Round up #55: AMZN vs CA on The Daily Show, EU vs Agency Model

Round up #55: AMZN vs CA on The Daily Show, EU vs Agency Model

EU vs Agency Model

I’ve mentioned before that I’ve been a bit surprised that the Agency Model hasn’t been front page mainstream news in the USA.

It might have to do with it being about books. If the movie studios decided that all movie theatres were going to charge the same ticket prices…and by the way, raise the ticket price for popular movies to $20, I suspect we would have seen some stories.

So, it seems a bit ironic to me that the European Commission investigating the Agency Model was in the crawl on a 24-hour news station this morning and is featured in USA Today.

You know, because retail competition seems so much more European than American? Maybe it’s because books seem more European… 😉

Just kidding, but I would love to have seen the news selectors make reading a slightly higher priority here in the USA.

Instead, it may be class action suits that effect a change in the United States.

That, and the fact that I don’t think the Agency Model has been a particularly good thing for the publishers which have adopted it.  I think they may have been dazzled by the Apple’s promise of an iTunes for books and huge sales through that channel. Instead of the iPod, they’ve gotten the Newton. 😉 Okay, maybe that’s a bit of hyperbole, but iBooks hasn’t changed the digital landscape.

As the Fire has reportedly moved solidly into second place for tablets (although that’s a bit like like being the second best known bodybuilder in America to Arnold Schwarzenegger), Apple may have less influence.

If the publishers can have an excuse to get out of the Agency Model in the USA as a way to settle the class action suits without a litigative conclusion, they may go for it.

The Daily Show on Amazon versus California

I watch The Daily Show…well, every day. 🙂 It’s usually very timely, and I often see the actual news clip I want there before I see it somewhere else.

On the issue of collecting sales tax, they are late to the party, though.

The story (reported by John Oliver) is about Amazon using “direct democracy” to work to overturn a so-called “Amazon law” which would have redefined what a “nexus” is in California, compelling Amazon to collect sales tax.

That’s over. Amazon and the state reached a compromise, and Amazon is not pursuing that legislation any more.

I’m guessing that somebody has been pushing for this story in the writers’ room   for months…and it’s been pushed aside (darn dynamic Republic Presidential campaign). 😉

One of the people interviewed is John Burton, chairman of the California Democratic Party. Burton says some remarkable things that are thoroughly different than my understanding of equal collection legislation:

“Why the sh*t should Amazon skate when we have a state where we’re shutting down schools, shutting down hospitals, firing teachers, firing cops, firing firemen, screwing mental health people, because they don’t want to have a g*ddamn sales tax like everybody else?”

Okay, let’s back up here.

Equal collection legislation is not about having or not having a sales tax. It’s about whether the seller collects the sales tax at the time of sale, or the purchaser pays it later separately.

Since many consumers don’t pay the sales/use tax on their annual taxes, that’s why states want to compel retailers to collect it. You could just as easily swear about the people who shop with Amazon…they are the ones who are often failing to pay the taxes that are now on the books.

Prosecuting grandparents for not reporting and paying the tax on their Polident purchases isn’t very good politics, though.

Burton goes on to emphatically say

“My daughter gave me a Kindle for my birthday present and I will not use it because of these g*d damn people at Amazon.”

Burton’s comment continues through an um…colorful…illustration of where one might read a paperbook. That particular bathroom use can be done as easily with a Kindle, but that’s beside the point.

You can see the video here (following an ad):

http://www.thedailyshow.com/

Burton’s stated anger at Amazon seems misplaced. As I’ve reported recently (and repeatedly), Amazon supports a national sales tax policy.

Is Burton perhaps agitated because equal collection might be settled nationally rather than by California? Isn’t the point to get the sales tax so you can put those firefighters back to work?

Regardless, I love that Jon Stewart often promotes authors on The Daily Show…nice to hear the Kindle mentioned, even if it is in conjunction with a bodily function. 😉

Audio input on the Kindle Fire

One of my regular readers and commenters, Tom Semple, mentioned that the Kindle Fire might be able to have audio input (record or transmit) your voice. No, it doesn’t have a dedicated microphone, but by using a TRSS (no, no, not The Real Slim Shady…a Tip Ring Ring Sleeve), you can apparently record low quality sound. Tom and John Tobison (who has also made several comments about the Fire) have both reported success with that.  Tom tried Skype (which Tom had sideloaded), which would have allowed you to make phone calls with the Fire. Unfortunately, that didn’t work.

I really appreciate readers taking the time to comment, experiment, and report back. I also like you asking questions, of course, but I’m always happy to learn something new.

If you try this out, let me know what your results are.

E-book sales doubled in September, mass market paperback fade continues

The Association of American Publishers

http://www.publishers.org/

used to a nice job of putting monthly sales figures on their site. Now, I find that you can get them more easily somewhere else, like this

Media Bistro article

The headline for a lot of people will be that e-book sales doubled comparing September 2011 to September 2010, while adult mass market paperbacks (those are the smaller ones you see in racks in places like grocery stores, as opposed to the trade paperbacks, which are about the same dimensions as a hardback, except for depth) are down 54%.

No question: adult mass markets are rapidly losing marketshare to e-books. They were positioned as the cheap, more portable alternative, and e-books do both of those better.

I have thousands of MMPs…I can’t really say I’m feeling regret about this, though. Hey, I think I miss Ace Doubles more than most paperbacks. 😉

I think there may be an important message being missed in this data (which I recommend you read).

It may be telling us that the grip of the traditional publishers is slipping…it may be showing us a shifting away from the Big Six.

For a while, publishing was increasing over all in the AAP figures. This time, it’s down close to 6 and a half percent.

Does that mean people are reading less?

I would guess people are reading more…that’s certainly what I hear anecdotally.

I think it’s shifting away from the members of the AAP. Naturally, digital publishing is going to affect the sales of hardbacks and printed books more, which will hurt the traditional publishers more than it will affect others.

I can’t prove the hypothesis that these figures are showing that shift…I wouldn’t even say I can raise it to the level of a theory. We just don’t have good data on the independent sales to do a comparison.

It’s just my intuition. If it’s true, it will be interesting to see how the tradpubs respond…

What do you think? Is John Burton right to publicly excoriate Amazon? Does what you say on The Daily Show stay on The Daily Show? 😉 Will the European Union action have any impact on the Agency Model in the USA? Will you miss mass market paperbacks? When did you buy your last one? Should the next Kindle Fire Skype? Feel free to let me know…

This post by Bufo Calvin originally appeared in the I Love My Kindle blog.

8 Responses to “Round up #55: AMZN vs CA on The Daily Show, EU vs Agency Model”

  1. Bruce K Says:

    Its interesting that you grouped these two topics together because we need to ask the question: as a capitalist society, has Amazon helped the market, consumers and other companies?

    The answer appears to be a resounding YES.
    – Think of the amount of product that is produced and sold through Amazon. Product that produced domestically and on foreign shores. Products that are shipped, received and subject to tariff and import fees –mostly handled through western (including California) shores.
    – How much business has Amazon provided to UPS and USPS over the last 10 years?
    – How much have consumers benefitted from the competition and variety in prices and product.
    – How many small companies benefit from the exposure and infrastructure of marketing their product through the Amazon e-commerce portal?
    – How many independent authors and publishers are gaining traction and distribution that never could before.

    Its all about control and money. The California government (and all government) feels that they are entitled to a piece of every sale because Amazon is doing well. Forget about everything mentioned above. Forget that a national or California tax would greatly reduce my inclination to shop as often on Amazon. They don’t care, they are willing to reduce the oxygen going to Amazon in order to collect on the patient.

    What is California providing or paying for that warrants this tax?
    If products are made, taxes are sold. If employees are paid, taxes are paid.

    Similarly, the AAP doesn’t want a cheaper model. They don’t probably wouldn’t prefer to stop using paper, just like the automobile and gas industry don’t want another energy model. It reduces their control and hold on the economics of reading.

    • Bufo Calvin Says:

      Thanks for writing, Bruce!

      I think you’re absolutely right that Amazon has great for small business. Those Amazon Associates (something like ten thousand in California)? The state taxes their income.

      However, we need to be clear…this is not about adding a California or a state tax. Equal collection does not mean that anybody owes more tax…it’s about when it gets paid. We calculate our California “use tax” on our annual state taxes, and it’s a bear. I’d much rather have Amazon collect it for me.

      Since this is the same old sales tax that has already existed (just being paid more reliably), the justification for is the same as the justification for the sales tax you pay when you buy in a store.

      If the traditional publishers could have the same market share with e-books that they have with p-books (paperbooks), I think they’d prefer it… 🙂

  2. Lady Galaxy Says:

    I won’t miss mass market paperbacks at all. They were uncomfortable to hold and the print was way too small. I can’t even remember when I bought the last one. It’s probably been at least a decade or longer.

    My only fear is with their demise we may no longer get the reduction in price that sometimes comes when a book is reissued in paperback.

    • Bufo Calvin Says:

      Thanks for writing, Lady!

      It’s funny…I always loved the book…the words. I loved getting a mass market paperback, but not because it was a paperback. I always found them distressingly easy to degrade: I struggled to keep them in perfect condition.

      As to the “paperback drop”, I think what we are seeing and will see more will be possibly better. With the paperback model, you generally had to wait a year to see a drop…and what you got was of much lower manufactured quality than what you got if you bought it earlier.

      What we are seeing now is price that adjust based on demand. Take a look at books here:

      http://www.ereaderiq.com/pricewatch/

      Start clicking on the little blue graph symbol.

      You’ll certainly see some like this:

      _____________
      |
      |
      |

      That’s the single drop profile…right off a cliff. 🙂

      However, you’ll also find ones like this:

      ___ ___
      |__| | ____
      |___| |

      where the price has gone up and down and up and down.

      That may seem like a lot of work, but it can be done with algorithms based on the sales. Sales go down, price goes down…sales go up, price goes up.

      Services like http://www.ereaderiq.com become more important in that scenario…

      Basically, if you can wait for a book to come down in price after it is first released, you may not have to wait as long.

  3. Malcolm Northrup Says:

    Hi Bufo. My wife and I bought our last Mass Market Paperback (MMP) over two years ago when we she got a K2 and I got a KDX. When the agency model hit it became even less of a need because then the Indies began to make inroads and prices were (and still are) mostly $3.00 or less.
    I do still remember with affection, my Saturday journeys to B&N to walk the store and ‘find’ MMP’s with which I could stock up. I have to admit those were great times of discovery.
    Now I do browse daily thru about 6 Blogs, two emails and three search lists, to review the free and low cost ebooks that are available. This results in a treasure of new books which usually average less than $3.00 each having authors that in about 60% of the books are as good as the first line authors from the Bad Six.
    Make no mistake, I still buy from them but only when the price drops to what I believe is a reasonable level. That usually delays both their revenue and the authors earnings by at least 6 months. I doubt they have gained much at all and probably earn less in today’s $.
    Thanks for the thought provoking posts!

  4. Kay C Says:

    “….the average price I paid of a book from Amazon it was six cents.”

    I love it!!! Along with the nation’s economic issues, my family’s personal economic health declined as well. Purchasing books became somewhat of a luxury – as did the time to read them, as I now have 4 part time jobs. Enter my Kindle 3 this summer – my birthday gift to myself, and a treat for some extra work I’d taken on. While some of my “snobbier” (read “wealthier) friends say they will never give up their paperbooks, I say to them “good for you – but I love my Kindle!!!!” I’ve read more since I got my Kindle – I was never one for the bestseller list, and I’ve enjoyed finding new authors and new genres. And the portability and accessibility of the Kindle makes it so that I can take it anywhere, and read anytime – even in the few spare minutes I have every day.

    Hooray for the Kindle!!!

    • Bufo Calvin Says:

      Thanks for writing, Kay!

      I’ve been at that point…I had a used bookstore I would frequent near where I lived, and I would make myself leave the store for an hour and come back before I bought something. That was to make sure I really wanted it, even if it was a used fifty cent paperback. 🙂

      I ate a lot of carrots in those days…they were cheap and filling. In fact, I actually had my arms turn orange because of it…I didn’t know what had happened!

      With a Kindle, there are so many free books available, it would have solved that problem for me.

      I think my Significant Other had a great reply to someone who said, “I like the feel of a book in my hand.” My SO said, “I like the feel of a hundred in mine…” 😉

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