Last week an editorial by Mark Coker was posted on CNN.com, ominously titled ‘A dark day for the future of books,’ about how the Department of Justice recently charged Apple and five large publishers* with conspiring to raise the price of eBooks – and how a ruling against these behemoths could have unintended consequences that hurt publishers and (as the title portends) cast a dark shadow over the future of books themselves.
It took me roughly 30 seconds to form my own counter-opinion, which I can summarize in a single (albeit indelicate) word: Poppycock**.
Let me explain the basics of the case, first, for those who aren’t familiar with it.
1) Publishers were upset by Amazon, whose deep-discount pricing structure, they felt, was setting low expectations for book prices among buyers, as well as undercutting the sale of physical books. (There is truth to this; Amazon takes a loss on many books, selling them at prices lower than their own cost, simply to get the business).
2)When apple released the iPad, it entered into a deal with publishers to change the pricing structure in such a way that the publishers would now set the eBook prices, instead of retailers like Amazon, and those retailers would simply get a percentage of the sales as commission.
3) The government alleges this deal violates anti-trust laws, saying the publishers and Apple conspired to raise the price of eBooks – and force Amazon to adopt the new pricing model in the process.
Back to that dark shadow…
Whew. Now that that’s out of the way, let’s move on to what this means for the future of books: Nothing! That is, unless you believe Mark Coker.
Coker sees the newly-adopted pricing model (called the Agency Model) as a good thing:
Most important, the agency pricing model levels the playing field for e-book retailers. It prevents deep-pocketed retailers or device makers from engaging in predatory price wars to harm competitors or discourage formation of new competitors.
To this, I’ll only say that it doesn’t matter who sets the prices; deep-pocketed retailers already have the upper hand for so many reasons, and this will not change if the Agency Model is abandoned.
Forgetting, for the moment, that eBooks are nothing more than computer files and it makes little sense for retailers to reap huge profits for their mere transmission – the bigger issue is allowing retailers to control the software that lets you read those eBooks in the first place. If Apple (with its deep pockets) is able to force publishers to sell through the iBookstore, forcing consumers to read them with its own proprietary software on its own hardware (iPads, iPhones etc.) rather than on other, open-format eReaders, then the harm to competitors is far greater and far more permanent than the alternative (letting the government’s anti-trust lawsuit break Apple’s hold on the market).
Coker is right about at least one thing regarding the government’s goal, however:
It could inadvertently hasten the downfall of the world’s largest book publishers by forcing them to comply with onerous conditions [...that ...] will increase publisher expenses and slow their business decisions at the very time when publishers need to become faster, nimbler competitors.
But this says nothing about the future of books, does it? Only the future of the large publishers:
Unfortunately, the self-inflicted wounds of large publishers have already begun to render their businesses less relevant to the future of publishing. Authors are beginning to turn their backs on traditional publishers in favor of self-publishing. Authors are now hiring their own editors, cover designers and marketing consultants. By assuming responsibility for the roles once played by publishers, authors are earning up to 70% of the list price as their e-book royalty versus the 17.5% paid by traditional publishers.
Coker’s last paragraph sort of proves my point. The publishers may be struggling, but the authors are finding other ways to get their books into the hands of readers – and earning more for their efforts than ever before, in many cases. Yes, rampant self-publication has its downsides (an influx of horrible, Eye of the Argon-like books, for instance – but the market, doing what it does pretty much on its own, will sift out the crap, bring the blockbusters to the top of the heap, and create niche markets for the well-crafted, but not mainstream, work out there.
So, in other words, don’t fret, book lovers
Once upon a time, books were made by hand, and passed (by hand) from person to person to be read. Then publishers took the reins, and small retailers gave customers a place to discover the latest writing. Before long, huge chains drove the small retailers out of business, and started putting the squeeze on publishers and customers alike. Then even the big chain stores failed, leaving only a few physical stores and only a few (consequential) online outlets to get the books to readers.
The means of distribution have changed, who gets the money and how much has changed, but the basic principle has always been the same: the authors write the books, the readers read them. Regardless of how the Justice Department’s case pans out – whether Apple and Google eventually carve up the world or publishers simply perish and books go direct to consumers – the future is, and always will be, bright for books.
* The publishers are Simon and Schuster, HarperCollins, Hachette Book Group, Penguin and MacMillan.
** ‘Poppycock’ was not the word I had in mind originally.