Pissing Contests Can Be Fun, Just Not Into The Wind

Here’s something I’ve been wondering lately. Amazon’s a monopoly, right, so we’re told? They had a 90% market share in ebooks 5 years ago. Today, estimates of their market share in ebooks range from 55-65% or so. Do monopolies typically lose 25-35% of their market share over 5 year periods? Yet we talk about Amazon today as if they’re more dominant than ever. Maybe they are, but something about that doesn’t seem quite right. It looks to me like that 90% was, as the sports analytics guys like to say, the result of a small sample size (very young market and they were the only player going all out after it). But that would mean they’re not actually a monopoly but a highly competitive company who grabbed a commanding lead in the market. And a commanding lead is a far cry from a dominant monopoly. Just ask Barnes & Noble.

What I find interesting is this assumption that Amazon will become abhorrent, they’ll destroy publishing, tear the fabric of time and space, and we’ll all suffer with no recourse forever. Anybody actually watching the lifespans of these tech companies? The pace of everything has sped up. We’re in a world where an unknown startup can become a beast in a few short years. But it’s also one where the beasts can fall on their faces just as fast. Nobody is afraid of Microsoft’s market power anymore. I hear Yahoo is getting into TV shows these days. In fact, that’s the first thing I’ve heard about Yahoo in months. AOL still exists, apparently. At least they pop up now and then to piss away money on some new acquisition they’ll proceed to run into the ground. When was the last time Google did something truly innovative that didn’t turn out to be all hype? Even Apple just dropped billions on a questionably-profitable headphone maker to get their hands on a flailing music store and seems more interested in protecting what they have rather than continuing the innovation they earned it with in the first place.

I think this reflects a bit of the problematic thinking that’s infecting the industry. Self published writers aren’t real writers or they’re disgruntled trad rejects or they’re a substandard slush pile gumming things up with bargain basement prices. They don’t truly believe any sizable numbers of indies can produce work as professionally or more so than they can. It’s unthinkable to them. They have the same problem with Amazon. They don’t understand where Amazon came from and they have no idea how to deal with them. I feel extremely safe in saying that when real competition comes to Amazon, and it inevitably will, it’ll be another publishing outsider that brings it, someone who can and will find weaknesses in Amazon to exploit when they appear. I’m also certain that publishers won’t like them any more than Amazon, either. Publishers would clearly rather force all retailers into the party line that’s escorting B&N on a slow walk to the bankruptcy judge. They don’t really want genuine competition with Amazon to emerge because what that requires isn’t going to bring back the good old days for them, either.

I watched (most) of that Amazon hate panel at the New York Public Library the other day. The most telling comment of all, I think, was when one of the panelists said that tech companies needed to learn manners. By that, I took it to mean why aren’t they acting like everyone else? Don’t they know they’re supposed to be making as much as they can squeeze out of readers, not us? And it’s just rude of them to undermine our leverage with writers by giving them real options and a sizable cut. Where are your manners? Get with the program, already!

Which brings me to the dueling petitions circulating, one from traditionally published writers “not taking sides” by bashing the hell outta Amazon and a response to that by independent writers. The former was ridiculous and embarassing, I thought, and it showcases either the ignorance of these authors to actual business dealings above their station or is simply a disingenuous attack designed to protect their personal paychecks. Either way, I thought it was unseemly. How can you claim to not be involved in the dispute in a document specifically designed to inject yourself into the matter and pressure one side over the other? It’s dishonest.

The latter petition, while I agree with much of what it said, did come off a bit preachy to me. I totally understand the desire to counter what you (and I) see as the slanted misinformation and fear-mongering going on out there. It’s hard to understate the freedom writers have now. We can literally do anything we can think up, produce it and distribute it to a wider audience than ever before and not have to sell our souls, rights and most of the proceeds to a middleman. It’s so obviously beneficial that I often wonder how there are writers who don’t see this or worse yet, seem to actually be afraid of it. We now live in a world where it’s possible to make money directly on our copyrights without being forced to give them up in perpetuity. That’s a huge development, and something that was very nearly impossible to consider a decade ago.

It probably shouldn’t be surprising that some writers haven’t grasped the full implications of this yet. It’s a major change in conditions that had been static for decades, if not longer. How much longer they can continue to ignore it is the question. I suspect many of these writers have the unfaithful girlfriend or boyfriend problem, with their publisher playing the roll of significant other. They suspect he or she is cheating on them, have bits and pieces of circumstantial evidence that something isn’t right but they don’t want to admit it to themselves because admitting it means a necessary major upheaval in their lives. So they rationalize away the concerns staring them right in the face. Given the sometimes irrational and conflicting nature of that petition, and other similar sentiments I’ve seen recently, I suspect many are at the point where they’re going to come home from work early one day soon to find him/her in bed with someone else and not be able to avoid that particular elephant in the room any longer.

As far as the indie petition goes, while I like and appreciate the sentiment behind it, I just don’t think it needed to be done. I’m all for calling out bullshit, but to do it in a similar format with a bit of a rah rah attitude, even if it’s totally justified, gives the people who ought to be paying attention a ready excuse to dismiss it. To rationalize away finding a pair of panties that don’t belong to you under the passenger seat of your boyfriend’s car, as it were. “They must be his sister’s.” Uh huh. The original letter was a back patting exercise, preaching to a choir that’s not currently going to be convinced of anything other than what they already believe. Unfortunately, I think the indie petition is the same sort of thing. My opinion is who gives a damn what those other authors think? Let ’em look foolish, let ’em slap their names on something that’s fairly easily refuted and, frankly, not particularly well written. When the entity you’re yelling at is more responsible for making you money than the one you’re giving most of the proceeds, you’re in for a sizable wake up call in short order. I’m not convinced slapping them in the face with their own format will do anything but make them more entrenched in their beliefs, no matter how well intentioned or how clearly we see they’re setting themselves up to be burned.

You can’t stop people from making their own mistakes. Our copyrights have direct benefits to us now, something they essentially never had before, and that alone makes them more valuable than ever. Yet royalty rates are anywhere from “meh” to outright terrible. All reports also indicate advances are shrinking as well. At what point does it become obvious that what you’re giving up far exceeds what you’re getting in return? The man who hired me at my very first job in publishing used to talk about the law of diminishing returns all the time. He was usually talking about circulation, the point where the costs of increasing it would outweigh the return you got from it. That’s where we’re heading with publishers, I think. The cost of doing business with them is outweighing the return. A much larger cut of the proceeds should be the very least we should expect from publishers but we’re getting the opposite with threats of even harsher cuts in the future. And by much larger, I’m talking double or triple what they pay now, at least. And none of this lifetime copyright, or non compete, or discount clause nonsense anymore. It’s not my or any writers’ job to leave money and control of my career on the table to lifeline your business infrastructure because you can’t afford to pay the freight. Writers’ offer more value than ever, Amazon’s retail platform offers more value than ever. Publishers’ problem is that they’re one of the few in the loop who’s bringing less value today than a decade ago. Basic rules of business would dictate that when you become less valuable, you can no longer command as big a paycheck. What’s at issue here is that publishers and some of the writers still being paid by them as they always have, don’t truly understand their value has fallen off and continues to do so. Look no further than the fact that ebook profits (built on low standard royalties to authors, btw) are the only thing keeping many of these publishers out of the red. If the traditional business model is so valuable, then why are your profits basically gone without the contributions of the non-traditional?

Writers on the whole were never really compensated for giving up our rights anyway. For most, they had no value at all without a publisher, and you giving them up was a required condition. Writers were paid based on sales. The rights were a necessary toll basically sacrificed for access to the market. The value of those rights to us have increased while the rewards of signing them over have gotten smaller. Yelling at Amazon isn’t going to change that. Do you think if Hatchette gets higher prices, you’ll see any more of that money? Will they up standard royalties? Chances are you’re on a contract where the more successful your book is, the more money you’ve left on the table. Go back and do the math. If Hatchette gets what it wants and mitigates the competitive impact of Amazon, do you think that makes them more or less likely to improve writer compensation? And given the nature of these publishers, generally working in lockstep, what one settles into, they all likely will shortly thereafter.

The question in my mind isn’t why aren’t indies rooting for Hatchette, it’s why aren’t trad writers rooting for Amazon? (Well, the question after “why should we be rooting for either?” anyway. What we should be doing is advocating for the best possible treatment from all sides.) I’ll tell you why, because Hatchette owns your rights. If they run themselves into the ground, you’re contractually obligated to eat a face full of dirt with them. If Amazon (or any other retailer) destroys themselves, I just move on to another one. Amazon doesn’t own me. Hatchette (and other publishers) do own you. If you can’t see the inherent long-term danger in that, and you obviously can or else you wouldn’t be bitching at Amazon rather than your own publisher, then no petition, no logic, no facts, no amount of fisking is going to help you.

By the way, your letter basically demands Amazon cut a deal immediately and go back to discounting your books. Do you realize it’s highly likely Hatchette wants the ability to restrict Amazon’s discounting as part of any kind of agreement? How’s do you expect that’ll work out for you? “You should settle so you can go back to doing what a settlement with my own publisher will prevent you from doing.” Good luck with that.

One part of the indie petition I liked very much was the thank you to readers. We should all do that far more loudly and often than we do. But readers don’t care about this conflict. Most don’t know Hatchette from Heineken. They do know Amazon and seem to like them in overwhelming numbers. No petition from a handful of best selling and/or famous authors is going to change that, especially when the argument behind it is higher prices for them. Supporting culture and literature against cold corporate business sounds great until you say, “Oh, and all our ebooks are going to be $12.99 from now on.” Good luck with that, too.

I believe very much in the “look where your bread is buttered” school of thought. Amazon offers a fair retail platform at a fair rate. Publishers may offer you the butter but you have to lease the bread from them. And the knife you need to spread it, well, that’ll cost extra, too. Maybe Amazon ends up like them someday, but that day is not today. And it also discounts the idea that, hey, maybe they won’t because, as a tech company, they know better than most the second they do, someone else is going to pounce. “We want competition by preventing the circumstances where competition can actually develop” is not a viable plan.

Everyone is ultimately going to make the choices they’re going to make, and they’re going to face the consequences of those choices; good, bad or some of both. I’m not sure dragging readers into the middle of a pissing contest between two groups who really should be in agreement on most things furthers anyone’s ends, regardless of who started it. And that’s what I think about that.

Dan Meadows is a writer living on the banks of the Chesapeake Bay. Follow him on Twitter @watershedchron

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