Tag: Apple

It’s Done!

I know. I know. I was supposed to be back a couple of days ago with a review of the iPad Pro and more blogging. I got waylaid, first by the injured knee and then by writing. I’ll admit I worried that the injury would bring most, if not all, of my writing to a standstill. I can’t sit at the desk right now to work. I can’t sit in the recliner or on the sofa with the knee elevated and work on the laptop. It is too much weight and pressure on the knee. But, to my surprise, the iPad Pro turned out to be a better solution than I’d dare hope and, as a result, the final draft of the re-imagined Light Magic.

I picked up the iPad Pro about two weeks ago. It was on a whim a and I got a really good deal on it. Part of the reason for getting it is because I am trying to migrate all my writing and editing to my MacBook Pro and having an iPad to take with me when I’m away from the house would let me keep with the “Apple means writing” mindset. Part of it was less selfish. My mother has been using a second gen iPad I gave her years ago. To say it is on its last legs is being kind. I’ve been looking for a replacement, one she wouldn’t have to learn a new OS on. So i wanted to know what the real differences were between the iPad and the iPad Pro and if the differences were something she would need or want.

I did my research. I decided not to spend the additional money for the newest version of the iPad Pro, choosing instead to go with a refurbed 9.7” version. I got a great deal on it and, using the money I saved, bought an Apple Pencil to go along with it. They came in and I started working with them. Then I injured the knee and knew I needed to find a way to write or I’d be blowing not just one deadline but at least three if the damage to the knee was as bad as I feared.

I’d bought one of the most recommended Bluetooth keyboards and cases for the iPad Pro but it suffered the same problems so many of its kind do. There was a lag between typing a word and that word showing up on the screen. That lag got worse the lower the keyboard’s power. You had to carry the charge cord with you or find yourself suddenly unable to use the keyboard while out and about.

But it was the lag or the drag or whatever you want to call it that bothered me the most and made it almost impossible to use if I was going to do any serious writing on the iPad. I bit the bullet, trolled various sites and found the Apple keyboard for the iPad Pro at a really good price. (Mind you, I’m cheap and did not pay retail or close to it for any of this).

Oh. My. Goodness.

The keyboard is totally awesome. It doesn’t rely on Bluetooth or wireless connections. There is a connector on the iPad it hooks into magnetically. That is how it communicates with the tablet and where it gets its power. The one real drawback, other than the fact it isn’t a full-sized keyboard — is that the keyboard isn’t back lit. But the feel of the keys is much better than I’d expected and I like the sound of them. Better yet, the keyboard keeps up with me and I don’t have to wait for it to catch up. Huzzah!

the Apple Pencil is wonderful for making notes or for annotating a manuscript. The batter life on both it and the iPad Pro are much better than I’d dared hope. I can work most of the day, pausing only for a short time to give the iPad a quick charge. Then I plug it in overnight.

To give you an idea of how much I have written on the iPad Pro since getting it, in this past week, I have managed close to 40k words on it. I have the work saved on the iPad and have emailed it to myself. I can save it to Dropbox or any of the other major cloud storage sites. In fact, I have been writing this blog post on the iPad Pro using the Apple keyboard.

it isn’t for everyone and I certainly don’t want to do all my writing all the time on it. I also can’t do my conversion on it because the program I use — Vellum — isn’t available on iOS. But for something that is portable and able to do what I want and need when writing and stand up to my writing schedule (at least so far), I highly recommend the iPad Pro.


Apple and privacy.

If you somehow managed to miss it yesterday, the internet is abuzz with news that Apple is refusing to submit to a court order that it write the necessary code to allow the FBI to break the encryption on the iPhone owned by one of the terror suspects in the San Bernadino shooting. One side is applauding Apple for standing up and trying to protect the privacy of its customers. After all, they use the encryption option to prevent their data from being stolen. The other side is pointing out that the government isn’t asking Apple to put a backdoor in the iOS that would permanently allow the government to grab your data. They go on to say that this is an issue of national security. The line is drawn in the sand and Apple is promising to appeal the order.

My layman’s understanding of the problem is that you are only allowed so many times to try to hack the iOS before the encryption coding kicks in and wipes the data. The FBI techs, who you would assume are some of the best in the country — if not the world, should be able to hack the system without triggering the wipe. The concern the government has is that there is information on the suspect’s phone that could 1) lead to others who mean to do this nation ill and 2) information that could point to other terrorist activities in this nation or elsewhere in the world.

I’ll admit that I’m torn on the issue. I hate the very thought that the government might have a backdoor into my phone or computer or any other aspect of my life. But I also know that, in this day and age of instant communication and digital everything, privacy is an illusion. Yes, there are ways to make it more difficult for the average Joe on the street to steal your data but that gets more and more difficult with every day that passes.

I don’t believe the government should have a hand in my personal life. It shouldn’t tell me what I can do or can’t do in the privacy of my own home as long as no one else is harmed — and I do mean harmed. I don’t mean it hurts someone’s feelings or makes someone feel marginalized or uncomfortable. I most certainly don’t believe the government should monitor my communications or economic transactions without a court order that requires them to prove probable cause to do so.

However, the government has one duty that we should all keep in mind — to protect the citizens of this nation. Whether we like it or not, whether we want to admit it or not, we are at war. There are people out there who have made it their goal, both personally and as a nation, to destroy the United States. It appears that the San Bernadino shooters were at the very least sympathetic with those enemies of our nation. It doesn’t appear to be a stretch to believe the woman was one of those who have sworn to destroy us and that she radicalized her husband.

So it isn’t hard to understand why the government wants to see what might be on the woman’s phone. Hell, to be honest, I want to see what’s on it if it means potentially saving lives.

Still, is it asking too much to order Apple to find a way into their own iOS for this reason?

That was the question the local news discussed this morning. The analogy one of the anchors came up with kind of stretched the point some but I understood where he was coming from. He compared the iPhone in this instance with a safe deposit box. In the latter case, the government has enough probable cause to have a judge issue a search warrant for a single safe deposit box at a certain bank branch. That doesn’t mean the government gets to open all the safe deposit boxes at that branch, much less at very branch of that bank. No, it means that one particular box will be opened.

That is a simplistic approach to the issue, even if a valid point of view. The government is saying that it isn’t asking for a backdoor to be put into all iPhones. It is instead asking Apple to write code that will let it get into this one particular phone without wiping the data it contains. A single target, so limited impact.

However, as Apple points out, once the code is written, it can be stolen and/or exploited. The only way to prevent that is to not write the code.

On the other hand — and how many hands does that make me having? — there is the argument that Apple could destroy the code after it is used in this particular case.

I’m not sure where I land on this issue. No, I do know. Unless and until Apple says it will write a cone time only code and then destroy it, I don’t want to see the code written. There are too many possibilities of it being misused, either by the government or by someone else. Still, there is that nagging voice in the back of my brain that reminds me there might be important information on the phone that we need to know about.

What this really points out is the issue we are going to face more and more often in this digital age. When does the interest of the government in protecting our nation outweigh our right to privacy?

(On the writing front, I have finally figured out why the first two chapters of Honor from Ashes (Honor and Duty Book 3) have been bothering me and, more importantly, figured out how to fix it. So that is what I’m going to be doing today. Then I will return to the edits.)

What Price E-books?

That’s been a question plaguing the industry since e-books really entered the picture. We all remember how the then-Big Six publishers threatened to pull their books from Amazon if Jeff Bezos and company didn’t raise prices above the $9.99 threshold. That went over like a lead balloon and the agency pricing model emerged along with Apple’s entry into the e-book market. Then along came the Department of Justice’s price fixing law suit against five of the Big Six, state lawsuits to match, settlements from most of the parties involved and finally the judge ruling that Apple was liable under the suit. Appeals are going on as are objections to the court appointed monitor.

But it hasn’t just been the publishers and retailers trying to figure out just exactly how to price e-books. Readers have been debating the issue ever since the first e-book hit the market. If you visit the Kindle boards on Amazon, or just about any other reader-related discussion board, you will find somewhere on it a debate about pricing. Some will never buy an e-book priced less than $2.99. To them, anything less means the e-book is of poor quality, usually in the editing or formatting variety, and not worth their money. Others won’t pay more than $4.99 for an e-book because they don’t see how it can cost more than that to produce the book. After all, there are no printing, warehousing or distribution costs for an e-book. The general consensus seems to be that an e-book has to be by a really favored author for most of us to pay more than $9.99 for it.

And the debate continues.

Last year, when Baen Books made an agreement with Amazon to sell their e-books, part of the agreement was that Baen would not undersell Amazon. That meant a restructuring of the Baen monthly e-book bundles and — gasp — an increase in price for newly released Baen e-books. I daresay most of us were thrilled with the fact that Baen now had access to a larger market for its e-books. Oh, we hated the fact that prices were going up — who doesn’t? — but we saw it as the price of doing business. After all, it had been years since Baen had increased the price of its e-books and now it was actually following the market trend.

There are still those who periodically whine about the changes. Most often that is because past monthly bundles (where you can buy all the e-books for that particular month at a discounted price) are no longer available once the new titles in the bundle go up for sale individually. Okay, I’m simplifying it slightly here, but that’s the gist of the deal with Amazon. The major component of the argument seems to be that there might be a bundle someone wants to buy and they forget to do so before the magic cut off date. Well, sorry, but that’s their problem. Baen has been kind enough to let us know what that date is. It also publishes the e-book schedule several months in advance so you can see what the bundles will be. Mark your calendars. Give up that extra latte and buy the damned bundle.

What started this rant anew — rant for me — was reading a post in a forum I follow asking why e-book prices aren’t lowered to match the price of used mass market paperbacks three years after the title first comes out in hardback. Well, you can imagine the mess created as my head exploded on that. Especially when you take into account the price the poster recommended was $3 (according to the poster, that is a penny for the book and then the average cost of shipping and handling).

I have problems with this idea on so many different levels. First is how this person equates an e-book with a used mmpb. Just in case there is someone out there who doesn’t know, an author gets absolutely nothing on the sale of a used book unless tat authors is actually the seller. There are no royalties. The sale isn’t reported to BookScan so it doesn’t help improve the author’s numbers. There are no rules or regulations on how to price a used book either.

Beyond that, where did this person come up with the idea that the average price for a used mmpb is a penny? Yes, there are a lot of used books listed on Amazon and elsewhere for that price. But if you look closer, those books are usually described as being in poor condition. I don’t know about you, but I don’t want a book that is falling apart — not unless it is a book I have to have for some reason and there is no other alternative.

But an e-book isn’t a used paperback. It isn’t rated by condition. Under current laws, you can’t resale an e-book either. So, when you buy an e-book, you are buying a NEW book for all intents and purposes. Just because you haven’t gotten around to buying it for several years after its initial release, that doesn’t mean it should automatically be discounted to a point where the author will get basically nothing out of it if he happens to be traditionally published and represented by an agent.

Let’s look at some hypothetical figures here (and remember, it is very early for me and I am math challenged, especially when I haven’t had but one cup of coffee.)

The e-book is sold for $3.00 under this proposed system. It is published by a legacy publisher and the author has an agent. Those are the parameters of out equation. Assuming Amazon then pays the publisher 70%, the publisher gets $2.10. Assuming the publisher doesn’t take out anything but their percentage of the sales price and pays the authors a whopping 25%, a check for 52 cents. Of that 52 cents, the author’s agent will get 15% or approximately 8 cents (again, all assuming my math is right). That leaves the author 44 cents out of the sale.

Oh, and that is assuming the author has already earned out his advance. If he hasn’t, this drop in price is almost guaranteed to prevent him from ever earning it out before the publisher writes the book off as out of print. Even then, the author has to fight to get his rights back.

But let’s take the poster’s idea one step further. Under his line of thought, if an author does manage to get his rights back to a title, that author should be limited to pricing a re-release of the book under his own imprint to $3.00. Why? Because the book has been out for three years or more already. So what is the impetus for an author to 1) fight to get their rights back and 2) take the time and effort to re-edit, have a new cover created, promote and format/convert the title for re-release? Especially when so many readers think a book priced that low isn’t of the same quality as an e-book priced even a dollar more.

The point is, e-book pricing is still a work on progress. I doubt prices will ever match those of used mmpb — at least I hope they never do. As an writer, I like to eat. As a reader, I like to support the writers whose work I buy and I’m willing to pay to do so. I want them to make enough money from their writing that it doesn’t become such a financial burden to write that they have to quit and take on a second or third job just to make their monthly bills.

But that’s me. I don’t judge an e-book by its price, although I am guilty of judging it by its cover. I use the preview function to see if the writing style is one I enjoy, if it has been well edited and if there are any formatting issues. I will pay as little as 99 cents and as much as $9.99. Anything over that and it has to be a book I need for research and can’t get in hard copy. The average price I pay for e-books is $6.99. But, again, that’s me and to each his own.

That sound you hear

is my head exploding — again. One of these days, I’m going to learn to quit reading the news before I’ve had enough coffee to function at something close to human levels. For one thing, once caffeinated, I know what stories not to read. You know the stories I mean: the ones that have you wanting to either throw the computer against the wall or that threaten to send you out onto the streets, looking for the idiot in the story so you can “discuss” the situation with him.

I hate to say it, but I’m a slow learner about this one thing. At least it seems that way, especially this morning. There are any number of stories that have me grinding my teeth and looking for something to throw. But I’ll touch on only two of them. One of them has me shaking my head and wondering about some folks’ priorities. The other is a continuation of a story that has been more than a year in the making and yet it still continues to aggravate me to no end.

The first happened in the Kansas City – Baltimore football game this weekend. Fair admission here: I didn’t watch the game. I’m not a huge fan of either team. But I did scan the sports section this morning and saw a mention of an incident in the game. Then, when I went online, I found more about the game and what had to be one of the biggest “WTF were you thinking” moments in NFL history. Even if it wasn’t, it is one of the most embarrassing moments — or it should be.

KC’s quarterback Matt Cassel isn’t the best quarterback in the league and yesterday was not a shining moment in his playing history. If I remember correctly, he threw three interceptions in a game KC lost in what looked like a baseball score: 9 – 6. This was also a home game for KC and, as you can imagine, the fans weren’t impressed by Cassel’s playing.

Coming from Dallas, home of the lukewarm fans, I can understand that. Dallas fans have been known to turn on their own team in a heartbeat. We love winners and demand that of our pro teams. Ask poor Tony Romo after his performance last week. But, to the best of my knowledge, Dallas fans have never cheered when a Dallas QB has gone down to injury.

And that is what happened in KC yesterday. Early into the fourth quarter, Cassel took a hit that left him laid out on the turf for several minutes. During that time, KC fans — and not just a few of them, by all accounts — cheered the fact that he’d been hit and would have to come out of the game. That’s right. These people, and I use the term loosely, were glad someone had been hurt and were not afraid to let others know it. After all, I guess it’s more important that their team win than it is to worry about how badly a player might be injured.

As appalling as that is — and, considering just how seriously some football players have been inured over the years, it is very appalling — something good came out of it. Eric Winston, one of the KC players, was so angered by what happened that he called an impromptu conference after the game. With reporters crowding into the locker room, Winston let loose on the fans for their behavior.

“When you cheer,” Winston said, “when you cheer somebody getting knocked out, I don’t care who it is, and it just so happened to be Matt Cassel – it’s sickening. It’s 100 percent sickening. I’ve been in some rough times on some rough teams, I’ve never been more embarrassed in my life to play football than in that moment right there.”

All I can say is good on Mr. Winston. The behavior exhibited by those cheering fans was sickening. I can’t help but wondering if they are the same parents who stand on the sidelines of their kids’ little league games and yell when their child doesn’t slide, cleats first, into base. Or maybe they are the parents who yell at their child for not taking cheap shots in football or soccer. After all, winning is all that matters — who cares who gets hurt in the process.

Gah. That’s all. Just Gah.

Now for the second head exploding moment of the morning. A little background first. Last month I wrote a post over at Mad Genius Club about Bob Kohn, his comic-strip style brief asking to intervene in the DoJ’s price fixing law suit against Apple and five major publishers, among other things. Funny thing is, my head was exploding over that post too. Guess it’s a good thing my head grows back as quickly as it does. 😉

Any way, glancing through the headlines over at Publishers Weekly, I see Kohn is in the news again. Judge Denise Cote denied Kohn’s motion to intervene in the lawsuit. In fact, her judgment — which I assume wasn’t written comic book style, proving she has more respect for Kohn than he has for the court — was ten pages of explanation of why she was denying his motion, focusing on the fact he doesn’t have standing in the case.

Not that that is going to stop Kohn. As is his right, he’s already filed an appeal of her judgment. My issue with this is Kohn’s reasoning for wanting to intervene. He says, “My aim is to get this case thrown out,” Kohn states, “before it does further damage to consumers, authors and the book industry.” That sounds good. Usually I wouldn’t have any problem with that. The problem is that this is a law suit about price fixing — not about whether or not publishers should be allowed to use agency model pricing. That’s an issue so many folks seem to forget.

Let me repeat that. This is a case against price fixing. The Department of Justice has alleged collusion on the part of Apple and the five publishers to fix prices. It has not said “Agency model pricing bad. Must stop it.” Quite the contrary, in fact. It has said there is nothing inherently wrong with that pricing model. The issue is how the publishers and Apple allegedly decided to implement it across the board.

But this case has become a classic smoke and mirrors defense for the named parties — except the three publishers who have agreed to settle with the DoJ and state attorneys general. They want to put Amazon, a non-party to the suit, on trial. You see, according to them, “Amazon bad. Amazon might do something in the future that might harm us. That means we must be allowed to break the law now to protect ourselves.”

Like I said, smoke and mirrors.

If they realize that argument won’t win you over, they then turn to the “but e-books prices haven’t risen since agency pricing went into effect.” They point to studies that show just how the opposite is true. What they don’t do is break those sales down between the publishers following the agency model and those who don’t. And let’s not forget all those e-books being put out by authors and not through publishers. Those also tend to be much lower than the price of agency model books. But, gee, that’s using logic and that mustn’t be done in this suit.

So here come Kohn, saying he wants to protect the industry and the readers from further harm. What harm? Where has the industry, the consumer and the author been harmed?

Oh, here come the boo-birds, pointing out how Amazon has killed the local bookstore. Nope. Don’t buy it. Why? Because that forgets, oh-so-conveniently, the fact that the big box stores basically killed off the local indie bookstores. Those same big box stores then over-expanded and didn’t adapt to changing economic times or technology demands. Nor does it look at the fact that, in many areas, the local indie bookstores are making a resurgence.

Did Amazon hurt bookstores? Sure. They hurt the big box stores the same way the big box stores hurt the local indies. By undercutting prices. But no one seems to worry about that. After all, as I’ve said before, Amazon is the big evil.

So, how does Amazon hurt the authors? Hmmm….it offers them the opportunity to put their backlists out without having to go through a middle man. It gives them 70% royalty if the author charges at least $2.99 for that book. Show me a publisher that pays that much to the author. Oh, wait, you can’t.

And the boo birds will be back, telling me how much it costs for a publisher to put out a book. Sorry, nope. The figures don’t work, especially if that publisher is also putting out the hard copy of the book. Authors need to get over their feeling that they owe publishers something and remember that they, the authors, are the creators. Without them, publishers wouldn’t exist. Well, I guess they’d find someone who just has to be “published by a real publisher”. Sigh.

How has the publisher been injured? Look, the biggest problem with legacy publishing today is that it continues to insist on operating the same way it has for decades. It has been too slow to adapt to changing times and demands. To fight possible economic ruin, they allegedly stooped to collusion to fix prices. But, according to so many of their supporters, that’s okay because Amazon is bad and might just do something evil in the future.

Whether Bob Kohn has standing or not and, from what I can tell, the judge was right in ruling he doesn’t, he has the right to appeal. But please, quit playing smoke and mirrors and actually address the issue before the court — did the named defendants collude to fix prices or not?

And folks wonder why my head keeps feeling like it’s going to explode.

Smoke and mirrors or self-delusion?

(Edited to add: Welcome to everyone coming over from Instapundit!)

That sound you hear is a mix of the themes from Jaws and Psycho. Or maybe just It’s a Mad, Mad, Mad, Mad World. I’m beginning to think it is the latter. At least when it comes to the reactions from a certain part of the publishing industry to the Department of Justice’s anti-trust/price fixing suit against Apple and five of the big six publishers.

Let me state once again, the filings by the DoJ do not challenge the legality of agency pricing. In fact, if I remember correctly, there is language in the filings saying that the agency model might be used later. The issue is whether or not Apple and the other defendants colluded in price fixing.

But that seems to be conveniently overlooked by many who are opposed to the DoJ stepping in. The latest comes from Oren Teicher, CEO for American Booksellers Association. This is from an email he sent to ABA members last week:

I’m writing today to share news about a step that every independent bookseller in the United States can take to advance the argument that the agency model must be preserved to help maintain diversity and competition in our industry.

First, as I said above, the agency pricing model isn’t at issue here. It is the way it was entered into. Second, I still have concerns about how this model can help maintain diversity and competition in the industry when the publishers themselves admit they are making less money under it than they did under the previous model. Less money for the so-called producers of e-books when they are already facing money problems is not a good thing, especially as the share of e-book sales v. hard copy sales is increasing. No, the only ones agency pricing helped was Apple. Finally, this statement completely overlooks the fact that Google is ending its relationship with indie bookstores. So, where are they turning now to become e-book retailers? And why has there been no hue and cry from ABA about this?

As ABA made clear in a meeting with DOJ on March 19, we could not believe more strongly that the agency model has been good for our channel, good for all bricks-and-mortar bookstores, good for publishing, and, most importantly, good for readers and book buyers. Since its introduction, the agency model has corrected a distortion in the market fostered by below-cost pricing, predominantly led by Amazon.com, the ultimate result of which is, we believe, to reduce or to eliminate competition among both retailers and publishers.

Fine, but it is the method the agency model was forced on Amazon and the other retailers that is at issue. Read the pleadings. Then communicate accurate information to your members. Let’s take the last sentence to another level. If the DoJ allows a violation of antitrust law to stand in this case, what is to prevent citrus farmers from banding together and demanding something similar from their distributors. No longer can we use coupons for a discount on our favorite OJ in the stores (try using coupons on e-book sites for any of the agency model e-books. You’ll be told you can’t.) No more specials or sales of one brand in one local store but not in another. It is  a slippery slope ABA is suggesting the DoJ start on and, let’s face it, we’ve seen the results of these sort of slopes before.

Since the introduction of the agency model many more independent booksellers are selling e-books, and those sales have shown steady growth. The agency model has lowered prices to indie bookstore customers, and indies themselves have seen significantly increased price competition among publishers in regard to promotions, discounts, and special offers, all of which have allowed bricks-and-mortar bookstores to offer customers a wider array of titles at a greater value.

And most of those have been able to sell e-books through Google. See my comment above. That is going away because it wasn’t making Google money. So where is the outcry there?

And what publishers are they talking about? Because, according to the agency model terms, Publisher A is required to sell his e-books at the same price everywhere. So where are all these specials, and discounts, etc., coming from? Oh, I know where they are coming from. Small presses and individual authors WHO ARE NOT PART OF AGENCY PRICING. At least that is my assumption since this email doesn’t list specifics.

Deeply discounted books were among the key components in the fuel stoking Amazon’s engines of growth. It’s frankly somewhat stunning that DOJ would accept the possible upending of an industry as important to the cultural and intellectual life of our nation as bookselling and publishing so that one retailer could pursue a policy that is nearly certain to result in monopolization of the e-book market.

So, let’s ignore the law and let certain parts of the industry — and, let’s not forget, a direct competitor to Amazon — do as it wants. The next step would be, I assume, to pass laws to prevent Amazon from doing anything to its own benefit. After all, that would help prevent it from pursuing a “a policy that is nearly certain to result in monopolization of the e-book market.” Color me not impressed. No, color me scared. This is the sort of thinking that stifles a market, whether they want to believe it or not.

Before the introduction of the agency model, Amazon had a 90 percent market share in e-books, when they were selling below cost, a price far lower than indie booksellers could purchase e-books from publishers. Today Barnes & Noble, Google, Apple, Kobo, along with indies and others have joined the market, which has become far more competitive and diverse.

And why is that? Barnes & Noble was late getting into the e-book market, first as a seller and then as a provider of hardware to read their e-books on. Apple was busy in the music market until it developed the iPad — oh, wait, that’s when agency pricing came into effect. And let’s not forget that Apple is a named co-defendant. The late, not-so-lamented Borders suffered from the same lack of foresight as these others did, but they compounded it by using Amazon as their online bookstore for a long while instead of building their own online presence.

Amazon is not pure. I have never said they were. However, the leadership at Amazon saw something worthwhile in e-books and went after it. These poor publishers and booksellers didn’t. They thought e-books were a fad that would disappear in time. Don’t believe me, talk to anyone who happened to work with Jim Baen more than a decade ago when Baen Books started offering digital versions of some of their titles. Mr. Baen may no longer be with us, but others are. They can tell you how Baen talked until he was blue in the face and people told him he was wrong, e-books would never catch on.

Better yet, look at how publishers still look at e-books. These same publishers who are so strongly advocating the agency pricing model, at the loss of income, also advocate the use of DRM. They want to limit the number of devices on which you can read an e-book you’ve purchased. Oh, wait, according to them, you don’t buy the e-book. You only buy a license to read it. And, just in case you hadn’t realized it, you are also prone to illegal acts so they’ll add the DRM so you can’t give the e-book away or put it up on a pirate site. Doesn’t that just make you feel all warm and fuzzy about how these publishers who are crying foul when it comes to Amazon?

Poor iddle publishers.

The United States of America is a nation of laws. If we don’t like a law, we need to act to have it amended or overturned. There are ways to do this. Asking that the Department of Justice, the enforcer of federal laws, ignore something because you are afraid an entity might do something you don’t like in the future is foolishness. Ignoring other factors that lead to the state of your industry goes beyond foolishness. It is putting a nail in your own coffin. Look beyond your boogeyman to find the real problems.

Publishing and bookselling are glass houses right now. It isn’t wise to start throwing stones, especially if you don’t know where they will land.

Edited to add:

Another clear indicator of just how little importance the industry truly puts in e-books comes from Publishers Weekly. PW’s facebook post links to the weekly print book sales figures with this comment: a quick way to check the industry’s pulse. In other words, e-books don’t have an impact on the “pulse” of the industry. Maybe that’s why the defib paddles are being prepared. By the way, when you follow the link, you see that sales are down pretty much across the board for print sales. And remember, even though they aren’t saying it now, the initial reason for publishers going to agency pricing was to prevent the “cannibalization” of hard copy sales.

The Glamour’s Worn Thin

(Cross-posted from Mad Genius Club)

I’m a little late posting this morning because I’ve been going round and round about what to write. Dave did such a wonderful job yesterday discussing his thoughts on Mike Shatzkin’s blog about what he thinks will happen if the Department of Justice’s possible antitrust investigation into Apple and five of the big six publishers causes the agency pricing model to disappear. I’ve already covered my thoughts on Scott Turow’s letter about the issue. Then I made the mistake of reading some of the comments from the “enlightened” on it and, well, you guessed it. I’m weighing in again on the issue.

I’ll admit, part of the reason for this post is a thread started by what I can only term a publishing troll on one of the boards I read every morning. This person posted a defense of big publishing comment that included a statement that the people “attacking” legacy publishing are doing so because they don’t have the talent to be published by a “real” publisher.

I beg your pardon? Oh, and that grinding sound you hear is the sound of the teeth of innumerable mid-listers who have suddenly been cut loose by their publishers because, even though their books are still on the shelves more than a year after publication and even though there are continued demands from their fans for more in a series, the publisher claims they just didn’t connect with the public. And that evil laugh you hear is me as I contemplate what will happen when these same mid-listers, free of the fear of upsetting their publishing masters, finally demand full audits and the publishers are caught between a rock and a hard place because of their “creative” bookkeeping methods.

So, yeah, I’m in a pissy mood this morning. I’m tired of legacy publishers thinking they can pull the wool over the eyes of authors who should know better. I’m tired of them also thinking readers, those good folks who buy their products, as so dumb they can’t see what is happening. With that in mind, I’m going to revisit Shatzkin’s blog and some of the sources it cites.

From the opening paragraph:  But if this does mean the end of the agency model, it would seem to be a cause for celebrating at Amazon and a catalyst for some deep contemplation by all the other big players in the book business.

Duh. Of course it will be “a catalyst for some deep contemplation”. The problem is, they should have been doing this “deep contemplation” years ago. Market trends and technology have been changing for the last three plus decades and yet the publishing industry hasn’t really embraced these changes. The publishers should have been concerned when the big box stores came onto the scene and forced the smaller, locally owned bookstores out of the market. But publishers weren’t. Oh no, not at all. They embraced these new stores, loving the fact they could do larger orders and write bigger checks. But now, with the economy and other trends causing these large stores to close down, publishing is running scared and blaming Amazon for the problems faced by these brick and mortar stores. But the truth of the matter is, Amazon is only one small part of the whole equation. Unfortunately, neither the big box stores nor publishers did any “deep contemplation” before things became so bad their entire companies are in danger of failing.

Agency pricing, for those who have not been following the most important development in the growth of the book market, enabled the publishers to enforce a uniform price for each ebook title across all retail outlets

Okay, pardon me while I laugh for a bit. Is he really saying agency pricing is the most important development in the growth of the book market? Sorry, but no. E-books are the most important development in the growth of the book market. If you’ve followed the sales numbers over the last few years, the only segment of the market to consistently grow, usually in triple digit percentage points, has been e-books. The only thing agency pricing has done is artificially inflate the price of certain e-books and that, in turn, has opened the market to small press published and self-published e-books.

This was Apple’s desired way to do business, and it addressed deep concerns the big publishers had about the effect of Amazon’s loss-leader discounting.

Okay, whether he meant to or not, he just admitted that agency pricing is something dreamed up by Steve Jobs and agreed to by five of the big six publishers. And, if you read the link included in the quote above, you will see this wonderful piece of logic from Macmillan: The agency model would allow Amazon to make more money selling our books, not less. We would make less money in our dealings with Amazon under the new model. Our disagreement is not about short term profitability but rather about the long-term viability and stability of the digital book market. Am I the only one to see all sorts of wrong in this statement? How in the world is lower profits for the publisher–which would mean less money for authors under most contracts–be good for the publisher? How is this sort of an agreement going to safeguard the “long-term viability and stability of the digital book”? It makes absolutely no sense. My opinion is that they went along with this because they wanted into iBooks/iTunes and the only way to do so was to accept Steve Jobs’ terms and that meant forcing Amazon, B&N and other e-book retailers to adopt the agency pricing model. Remember, the key to the agreement with Apple was that these publishers would not allow their e-books to be sold for less anywhere else. So Amazon isn’t the only market where these publishers would be making less money. Funny how folks seem to overlook this little item.

Back to Shatzkin: Although the WSJ article and Michael Cader’s follow up in Publishers Lunch make no “agency is dead” declaration and there are quotes from publishers and others indicating that there are a range of possible outcomes, including a version of agency that is modified to allow some discounting, everybody in the industry now has to contemplate what it would mean if the agency model is legally upended.

Again, why weren’t they already considering this? For one thing, the contracts signed with Amazon, B&N, etc., weren’t for perpetuity. There would soon be a time when they came up for renegotiation. For another, The European Union, not to mention more than a few states’ attorneys general, were already looking into the legalities of agency pricing. The fact that the industry hasn’t been considering “what ifs” simply shows how out of touch it is with the reality of the market these days.

To Amazon, it would mean they would be free to set prices on all books again, including the most high-profile and attractive ones that come from the big trade houses. That is an opportunity they are likely to seize with loss-leader discounting of the biggest marquee titles.

Ah, evil Amazon. Conducting its business as, gasp, a business. The ability to sell a product wanted by the public at a lower price has been an age-old tactic of shop owners and merchants. It gets folks through the doors, be they physical doors or cyber doors. And isn’t this basically what the brick and mortar stores did when they burst onto the market? They were able to price hard covers much less than the mom and pop bookstore could. That’s why the public initially loved these larger stores. It’s also why publishers loved them. These lower prices meant more units being sold. Funny how the publishers have forgotten that.

To Barnes & Noble, it would mean they have to devote cash resources to ebook discounting that they might have preferred to dedicate to further development of the Nook platform, maintaining the most robust possible brick-and-mortar presence, and improving the user experience at BN.com. 

This very well may be true. The problem with this statement is that it omits the part about BN waiting too long to enter the e-book market. It forgets that BN spent too much time selling third-party e-book readers instead of developing and putting on the market its own e-book reader. It also ignores the fact that the BN online presence is not user friendly, especially not when it comes to e-books. It also lacks the vibrant online community Amazon has built.

Unconfirmed stories abound that B&N is about to announce an international expansion. Whether that will produce cash flow immediately or require it for a while is not yet known. For B&N’s sake, it would always better if it were the former, but if they’re about to fight discounting wars, it might be critical.

I seem to be saying, or at least thinking, “too little too late” a lot as I re-read Shatzkin’s post. BN needed this international expansion long ago. The fact that it may, finally, occur probably is too little too late. I’ll note here that this possible expansion is for e-books, not brick and mortar stores. Again, why has it taken this long? I’ll also note that the source Shatzkin cites is from August of last year. So far, to the best of my knowledge, that expansion has yet to occur.

To Kobo, it would mean that they also will need to devote cash resources to subsidizing price cuts to match Amazon. With their new ownership by Rakuten, they should have the capital they need to fight this battle. They must be glad that deal got done before agency was upended.

Nope, sorry. For those of you familiar with Kobo, you know they don’t always match Amazon prices. There are a number of titles Kobo offers for substantially higher prices than the same title is offered for on Amazon. And, before you ask, I’m talking about legacy published e-book titles. So I don’t see them trying to match prices with Amazon except on certain titles.

To Google, it would mean that the bookstore service piece of their ebook business will suddenly be highly challenged. Many independent stores might be pushed out of the ebook game completely; it certainly would be extremely difficult for them to support competition with Amazon’s prices. To Google itself, with their new Google Play configuration, it means they will have to both spend more margin and more management energy to be a serious competitor in the retail marketplace. There’s no clear evidence that they have the interest at the top to do that, although they certainly would have the resources.

Yes, I’m laughing again. Google’s e-book business is already highly challenged. They’ve dropped the number of stores able to take part in their program. Their interface for authors and small presses leaves a lot to be desired. As for Google Play, why is Amazon the only reason they would have problems? Doesn’t Shatzkin remember a little company called Apple and its iTunes store? Or does he not see the parallels between Google Play and iTunes?

To Apple, it would mean that their entire iBookstore model is in question. They apparently didn’t want to take on all the normal responsibilities of a merchant, which would include setting prices. Now they may have to.

Oh, cry me a river. If Steve Jobs hadn’t presented the agency model to publishers and said “accept or else”, we’d not be having this discussion. But then, I’m just a bitter small publisher employee who can’t put our e-books directly onto iTunes/iBooks because we use PCs and not Macs, something required to use their interface. And, btw, they are the only storefront for e-books that we’ve come across that requires a certain computing platform in order to upload a file.

To all the big publishers, including Random House (the one of the Big Six not being sued, because they stayed out of agency for the first year and therefore were not considered part of the “collusion”) it would mean that they will have to painfully reverse the re-pricing and systems adjustments they went through to implement agency in the first place.

“Painfully”? How can it be painful if they can return to a pricing model where they made more money? Remember the quote from the Macmillan post above. It was admitted then that agency model pricing meant less money for publishers.

Smaller publishers and distributors might be beneficiaries if agency is eliminated, but they might not. The agency model is a great advantage for those publishers who are able to fully implement it. But that is only six publishers — the Big Six — because Amazon has simply refused to let anybody else sell to them that way.

I ask again, how is ia great advantage for publishers when these same publishers admit they don’t make as much money from agency pricing as they did before? As for Amazon refusing to let anyone else use agency pricing, good for them. It means Amazon is looking out for the economic well-being of the company and making sure it keeps its shareholders happy. It also means Amazon is looking out for its customers. But that’s a bad thing I guess because, gasp, it isn’t saving legacy publishing from the follies of the boardrooms in NYC.

That creates problems for the smaller publishers but an even more threatening one for distributors. All but the Big Six, if they want to sell to both Amazon and Apple, must operate a “hybrid” model, selling Apple on agency terms and Amazon on wholesale terms. The two are inherently in conflict. What is ultimately a threat to the distributors is that distributees that desire agency terms, and many would. might seek distribution deals from one of the Big Six. (It might be coincidental, but it is worth noting that IPG, the company having a fight with Amazon at the moment over terms, is a distributor.)

Okay, here is where I have to watch myself. It doesn’t create a problem for small publishers. We set our own prices both with Amazon and with Apple. If one lowers the price for promo reasons, the other can and does the same. As for the two being inherently in conflict, thank Apple. As noted before, Jobs required the first five of the big six to accept agency pricing or not sell in iBooks. Blaming Amazon for something it had no control over is ridiculous.

As for the threat to distributors, get real. I’ll admit distributors have a role in publishing, but not when it comes to e-books. Sorry, but there is no reason a small press has to use a distributor to get into Amazon or BN. The process is simple and relatively pain free to upload titles to either of these stores. Given the proper Apple computer, I assume it is for iTunes/iBooks as well. So I have no sympathy for IPG or other distributors moaning the fact Amazon won’t let them go to agency pricing. As an author I have even less sympathy because I know publishers take out the cost of distribution before figuring royalties. Why would I want to lower my already too small royalty payments?

Of course, we don’t know how the Big Publishers will respond if they’re forced off agency. It’s long been my opinion that the 50% discount for ebooks is unworkable. It leads to ridiculous and unrealistic retail prices. (Publishers operating on the hybrid model have to have two retail prices: one on which to base the wholesale discount and another at Apple operating agency-style. It’s crazy.) Would the big publishers, if they couldn’t do agency, keep the 30% discount and their current prices? Would they go back to the 50% discount and jack the suggested retail prices back up? If they did the former and nothing else changed, the smaller publishers could be at a much greater disadvantage than they are now.

Ah, the economic double-speak. First of all, small publishers won’t be at a “much greater disadvantage” because we will still be pricing below major publishers. Why? Because our overhead is much smaller. Also, for those of us with a limited paper-side publishing, we aren’t trying to artificially prop up the hard copy publishing arm with the digital arm. And that is exactly what the legacy publishers are doing. They are trying to use their e-book sales to keep the print side alive.

The other thing Shatzkin keeps overlooking is the fact that publishers aren’t making as much per sale under agency pricing as they did before. So, going back to the previous pricing method would actually give them more money in their pockets. How that is a bad thing, I don’t know.

Over time, the biggest losers here will be the authors. The independent authors will feel the pain first. Agency pricing creates a zone of pricing they can occupy without much competition from branded merchandise. When the known authors are only available at $9.99 and up, the fledgling at $0.99-$2.99 looks very attractive and worth a try. Ending agency will have the “desired” effect of bringing all ebook prices down. As the big book prices are reduced, the ability of the unknowns to use price as a discovery tool will diminish as well. In the short run, it will be the independent authors who will pay the biggest price of all.

This guy really should try his hand as a comedian because he’s killing me here. First of all, do any of us really see legacy publishers pricing their books under $5.99, much less as low as $2.99? And let’s forget about the fact that they already have e-books in the $7.99 range.  The loss of agency pricing will simply allow best sellers and new releases to come down in price to something more readers will be willing to pay. This will be, in my opinion, back in the $9.99 range and there simply aren’t that many self-published or small press published titles that are in that range.

With regard to his comment that the lower prices will make it harder for “unknowns” to price their titles low enough to be discovered by the average reader, wrong again. I would be very surprised if legacy publishers will price any book, much less a new release, at less than $7.99. Remember, they are using e-books to prop up their print divisions. If they price low enough to shut out these so-called “unknowns”, they will have to do some major cost cutting somewhere and that isn’t going to happen. They like their plush offices and they’ve already cut out or outsourced so much of the editorial process that it isn’t funny.

But, in the long run, all authors will just get less. They will join the legion of suppliers beholden to a retailer whose mission is to deliver the lowest possible price to the consumer.

Authors already get less. Most authors are not paid royalties based no cover price, not really. Publishers take out expenses. So, if an e-book has a price of $12.99 and the publisher gets 30% of that under agency pricing, that starts the share of the pie the author gets to look at at $3.90. Believe me, the author is not getting much of that at all. Once more, I remind you of what the Macmillan post said. Agency pricing means less money for publishers than the previous pricing plan paid. Less money for publishers means less money for authors.

Seth Godin has recently made the argument that this is simply inevitable. Perhaps it is. The laws of supply and demand would support that contention. But from my personal perspective, I don’t like seeing the government hasten the process along.

Could this be because he works with/for publishers? I am not, and never have been, one to want our government interfering in business. However, we do have laws and the Department of Justice is tasked with upholding these laws. If there has been collusion between the publishers and Apple — and I think it is pretty clear there has been — then those laws need to be applied to them.

The truth of the matter is simple. Agency pricing has hurt publishers and hasn’t done what they wanted–it hasn’t saved their print divisions. Those sales continue to fall while e-book sales continue to rise. Amazon is not the only reason for the problems publishers face. Despite what one commenter on the thread that got me started on this this morning said about publishing’s business model not being broken, it is. Until legacy publishers address ALL the issues facing them and not just try to save things by artificially inflating e-book prices, the industry will continue to flounder. Just a few of the issues they need to address are:

1. the failure of agency pricing to do as they wanted

2. low royalty rates to authors

3. cutting of mid-list authors, traditionally the work horses of the industry, as a cost-cutting means to allow them to continue paying higher advances to their so-called best sellers (note here that those advances have fallen just as have the advances to mid-listers)

4. lack of push or promotion for books

5. decline of physical bookstores (yes, Amazon has had a hand here, but so has the economy, over-expansion of the big box stores after pushing the locally owned stores out of the market, mismanagement of the big box stores, etc.)

6. decline in the quality of their product (publishers have cut their editorial staffs, often use interns to do copy edits and proofreading, lower quality bindings and paper, etc)

7. economic downturns that have people unable or unwilling to pay $10 for a paperback or $30 for a hard cover

There are a number of others as well. But agency pricing is not the savior of the industry. Amazon is not the big bad that a few outspoken publishers and authors would have us believe. Publishing is plagued by what could almost be termed a perfect storm, a combination of factors that it failed to see coming and that it has failed to effectively deal with once those factors could no longer be denied.


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