’t warrant several hundred dollars out of my pocket every year. It warrants some, definitely. And I make sure to give them some business.

    As far as the producer/consumer distinction, I’m not sure I see the connection between the Apple post and Amazon/Independent bookstores. I can’t remember the last time I visited an independent bookstore to buy a self-published or handmade book. It may happen on rare occasion, but I don’t see it as part of an independent bookstore’s business model.

    I see independent bookstores as having real value in light of Amazon’s business model. And I think you probably do, too, given you comments. I’d love to hear what you think the primary value independent bookstores bring to a community. And what we can do, as consumers, to support them.

    Looking forward to your response. Thanks again for commenting.

  3. Our future may very well be shaped by the choices that we make as consumers. There are always hidden costs in a cheaper product. While these may not be immediately apparent to a consumer, they will eventually have an impact on you, your community and possibly future generations to come. I think of the food that I buy in the same way. The impact of supporting local businesses are multiple, but so are the impacts of not allowing huge corporations to drive those local businesses out. How are Amazon’s business practices, who do they employ, how do they treat their publishers/employees/customers? I personally know the owner and employees at my favorite bookstores around town, I like that. In addition, what Amazon is doing is essentially price fixing their books, many times at a loss – because they know that people will buy other things on their site. The way the market should work is that we let companies charge what the market can bare and the results come in the sales. Once a company like Amazon gets so big, these little gems that we call bookstores go out of business – because Amazon can push around the publishers. These little stores are not being greedy charging what they do, it’s out of necessity. Unfortunately, they can’t compete, and they become the casualties of the global marketplace, along with so many other unique and one of a kind businesses.

    I am one of those nostalgic folks, true. I grew up in a tiny southern town. Our local bookstore was the only place where you would hear or see a liberal thought for hundreds of miles. I used to go there every Sunday with my dad and I could just tell that there was something different and interesting about the people that worked there and the titles that they sold. There was a sense of an intellectual hub. Maybe children growing up in this little town today have access to the internet and so know about things that I never did. But to me, that place had vital importance (it was on the McSweeney’s 100! http://www.mcsweeneys.net/avail/ ) – and it went out of business recently, even though they worked very hard to stay relevant and provide something unique to the community. Unfortunately, I think these types of places will be missed when they are gone, but people simply don’t appreciate the fact that they are putting them out of business with their actions.

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