Who's this handsome man?

Would the last bookseller out please turn off the lights?

So apparently, Waterstones has decided that capitulation is the only honourable choice, that or the chain’s upper management have been smoking some really rocking shit. The details are yet to be released, but from the sounds of the arrangement, Waterstones and Amazon will have a deal whereby you can buy books via your Kindle in-store from Amazon, presumably allowing Waterstones an affiliate percentage (or vice versa) for arranging the sale.

[Quick edit to add: unless they really are expecting you to purchase a specific Waterstones-labelled ereader and shop on that (presumably for those who’ve not yet taken the software/hardware plunge). In which case, well, everything below will only happen the quicker..]

I appreciate, in all seriousness, that MD James Daunt is “selling reading”, and that this is an attempt to keep his chain (and bookselling in general) relevant in a digital age by offering, effectively, what Amazon is exceedingly poor at - “curation”, presenting to the customer things they might want that they never knew existed and making it easy to find good stuff.

But - and I’m not the only one by any chalk to think similar things - given that ebook sales are rapidly overtaking print (albeit print, especially for big, colourful non-fic - photo and fashion books, some types of text books, etc. etc., though the iPad-only ibooks will and are making inroads here too - won’t die out completely), and given that you have to sustain massive amounts of very expensive town centre real estate and staffing costs, it seems insane, totally, utterly, insane, to say: “Sure, we’ll accept only making x% on what we would’ve had from the dwindling print sales to feed from a growing portion of electronic ones that are, nevertheless, cutting our existing sales base off at the knees, while you work on figuring out how to better curate your own content so we won’t be needed, and in the meantime we’ll make it seem more ordinary to buy via your hardware until we exist only as a sort of vestigial showroom storefront, commercially and financially fucked, while you kick on into the future.”

Obviously my own opinion is showing through there. I doubt anyone actually said that when Bezos invited Daunt to the Death Star and told him to turn or be destroyed, but I imagine that will turn out to be more or less the gist of the deal.

Waterstones isn’t B&N, it doesn’t have its own hardware and ebook storefront known across the land and beyond as the Other Place to buy books. It’s sold the Sony ereader for a few years (though I’ve never noticed much push for a matching online storefront, however much I’m sure that one exists), and presumably that experiment tanked. The management - and if, as that profile of Daunt suggests, he’s kept most stores open and encouraged, in a few at least, a return to the more independent buying habits of the pre-hub days, he’s to be applauded - clearly see the future as being primarily digital. It’s just a shame that they seem to have settled for slowly turning the company into something between a living museum and a UK customer service front end for Amazon while all the money-making happens out the back in the parent organisation’s HQ inside a hollowed-out volcano. Shaped like a skull.

“I’m selling reading,” says Daunt, who shares my view that, from many perspectives, this is a golden age for the consumer. “We have to insinuate ourselves into the process, and we have to be seamless.” On closer examination, “seamless” turns out to mean persuading Waterstones customers to choose an e-reader (and ebooks) through a Waterstones-sponsored device. Daunt won’t say when this will happen – “it’s the bit we have to get right” – but it’s imminent. “We’ll be different from Amazon,” he says, with characteristic ebullience, “and we’ll be better.”

Huh. I see.

Amazon.com, for all its glory, is one of the least transparent companies in the market. Shareholders aren’t even entitled to know how much stuff it sells, namely they have no clue, from the company, as to how many Kindle eReaders and Kindle fires are sold. Sure enough, the company quite often repeats that these are the products that sell the most; that they are seeing growth; that - and this is said often - they like what they see. But no concrete numbers are put forward, and at times there are pretty obvious clues that the truth is very far from the optimism expressed by management. This is one of those times.

To put it short. The Kindle eReader has dropped out of bed. It has fallen beyond the wildest dreams of Amazon.com’s management. They never told it to the market, but this is reality. I have proof, and the proof is undeniable. The drop in Kindle eReader sales came with the introduction of the Kindle fire, and the cannibalization has been nothing short of stunning, massive.

— Sales of both the e-ink Kindle and, after launch, the Fire seem to have collapsed by at least 75% in the first 3 months of the year. Maths! (via Daring Fireball)

Why the Publishers Association should walk the plank

Via @david_hewson (and I know, before we start, that my views and David’s are very different on the subject, but that’s totally cool), we have a Bookseller piece in which the Publishers Association - an organisation surely in need of an apostrophe - calls for the fight against piracy to be escalated and for “authors to press the case against copyright theft”.

Incoming PA president Little, Brown chief executive Ursula Mackenzie said the PA needed to “ramp up” the fight against piracy “or to give it another name, theft”, and use authors to explain to consumers the amount of work that goes into the creation of published books.

Let’s dismantle this a little. The PA spent £196k on “anti-piracy measures” in 2011 - which may or may not be lobbying expenses and legal fees (DRM charges would be per-publisher, not for the association) - and recently welcomed the wholly empty ISP blocking of the Pirate Bay.

No surprise, then, that the incoming president trots out the old “piracy is theft” line. It’s not, and let’s be clear about that. If someone puts a copy of one of my books up for torrenting (or on Scribd or on Usenet) - and please, someone do; it’ll mean they’re being read - they haven’t deleted the original from existence, preventing it from being bought and enjoyed by other users. This is unauthorised copying. It’s a rights breach. It’s not stealing. It might impact my income (though that’s debatable, as we’ll see), but it doesn’t directly take money from my pocket and prevent me earning more through the sale of goods. It doesn’t even come close.

It also, crucially, doesn’t force anyone else to download that book. This isn’t the Napster era and there can’t be anyone alive in the developed world who isn’t aware that torrenting such a file is piracy. If they choose to do it, they know very well what they’re doing. Sure, they may justify it to themselves because the owner of the rights makes ridiculous money off them, or because the legitimate price is too high, or because they’re “trying before buying”, or because it’s a way of striking back against censorship of the internet.

But it’s their choice. Their responsibility. This is a crucial point, I feel, not only in piracy discussion but also in so many other areas where extra legislation and court mandates rule. Banning “happy hour” promotions in pubs, for instance, may make it more expensive for youngsters to drink themselves into violent, puking oblivion, but only enabling or educating those same youngsters to recognise that seeking said oblivion every Friday night might make you a bit of a twat, and making twat-free alternatives viable, is ultimately the only thing that’ll stop it. (I learned by doing, as many of us do.) Personal responsibility, no?

And if you then say, “But most people can’t be expected to do the right thing, not even most of the time” then you’re basically giving up on society and you should probably go and live in a cave somewhere. Some people will always be twats, and some people will always pirate everything they consume, but the trick is to ensure these remain a comparatively harmless minority.

Aside over - though we’ll touch on this later. Roll on.

The piracy argument is laced with assumption and very dodgy statistics, the former on both sides and the latter predominantly on the side of the “copying is theft” crowd. For example, in 2010 “copyright protection company” Attributor released a widely-publicised ‘study’ claiming that ebook piracy in the US “cost” nearly $3bn, with an average of 13,000 illegal downloads per book. (They assume $10 average sales price, so some elementary maths tells you that we’re dealing with 21,538 titles.)

$3bn. Wow. A lot of cash.

(If you don’t want to bother seeing how maths destroys this type of estimate, skip the bit between the horizontals.)


$3bn is a lot especially when you realise that the actual ebook market in 2010 was $900m globally, ~$750m in the US. That’s an 80% piracy rate. Endemic. And the result of all this terrible piracy? The ebook market grew by over 200% in 2010, and continued to explode afterwards, even though piracy hasn’t become any harder between then and now (despite court cases and blocks, the closure of MegaUpload et al., file-sharing sites continue to proliferate like mushrooms and blocks are trivially easy to circumvent; while, conveniently, often making it impossible to identify the user doing the pirating). DAMN YOU, PIRATES! We’d have sold $10bn worth of books in the US in 2011 if it hadn’t been for your horrible ways.

Of course, Amazon has a 90-60% market share. In 2011, sensible vague customer estimates (since Amazon rarely release actual figures) would put Kindle sales for the same year at 10-12 million units, plus iPad (40 million in 2011, but not everyone uses the Kindle app) and, to a much lesser extent, phone users, minus those upgrading from one Kindle to another, or buying as a present for Christmas (4 million of those Kindles were sold in Q4) as they’d make few book purchases in 2011, and minus those iPad/phone types who also own Kindles, which for gadget heads is quite a lot. Let’s call that an assumed buyer base of around 25 million on a market of US$7.5bn.

If piracy equates to lost sales, and the piracy rate estimates were accurate, each user would actually want to be buying $300 worth of books per year from Amazon. Since average bestseller prices are no longer the $10 assumed in 2010 but are probably more like $5, that’s 60 books, or 1.2 books per week for the average reader.

But wait! 35% of ebook buyers account for 48% of market spending. That’s 8.75m users spending $3.6bn, or $411 per year each, or ~82 books per year, 1.5 per week, every week, all year-round. The other 16.25m users spend $3.9bn, $240 each, 48 books, or still just under a book per week. Every week. For a year. If they only buy from Amazon and don’t also purchase print books or, for those not on Kindle, books from other sources.

Multiplying up for all those $0.99 ebooks and adding in all the freebies Amazon and others offer and ohholyfuckingshit you guys with Kindles must be reading all the time, even if 80% of what you’re reading is pirated.

Or maybe the pirated books aren’t read on Kindles because pirates can’t be arsed with USBing files across, in which case the potential userbase rises and pirates would only likely have to read one book every couple of weeks. Still: voracious, voracious readers those pirates.


Skipping past all the maths and the assumptions and the rest, piracy estimates this high suggest that without piracy, the ebook market would have (easily, depending on whose figures you believe) eclipsed the print market in dollar terms last year. Despite having an actual market base that’s much smaller in terms of people with ereaders vs. those who rely on print.

Clearly, high percentage estimates are woefully inaccurate, as you’d expect for figures put out by people who make their money “fighting piracy”.

Going lower, the Fail suggests - unattributed - that 20% of ebooks are pirated.

This number, though seemingly plucked from the Mail’s arse, can only be more accurate, but ultimately, does this even matter? (Especially when if we’re talking 2011 figures, 20% piracy applies to 20% of the market, or 4% of overall sales. And especially when there is equally vague counter-evidence that heavy pirate consumers of media tend to be higher than average paid consumers of that same media. And before you scoff that that idea, bear in mind that despite “rampant” ebook piracy, the US market alone - others are coming from further back and growing faster - rose $600m in 2010 and $900m in 2011.)

There’s an assumption in talking figures that pirate downloads = lost sales. This is utter presumptive trash and has been dismantled at length in many better places than here. Some of those downloads equate to sales that might have been made, but every single straw poll conducted of people who routinely download stuff suggests they do so because (a) they believe they’re entitled to free stuff because it’s on the internet innit, or (b) the legitimate price is outside what they’re willing to pay, or (c) they’re not sure they’d like it anyway and don’t want to risk the cash and/or have never heard of whoever or whatever it is and want to have a look-see at it, or (d) whatever it is isn’t available legitimately where they are. (With the optional - there’d be a lot of overlap with the others - addition of a smaller fifth category, (e), who are sick of being treated like fucking criminals - via DRM, those “YOU WOULDN’T STEAL A CAR” ads, etc. - by content producers when they do legitimately purchase something when, famously, the pirated version usually strips all that garbage out.)

(A rejoinder to those ads and similar measures, incidentally, is that they’re like running a supermarket where you follow every customer around. Every time someone picks something up from a shelf and puts it in their basket you yell: “DON’T STEAL THAT! I’M WATCHING YOU! NO STEALING!” And, in DRM terms, then refusing to allow them to cook anything with those ingredients if the meal also involves food bought from somewhere else.)

Of those, only (a) are likely to include a significant number of lost sales. (b) can’t afford them, (c) wouldn’t take the risk on an unknown and (d) can’t buy. Note also that a person can be any combination of those four or five categories at various different times.

(a) are mostly children of the post-Napster internet generation. Which also means that they’re capable of using a search engine. Which means that they are capable of bypassing any IP block or user address log, attempt to chase one download provider offline (since another always crops up), and find DRM-cracked versions of whatever you’re selling. And the more you try to stop them, the more of a game you make of getting round it. Trying to stop these people pirating your stuff is akin to stopping people taking drugs by making them illegal. They don’t, frankly, give enough of a shit to care.

Most of the time.

This here is where our responsibility and education kick makes its return. There’s an assumed entitlement among some internet users - the (a) types, mostly - that because information should be free, so should any and all data and content. We already know how widespread the assumption of the cheap production value of an ebook versus a print book is, and how inaccurate it is. When people can see how great the human effort, time and passion put into a digital product is, they are more than willing, if they like what you’re doing, to throw money at it. If you don’t believe me, I suggest you never, ever visit Kickstarter because it’ll blow your mind.

Professional authors, by and large, do a good job of this. We blog, tweet, write at great length about the time and effort that goes into what we do. But we’re hampered because a lot of other authors do it for nothing (or at least nothing more than a hope and a dream). The difference between both types and what they do is very small if anything; after all, we were all unpaid and unpublished once. The difference is the input from publishers, and publishers don’t, to my mind, do anything like as good a job of explaining their part of the process. A handful of editors and PR people tweet, a smaller handful blog, but there’s a distinct corporate whiff about a lot of it - how often do you see your publicist enthusing about a book from a different publisher they’ve read and loved? - and it does little to explain the chain in human terms.

My last book, for instance, had one writer (yo!), one editor to fix it, one PA to that editor to handle a lot of the chatter between me and her, one freelance copy-editor, four professional proofreaders, one graphic designer, an unknown number of typesetters and layout and formatting cleverpeople, an unknown number of printers for the hardcopy version, and a further unknown number of other people who handled it from one part of the chain to the other, and one publicist to help sell it. Some of these people probably didn’t know much, if anything, about my book specifically, but some/many/all of them love writing, love books, and are both passionate about what they do, what they give to the reader, and also rely on that passion to continue to eat and pay the bills. But, with some exceptions, publishers rarely push that to the fore and humanise the job they do. They present as a brand, a corporate entity, and frankly, who gives two shits about one of those? I wonder how much education for our category (a) types in this regard £196,000 per year would buy you.

The answer to piracy beyond education is simple in my opinion. I’m going to borrow a quote from Jonathan Coulton, though I’m tempted just to mass paste half that entire blog post because it makes a massive amount of sense. It’s this:

Make good stuff, then make it easy for people to buy it. There’s your anti-piracy plan.

While (a) needs reminding that the makers of stuff are people too, and that either will or won’t work on them, (b) can’t afford it (easily), (c) isn’t sure they’d like it, and (d) can’t get it. You make your stuff affordable, make it readily and easily sample-able, and you make it available as widely as possible (and then don’t complain when people outside the catchment area you’ve given it acquire it illegally), and you sweep away a lot of the reasons for people to yoink stuff off the net.

Stop treating your regular customers like criminals - and doing that is a lousy incentive to bring people back into the legitimate fold, let me tell you - and making bullshit statements in support of easily-circumvented blanket legal measures which only make the tech-savvy types they’re targeted against more determined to give you the finger. Acting like your readers are hiring your books, not owning them, makes you - as a publisher, or a distributor - look like a tool.

For comparison, I downloaded a non-fiction tech guide from O’Reilly (OREILLY? YA REILLY! oh ho ho) a week or so ago. (For free, in this case.) As with all their books, I can download it in a bunch of different formats, as much (IIRC) as I like, and swap it between devices however I fancy. It’s also had an update and I’ve been emailed to say if I want to read the amended version I can download it again. Go me! (I’ve not actually done it because it’s too much hassle for my purposes and I’m not too worried by whatever changes there are; but it’s nice to know the service exists.) While I was aware of O’Reilly before this is the first time I’ve downloaded something from them, but I would happily do so - and pay for whatever it was - again in future because, hey, that’s good.

Let’s borrow from another ebook piracy post with a better title than this one that’s also worth reading:

Let’s talk about video games for a minute. In the last decade or so, game industry giants have implemented increasingly ridiculous DRMs to protect against piracy. This, of course, doesn’t work even if the DRM in question is a good bit harder to crack than the pathetic worthless shit that comes with ebooks (so you can imagine just how effective ebook DRM is, which is not at all: the average end-user can remove it without hassle). There are times when the DRM becomes so ridiculous that a game may be boycotted. EA and Ubisoft are especially notorious for this.

EA and Ubisoft have both removed DRM from some of their games. Why? Because, unlike the publishing industry–which appears to be populated mostly by tech-illiterate fact-phobic baboons (who often can’t even keep their ebooks free of formatting and typographical errors)–they realize the crucial, simple fact that they need their customers more than their customers need them. They need the goodwill of gamers. No matter how high-budget and hyped your AAA blockbuster title is, there will be other high-budget AAA titles… or even lower-profile but polished indie titles. Or free-to-play MMOs. Gamers are spoiled for choice and much of the mainstream stuff is fairly interchangeable, in much the same way that Voinov’s output is interchangeable with other sweaty sagas of identikit men who rape other men into true love, and likewise with all the paranormal romance, all the Dan Brown-esque “thrillers”, all the gritty grimdark fantasy. Readers have options. Writers are nothing if not disposable. Stop writing and only a handful of hardcore fans will give a shit. The rest of the world will move on to whatever it is that they want to read. There are so very many books released every month, a great deal more than games.

We are not, as writers, and consequently as publishers, entitled to earn money for what we do, any more than anyone else, especially in arty fields where worth is measured not in terms of raw materials and necessity (because in arty fields, necessity hovers around zero) but in terms of enjoyment. We’d like to, and I sure hope I can continue to do so myself, but the world doesn’t owe me or you or anyone else in publishing just because. It so happens we do pay, traditionally, but traditions change and tradition is a lousy argument for the retention of any practice. But while we’re certainly not entitled to reward, we can do what we can to make those who like what we do feel like we’ve earned that reward.

And that starts, not in the courts, but by not treating the very people you want to like you as though they’re crooks or cattle.

If you ask legacy publishing’s defenders, “Which is the monopoly: the entity that charges high prices and pays low royalties, or the entity that charges low prices and pays high royalties?”, you’ll be told by those defenders (tortured logic to follow) that of course it’s the latter.

Further to the last, Barry Eisler continues to give Amazon a reach-around with a succession of bizarre leaps of logic.

The answer to the above question, incidentally, is “neither option is relevant to the first part of the question”. It’s like asking “which is the monopoly: the company whose boss drives a blue car, or the one whose boss drives a red car?”

The correct answer is, of course, the one which is the only supplier (or, stretching the strict definition for practical reasons) more or less the only supplier, of a particular commodity. Which in this case is ebooks, and if Amazon regains the market share lost when Apple offered a sweeter deal to publishers, it’ll almost certainly be them.

In the meantime, the publishing establishment wants you to believe that in order to prevent Amazon from possibly one day charging higher book prices, the establishment has to charge you higher prices today.

No, the publishing establishment wants you to believe that in order to prevent Amazon from possibly one day paying its suppliers less to keep prices low with the risk of putting those suppliers - the publishers - out of business, the establishment has to try to stop the slide to bargain basement price demands and deals based thereon (though as the maths I did the other day suggest, they have more room for wiggle than they sometimes let on).

Amazon, as Charlie Stross correctly points out, is also on its way to being a monopsony, exactly like Tesco (and the other top few supermarkets) as Nick Harkaway says.

Whether Amazon’s monopoly or near-monopoly and monopsony position, should it regain it (and eyeing the DOJ lawsuit and grumblings in the EU it seems quite possible they will) will lead to exactly the sort of supplier-squeezing fuck-you demands supermarkets routinely make “because people expect low prices” is a matter of opinion and conjecture, and Barry’s entitled to that as much as the next person. He’s right that publishing has been, and largely continues to be, slow to innovate. Right, too, that DRM is bad - though as Stross points out, Amazon has been by far the biggest winner on that score - and right that industries change over time.

But he’s wrong to couch arguments in terms of the money paid for or from ebooks, with Amazon existing as a glimmering beacon of hope in an expensive, poorly-paid authorial wilderness, with everyone else the grasping, greedy claws of the grey-suited “establishment”, because even ignoring the fact that he - and plenty of others who’ve done very well out of Amazon - have become shiny-eyed evangelical mouthpieces for the Great New Way and the language reflects that, those terms are often irrelevant (unless you’re asking “who will currently pay you the most royalties and generally charge the lowest prices (if you accept their weird-ass contract)?” in which case, rock on).

Amazon’s undoing, or the source for most competition, might prove for instance to be its own KDP offerings. To borrow from Stross’s remarks to Macmillan on DRM, “Amazon’s inclusion of masses of self-published material in the Kindle store has made it impossible for heavy consumers to browse it effectively.”

And that lack, just as everything else - monopoly position, author squeeze, more books, fewer books, etc. - could or could not happen regardless of which company pays the most and charges least, or which one sprays liquid customer service from every golden orifice, or which one tickles your private bits with a delicate feather while you shop.

KDP: licensed to ill

While we’re talking Amazon, and while Apple and publishers are locked in somewhat ludicrous court battle over agency pricing and collusion (as if they needed to collude to agree that Apple’s long-standing standard practice was more attractive than Amazon’s shit-on-a-stick; that’s another argument for another day), let’s get legal for a moment.

This isn’t going to turn into an Apple vs. Amazon post - really - but I need to mention this for context. A while ago, when iBooks Author was released, half the internet briefly took up arms against perceived wrongs in the iBooks licensing agreement, believing, wrongly, that it enforced a single-point-of-sale rule on books listed through iBooks. Apple quickly amended the license to emphasise that the restriction applied only to .ibooks files created with iBA, and the controversy died.

But what of Amazon’s license agreement for Kindle Direct Publishing? There certainly hasn’t been the same level of uproar over it - indeed, most KDP authors seem happy with their terms. Odd, this, because it’s a very strange beast.

Most of us know about the “Matching Competitor Prices” rule in the KDP pricing terms. The rule has changed somewhat over the past year; it used to be a rule in the license itself that you guaranteed not to list something for sale cheaper anywhere else, and if Amazon found you had they could drop the price to beat it.

(As per this similar dissection of the agreement, the old version of Section 4 was:

You must set your Digital Book’s List Price (and change it from time-to-time if necessary) so that it is no higher than the list price in any sales channel for any digital or physical edition of the Digital Book.

But if you choose the 70% Royalty Option, you must further set and adjust your List Price so that it is at least 20% below the list price in any sales channel for any physical edition of the Digital Book.

That clause has since been dropped.)

It all happens now in the new section 5.3.2:

To the extent permissible under applicable local laws, we have sole and complete discretion to set the retail price at which your Digital Books are sold through the Program.

You provide a list price, but if Amazon need to sell cheaper “to match a third party’s sales price for any digital or physical edition of the Digital Book” they can do so. (Whether or not this affects your royalties depends on whether it was a 35% (it doesn’t) or 70% (it does) royalty book.)

So what exactly is a “Digital Book” as defined by this license? Apple very neatly confined their more draconian requirements to the .ibooks file created by their software. Is this something similar? (If you’ve never used KDP, you upload a .mobi or .epub file.) What’s Amazon’s take on this?

Badly defined.

This Agreement is a binding agreement … with respect to your participation in the Program and your distribution of digital content through the Program (all such content, “Digital Books”).

Content. But what, exactly, is the content by which a book is defined? If you sell a short story through Amazon for $0.99 (or for free via Amazon Select), and then include that same story in a collection at a higher price, does this give them leave to match the collection to the lower price? (Not that they need your permission, as the agreement makes clear, but they pay lip service to justifying such decisions in terms of competition with either other parties or other national versions of Amazon.)

(While we’re at it on content, let’s not get into the business of their actual content guidelines, which make the recent Smashwords erotica kerfuffle look tame. (And again I’d point you to the third part of the ePublish a Book article for why it’s especially bad.)

To use an analogy, if you sold a regular, a Blu-Ray, and a collector’s super-special director’s cut special edition of a movie under the same terms, is the content the same? The latter two certainly share elements of the same content, but the Blu-Ray “contains” massively more data (which, if a film is a series of images means a lot more “movie”) and the special edition has all sorts of extra material. In both cases the content of what’s on the disc is very different. Each, one might say, should be a different Digital Book under the license terms. What constitutes an “edition” of content isn’t defined.

(They might argue that both were different editions of the same thing, and with at least some justification - but my point is that the definitions they use are missing or totally inadequate. And open to abuse by Amazon, while if they monkey with your pricing it’s your earnings that take the hit.)

So far, so economics, and maybe I’m making too much of it. It’s not the weirdest part of the agreement, though. That’s this:

7 Confidentiality. You will not, without our express, prior written permission: (a) issue any press release or make any other public disclosures regarding this Agreement or its terms; … [a lot of stuff about Amazon Confidential Information which means, apart from anything else, anyone discussing their sales figures without prior written consent from Amazon is technically in breach of contract] … Without limiting the survivability of any other provision of this Agreement, this Section 7 will survive three (3) years following the termination of this Agreement.

This agreement, as previous linked, is a publicly available document. A publicly available document that its signatories are forbidden from discussing under what is effectively a lengthy NDA or face termination of their account (or, in theory if the expense was justified, legal action) if Amazon object at all because they’re breaching their contract.

(Yo.)

I’ve never had anything like that in a contract I’ve signed with a publisher. There’s no such clause in the contentious iBooks Author license. Quite why it’s in here in the form it is… well, I’m baffled. I’m also completely unable to think of any happy, cuddly reason to have it there in any form at all.

(Bear in mind that this is an agreement which - in theory at least (I doubt it’d survive a court challenge) - can be changed for anything other than rights & royalties at any time, effective immediately, without Amazon needing to notify you directly; the onus is on the user to check the terms haven’t changed, and continual use of the program signifies acceptance of all changes whether you’ve noticed them or not.)

This is the glorious author-friendly, reader-friendly, digital future. Hooray.

Distribution in the Digital Age

In my post the other week, I wondered why publishers don’t set up their own distribution systems for ebooks to compete with Amazon and cut out the middle man. Yesterday, over a pie and a pint with @t0mbale, I got to talking about the same subject, and about Steam. So why should he be the only one to be bored with my ramblings?

Steam, for those who don’t know, is a digital sales and distribution platform run by game publisher Valve (creators of Half-Life et al.). When it launched it’s safe to say it was a total bag of shit, but they’ve improved it greatly down the years. They have the website version, and an application on Windows and Mac (which effectively runs as a sort of browser window with game-launching tied into it; you can’t run your Steam-bought games without running the Steam app itself). It started out as a way for Valve to release updates and mods to its games, but after launch they did deals with other publishers to sell some of their games through the Steam store. Now it accounts for between 50 and 70 percent of all PC games sales (maybe; Valve don’t release sales figures, so it depends on who you believe).

It has cloud achievement/status syncing, keeps records of which games you’ve bought so you can redownload them on a new computer wherever and whenever, and has a pretty thriving community and social system baked into it. (And various other things - and other issues - that don’t relate to what I’m talking about with ref to books here.)

Earlier this year, as I recall, EA, one of the world’s biggest games publishers, pulled its games from Steam (to considerable outcry from users) and announced that its next big releases would be distributed instead through its own ‘Origin’ digital store/application.

Basically, they’d seen how Valve were raking it in as middleman and decided that they had the clout to do things the same way but without paying a percentage. Gamers bitched about needing another account and application to run games, but Modern Warfare 3 will still sell a bazillion units.

So, let’s talk about books. We have three primary global digital distributors, all of whom play middle-man. They are Amazon (the 800lb gorilla), Google Books (the underfed colobus monkey) and iBooks (the tiny rhesus macaque). (B&N is the US-only Colorado spider monkey*, but since I’m not American I’m going to steer clear of them here.) All of these services - I admit I don’t know for certain what the deal with GBooks is, but I’d be surprised if it wasn’t the same - take a percentage in return for selling books - unless you’re a publisher which hasn’t arranged an agency contract with Amazon, in which case, uh, sorry; tough shit.

Amazon has realised that it can help itself to a bigger slice of the pie by doing away with what it sees as another middle man and becoming a publisher in its own right, both through KDP and its newly-launched imprints. They’re by far the biggest distributor, and their aggressive price-shafting of publishers would suggest they’d rather publishing houses became rump editing services and no more. (Valve, back to our analogous cousin in the game publishing industry, already produced its own stuff and hasn’t shown any interest in putting other people out of business.) Google and Apple haven’t, to my knowledge, show any signs of doing that; they’d like their percentage cut, and to sit back and rake it in.

Now, publishers have, for a long time, sold their own books and ebooks through their own websites. However, no one reading a book has, in the main, any clue or interest in what imprint produces it. And no one looking to buy a book is going to go first to, say, the Penguin website to find it. Their first stop will be Amazon, or B&N if they’re a spider monkey fan, or maybe the Book Depository if they’re after hardcopy. Or else they’ll fire up their Kindle app on their phone and browse and buy direct.

A publisher is not a consumer brand, in exactly the same way, back when, that Valve wasn’t a brand for games, and even EA realised it needed a separate store brand name.

So why hasn’t one of the big publishers decided to take the plunge and launch a Steam-like store service (either for just its own books, or open to third parties), with cross-platform apps - which should be easy enough to write, given that they’re primarily database handling - with the same syncing as Kindle and Google Books and whatever, maybe even the Goodreads-like in-app social side, and offer a higher cut, say 85%, to third parties (if it was open to them; if they went Origin rather than Steam they’d get 100% because it’d just be their own) than Amazon, and push it to consumers?

For starters, they’d face a huge commercial risk to start with, because to make such a service a success, they’d have to pull those digital books offered in the store from Amazon (at very least). They’d have to treat it rather like the launch of a new imprint with a bunch of titles by big-selling authors, apps and digital infrastructure that worked properly to start, then market them heavily to consumers. Make sure they start with a bang and rely on future sales and their much bigger percentage income to make back that advertising spend. This, in an industry where many big publishers didn’t even have useful websites a few years ago, would be a massive, and let’s be honest, unlikely leap.

They would also need to be sure they could offer hardcopy versions for shipment via the same app - quite possible, since in the past many publishers have run their own web store either on their own or in partnership with wholesalers or retailers (not least, in the past, with Amazon) - perhaps even with a system similar to Gardners’ Hive (which effectively wholesales books through local indie bookstores), because the moment anyone pulled an EA on Amazon’s network, or even threatened to, from past behaviour I would imagine that Amazon would delist that publisher’s books, as they have with Hachette and SMP over commercial disagreements in the past.

It would be the ultimate game of chicken, but it’d also be the only way publishing will ever shake off the lingering threat of Amazon and properly get to grips with the ebook age themselves, to free themselves from having their income stream increasingly controlled by one entity.

(Unless, somehow, GBooks or iBooks start claiming a bigger share of the pie themselves, and that seems unlikely; unless iBooks becomes as cross-platform ubiquitous as iTunes (which it won’t; iTunes had the same march on everyone else in music that Kindle does now in books) or Google suddenly start spending ad money to push their service on Android, which they won’t - even Chrome has only recently started to see ad money thrown at it. We can forget about either of these services hitting Amazon, I think.)

(Unless unless a big publisher piggybacks GBooks, say, and offers Google exclusive books by major names, basically using them as the exclusive distributor I postulated earlier.)

Dave suggested that any publisher who did launch their own exclusive book service would open themselves up to monopoly or price-collusion investigations, but I don’t think that’s right. Valve haven’t, EA aren’t; as the producers of what they’re putting out, it’s up to them where and through whom they sell their stuff and which option seems to them to offer them the best commercial return.

It won’t happen - or else it’ll happen too late and too half-assed - and in ten years we’ll all be writing books in the Amazon-branded post-apocalyptic wasteland by the light of oil drums full of burning celebrity biographies. But it’d be nice to think it could.

* I’m making this one up.

Edit: The mighty Ed Champion conducted a similar thought experiment a couple of years ago, too.