The e-Book Battles: Why Some Publishers Are Abandoning Amazon
Sure, Everyone Poops. But not on Amazon.com, because the online retailer's effort to transform the way we read is leaving traditional publishers feeling, well, shitty.
That’s the story today for Educational Development Corporation, a book publisher that decided to pull its 1,800 children books, including the iconic defecation title, from Amazon’s virtual shelves, complaining that Amazon’s ultra-low prices were quashing its other distributors, including bookstores and a direct sales force of 7,000 people.
EDC is reacting to a dilemma that drove Borders out of business and is putting the screws in the entire publishing industry: Amazon’s ability to cut prices and rely on volume—especially with e-books—hurts publishers who still rely on traditional distribution channels, even as consumers rejoice at low prices and more choices. More people report reading books today than ever before.
Last week, we saw the ugly conclusion of another effort to push back against Amazon’s business practices. A coterie of five major book publishers and Apple face an anti-competition lawsuit brought by the U.S. Department of Justice after the group allegedly collaborated in 2010 to increase prices for e-books above Amazon’s favored $9.99 price point. With all but two of the parties in the lawsuit settling the government’s charges, Amazon has promised to return to lower prices for e-books.
Whether the book publishers were illegally colluding to raise prices or not, they’re fighting a losing battle. According to Publisher’s Weekly, $887 million worth of e-books were sold in 2010, and the sector has been growing rapidly as iPads and other tablets increase in popularity. Given the cost burdens of paper-book distribution, the dead-tree book is unlikely to be setting book prices for the vast array of consumers a few decades down the road.
EDC, the publisher that pulled its titles from Amazon, says that the bulk of its sales still come from traditional distribution lines, and that business has actually picked up since its decision to stop selling on Amazon. The company sells millions of dollars of books outside of Amazon, and its executive is happy to play the role of the scrappy underdog facing down the market-making dictates of the two-ton gorilla Jeff Bezos built.
But it won’t be long until someone comes up with a different take on introducing toddlers to the realities of human waste and decides that publishing it directly through Amazon makes a lot more financial sense than going through a traditional publisher. Or maybe it makes sense to collaborate with an e-book publisher, since besides copy-editing and marketing, e-books can include sound effects and animation in the iPad edition, all the better to educate the youth. It’ll be cheaper than Everyone Poops, and probably net the creator a larger share of the proceeds.
EDC and other publishers can fight Amazon for a while, but it’s not really the web retailer they’re fighting: They’re pushing back against the power the internet gives creators to distribute their work widely and cheaply. Amazon’s big lead in turning that phenomenon into a business may not be permanent, but the change in the broader marketplace is here to stay.