HarperCollins steps into the ring of the Amazon vs. Macmillan battle

While Amazon has yet to fully reinstate Macmillan titles on its website, another potential threat looms on the horizon for the online retailer. Rupert Murdoch, chairman and CEO of News Corp. – the huge media conglomerate that owns HarperCollins – said about e-readers during a conference call yesterday that “devices and platforms are proliferating, but this clever technology is merely an empty vessel without any great content.” Further taking the side of the publishers in the Amazon vs. Macmillan battle, Murdoch had this to say (via All Things Digital):

We don’t like the Amazon model of selling everything at $9.99. They don’t pay us that. They pay us the full wholesale price of $14 or whatever we charge. We think it really devalues books and it hurts all the retailers of the hardcover books. We are not against [inaudible] books. On the contrary, we like them very much indeed. It is low cost to us and so on. But we want some room to maneuver in it.

Murdoch also said that Apple has already agreed to “a variety of higher prices” for e-books, and that Amazon is ready to renegotiate pricing with News Corp. Will the clout of a publisher like HarperCollins force Amazon to allow higher prices? Will customers be willing to cough up more than $9.99 for an e-book, despite online protests? Or will the higher prices deter readers from investing in the high-priced Kindle at all?

One thing’s for sure: the publishing industry is being brought together by a common enemy, as demonstrated today at the America Booksellers Association’s Winter Institute. Galleycat reports that when Macmillan’s stand against Amazon was mentioned at the event, the company received an enthusiastic standing ovation.

Will Kindle be the Betamax of the decade?

In the race to win consumer confidence (or, well, interest) in e-readers, one can’t help but wonder how we’ll look back on the recent Kindle vs. Sony hardware wars. With Google planting flags, and Amazon opposing the Google settlement, The Globe and Mail‘s king of tech nerds, Brian Joseph Davis, suggests the Kindle could go the way of ColecoVision, the Commodore 64, or even the once beloved Betamax.

My money is still on Sony this week as they’ve entered the fray of the Google settlement crisis. They’re on the side of Google Books. Sony’s Reader displays any e-book format and supports file copying on up to six devices. The Reader and Google are a good match.

On the other side is Amazon with their Kindle (which is a proprietary-file-laden piece of poo). Stepping into that corner with legal and monetary support, just because they hate Google, is the axis of Microsoft and Yahoo.

Meanwhile, blogger B.Kienapple weighs in on the e-reader battle, discussing the Google-supported, UK-based Interead, the company behind the Cool-er e-reader. Now that Google has provided “books” for the terribly named Cool-er, she wonders who will actually read said materials:

Academics? School kids? Everyone knows that Amazon has the selection and pricing down pat. This is the sad fact of the matter.

Also, while the Cool-er e-store is now well stocked, you may not want to read them on the Cool-er’s own e-reader. The review that came in from Gizmodo earlier this year indicated that problems abound. My biggest complaint, from what I can see in the review, is the computer-like font. The Sony and Kindle both mimic print type (easier on the eyes, I do think). The Cool-er’s functionality looks entirely primitive, too.

While it’s easy to mock twitchy-texting, Twitter-obsessed blogger-types, many of those same tech-savvy users remain staunchly old-fashioned when it comes to e-readers. Maybe if one came in a swag bag filled with free “books” this Quillblogger might accept it, if only to take on a plane thereby avoiding the ache of heavy luggage.

But you may want to hum a bar of “Video Killed the Radio Star” and keep a curious eye on the tech pages as the e-reader war unfolds. You wouldn’t want to resemble your uncle clinging to his eight-track tapes.

Amazon: more than just a bookstore

Time magazine book critic and tech columnist Lev Grossman follows up his report earlier this year about the future of literature with a new article, written with reporter Andrea Sachs, examining the impact Amazon is having on the publishing industry. “If Amazon is a bookstore,” the authors write, “it’s supposed to be buying from publishers, not competing with them. Right?” The answer, of course, is that Amazon isn’t just a bookstore anymore:

… Amazon has diversified itself so comprehensively over the past five years that it’s hard to say exactly what it is anymore. Amazon has a presence in almost every niche of the book industry. It runs a print-on-demand service (BookSurge) and a self-publishing service (CreateSpace). It sells e-books and an e-device to read them on (the Kindle, a new version of which, the DX, went on sale June 10). In 2008 alone, Amazon acquired Audible.com, a leading audiobooks company; AbeBooks, a major online used-book retailer; and Shelfari, a Facebook-like social network for readers. In April of this year, it snapped up Lexcycle, which makes an e-reading app for the iPhone called Stanza. And now there’s Amazon Encore, which makes Amazon a print publisher too.

As Grossman and Sachs put it, Amazon is “the most forward-thinking company in the book business.” Whether or not that’s a good thing depends on if you’re a book buyer or a publisher, they argue.

U2 and Madonna don’t have deals with record labels anymore; they did their deals with a concert promoter, LiveNation. That stuff that the labels used to do – production, promotion, distribution – it’s just not that hard to DIY now or buy off the shelf. It’s the same with publishing. Amazon could become the LiveNation of the book world, a literary ecosystem unto itself: agent, editor, publisher, printer and bookstore.

Still, as the authors rightly point out, while Amazon has the power to hurt publishers, it’s likely not in a position to mortally wound them. On the contentious issue of e-book pricing, for example, the industry is beginning to fight back against Amazon’s lowball $9.99 price tag on many of its best-selling e-books, an unsustainble price point aimed at fueling Kindle sales. Yesterday, Simon & Schuster announced it was bypassing the Kindle store altogether, making 5,000 titles available through Scribd, a social media platform that allows users to share and sell their own work. The S&S-set price – 20% off the hardcover price – is one that many publishers, not to mention authors, will find more sustainable.

Amazon kindles a price war

It may not be the equivalent of the sans-coulottes rising en masse during the French Revolution or a student facing down a tank in Tiananmen Square, but there appears to be a grassroots uprising of sorts developing around the pricing of e-books sold through Amazon for use on their Kindle readers. According to Galleycat, a group of almost 250 Amazon users have initiated a boycott of Kindle titles priced at more than $9.99. These currently include bestselling titles such as The Secret, David McCullough’s biography of Harry Truman, and the new novel by Harlan Coben.

There are currently 808 titles on Amazon with the “9 99 boycott” tag, including some (like Breaking Dawn by Stephenie Meyer) that are sold at $9.99 on the nose.

Not surprisingly, most of the online commentary supports the rebellion: it’s another example of the people making their voices heard against the greedhead publishers and corporate behemoths. And to be fair, many of the arguments the boycotters are making have merit: Kindle e-books are not as permanent or as versatile as actual books (they can’t be marked up, lent out, or printed out), and there is a tradition of electronic content on the Web being priced more modestly than its physical counterpart (one reason why iTunes became so popular).

Still, it’s fallacious to presume that e-books don’t cost publshers anything to produce (even without the cost of paper, printing, and warehousing, there are acquisitions and editorial costs to be factored into the equation), and they are still getting gutted on their margins for regular books by sites like Amazon, which demand steep discounts on the titles they sell. Mark-ups for e-books may seem like price gouging on the part of publishers (and this may indeed be the case), but the bottom line is that this segment of the market is still negligible, and publishers need to make money if they want to survive. Perhaps the solution is to sell more e-books at a lower unit cost; whether or not the Amazon boycott has this effect remains to be seen.

Your iPhone (or iPod touch) as bargain hunter

As a buyer, I’ll admit to occasionally putting a book down because I want to compare prices with another bookstore or check the Internet at home. Apparently some iPhone programmers have too, because some of them created Snaptell, an app that, by simply photographing the cover of a book (or CD, or DVD, or video game), will automatically compare its price to those on the Internet and every store in your local area.

Understandably, the existence of such a technology is making some booksellers nervous. But as the L.A. Times notes, it’s unlikely book buyers will be willing to drive 20 minutes or spend another token on the subway just to save $2. And online sellers conveniently omit shipping and handling from their prices, which can easily add another $5 to the cover price (unless you’re spending more than $35 to begin with). So the only sellers who really need to worry are the ones who charge $5 or $10 more than the others, and they should be lowering their prices anyway.

As a customer, you have to admit it sounds convenient.

Canadian praise for the not-in-Canada Kindle

CBC Radio’s Toronto morning show, Metro Morning, spotlighted Kindle today (about the sixth item down). Tech columnist Jesse Hirsh suggested that Amazon’s e-reader could represent “the tipping point” for the technology – “I think Kindle’s the one to go mass-market,” he said. Hirsh may be a little starry-eyed about the pricing of Kindle content, though – he suggested that the vast majority of e-titles are going for 99 cents, and that even top sellers go up to only $5. A look at the Amazon site, however, shows that many prices aren’t quite that good.

Metro Morning listeners who wondered if the piece was a sign that the Kindle is coming to Canada were disappointed. Hirsh confirmed that Amazon has still not announced a Canadian wireless partner, which is a fraught decision in the Canadian market.

In the September Q&Q

Our brand-new September issue features a cover profile of Miriam Toews, whose new novel, The Flying Troutmans, is set for release next month (and is also reviewed in the issue). Also in September, we look at the succession strategies of four B.C. publishers; offer a close-up on author Rukhsana Khan; look at the issue of booksellers ordering from Ingram in the U.S.; and ask whether Canadian novels are just a little too long. Plus the Fall Announcements, and reviews of new books by Ronald Wright, Helen Humphreys, Joan Barfoot, Joseph Boyden, Rawi Hage, Tish Cohen, Cary Fagan, Polly Horvath, and many more. The full contents can be seen after the jump.

(more…)

Potter for a quid

Today, Guardian blogger Nicholas Clee muses on the implications of selling the Harry Potter series at bargain basement prices. This is in light of British supermarket chain Asda’s decision to sell Harry Potter and the Deathly Hallows for a mere £1 last week. According to theBookseller.com, Asda’s sale was basically the equivalent of giving Bloomsbury the finger, as the chain has accused the press of “holding ransom” over the children’s book market by charging £8.99 for Potter books. After winning 79% market share of Potter books last week (and losing £150,000 in the process) Deathly Hallows now retails at Asda for £3.86.

From Clee’s blog:

Asda’s promotion is of the kind given to brands that are coming to the ends of their lives. As Deathly Hallows is officially the last HP novel, that is an alarming move. Julian Rivers, a former chief executive of wholesaler Bertrams, predicts that HP will be finished as a bookseller’s supported line at theBookseller.com. […] Rivers draws an analogy with Catherine Cookson, whose novels, following her death, were bound up and sold in cheap packages through mass market outlets. If that was an admission that Cookson’s novels could no longer command full prices through bookshops, it was a self-fulfilling one.

It begs the question: does reducing the price devalue the brand?

Quotes from the top

A Monday morning panel discussion at BookExpo Canada, dubbed “View from the Top,” drew more than 60 attentive spectators. Moderated by Globe and Mail arts writer James Adams, the panel included four Canadian publishing execs – Random House of Canada president and CEO Brad Martin, Simon & Schuster Canada president Kevin Hanson, House of Anansi Press president Sarah MacLachlan, and McClelland & Stewart VP and associate publisher Susan Renouf. The conversation touched on several big themes, from environmental concerns to pricing to e-books. Some highlights appear below.

On the supply chain

“If the consumers really understood the amount of energy involved in shipping all that stuff, they would be appalled.” – Sarah MacLachlan

“That’s the biggest waste in our business…. That’s one of the first things we have to tackle.” – Brad Martin (on mass-market paperbacks, which are destroyed if unsold)

On book pricing

“One of the things we’ve really failed at as an industry is selling the value of what we all collectively do…. We’ve done such a good job [over the past several decades] of selling the democracy of reading, and that it should be accessible to everyone, that we’ve kind of bottomed ourselves out of our own market. We have failed to market ourselves as something that is valuable.” – Susan Renouf

“The model that we use to sell books is sort of ridiculous…. We have to think about a new way of selling new books.” – Sarah MacLachlan (on the list-price practice)

“For the most part, we are a price taker.” – Kevin Hanson (on the Canadian market’s pressure to compete with the U.S.)

On e-books

“I think we’re getting closer to the tipping point where e-books become a much more powerful force in the market…. I don’t believe there will be a single platform. I believe there will be a number of competing platforms in the immediate future.” – Brad Martin

“I find if I work late on my computer at night and try to go to sleep, I can’t. Whereas if I read a book I go to sleep in two minutes.” – Sarah MacLachlan

“The challenge for all of us is that it means we all have to run parallel business models.” – Susan Renouf (on e-books complementing print books)

On the market

“I think there are more readers out there. We have to be optimistic about that.” – Kevin Hanson

“Diversity is supposedly a great thing, both in nature and in book publishing, so I’m not going to say there are too many books being published.” – Brad Martin

2008 Libris Awards spread the wealth

Booksellers must have been in a share-the-wealth mood when they voted on this year’s Libris Awards, as all three nominees for Author of the Year went home with a prize. It was Lawrence Hill who actually won Author of the Year, for The Book of Negroes (HarperCollins Canada), while Elizabeth Hay took home Fiction Book of the Year for Late Nights on Air (McClelland & Stewart), and Naomi Klein won Non-fiction Book of the Year for The Shock Doctrine (Knopf Canada).

When Lawrence Hill stepped to the podium, he made sure not only to thank his editor, Iris Tupholme, and the rest of the staff at HarperCollins Canada, but also Sarah MacLachlan and Lynn Henry of House of Anansi, which published his other 2007 release, the non-fiction work The Deserter’s Tale (co-written with Joshua Key). When accepting her award, Elizabeth Hay made a special thank-you to independent booksellers, reminiscing about approaching them to stock her work early in her career. “[You were all] very sweet to me as you declined to put it on your shelves,” she said, laughing. (Naomi Klein, wasn’t present for the awards, so Knopf publisher Louise Dennys accepted on her behalf.)

The Small Press Publisher of the Year award went, for the first time, to Cormorant Books, which won out over NeWest Press and Arsenal Pulp Press. It was the third nomination for the Toronto-based house, and publisher Marc Côté took the opportunity to make a point. “Larry Hill published his first novel with Turnstone Press, Michael Ondaatje with Coach House and House of Anansi, Liz Hay with New Star, Cormorant, and Porcupine’s Quill, and Joseph Boyden published his first collection of short stories with Cormorant. We are the presses who bring you the writers of tomorrow,” he said, to cheers from the majority of the room. “Pay attention to all of them.”

The award for Publisher of the Year also went to a first-time winner, Penguin Canada, which won out over Random House of Canada, HarperCollins Canada, and McClelland & Stewart. Company president David Davidar accepted the award with very little speechifying, simply thanking booksellers for the recognition and thanking his staff for all their hard work over the past few years.

Peter Waldock, who took the podium for the second year in a row to accept Distributor of the Year for his company North 49, was the only honoree of the evening to openly address the touchy subject of pricing. “I think we’re going to have a good fall,” Waldock said, after acknowledging the difficulties of the past year. “Hopefully publishers will get their prices in line, hopefully there’ll be a strong Canadian list, and hopefully we’ll all sell a hell of a lot of books.”

The evening’s only double winner was Scaredy Squirrel author Mélanie Watt, who took home prizes for Children’s Author of the Year and Children’s Illustrator of the Year. Watt was at home in Montreal last night, so award presenter (and comedian and author) Sean Cullen filled the gap by riffing for a bit. “BookExpo has the distinction of having the most expensive drink tickets anywhere. What a great combination: expensive drink tickets and an industry of alcoholics,” he said. Then he pointed to the floor and added, “And where can I get this carpet of bean pods and geometric squares?”

The evening’s other winners were children’s bookseller Mabel’s Fables for Specialty Bookseller of the Year; The Bookstore at Western for Campus Bookseller of the Year; CS Richardson for Book Design of the Year for The Frozen Thames (McClelland & Stewart); Dot Middlemass of Kate Walker & Associates for Sales Rep of the Year; Anne Collins of Random House Canada for Editor of the Year; House of Anansi Press for Marketing Achievement of the Year for their “Want a Bag With That?” promotion; and Victoria, B.C.’s Munro’s Books for Bookseller of the Year.