Tuesday, June 11, 2013
Industry Pulse: Summer 2013
To help you choose what size poncho, here are three big turds set to spray all over us:
1. Apple vs DOJ -- The Great E-Book Price-Fixing War
The government and retailers are going to war over what our art is worth in a specific format -- in this case, it's e-books. At the heart of the battle is Amazon (behind the cloak of the DOJ) versus Apple. One may wish to recall that at the time the publishers developed the Agency Model, Amazon was selling e-books at 40%-75% discounts and attempting to dictate the industry price for this newfangled digital version of a book. Amazon severely crippled fair-market competition with this practice. The Big 6 publishers were reeling from Amazon's bullying and price rigging. Amazon -- being first to bring e-books into the mainstream via their Kindle tech -- tried to set an artificially low price for our art. Publishing houses rebelled but lacked alternative tech & distribution options to turn-down Amazon's unfavorable terms. When a House said no to Amazon, Amazon removed every book by the publisher from their store. The publisher was now without its #1 retailer. In stepped Apple, with a retailer and tech option to combat Amazon. Thus Apple and the Big 6 came to an agreement on pricing. It is this agreement that the DOJ is litigating under Antitrust laws. For more details (with graphs!) check out CNN Money's Coverage and Good Ereader
Why Writers Care: It's all about the retail value of our product. In the end, it's about how much we can and/or will be paid. What comes out of this e-book trial will have repercussions for print across all publishers. Expect another flutter of contract addenda after the case is settled.
2. Random Penguin & Author Solutions
The merger of Random House and Penguin (aka Bertelsman & Pearson, their parent companies) brings the Big Houses count down to 5, which means less NYC opportunities and lots of angst for the employees and authors of the two houses. The upshot of the merger is that medium and small presses are eager to step in to the gaps the conglomerate will leave behind. Random Penguin leadership says the merger will better position them for competition in the digital market (see Apple vs DOJ above). BUT, before we get all warm and fuzzy about that idea, we must recall that Random Penguin is the owner of reviled vanity press Author Solutions. Author Solutions is in the throes of a class-action lawsuit for breech of contract (non-payment of royalties and failure to produce accurate sales records) and unjust enrichment (aka ripping off authors via producing shitty products and pissing off end-consumers thereby ruining the author's brand). The merger is expected to be complete by the end of summer. By spring 2014, the internal realignments and new strategies will have trickled down to the editorial and marketing staffs.
Why Writers Care: There's a caution flag on the field. Even if you're not published by Random House or Penguin, any movement to shape the e-book market (especially with a company like Author Solutions in the mix), is going to ripple into your next round of contract negotiations. Don't sign blindly and make sure your agent (assuming you have one) explains the changes to you. Also, expect another shift in what will be the "hot" genre as the minds behind Random Penguin review their stables.
3. Digital & Discovery
No lawsuits in this one. It should come as no surprise that publishers are still at a loss for how to improve discovery. Now that Amazon has acquired GoodReads and Bookish has yet to make waves, publishers are staring at social media (aka Facebook, Tumbler, & Twitter) trying to figure out how to use it to their advantage. In the world of social media, intimate connections are more successful than companies hawking their wares. People want to have conversations with people, not with a company. This is why authors will always be better at social media and why publishers need to figure out how to use their mass to better support us. By the time the publishing industry figures out how to improve ROI in social media the outlets they're targeting will have imploded.
Why Writers Care: We're still on the hook for our own marketing and we will be for the foreseeable future. Sorry. Do expect the publishers to ride you harder about being more visible.
There you have it, dear readers, the pulsing turds of the summer. What issues are on your radar and what size ponchos are you stocking?