Drôle de guerre: Hachette, Amazon and authors. Something needs to be fixed, but looking ahead

A commercial dispute between Amazon and Hachette has led quite a few authors to take a stand. On which side? Well, they surely are against Amazon. But are they also with Hachette?

Authors United sent a letter to their readers through an advertisment. They claim Amazon has boycotted Hachette and made the works of some authors more difficult to find at the right price. Amazon answered by accusing Hachette to impose the wrong price on their books (adding a little gaffe about Orwell). Hachette just said that they want to go on negotiating. John Kay suggests that the real problem is in publisher’s strategy.

It’s been a sort of “drôle de guerre” until now. But the future is not going to be nice for some of the players. Amazon is winning on the technology side and there is little that Hachette and other publishers have been doing to prevent their complete defeat. Authors are asking Amazon – rightly – for fair competitive tactics. But in the long run, this is not enough. If they like publishers they should be asking them to improve their vision and strategy.

Publishers buy authors’ copyright in exchange of some services they still give, such as financing, marketing and editing, but they can pay for it only if the also make a great delivering. As a matter of fact, marketing and editing can be done by someone else, maybe financing too, delivering is done more and more by Amazon. Publishers’ problem is not about negotiating: it is about creating a real strategy.

Where to look? Where is Amazon going to find problems?

Amazon is a scalable platform that has the ability to lower the price for delivering content – and many other things – to the consumer. The more customers they have the more margins they do in an exponential manner. What prevents them to make huge and stable profits now is their choice and will: it is because they are investing tons of dollars in innovation and in acquiring customers. In the long run they will have a base they think is right and start getting more and more profitable. The problem with that is that they also want to lock-in customers. Their platform is not interoperable with any other platform. This is because in their technical world they want control. And this fundamentally changes the idea of Amazon as the place where you find anything you need to find at a very good price.

Amazon is competing against publishers, and winning. But it is also competing against other platforms: such as Apple and Google. In the book world they win because customers feel that Amazons has the best choice of books – and a very good device to read them. If Amazons starts not to sell everything, if it excludes some publishers or authors, it will be chaos: people will have to have a device for every platform to get to every author. So they need to fight publishers without helping Apple and Google.

There is a technical flaw in Amazons’ stategy. If the net is neutral somewhere can be created a new platform that starts from skratch with the idea that it will allow to deliver, pay and read any book that is published by any author. A new interoperable platform that levels the field for competition between authors, publishers and device makers can be a prospect: if someone starts to invest in it before Amazon has completely won.

Authors could ask publishers to invest in this platform, now. Or they could start thinking about a new platform that will help all professionals to find they business model: editors, markerters, financers, stylists, authors and every other profession can gather in a new book project, make a deal about how to divide revenues and deliver the work. It is not impossible.

What’s impossible is to win by just complaining.

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