Amazon is trying to force publishers to reduce the price of e-books and increase the proportion of authors
In a public statement regarding its relationship with the publisher Hachette (the fourth largest in the US), Amazon accused Hachette of setting unreasonably high prices for electronic versions of books, and underestimates the share of payments to authors from sales of such books.
The statement says: “with electronic versions of books, the publisher does not bear printing costs, the risks of oversizing, costs of sales forecast, returns, lost profits from insufficient circulation, costs of warehouses and transportation. Also for e-books there is no secondary market - they can not be resold as used books. E-books can and should cost less. ”
According to Amazon, setting the price for e-books at $ 14.99 or even $ 19.99, the publisher eventually loses profit. According to the company's calculations, if the price goes down from 14.99 to 9.99, sales increase 1.74 times, that is, instead of revenue of 1,499,000 dollars per 100,000 books, the publisher could receive 1,738,000 dollars - 16% more and also increase the audience, which can help the author’s book to get on the bestseller list.
')
According to the company, the distribution of revenue should be as follows: 35% to the author, 35% to the publisher, and 30% to Amazon. “Is the share of 30% reasonable? Yes. In fact, 30% of total revenue is the share that Hachette imposed on us in 2010, entering into a price deal with competitors to raise the price of e-books. We have no complaints to 30% - however, we have big complaints about price increases, ”the statement says.
Also, Amazon does not make payments directly to authors of books sold under a contract with publishing houses. Currently, Amazon pays 70% to publishers who decide for themselves what share the authors should receive. “In our opinion, Hachette shares with the authors too small a share of the profits - but, ultimately, it’s not for us to decide,” writes Amazon.
The business “war” with Hachette began a few months ago, when Amazon removed the option of pre-ordering books produced by the publisher, and on the recommendations page began to offer cheaper alternatives. In order to win over the authors, Amazon offered Hachette to pay 100% of the proceeds to the authors themselves, to which the publisher replied: "this is suicide."
The statement says: “with electronic versions of books, the publisher does not bear printing costs, the risks of oversizing, costs of sales forecast, returns, lost profits from insufficient circulation, costs of warehouses and transportation. Also for e-books there is no secondary market - they can not be resold as used books. E-books can and should cost less. ”
According to Amazon, setting the price for e-books at $ 14.99 or even $ 19.99, the publisher eventually loses profit. According to the company's calculations, if the price goes down from 14.99 to 9.99, sales increase 1.74 times, that is, instead of revenue of 1,499,000 dollars per 100,000 books, the publisher could receive 1,738,000 dollars - 16% more and also increase the audience, which can help the author’s book to get on the bestseller list.
')
According to the company, the distribution of revenue should be as follows: 35% to the author, 35% to the publisher, and 30% to Amazon. “Is the share of 30% reasonable? Yes. In fact, 30% of total revenue is the share that Hachette imposed on us in 2010, entering into a price deal with competitors to raise the price of e-books. We have no complaints to 30% - however, we have big complaints about price increases, ”the statement says.
Also, Amazon does not make payments directly to authors of books sold under a contract with publishing houses. Currently, Amazon pays 70% to publishers who decide for themselves what share the authors should receive. “In our opinion, Hachette shares with the authors too small a share of the profits - but, ultimately, it’s not for us to decide,” writes Amazon.
The business “war” with Hachette began a few months ago, when Amazon removed the option of pre-ordering books produced by the publisher, and on the recommendations page began to offer cheaper alternatives. In order to win over the authors, Amazon offered Hachette to pay 100% of the proceeds to the authors themselves, to which the publisher replied: "this is suicide."
Source: https://habr.com/ru/post/232407/
All Articles