Smells Like Chicken
A weekend game of corporate chicken between Amazon and Macmillan over ebook pricing, which led to the former briefly pulling the latter’s books from its site, has ended with a public capitulation from Amazon. Expect to see similar incidents over the next few years. The tectonic plates are shifting, ecological niches are changing, and the dinosaurs are fighting for whatever marshmallow bananas remain. (Hmm, I’m pretty sure I had control over that metaphor when it started...) A similar game of chicken played out recently between Fox TV and Time Warner cable carriers over carriage fees.
Publishers fear that Amazon has devalued the perceived value of ebooks, and, as a domino effect, print books, too, by training their customers to see 10 bucks as the default price point. Amazon has done what seems to be a crazy thing first of all by flaunting the brute force of their current market share, and second by immediately giving in.
Purely as a roleplaying exercise, let’s imagine that Amazon’s actions were in fact clever, and then make that thought seem credible.
Tactics aside, $10 may actually wind up being customers’ perceived value for an item that consists of a formatted text file, can’t readily be loaned to others even in your own household, and can’t be sold at a used bookstore after you're done with it. Of course publishers would like that number to be higher. On a related note, I would like people, moved by the wit and eloquence of my blog entries, to show up at my door to hand me free truffles and Côtes du Rhône*.
Amazon may never have thought itself capable of winning the present skirmish with Macmillan. One might propose that they wanted to lose in a high-profile way, thus turning customer resentment for the coming failed experiment onto Macmillan and its fellow publishers. Under this scenario, it looks foolish for a weekend in late January but smart, and on the side of the customer when all the dust has cleared.
It might well be that you can earn more money overall pricing mainstream books at $10, and selling more of them, than you do by placing them above the resistance point. Ultimately, it’s not a moral question but a math problem. In the meantime my investment in rooting for the Albertosaurus over the Allosaurus or vice versa remains somewhat limited.
In our own little corner, the perceived value of a PDF is fortunately higher. But our files have useful illustrations and complex graphic design. If the rich special features mooted for iPad-based ebooks take off, we can add way more in the way of genuinely valuable extra content-but more on that soon. The closer relationship between publishers, designers and players may also help here. On the other hand, we’re the canaries in the coal mine of book piracy, so we can’t exactly rest easy in the security of our own marshmallow bananas.
I knew that metaphor would finally make sense.
It did finally make sense, didn’t it?
*Others might request ponies. We all have our priorities.