With the Hachette Amazon dispute over pricing in the background, Amazon told its Kindle authors of the days when books were a luxury product meant for the elite. It reminded them of hardbound gilt-edged editions that cost ten times the price of a move ticket. Apparently when paperback editions arrived publishers opposed them in order to preserve their margins with authors also weighing in on their side. Amazon in its note quoted George Orwell’s attack on the paperback format in 1936.
liver Corlett’s A Short History of Paperbacks says that though paperbacks had arrived during the seventeenth century in France and Germany it was in the eighteenth century that they made inroads to the strong publishing industry in England. With the advent of the steam rotary press and railroads, both production and distribution became easier and paperbacks could be sold on news stands. The Dime Novel series by Erastus and Irwin Beadle attained instant success — selling 65,000 copies of Malaeska, a romantic tale about an Indian princess by Ann S Stephens.
Opening an office in London in 1862, Beadle and Adams started producing war stories, derring do tales, romance and thrillers that soon became a rage with the English masses labelled ‘penny dreadful’ by the publishing community.
The Penguin imprint
The first mass market paperback by a reputed publishing house was produced in the US — the 1932 Pulitzer prize winning The Good Earth by Chinese American writer Pearl S Buck (Sài Zhēnzhū). When Buck received the Nobel Prize for literature in 1938, her publisher John Day brought out a paperback edition of The Good Earth under the Pocket Books brand and softcover books lost some of the stigma attached to cheap thrillers. At the same time Bodley Head in Britain countered slack sales and a recession by introducing its Penguin imprint with best selling authors Agatha Christie, Ernest Hemingway and Dorothy Sayers — its first 10 paperback titles sold a million copies.
Penguins sold for sixpence, a tenth of the price of a hardback eliciting Orwell’s ‘Review of Penguin Books.’ Amazon recently quoted the first sentence of Orwell’s article, “The Penguin Books are splendid value for sixpence, so splendid that if the other publishers had any sense they would combine against them and suppress them.”
While it is no easy task to predict the future of the publishing industry, Amazon’s conditions (in the context of its dispute with Hachette) include 50% profit sharing for eBooks. The US$ 74 billion turnover Internet giant is far bigger than Hachette’s US$ 10 billion and most of the larger global publishers put together. Since it is said to control over 50% of the eBook market and also distributes nearly 25% of their print versions globally, large publishers can hardly think of selling books both in print and in electronic formats without Amazon.
Hidden costs of publishing
Whereas distribution and sales can be seamlessly efficient if warehousing logistics and last mile delivery is managed by players such as Amazon, editing and publishing is a different ball game all together. The thinking part — key to successful books, and its cost cannot be truly quantified especially when best selling authors such as Vikram Seth take seven years to write a book, along with a million pounds as advance.
After writing the 1,349 page blockbuster of the decade The Suitable Boy for Orion, Seth was sued by Penguin who bought its rights and also advanced him a million pounds for the sequel to be produced within seven years. Seth whose deadline expired in early 2013 found himself a more tolerant publisher who bought over the rights from Penguin. Meanwhile it is reported that Penguin has sued a dozen or so authors including Elizabeth Wurtzel and New Yorker writer Rebecca Mead for incomplete or non existent manuscripts. There are many hidden costs in publishing like peer review, editing and re-editing, as the manuscript moves from the commissioning editors desk to the copy editors desk — just one reason why it takes 9 months to a year to produce a book after the final approved manuscript is made available to the publisher.
Efficient web portal
The publishing industry is agonizing over Amazon’s muscle flexing and throttling of Hachette’s US sales at a time when their distribution contract is due for renewal. Amazon’s own record as a publisher is poor — with its Create Space self publishing platform languishing with millions of titles selling less than a hundred copies.
Apart from the gate keeping process (or hurdles) in the publishing industry that raise the cost of publishing but are meant to keep its quality consistently high, there is the bigger cost of promoting a book. It is said that publishers promote 10% of the books they produce aggressively while only 1% of these become best sellers and bring in over 80% of the revenue that sustain the business. Without any book promotion apart from its algorithmic
recommendations, Amazon seamlessly delivers books sold on its convenient and efficient web portal. Publishers say that paperbacks add value only because they have become more expensive and sustainable — the price gap between hardcover books and paperbacks has narrowed to just 50% today.
Amazon says, “The important thing to note here is that the lower price is good for all parties involved: the customer is paying 33% less and the author is getting a royalty check 16% larger and being read by an audience that’s 74% larger. The pie is simply bigger.” However publishers dispute this claim saying that the publishing industry has contracted during the last ten years while Amazon has grown to giant proportions.
Hachette itself is an example of the dismal state of the publishing industry with some of the erstwhile larger publishers such as Little Brown, Hodder and Stoughton, Octopus, Orion, John Murray, Orbit, Abacus, Hamlyn and several others already consolidated under its publishing platform in a fight for survival. If Amazon wins the battle with Hachette, it will definitely reduce prices and bring in more readers. However, it will also drive profits away from the publishing industry — which unlike Amazon cannot survive by selling gizmos and game.
