This Is The Kind Of Competition Publishers Want

Source: Flickr

Source: Flickr

Since the huge shift to online purchasing and e-books, a common meme is that there is some kind of “discoverability” problem in publishing.

The funny thing is readers don’t seem to have any problem finding books they love. Any readers I talk to have a time problem – reading lists a mile long and never enough hours in the day to read all the great books they are discovering.

The real discoverability problem in publishing is that readers are discovering (and enjoying) books that don’t come from the large publishers. What these publishers have is a competition problem not a discoverability problem.

Amazon regularly gets slated for purported anti-competitive actions, but it has done more to create the digital marketplace than any other company. It has also done more to open up that marketplace to vendors of all shapes and sizes than any other company. Small publishers and self-publishers, for the very first time, have a level playing field with large publishers.

In other words, Amazon has fostered huge levels of competition that rarely get spoken about. Because Big Publishing doesn’t want actual competition. It hates actual competition.

What Big Publishing wants is the faux-competition that existed before the digital revolution – when they had a lock on distribution, reviews, chain stores, supermarkets, and airport bookstores. (Seriously, does anyone aside from James Patterson want a return to those days?)

Today a small publisher or self-publisher can publish e-books cheaply and match the distributive reach of the largest publishers just by uploading to a handful of sites. This is what an open market looks like and Big Publishing hates it.

They have reason to. I had a stab last year at estimating how much of the e-book market self-publishers have grabbed in the US, pegging it at around 25%. The much more rigorous Author Earnings reports have confirmed that estimate, showing that self-publishers had captured 30% of the unit sales on Amazon and Barnes & Noble.

Big Publishing might like to think it’s a special snowflake (to which the law doesn’t apply), but its speech and actions follow a very familiar pattern that is witnessed any time a cosy club is being disrupted. By ushering in the digital revolution, then opening the marketplace up to anyone and creating a level playing field, Amazon has poured cold water on this garter snake breeding ball.

Large publishers have proved adept in one area: getting their message out. Sometimes it feels like they spend more on corporate PR than breaking new authors, and you need a bullshit dictionary to parse their statements.

So when large publishers say that the discoverability puzzle hasn’t been solved online, they are really expressing despair at retailers recommending books not published by them.

And when large publishers say that online retailers haven’t matched the experience of buying in physical stores, they mean that they wish there was some way to relegate all that stuff from small publishers and self-publishers to the warehouse, and have tables piled high with James Patterson and Snooki.

This is why you get hilariously awful attempts to build a discovery site for readers like the failed Bookish. As the Huffington Post reported in February last year, despite claims from Bookish CEO Ardy Khazaei that it would be “completely independent and autonomous” and not “a mouthpiece for a specific publisher,” the site only pushed books from Hachette, Penguin and Simon & Schuster – the same publishers who founded Bookish.

You don’t see Amazon doing the same thing with Goodreads, despite fears expressed at the time of the purchase. In fact, it’s interesting to note that Amazon stocks many items from companies it’s in direct competition with, such as iPhones, iPads, Nook e-readers and tablets, and Kobo devices.

And you don’t see Amazon fiddling with its own algorithms to favour the books it publishes, despite a 2013 prediction from Robert Levine that, within two years, Amazon will exclusively recommend its own books. Here’s a prediction, since “the industry” seems to love them: Robert Levine will be about as right as Ewan Morrison.

The fear-mongers always forget Amazon’s core philosophy: recommend the product the customer is most likely to purchase. It’s interesting to note that this is the exact opposite of traditional co-op: recommending the book that the publisher wants purchased.

While it’s revealing to look at sites like Bookish and consider what Big Publishing would do with retail or discovery, we already know what it does with self-publishing. Exploitative vanity press Author Solutions runs self-publishing companies for HarperCollins, Simon & Schuster, Harlequin, is owned by Penguin Random House, and is now recommended by Publishers Weekly.

Large publishers want to decide what gets published, what gets distributed, what gets recommended, what gets discovered, and what gets sold.

Amazon – and the digital revolution it instigated – has made that impossible.

Anyone can publish. Distribution has been blown wide open. Large publishers have lost power over what books get recommended and discovered too, with the agnostic approach of sites like Amazon, Goodreads, and BookBub. And large publishers have definitely lost control of what is getting sold: self-publishers have grabbed a huge chunk of the market, and more and more writers are beginning to realize they don’t need a publisher to reach readers and make money.

This is the real reason why Big Publishing hates Amazon. Large publishers face real competition for the first time and they don’t like it one bit.

About davidgaughran

David Gaughran is an Irish writer, living in Prague, and author of Mercenary, A Storm Hits Valparaiso, Let's Get Digital, Let's Get Visible and this here blog thing.
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102 Responses to This Is The Kind Of Competition Publishers Want

  1. Jaye says:

    As always, you nailed it, David. The big publisher historical response to competition has been to eat it. Amazon is too big to eat and besides, it fights back.

    The ones I feel badly for are the authors who truly believe they are “partners” in the process. They are no more partners than the horse pulling the cart. Technically, they own the cart and all the goodies it contains, but they have zero say in where they are forced to pull the cart or what the publishers do with it once it arrives at its destination. And you know what happens when the horse is no longer able to pull, right? It’s taken behind the barn and shot.

  2. Reblogged this on Books: Publishing, Reading, Writing and commented:
    This blog post is so right-on-the-money that I had to reblog it immediately! Thanks, David Gaughran, for pointing out the truth of the situation that has been right in front of out faces all along.

  3. Awesome post. Thanks.

  4. David Penny says:

    Yes, Yes and yes again, David.

    I’ve always fought against those who love Amazon-bashing – and the awful thing is many of those who fear and deride Amazon are authors themselves. It’s the old “I hate Microsoft” thing all over again. When companies are small they’re considered innovative – when they become large they’re considered monoliths who have lost any spark of creativity.

    For myself I’ve only ever had a positive experience with Amazon – I have actually had conversations with real people when I’ve had a problem. Sure, this may not stay the same, but we live in a different world now where the publishing paradigm has changed for good. The big firms haven’t yet accepted this and, as you say, their only retort is to use the weapons of publicity (which they are good at) against the innovators.

    What has changed now, I believe, is that a company like Amazon doesn’t play by the same rules as the old publishers. They deride Amazon because, in the future, they think it will start behaving exactly like they are themselves doing now, and cutting off the competition.

    • On the last point, I think it’s inevitable that Amazon will become bloated and inefficient at some point. And then it will be disrupted by someone else. That’s the way it goes. But that disruptive force won’t come from publishers.

      • David Penny says:

        Of course. The one thing you know about a disruptive technology like Amazon is they too will be subject to the same forces themselves one day. Which is why, as Indies, we are in a far better place to respond to changes much more quickly than the establishment.

        Sorry – old hippy, never really got over my hair disappearing.

    • David Penny – like a good ole’ hippy you are following the truest path to freedom. I am there with you.

  5. zanesachs says:

    Well put, David. The Big 5 aren’t interested in discovering new writers … they’re interested in perpetuating brands, like James Patterson and his list of ghost writers, and creating manuscripts for dead writers (like Louis L’Amour, who somehow keeps coming up with new books–from the grave). Years ago, I heard John Saul speak on this topic, and he said the REAL competition for new writers is DEAD writers. That kind of backward thinking created a gigantic hole in publishing,

  6. Pingback: This Is The Kind Of Competition Publishers Want...

  7. “cold water on this garter snake breeding ball”

    Annnnd that’s pretty much the only image I need to picture this mess.

    It will be interesting to see how long it takes for the BPH to understand that they need to stop fighting a lost battle and get ready for the next one. Of course, I don’t expect they’ll suddenly gain the ability to see the future. They’re too focused on a vanished past. In the meantime, I keep putting out more books on my own.

    • Perfectly stated, David. There are only authors now — those still foolish enough to be chained to an antiquated system and the rest of us who have seen the light.

  8. Spoke to a graduate class on creative nonfiction at Southern Oregon University last week David and told them they should check you blog to find out what is happening in the world of self-publishing. I always appreciate your insights. –Curt

  9. D.L. Shutter says:

    BigPub can’t dictate online coop like they have for decades in physical stores. Zon has their own imprint titles along with the occasional breakout indie they’d like to tell people about. And with the demise of the big chains, or sales approaching negligibility, everyone’s book has become a thumbnail. A true, level and open playing field, like Dave said. A nightmare scenario for BPH’s.

    But why are publisher’s still crying amidst record profits from the digital boost, their mountainous backlist which benefit from the long tail and digital shelf, (See the AR on BPH backlist, the real payoff from decades of rights grabbing contracts) full stables of mega-sellers who have stayed true to Legacy and new, consistent blockbusters every year? WTF else do they want???

    YOU LOST AGENCY…and it’s NOT coming back! Get over it! Take Zon’s terms and move on where you’ll continue to make money by the truckload. The concerted PR pleas for help with an “Evil Zon” amount to tantrums from a petulant child that’s not getting his way to control every toy in the playroom.

    And in the end, Bezos will end up making examples of some spoiled, entitled little children by making them sit in dunce chairs and stand in corners until they come around.

  10. carollight says:

    You should have been the one to write the op-ed in today’s NY Times instead of the lawyer who asserted that Amazon was trying to drive publishers out of business and then drew the conclusion that fewer publishers means fewer books! I was astonished that the Times would publish something with such false reasoning.

    • The NYT’s coverage of the publishing business isn’t great. And there are some excellent theories in the comments of my last post about why the old/trad/news/print media tends to pump out articles like this (and ignore the real scandals). Some factors mentioned:

      1. Media ownership. Lots of media outlets are owned by the same companies as the large publishers.
      2. Digital sympathy. Newsrooms were eviscerated by the digital revolution and reporters may well have sympathy with their publishing cousins.
      3. Tribal loyalty. Much like the way bloggers disrupted news media, reporters may also view self-publishers as upstarts who haven’t paid their dues etc.
      4. Advertising. Papers like the NYT sell a lot of ads to publishers (and Author Solutions!).

      And of course there’s all the reporters with book deals, who want book deals, who have worked or want to work in publishing, who are generally just elitists of one stripe or another or who automatically defer to power, and maybe some general Manhattan incestuousness.

      I’m not saying all news media is like that. There are many fine reporters out there. But the coverage of publishing is generally quite terrible IMO.

      • Another possible reason: NYT may not be thrilled that Amazon’s Jeff Bezos acquired the Post.

      • Scott Daniel says:

        David to your point about bloggers disrupting news media, I think that’s a bit of a stretch. I would say a combination of factors eviscerated newsrooms. The loss of ad revenue to the internet, in general, is the largest single factor. As far back as the late 1990s, legal ads, job listings and such started going digital. That was life-blood to weekly papers like the one I wrote for. To me, and maybe I’m wrong, I always thought papers made a mistake by not monitoring their product immediately. A few tried putting up pay walls, but most didn’t. If they had, it might have steadied print subscriptions, at least for a time, and put money in their pockets from the digital side. But news organizations were too slow to react. I’m long since out of the business, but the depths to which newspapers have fallen does sadden me.

      • I should clarify: I don’t think that bloggers were the key disruptive force. And I would agree with you about the importance of the factors you mentioned.

  11. Matthew Iden says:

    “garter snake breeding ball”? Did you lose a bet and have to put that in a post? ;)

    • In my defense, it was going to be “giant garter snake breeding ball” but I thought that was over-egging the pudding.

    • “I’m tired of all these M— F—ING indies in this M— F—ING publishing bidness!”
      ::runs away fast::

      More seriously, I am very small potatoes-no one knows I exist as an author, and using price is one of my only tools of attracting attention. I am not keen on having Amazon dictate my prices . I don’t *reasonably* think they will do that any time soon, but given the sudden drop in royalty percentages for audio books that ACX instituted not too long ago, it’s not outside the realm.

      • This is because the only way to get your audiobook on Audible is via ACX. iTunes is possible but it’s challenging. They can drop the royalty to 40% and it’s in their best interest as a business because competition in audiobook distribution is limited. Currently, speaking. This is why it’s so important to not put all our eggs in one basket and publish through multiple retailers. Thus having more revenue streams.

  12. Once again I agree with your points, and I am thankful you show us the truth. The gate door is opened and cannot be closed. Amazon has been true to their mission and has supported individual publishing more than any other distributor, while traditional publishers are hiding behind new companies that are too willing to pillage our pockets. It is hard to know who can be trusted these days – so I thank you for doing the leg work and investigating.

  13. I received some pushback privately on the claim that Amazon provides a level playing field, and they have a point so I’d like to tease that out.

    I’m not saying that Amazon’s store is some kind of utopia or that Amazon is altruistic or anything like that. I see Amazon as pulling levers all the time. Some of the changes favor self-publishers. Some favor imprints. Some favor large publishers. Overall though, I think Amazon is trying to display the products that each customer is most likely to purchase (and I would view the algorithm changes in March/May 2012 as a corrective measure after KDP Select was more influential on visibility in the Kindle Store than expected/intended).

    The system isn’t perfect (and I’ve noted it’s limitations in posts here before). But it’s much more of a level playing field than any other retailer, and infinitely much more of a level playing field than the old print world, where self-publishers and small publishers struggled to get into stores at all, and then when they did they were usually spine-out on the genre shelves, and nowhere near the front tables.

    • There is no such thing as perfect, but we have to recognize what is the best available to us, and make choices based on the evidence in front of us. Lot’s of Indies out there like myself are not pulling in numbers like some have in the past, but Amazon still gives us an honest shot. It’s up to us to use what we have in the most creative manner we can. Amazon has continually tried to meet the ‘customer’s needs’ and that what we as book makers should be striving for also.

      • Amazon could decide tomorrow that its whole recommendation ecostructure will be massively tilted towards its own imprints, but they haven’t done it up to now. I’ll worry about it *if* it happens. I’m more worried *today* about how publishers are exploiting writers with their vanity presses, and how they are getting a free ride in the news media about it too.

        We have a golden opportunity right now to reach readers and make money. Maybe this will only ever be a blip in the history of writers, but that’s all the more reason to dive into it, make the most of it, and enjoy it – instead of worrying about what Amazon might do in the future.

  14. Lior Samson says:

    Discoverability was never a problem for readers; it is a problem for authors and publishers, including self-publishers. The tsunami of indie-published e-books is as much a problem for independents as for the big houses, maybe more so. From the author’s perspective, the issue is not a matter of whether readers can find SOME book, but whether they will find MY book. If my ten books are swimming in a sea of 2.7 million (approximate number of current Kindle books on Amazon) they will be much less likely to be found than if they were floating in a pool of 800,000 (the number from four years ago). Other things being equal, as the scientists say.

    The goal of indie authors is to make other things not equal, to find alternate routes to sales and side entrances to the hallowed halls of success. As an independent author, I cannot get NYT, WSJ, and Boston Globe coverage and reviews the way Joe Finder has done with his new thriller from Dutton. I have to find other ways to become more easily found by would-be readers.

    –Larry Constantine (pen name, Lior Samson)

    • Larry, do you write fiction? If so, I have some good news. Those 2.7m items in the Kindle Store you mentioned include games, magazines, and newspapers, and lots and lots and lots of non-fiction. Off the top of my head, only something like 850,000 books in the Kindle Store are fiction. Then when you drill down by genre and sub-genre, the numbers are surprisingly small.

      Also consider that something like 1m of those items in the Kindle Store don’t even have a rank – meaning they’ve never gotten one single sale. You’ve just cut out a huge chunk of the competition! Then out of all the books that have only had one sale, only a minority are being actively marketed. Huge numbers of books aren’t being pushed whatsoever – whether they are translations, single short stories, poorly reviewed novels, backlist, or whatever. The actual number of books you are competing against (for visibility etc.) is quite small.

      And even 2.7m is far, far less than Amazon has on the print side. Last time I checked it was something like 6m or 7m print books. And that’s only a fraction of the physical books in print – I think Google estimated that at something like 32m, and the total titles ever printed in English (this is randomly plucked from very foggy memory so please feel free to correct) is something like 185m.

      There are a lot of books in the world. And there’s going to be a lot more. You can’t do anything about that. But it’s really not as bad as you think. (IMO)

    • Dan Meadows says:

      In a pool that size, there’s got to be a mechanism for culling it down in some way for manageable search. Amazon’s way let’s the customer dictate that culling, and those processes will only get more and more precise as the data they collect from all angles piles up. That makes the synergy of the metadata, cover image, blurb and sample crucially important, possibly more important than anything else short of the actual writing. Meta data granular and specific enough to show up in the specific customer searches, cover to catch their interest, blurb that gets the hook in and sample that anchors it. It’s the most important marketing that can be done. Do it right, particularly metadata, and your work will likely be exposed to more customers directly looking to buy than any number of tweets, ads or reviews, in my opinion. Just because the pool is big doesn’t mean it’s impossible to be seen in it. In fact, the bigger pool can be an advantage in a way because it’ll require ever-more specific search functionality to deal with it.

  15. Books compete with each other. Independent books compete with published books. Published books compete with published books. Independent books compete with independent books. All books compete.

    Cant get discovered in the tsunami? That is competition from other independents. Your publishing company is losing market share? That is competition from independents since they are taking that market share.

    It doesn’t matter if the author thinks of herself as competing. The books compete simply because they are offered in the same market at the same time. What the author thinks doesn’t matter.

    And who wins from all this competition? Consumers. There has never been a time when there were more books as widely available at low costs as we see today.

    And that level playing field? Nobody needs to level it. Competition doesn’t need any help.

  16. Reblogged this on Snapshot and commented:
    This sheds light on the shadows…

  17. Jim Kukral says:

    Exactly. Instead of the big publishers leading and innovating, they stick their heads in the sand and cry foul that their entire infrastructure is collapsing. The CEO’s of these companies should be ashamed. When is one of the Big 5 going to hire someone who is going to break ranks with the others and do something besides pouting about “how it used to be?” I’m not it’ll ever happen. Meanwhile, hybrid publishers who let authors keep their rights and actually provide useful services like editing and marketing will continue to thrive.

  18. William Ockham says:

    Publishers of all types (whether in the Big 5 Confederacy of Dunces or self-publishers) have a hard time grasping is that when Amazon changes its algorithms, it’s not even thinking about you. They don’t fall asleep at night dreaming up ways to help or harm you. They fall asleep at night thinking about me. Not me, personally, that would be icky. I mean, me, the loyal Amazon customer, Prime member, and purchaser of all sorts of different stuff from Amazon. Every change they make is designed to separate me from my money and make me feel good about it. They succeed amazingly well, considering I rarely spend much money anywhere else, except on beer which they won’t sell me.

    The only reason Amazon leveled the playing field is because that is how to get people like me to spend more money. Any time you find yourself worrying about whether or not Amazon would do something (in regard to books/ebooks/or tech items) that would harm your career, ask yourself if that action would allow them to get more money from me. If not, don’t worry about it. Won’t happen. If you aren’t sure, just ask me. I’m pretty good at that stuff (although they have come up with new plans I hadn’t anticipated like Kindle Countdown). If the predicted course of action might get me to spend more money, it could happen. Doesn’t mean it will. But it might. You will have to factor all their other constituencies, etc.

    So, if you are worried about them favoring their own imprints, relax. Won’t happen. Lowering KDP payment is unlikely in the near term. KDP authors would probably respond by raising prices, which would lead to me spending less money in the long term and being less satisfied. Most of all they don’t want to take a chance on me going somewhere else to feed my story habit.

  19. kareninglis says:

    Yep – Amazon puts the customer first. Spot on.

  20. revgerry says:

    This is music to my newbie author-to-be ears. While not anywhere near publishing, the biggest barrier to enthusiasm is the details of getting published. At 72, I didn’t think I had years to waste on that. I had heard that Amazon makes that simple, and I am please to know that it is also fair. Thanks.

  21. Pingback: This Is The Kind Of Competition Publishers Want | The Passive Voice | A Lawyer's Thoughts on Authors, Self-Publishing and Traditional Publishing

  22. Meredith L. says:

    I love this post. The huge positive: It’s true that the competition for readers’ attention (and money) is fierce and it does level the playing field for anyone who wants to publish. I love when the giants are humbled.
    The big negative: Everyone who self-publishes believes they have a great book when in fact it’s junk. Most wouldn’t make it past a grammar school teacher’s desk much less a traditional, Big Publishing house editor’s desk.
    One would think reading reviews might be a good way to sort through it – but when you have people paying for 5 star reviews those lines are going to be blurred. That’s when you have to rely on your first and second line social network connections to get the truth.
    Now – I am NOT saying that all self-published attempts are bad! I’ve read selections from the big guys that are drink coasters or kindling too. I am saying that the ratio of good to poor quality reading probably favors the ones with greater resources like screeners, editors, and an army of volunteer reviewers.
    That being said, I love giving new authors a chance and I will use any resource possible to pay-it-forward for them — if it’s good reading – whether they are self-published or not..

    Two thumbs up, David. Great reading here.

  23. barryknister says:

    David–
    I appreciate everything you have to say in your posts, so please forgive a little nay-saying in what follows. You speak of “discoverability” as a euphemism applied by Big Publishing. As an indie author, I apply it to myself. I was a commercially published novelist (long ago) who these days can’t find an agent because I’m not young (I think this is the reason). This means I must turn to self-publishing, which I have done–but again, because I’m not young or savvy about an entirely different field from writing–self-promotion, social media, etc–I am unable to get a fair shot in the new marketplace you describe in such hopeful terms. Damned in both directions, it seems.

    • Anon Author says:

      Barry, your age doesn’t have to be a factor in your quest to be self-published if you don’t let it. No one has to know how old you are. Use a pseudonym. You’ll have to start from scratch, but no one really cares about your age if you write a cracking good book. If you aren’t young or savvy about self-promotion, are you doomed? NO! Read Let’s Get Visible and Write, Publish and Repeat and read The Newbie’s Guide to Publishing for hints and advice on how to do it.

      Age is a factor for Trad Pub because the gatekeepers think readers care. They don’t. They care about story and character.

      • David Penny says:

        I agree age doesn’t have to be a factor in Trad, but it is. I was talking to a panel of agents last year who DO say age is a factor – not because the readers care, they don’t – but because agents and publishers do. One asked my age, and when I told her she shook her head. “Sorry – we need at least 20 to 40 years out of a writer so we can’t affprd to invest in anyone over 60, preferably 40″

        Hence all the new, young writers we see on the shelves.

      • patricefitz says:

        David Penny: I’m 58, and no one cares. I have a very active social networking profile in Facebook, and people are buying my books. I also publish others, and my lead author is… somewhere up in her 60s, I think? I don’t even know. We did a BookBub ad for her on Sunday and she sold 5,000 copies of the first book in her cozy mystery series that day alone. You could be an octogenarian, a couple with a pseudonym, or a reptile, and no one would know or care if the books appeal. As the old cartoon said, “On the Internet, no one knows you’re a dog.”

  24. tariencole says:

    Reblogged this on The Worlds of Tarien Cole and commented:
    Indeed.

  25. johnscherber says:

    Absolutely, David. I have self-published 20 books. I make a decent living and I have total control over what I do, in design, in editing, in delay times. I wouldn’t change it. I know a number of writers published in NY who are tearing their hair out and don’t do nearly as well as I do.

    John Scherber
    http://www.sanmiguelallendebooks.com

  26. Excellent article, David. As I’ve often said, Jeff Bezos is a visionary. I am pleased with Jeff Bezos and Amazon, as both an author and a consumer. And self-publishing sure beats NY publishing. Amazon also makes it easy to put back in print or ebook our back-lists (previously published by the Big publishers), which many of us are doing.

  27. prue batten says:

    Reblogged this on Prue Batten's Blog and commented:
    As an indie-published writer who has been ‘discovered’ by readers across the world and who has been ranking in the UK in Amazon’s Top 100′s for over eleven months without a break, I APPLAUD what David Gaughran is saying so clearly.

  28. prue batten says:

    Re-blogged on http://www.pruebatten.com and shared on Twitter and Facebook. Without Amazon, I would have remained undiscovered. I’ve now been ranking for an unbroken eleven months in Amazon’s Top 100′s in the UK with 6 books. Go figure!

  29. John Brown says:

    David,

    Way to cut to the chase.

    Is IS about the fact that they’ve lost the barriers to entry that used to keep all competition out. Amazon set up a totally new distribution channel that has grabbed at least 41% of the book market.

    Forty freaking one percent: http://www.publishersweekly.com/pw/by-topic/industry-news/bea/article/62520-bea-2014-can-anyone-compete-with-amazon.html

    Almost half of book distribution is now out of publisher control. With no barriers, the hordes are running in to sell their books, pushing publisher books out of the good spots. And the publishers can’t get Amazon to relegate the riffraff to the back rooms.

    Worse still, it appears lots of reader like the riffraff.

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  31. Reblogged this on Scary Funny and commented:
    Very interesting read!

  32. Christine says:

    The epiphany I got reading your article, David, which had not occurred to me before is that there is a Double Purpose in the proliferation of the Author Solutions scam throughout BPH. AS and the subsidiaries are meant not only to strip-mine wannabes of their money but also to ensure that those books, (whatever they may be, however well written or poorly written) do not effectively enter the competition online or in bookstores for the head space of the reader.
    AS published books don’t sell – I’ve seen some of them. No one would pay a cent for the covers hence it is an effective way of harvesting authors and preventing them from being read all at once. A brilliant way of eliminating some of the competition.

    • I actually cut a paragraph before publishing which floated that possibility. But I don’t know if it’s plausible. I’m not sure large publishers viewed self-publishing as a threat in 2012. I think they are starting to now, but it has been a slow realization (i.e. Harlequin mentioned self-publishing explicitly as a threat and a reason for falling sales/market share in their last financial reports).

      I think Penguin just wanted to monetize not just their slushpile, but the slushpile of every major publisher. Penguin knows that there are infinitely more writers out there than Penguin could ever publish, no matter how good or commercial their MS. It probably watched Harlequin hook up with Author Solutions and get away with it, Writers Digest peddling all sorts of two bit scams… and getting away with it. Thomas Nelson hooking up with Author Solutions… and getting away with it. And then Penguin got away with it too.

      So far.

    • What I meant was, I think Penguin’s motivation was $$$. They saw self-publishing growing fast and wanted some of the pie. They didn’t care they were buying an exploitative vanity press because they assumed they would get away with it. Which they largely have.

  33. A.J Sendall says:

    Reblogged this on A.J. Sendall and commented:
    David Gaughran, once again brings clarity to the sometimes confusing world of self-publishing.

  34. jenanita01 says:

    Reblogged this on AnitaJayDawes and commented:
    I could say that it’s time traditional publishers got with the beat, but what could they do that Amazon aren’t already doing, and doing brilliantly?

  35. As a self-publishing author writing a book on recent developments in the financial markets, I was struck by the parallels between what is happening in publishing and the markets. I argue elsewhere how recent advances in technology and their application in the markets has disrupted long established hierarchies. The end result is that the “little guy”, the retail investor, is now playing on a field much less tilted than before. All this has happened because of the emergence of a new set of “big boys”, the direct result of technological innovation. The establishment, the cozy interconnections among the preexisting established players is being rocked by the newcomers. The status quo is no more and the small investor is a collateral beneficiary.

    It is fascinating to see the same kind of scenario playing out in the publishing industry. Again the newcomers, self-publishing hubs like Amazon’s KDP, are, as you put it, disrupting what used to be a “cozy club”. And the beneficiaries are the “small guys and gals”, the new or less established authors. The fightback from the traditional publishers and the “old guard” of the markets is uncannily similar. They throw everything they’ve got at the newcomers. But things have changed and there is no going back. In publishing and investing, the “little guy” never had it so good.

    Thanks for another great post David.

  36. Dan DeWitt says:

    Yeah, yeah, great analysis, as usual. However, I’m giving you bonus points for reminding people what a giant thud Ewan Morrison is.

  37. stephaniequeen says:

    Lots of good points about the Big NY Publishers facing competition, David.
    However, I would be very pleased if Amazon faced more competition as well. I’m rooting for iBooks, B&N and KOBO to get better and gain market share.
    And of course, there really is a discoverability problem for all authors due to the proliferation of content.

  38. Robotech_Master says:

    “In a perfect world (okay, in my perfect world) there would be a separate section on Amazon or B&N.com for self-published e-books, maybe even separate websites. I truly believe that it would help the reader distinguish the books as well. Readers don’t purchase books based on who the publisher is and don’t necessarily care. As a result, they might not even know if they’re buying a book that was professionally edited versus one that was self-published. Publishers are devaluing their own content as well by even adding to the confusion. All publishers will discount the first title in a series, and these get mixed in with the other less expensive books and just add to the clutter.”

    Steven Zacharius, CEO of Kensington Books in the Huffington Post

    • Zacharius sounds more foolish every time he speaks. Of course publishers would love if self-pubbed books were ghettoized – we’re eating their lunch.

      And as for the contention that books are either tradpubbed and professionally edited, or self-published and unedited, Zacharius is either deliberately building a strawman, or so ignorant about the reality of self-publishing that he should stop talking before he embarrasses himself further.

      And while we’re on the topic, I know several authors who were published by Kensington, and none of them have anything kind to say about the experience. They are all self-publishing now and making more money and reaching more readers than they ever did under the “expertise” of Kensington.

      Which is the best possible riposte to this nonsense.

      • D.L. Shutter says:

        “…or so ignorant about the reality of self-publishing that he should stop talking before he embarrasses himself further.”

        Too late. He’s very aptly demonstrated that ignorance about self-publishing during the big discourse. He repeatedly dismissed examples of extremely successful and well known romance indies as circumstantial evidence of SP success. Apparently, if you haven’t had a NYT or PW article written about you as an indie, then you must be someone else’s imaginary friend.

  39. Reblogged this on The Writers' Workshop Blog and commented:
    I think David Gaughran hits the nail on the head with this one.

  40. Pingback: This Is The Kind Of Competition Publishers Want | Matthew Ismail

  41. Lane Diamond says:

    Yep. Just yep. The dinosaurs be a’ wailin’. They’ve been at it for the past 3+ years, and they’ll keep at it until they’re finally extinct… or truly evolved. That’s the real mystery to me: if they would just accept the facts on the ground, they could rework their business model and still be a force. They’re just so damned shortsighted.

  42. radford46 says:

    Apologies in advance, but I am forced to type this in full (using speech recognition, because I have severe RSI, so forgive any typos). The following is an article in today’s Sunday Times by historian, writer and broadcaster Amanda Foreman. I can’t provide a link to this because the newspaper’s online edition has to be paid-for. I’m just copying it from the hard copy I bought today. I’m sure that David and others will want to comment, so here goes:

    The article is titled: Stay silent and soon Amazon will be telling the world what it can read.

    ‘One of the greatest monopolies in history was the mediaeval Catholic Church. Its religious and temporal power was absolute until confronted by an even more potent rival: the printed book. Today, print is once more at the centre of a cultural revolution. Only this time it is not the challenger to a global monopoly. But its most successful weapon.

    Amazon, founded and controlled by Jeff Bezos, used to the humble book to leveraged itself into becoming the world’s largest online retailer. It took twenty years for Amazon to emerge as a monopolistic power. Last week, by creating an effective black list of authors for use as a bargaining tool against Hachette Book Group, the company showed us how far it would go in its abuse of that power.

    The public has only recently become aware of the long shadow war between Amazon and the publishing industry. In February Amazon began quietly, “disappearing” certain authors in an attempt to force Hachette into giving larger discounts on its books.

    What the public does not know is that the real fight is about kickbacks. How can Amazon make up for the fact that it sells almost all its books at a loss?

    The money has to come from somewhere – and it does so in the form of “fees” that the publishers must pay to have their books listed. It is the fees, not consumer choice, that drive nearly every aspect of how a book is displayed recommended on Amazon.

    In most economic and political situations. This practice is called “pay to play” and is banned.

    Amazon glories in its ability to operate behind a wall of silence. Its line is that it doesn’t talk to the press, but the real point is that it is able to dictate that same line to the rest of the book industry. No one in mainstream publishing dares to speak out because of the restrictions of punitive non-disclosure agreements.

    Even now, with more than 5,000 Hachette books and their authors held hostage by a Amazon, Hachette hasn’t said – can’t say – what the struggle is about. Nor has the German division of Bonnier, the other publisher involved in similar negotiations.

    Instead, both companies have dug in, issuing press releases declaring their commitment to resist the “unknown” terms offered. The reason they have taken this potentially ruinous stance is because they have no alternative. Ruin stares them in the face if they capitulate. The same threat applies to the rest of the book industry when it comes to their turn to negotiate with Amazon.

    According to estimates by Forbes magazine, Amazon controls 50% of total book sales in the United States. That does not amount to a monopoly under the terms of the Sherman Anti-Trust Act (1890), although in practice it effectively is one.

    Amazon, especially in the e-book division, has no viable competition. Thanks to a combination of predatory pricing, strategic takeovers and tax avoidance, it has very little competition anywhere.

    The world’s most efficient purveyor of nappies, underwear and batteries does not need Hachette and Bonnier to survive. If Amazon never saw another book, the dent to its overall sales would be small: reduction of $5.25 billion (£3bn) in its $75bn annual revenue.

    Amazon claims to be on the side of the consumer. But excluding certain writers, discouraging sales and extorting kickbacks in return for promotion are not the actions of an open, consumer-oriented emporium.

    In the short term, authors have had to adjust to an Amazon-dominated world. With a few exceptions, writers, across-the-board have suffered a dramatic loss of income.

    Amazon’s real attitude to the book industry was revealed in its public statement last Tuesday. This referred to books as “demand-weighted units”. They are not. The customer looking for Tolstoy’s War and Peace won’t buy Tolshoy’s Peace and War because it is cheaper. Despite what Amazon would like us to believe, Tolstoy’s book has value, the other simply a price.

    Publishers, for all their faults, understand this. If they go to the wall (along with independent booksellers), so will the financial structure that supports non-fiction, serious fiction and poetry.

    The pernicious changes to literary life go much further and deeper, however. All parts of the book trade have become vulnerable to distortion because that is how monopolies thrive, by distorting and corrupting the world around them.

    By way of illustration, the only literary organisation. I found that was prepared to go on the record to me was the Authors Guild, which receives no money from Amazon.

    The foundation of democracy was formed on the bedrock of books. It’s why non-democratic countries try so hard to control them. Disney has already allowed Chinese censors access to film sets, giving them carte blanche to decide what their compatriots may see. It is hardly a leap to imagine a similar scenario taking place at Amazon – soon, if it is allowed to morph into both a monopoly and a monopsony.

    In the long term, the risk to the public good is that Amazon’s power will diminish the fundamental freedom to express ideas through the written word. At best, the ability to research, reassess and reflect on the human condition will become a privilege for a select few, made possible by handouts from the state and private philanthropy.

    To the question “What can we do about this?” The answer is “plenty”. Market regulators need to breakup Amazon into its constituent parts, just as they once did with the banking monopolies.

    The big five publishers need to hold firm against Amazon’s demands; the freedom of the creative marketplace depends on it. Customers need to listen to the advice offered in Amazon’s statement and buy books from independent outlets while they still can.

    As for writers, it would be naive to say, “don’t be afraid to protest.” Of course, we are afraid. Until now, the risks of speaking out against Amazon far outweighed any possible reward. But the blanket targeting of Hatchette authors is proof that pliant behaviour won’t save us.

    We need to stand alongside our fellow authors at Hatchette and Bonnier. Their fate is our fate; we can help them win or watch them prepare the way for the destruction of all of us.’

    Well, there you have it folks. Ms Foreman raises some very serious issues that we who are also beholden to Amazon must bear in mind. I wonder how we would feel if we weren’t Indies.

  43. Soon the dinosaurs will fall. Tor offer DRM free ebooks and BooksGoSocial.com offers ALL writers a way to get discovered. Write a great book, publish it DRM free, promote the hell out of it! Good luck to all!

  44. Alix says:

    I was reading a book recently that had excerpts from several novels, and the “permissions” were acknowledged in the front of the book. All of the permissions came from the publishers– the “rights-holders”. That really struck me as one of the most pernicious aspects of the legacy publishers– they “own” the rights to our work, at least for the period of the contract… and while none of these Hachette-defenders realize it, most of these contracts make it quite easy for a publisher to keep the rights long after the specified period. So the author has no right to give “permission”– only the publisher does.

    This just reinforced my decision never to deal with legacy pubbing again (unless, of course, they make me an offer I can’t refuse :). The attitude is– we own this. No. I wrote it. I want to own it. Now I can, and still get readers. And the publishers– powerful as they are– are so stupid to alienate us authors, because they don’t just lose our books today. They lose the backlist and the reprint income in the future. I don’t think they’re going to last. Or maybe they’ll just become one huge publisher and publish mostly celebrity books and James Patterson.

  45. Pingback: No more “vs.” – Okay? | Books: Publishing, Reading, Writing

  46. Pingback: Reblog: This Is The Kind Of Competition Publishers Want | Matt Roberts

  47. Brilliant post, David. For now, Amazon is the only way I can check how my books are selling. I use it frequently as a customer and as a writer [published once by Picador and once by a tiny new imprint, Tenebris] and I’ll go on doing that until they morph into something so hideous no decent person would touch them. I’ll reblog this on franceskaywriter.wordpress,com and thanks to all the commenters too.

  48. Reblogged this on franceskaywriter and commented:
    David Gaughan’s thought-provoking blog hits the nail on the head again.

  49. Martin Lake says:

    Great article, as always. As far as I can see the only company who have been successful in stopping Indie books is WH Smith. They pulled Indie books after the hysteria about sexually explicit content. Smith’s still aren’t publishing indie authors unless they come stamped with a publishing house label, genuine or spurious. I might have a go at putting out a book published by ‘Martin’s Mum’s Bookie Wookie Press.inc’ and see if they start selling my books again.

  50. Pingback: Is Amazon a Monopoly/Monopsony?

  51. The thing is readers don’t care who publishes the book. They don’t pluck a book off a shelf at Barnes and Noble and say, “Gee, this book is published by Hachette. It must be super, awesome, off the hook, come-in-my-pants fantastic. I just have to buy it, devour it, and see if it’s spank worthy right NOW!” Most readers don’t even know who Hachette is. Readers like shiny and new, eye catching cover art, and an immersive story. That’s it. I’m not an indie publishing purist and I won’t say that I’ll *never* traditionally publish if the right deal comes along. What I won’t do is sign a contract that sets terms that I know I can’t live with—if it limits my ability to self-publish, connect with readers, or I *know* I’ll make significantly more on my own. If the initial payout takes the sting out of giving up larger digital royalties and the terms were right then I’d do it for the print reach. That’s not going to happen unless I can bring something to the negotiation table…like a following or fan base. I’m not worried about James Patterson. He’ll always have ghost writers making tons of money for his brand. I think his viewpoint is from an emotional bias instead of embracing the changes in publishing and coming up with inventive ways to use his brand to reach new readers. What I do worry about are the little guys. Those debut authors that have books coming out with Hachette during their renegotiations with Amazon. All publishes care about is the bottom line and whether a contract earns out. Author Solutions is deplorable. I met an author just last week that paid $7K to Hay House to self-publish a book through Balboa Press and it didn’t receive editing. Makes me sick.

  52. Pingback: Monday Must-Reads [06/02/14]

  53. wendykarasin says:

    David, what are your thoughts on such self pubs as Balboa and Turning Stone Press? I’m hearing enough chatter, good and bad, to make my head spin every which way. Preditors and Editors doesn’t seem to think much of either one, although I read an article in She Writes that sang the praises of Turning Stone. Since you don’t seem to have a dog in the fight, I’d appreciate your take on them. Thanks in advance.

  54. Reblogged this on The Story of Okal Rel and commented:
    No shame anymore in being one of the POD people. :-) Anyone else remember how vilified POD was when it first appeared in .. Mm early 2000s maybe ?

  55. Pingback: Big Publishing and the threat of real competition | Liminal Corvid Press

  56. Pingback: Die Woche im Rückblick 30.05. bis 05.06.2014 | sevblog - Self-Publishing und Schreiben

  57. Pingback: Sharing the Wealth; 6/6/2014 | Story Arcs

  58. radford46 says:

    Once again, apologies for possibly boring you with this, but I thought this article by writer Joel Stein in TIME magazine was, besides being illuminating, quite funny. As TIME lies behind a pay wall, I’ve taken the trouble of once again using my speech recognition software to let you all enjoy Joel’s article, which is titled 99c Loyalty: one writer’s dramatic account of surviving the feud between Amazon and Hachette.

    ‘When I joined the literary community in 2012 by writing my first book, I anticipated long teas with brilliant minds debating complicated issues during which I’d pretend not to be bored – just like a meeting at TIME, except with tea. Instead, I find myself in the middle of a brutish corporate battle during which I am also bored.

    Although the negotiations haven’t been made public, it seems that Hachette, which published my book (Man Made: A Stupid Quest for Masculinity), wants to set a minimum price for each of its key books on Amazon, fearing the online retailer will sell books at 99c to draw people in to spend money on more expensive items, such as anything’s that’s not a book. I personally think there isn’t a business model based on people being “drawn in” by books, as proved by the fact that there are no longer bookstores. I also suspect that lower prices don’t make a huge difference in book sales. I never heard someone say, “I spent two months reading Robert Caro’s Lyndon Johnson bio instead of Doris Kearns Goodwin’s because it was $6 less.” Per hour of entertainment, there is nothing cheaper than a book. Except everything on the Internet.

    Still, Hatchette’s demand was enough to cause Amazon to go Mario Puzo on the publisher’s books. A Malcolm Gladwell book now “ships in two–three weeks,” which is longer than it takes Malcolm Gladwell to write new books. You can’t pre-order J. K. Rowling’s pseudonymous novel The Silkworm, which is also listed very un-pseudonymously. Questlove’s memoir Mo’ Meta Blues costs nearly 50% less on Barnes and Noble’s website. A banner ad across Jeffrey Deaver’s The Skin Collector attempts to lure readers away by suggesting three “similar items at a lower price” with way less disgusting titles.

    So it was with trepidation that I went Amazon to see what barbarism it had committed on my book’s page – changing my author photo to one of my high school mullet shots, perhaps, or allowing yet more people to start their one-star reviews with “No, I haven’t read the book.” But there was nothing. My book was the same price as it was at Barnes & Noble’s website, could be shipped the next day and could even be purchased for a slightly higher price as a “collectable” first edition, despite the fact that there’s no second edition. Amazon was not just selling my book; it was pushing it hard. It was acting like stacked boxes of my book was starting to stink up its warehouses with their putrid mouldering, which is highly possible, since that’s what’s happening in my basement.

    This cannot be an oversight. Amazon attracts some of the best engineers in tech, so I’m pretty sure they can figure out which authors have egos so huge that being left out of the feud would destroy their confidence, leaving them unable to write again. Probably with an algorithm that looks the covers with the author’s name in a ginormous font under a photo of him stepping on a bear he supposedly hunted. Ordinarily I would do something about this outrage. I would write a mean joke about Amazon on twitter or mumble something about them being jerks at a party where I knew no one there worked in tech or was from Seattle. But despite how Amazon is purposely hurting me, I can’t join the vast majority of authors and publishers taking Hatchette’s side. I buy everything from the enemy of literature, including my groceries, which Amazon Fresh gathers from my favourite shops all over Los Angeles and then delivers to my door. My gentle emails telling them they forgot an item are responded to with apologies and a £35 gift certificate. I’m vaguely aware that Amazon’s warehouse workers have to wear monitors counting down the seconds they have to race to get my soap and deodorant, but I think they understand that’s a small price to pay for my not having to walk around stores and interact with cashiers.

    Also, back when I created a page for TIME , in which important people drew Thanksgiving turkeys in the shape of their traced hands, Jeff Bezos did a fantastic job, even gluing Legos to his drawing, despite my giving him no good reason to do this. Meanwhile, I’ve never had any interaction with Louis Hatchette, partly because he’s French, partly because he died in 1864, and partly because I didn’t sell enough books to make it worth his time to return my telegraphs.

    It’s hard to have company loyalty when we are all free agents with our brands and followers. I have no idea who will publish my next book, though I do know they’ll be sorry they did. And I would leave Amazon for a company that delivered even snobby groceries faster. More important, I know that cat videos are a bigger threat to books than e-book pricing. So I hope Hatchette gets what they’ve asked for, and the old system stays in place so books can still cost enough that publishers can continue to pay me advances they’ll never get back. Or that Amazon publishes my next book. They can pay me in gift certificates.

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