Many will say that Amazon is the evil empire of publishing. They’re not. As I continue to mull over and discuss the industry here in order to refine my views on things, I am attempting to clarify, in my head at least, exactly where I stand on things and ultimately get a clearer understanding of the ever-changing landscape of the industry. Hopefully, I give readers here things to think about as well.
Amazon and particularly, Jeff Bezos, has a very definite view regarding publishing. This view is rather diametrically opposed to traditional publishing modes of business. They saw a future with digital reading that presented an opportunity. The key word here is reading, not publishing. They envisioned a future where readers consumed their literature digitally, and saw in themselves an ability to create in infrastructure that maximized this possibility. They saw an industry that was closed off to the bulk of the producers (writers), and thus a virtually untapped resource for them to provide an avenue to produce. Of course, they desired to be the ones to give them this avenue.
Amazon had the tech and resources to create the new book experience for readers. It’s pretty simple in theory really. Create the infrastructure for producers and consumers to meet on a common field and be the one to capitalize on running this giant, open market. If you think how small, open markets work, like say a flea market, you have individual producers who sell their goods, competing against other individuals, and consumers are free to buy from whomever they choose. A larger company oversees the venue and charges the producer for the opportunity to sell their wares.
Amazon is the company overseeing the world’s largest book flea market. Their venue is the best space for writers to ply their wares and gives them the best opportunity to find success. Come one, come all. They’re open to everyone. Publishers are welcome, but they get to pay more for the privilege of setting up shop. Publishers are the big companies that sweep up what they feel is the best product, offering less money to the producer but providing access to a broader market. Think of the flea marketer who sells their product to a company so that their product can be found in bigger, brand name stores. This obviously works for a few.
Using this analogy some more, Amazon is creating such a grand scale market, that consumers are flocking to it over the name brand stores. The flea market vendors are seeing more and more opportunity to sell their wares and be successful. Brand name producers are seeing the fact that more and more consumers are shopping here, so they are setting up shop. Amazon wants to keep building on this strength of venue, so they’re going to keep making it more difficult for the big names to set up shop. Given unlimited space, they want to capitalize on getting the bulk of the producers to sell in their space. This doesn’t make them inherently evil. They have a vision and they’re smart and they have resources. I can complain about their tactics in relation to the company sellers, i.e. publishers, but it’s not wrong.
There are of course inherent problems with any system. From a consumer standpoint, the larger the store, the more difficult it is to find things. Products you might want are never found simply because you miss that part of the store. One only has so much time to browse the wares. The producers get lost in the aisles. High traffic areas garner the sales, much like any store. What makes Amazon feel so “sinister” in all of this is that none of this element really matters to them. They make money purely off consumers buying the product, and fortunately for them, this flea market sits in the middle of a much larger mall offer goods and services they make even more money from.
It’s a very enticing arrangement. All producers are welcome to set up their stall. They just want the commission from whatever you sell. Don’t sell? It’s ok too, because the space costs nothing for the producer. And consumers couldn’t be happier. Amazon gives them the biggest, cheapest possible selection, and a convenient method through which to purchase as much of it as they want. It’s up to them to find what they want, and Amazon will tell them what’s selling well, but otherwise, go find it. From a consumer standpoint, and this is who they are concerned with, it’s brilliant.
Like any industry that finds itself in the position of having all producers able to bring their goods to market, those who relied on being the ones to bring the product to market, are suddenly at a huge disadvantage. It’s a system breakdown. They were in business because the producers could not before get their goods to the consumers in any meaningful, economical way. Their notion of business was to cull the best products and present them to the consumer base. The growth of digital has subverted this or is in the process of doing so and will get there in the near future. There is nothing wrong with this subversion process in and of itself. It’s up to the former businesses to figure out how to deal with the new mode of consumerism in relation to their industry.
So, what do you do as a business when someone comes up with a way to give the producers of the product you sell a method for selling direct and at a cost you can’t compete with? Well, you can do what publishers have been trying to do, which is fight the new method and make it so your prices can’t be undercut, but this is a waste of resources and counter productive. It smacks in the face of consumer perception of how things should be, and you get problems like the DoJ suit. Or, you can take a more prudent, long term course of action, and see how you can improve on the method.
Publishers can’t fight the producers in this open market system. They have no viable method for undercutting their prices. Companies have lots of overhead and built-in costs. The flea-market stand has almost nothing. So, if you can’t fight the producers in that open market, you have two options. One is to offer the producer better terms for their product so that running the stand in the flea-market seems less prudent. The other is to build a better flea-market.
So, publishers, let’s get on this please. Better terms and conditions for my product or give me a better venue to sell it in. And don’t tell me there’s no way to do this, because in the end, there always is, even if it’s a painful one.