Amazon and Simon & Schuster reach a deal
There is a future for Big Five books in the Kindle store.
That certainly seemed like the most likely outcome, although the day may come when Amazon doesn’t need them any more.
Why even doubt that the biggest bookstore would carry books from the biggest publishers?
Well, Amazon has been in a dispute with Hachette, another of the Big Five…for more than six months. What I call the “Hachazon War” certainly enters another phase with Amazon reportedly reaching an agreement with Simon & Schuster.
It makes it much harder for Hachette to paint Amazon as an “impossible to negotiate with” Big Bad.
It gives authors something to consider…how much of the stand-off is Hachette’s fault? When their deals with that publisher are done, should they be shopping? Douglas Preston, an author who has led the authors who have publicly expressed concerns with Amazon, wants to know the e-tailer has offered the same deal to Hachette. If it has…why didn’t Hachette take it? Retailers don’t have to give the same terms to everybody, of course.
It also changes the dynamic if there is a Department of Justice investigation of Amazon’s negotiating tactics (Authors United has asked for at least a look into it). If nobody can make a deal with you, that makes it a lot worse than a fifty/fifty split.
I’m going to link to stories on this, but I’ve seen both that this will be a return to the “Agency Model”, and that Amazon will be able to discount the books.
Those aren’t exactly contradictory. In the Agency Model, the publisher (not the retailer) sells the books (the former retailer just acts as an “agent”), and sets the customer prices. The publisher could set the price…and still, in some way, let Amazon discount under circumstances. For example, they might allow a three for the price of two deal to be offered. That doesn’t change the actual price of the book.
While we don’t actually know the terms of the deal, it is reassuring that a deal was reached at all. As a reader, I’d like Amazon to carry every book. However, the conditions under which they carry them do matter. I wouldn’t want Amazon to carry S&S books if the prices doubled…well, I guess I would, for folks who would pay that, but I wouldn’t like it for me.😉
It’s possible that Amazon let the publisher set the customer price within certain constraints…that would be a form of compromise which could work for them both.
My intuition is that Amazon will make a deal with HarperCollins, and I would think they will with Penguin Random House. They’ve had trouble with Macmillan before…we could see a repeat there.
With publishers not standing united, though, I think everybody will deal before the end of the first quarter of next year.
This might also help Amazon’s stock a bit. Investors hate uncertainty.
Here are some of the articles:
- Wall Street Journal by Jeffrey Trachtenberg (the mainstream reporter who I think most understands the e-book world)
- Business Insider by Jillian D’Onfro
- The Verge by Carl Franzen
Update: there has been a brief
in the official Kindle forum about the deal. They don’t say much about it, except that they are happy, it’s a multi-year deal, and it involves both e-books and p-books (paperbooks). Interestingly, they chose to make it a ” no reply thread”…they aren’t taking comments on it.
What do you think? Does Amazon need the Big Five? What should they be willing to give up to get their books? Where is the line in the sand? Will this mean Hachette settles quickly? Feel free to tell me and my readers what you think by commenting on this post.
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