Tag Archives: Amazon

More from Borders & E-book Readers Revolt

I know, you thought we’d be able to get through the day without Borders intruding.  Nope.  Not today.  There is news from Borders here in the US as well as the Australian version of Borders as well.

On the home front, Borders has announced it is leaving Ann Arbor and moving its headquarters to “cheaper” digs in the Detroit area.  Ann Arbor is where the first Borders opened.  Now, the move isn’t final.  It is part of the plan being presented to unsecured creditors today.  We’ll see what happens.  My concern is, given the real estate market in Michigan — and assuming Borders owns their current headquarters — they are setting themselves up to leave property they very well may still owe on and incur even more debt with the new headquarters.  But, as I said, we’ll see what happens.

With regard to Borders in Australia, REDGroup has announced they will be closing 16 stores.  These closures will impact more than 500 employees.

In related news, also from Australia, 25 independent booksellers have terminated “their franchising agreement with A&R because parent company RedGroup Retail, now in the hands of corporate insolvency group Ferrier Hodgson, would not allow them to redeem customers’ gift vouchers.”  Here’s a hat tip to these retailers for trying to do what’s right by their customers.  I have to admit, I’ve been expecting Borders here to suddenly decide not to honor their gift cards.  So far, they’ve proven me wrong.  I really hope they continue to do so.

Finally, if you ever doubted certain publishers are clueless when it comes to e-books and price points, check out this article.  Kindle and Nook owners have launched a campaign of sorts to down-rate Michael Connelly’s latest book, The Fifth Witness.  Not because the book is bad.  No, this all comes down to cost.  The TFW hardcover on Amazon costs $14.28 while the e-book costs $14.99.  On B&N, it costs $14.73 for hardcover and $14.99 for the e-book.

This is a perfect example of the idiocy caused by the agency model that came into being because Steve Jobs wouldn’t let the big publishers sell through the iBookstore unless they agreed to not let any other e-tailer sell their books for less.  So, the price for the e-book is set by the publisher.  There can be no variation, no sales and no promotional giveaways of the book unless instigated by the publisher.

But that’s not the case for the hard cover — or for the soft cover when it comes out.  Those prices are set by the retailer.  This is good for the consumer because it lets us shop around for the best deal.  It’s good for the publisher because, gee, it lets more people buy the book.

What the publisher doesn’t seem to understand is that they are only going to tick folks off by selling a digital copy of the book for more than a physical copy.  The response has been fast and furious.  For a book that came out 1 day ago, there are 107 reviews on Amazon.  18 are 5-star reviews.  3 are 4-star.  84 are 1-star reviews.  That gives an average of 2 stars for this best selling author.

Now, I don’t necessarily agree with giving a book a bad review for its price.  However, at some point, the publishers need to start paying attention.  At the same time, some of these reviewers need to pay attention to the product page.  Instead of blaming Amazon — and BN — for the price, they need to realize the price was set by the publisher.

So, once more we are on the merry-go-round of e-book pricing wars.  Who knows where it is going to end.

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Worst Idea Ever

As those of you who follow my Sunday posts at Mad Genius Club are aware, I usually start my mornings trying to get enough caffeine into my body to function while I read the morning headlines and scan a select group of blogs.  I also skim the topics on the kindle boards over at Amazon.  That’s where the title of today’s blog comes from.  This morning there’s a topic on the boards entitled “Worst Idea Ever” and the original poster goes on to rip the kindle — but doesn’t rip any other e-reader — as being the worst idea ever because it does nothing to improve on books.

Okay, to each his own.  I know a lot of folks who have yet to embrace e-books.  Others have but have yet to make the move to reading them on a dedicated e-book reader or smart phone.  They read them on their laptops or desktop computers.  For them, e-books are a novelty but have yet to become “real” books.  Others lament the fact that e-readers don’t look, feel or smell like a “real” book.

As I said, to each his own.

Usually, threads like this don’t catch my eye.  Or, if they do, I quickly leave them because I get tired of the attack dogs that come out.  Like most unmoderated boards, the kindle boards have a few posters who feel they know it all and must share their exalted opinions.  Others have simply grown tired of newbies asking the same questions over and over again without first searching the forum to see if the question has been answered.  Then there are those like this poster who seem to like stirring the pot by posting something they have to realize will only bring out the dogs.

But it was a comment in response to the original post that caught my eye.  To paraphrase, they said that what’s important are the stories, not the package they are delivered in.

I applaud this poster for cutting right to the heart of the matter.  It is the story that’s important.  It doesn’t matter what the form of delivery, how beautiful the cover art or how reasonable — or unreasonable — the price.  If the story isn’t good, people won’t continue to buy it.  Word-of-mouth will get around, warning readers that this story doesn’t live up to expectations.  Think about that series of novels you used to love.  Now, years into the series, the stories feel flat, stale.  Do you recommend the later books or books earlier in the series and why? More importantly, do you rush out to buy the new book or wait?

To me, the introduction of digital books is far from the worst idea ever.  Our children have been raised in an age when computers are an integral part of their lives.  It will be more so for their children.  E-books are a natural progression, in my opinion.  Like them or not, they are here to stay — at least until the next technological leap.

No, the worst idea ever would be to try to prevent access to books simply because they aren’t available in traditional print.   There are so many good books and short stories coming out in digital format only.  Better, there are a number of books that have long been out-of-print now becoming available because their authors are willing to bring them out on their own.

Like it or not, e-books are here to stay.  No, I don’t think they will bring about the end of “real” books.  But I do think they will help encourage the younger generations to read simply because they are in a format these young men and women, these boys and girls, are comfortable with.  After all, isn’t that really what we ought to be concerned with?

(Steps off soapbox, sees coffee mug is empty and prepares to go in search of more caffeine.  Before I do, let me suggest you check back later today for another announcement of more titles that we will be publishing in both print and digital formats.)

 

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Deadlines, deadlines and more deadlines

That seems to be the life of not only authors but editors as well.  It’s stressful enough being one, but wearing both hats is enough to drive any sane person over the edge.  So I guess it’s a good thing I’ve never made any claims on sanity.

The Borders watch continues.  Barnes & Noble has issued an open letter to Amazon associates in an attempt to lure them into the BN fold.  Then there’s this article about McNally Jackson Bookstore in NYC and its new expresso book printer, or “book robot” as they call it.  This is yet another step in the new world of publishing, a step that authors need to keep an eye on because it is being billed as a way to keep books “in print” forever.  As with e-books, there are going to have to be contractual changes to define what “in print” means as more and more bookstores install these expresso machines and more and more titles are made available to them.

Don’t forget we put up two new short stories yesterday (and they should go live on Amazon and Barnes & Noble sometime today).  Check out Legion: The Enemy Within, by Dave Freer and Kate Paulk, as well as Free Surprise in Every Box, by Ellie Ferguson.  And don’t forget the e-arc of Dave’s middle grade/early YA novella, Without a Trace, is also available now.

 

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The Week in the News

Sorry I’m a little late getting today’s post up. I didn’t write it yesterday because I wanted to see the latest headlines before deciding on the day’s topics.

First, I want to brag on my hometown. Another reason I didn’t write the blog yesterday was because I spent most of the day at our new library’s grand opening. In this time of libraries closing or losing funding, our community has rallied around the library and build a wonderful new facility. Hopefully, I’ll have some photos next weekend to post. What is really great about the new building is the fact our teens are invested in it. Several years ago when the architects asked for input from the community, half a dozen different groups got together and drew up their ideal floor plans. The teens’ plan is the one that was chosen. That invests them in the library and their support was clear yesterday.

Any way, on to what’s happening around the publishing world.

I’m going to keep with local news for a moment. Earlier this week, Amazon sent out notices to its employees at the distribution center near DFW Airport that they would be shutting down the center. Why? Because the state comptroller wants to collect millions of dollars in taxes and penalties it says Amazon owes. Sorry, this is a distribution center. A center that employs a number of people. A center that was going to expand and hire up to another 1,000 workers.

Muddying the waters even more, Gov. Rick Perry has publicly announced he is firmly against the action taken by the comptroller and is going to do all he can to keep the distribution center here. The next month is going to be an interesting battle of wills between the governor, the comptroller and, quite possibly, the state legislature to see who blinks first. My take — unless the comptroller can prove the distribution center is actually a sales center, Amazon will be asked to stay. But at what cost? What sort of concessions will the state have to roll out to “apologize” for an ill-timed, if not ill-conceived, move by the comptroller?

The New York Times revealed its best sellers list this week and, for the first time, e-books were included. I haven’t had time to sit down and really study it, but the one thing that jumps out is the fact that the top five titles on the combined print & e-book list are the same as the top five titles on the e-book list. Two titles flip-flop positions, but that is the only difference. The same can’t be said for the non-fiction top five. Does this mean there are more fiction e-titles being purchased than non-fiction? Probably. What will be interesting is to see the reaction of traditional publishers when e-books brought out by authors digitally publishing their works on their own or by small digital presses break into the top ten.

Finally, no blog about the industry can close without mentioning the latest news about Borders. I don’t think it surprises anyone the speculation is now rife over whether or not Borders will be filing for bankruptcy this week. Borders hasn’t publicly confirmed this. However, it doesn’t take much searching online to find posts from employees or people “in the know” who say it’s a done deal. Now they are only waiting to find out if their stores will be saved.

What is of concern to me — beyond the worry for my friends and acquaintances who work for Borders — is how this will affect the publishing industry as a whole. Borders owes publishers and non-publishing vendors thousands of dollars for stock already in stores. (This figure may — and probably is — be substantially larger. We won’t know until the bankruptcy papers are filed.) A number of publishers have already ceased shipments to Borders. It’s a move I can understand. Publishers are, on the whole, struggling themselves. They can’t afford to ship product without guarantee of payment. On the other hand, how can a bookstore make money if it doesn’t have books to sell? It really is one of those “damned if you do, damned if you don’t” situations.

But there is another factor to be considered. Ingram continues to ship books to Borders when so many of the publishers have stopped. Ingram is the distribution outlet for a number of publishers, many of them small to mid-sized publishers who don’t have their own distribution arm. What the immediate and long-term impact this will have on these publishers, as well as Ingram, when Borders files for bankruptcy remains to be seen. But it is worrisome.

I hope Borders can find a way to come through this without completely going under. I’m not sure it can. What we have to prepare for is that this isn’t the last of the upheavals that will happen in publishing over the next few years. This is just the opening volley. So grab onto something and hold tight. Publishing will come through this, but it is going to be an interesting ride for awhile.

(Cross-posted to Mad Genius Club)

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Quick Notes

I’m hip-deep in manuscripts this morning, but wanted to pass along a couple of items.  First, Publishers Weekly has an interesting story about the breakdown of e-book purchases on the iPad.  I say “interesting” based on the earlier announcement by Apple that it had rejected the Sony app and all the speculation about how that might impact the Kindle, B&N and other e-reader apps currently available for the iPad, iPhone, and iPod Touch.

According to the PW article, e-book purchases by iPad owners breaks down this way:  40% from Amazon’s kindle store, 29% from Apple’s iBookstore, 12% from B&N’s nook bookstore, and 19% from other sources.  That’s a total of 71% of e-books purchased by iPad owners coming from sources other than iTunes and the iBookstore.  Perhaps it isn’t any wonder that Apple is looking for ways to direct sales back to the iBookstore.

The article goes on to discuss how publishers are using social media to promote their books and authors and how it really isn’t effective — yet.  “. . .while publishers are spending lots of time and money promoting books and authors through social media, few book buyers are learning about books from sources such as search engines, social networks, and Twitter, even though more book buyers use Google and Facebook (but not so much Twitter) than any other media by far. Fewer than 2% of book shoppers said they learned about the last book they bought through these major digital media.”  It’s pointed out how promotional trailers are made and thrown up on YouTube without an effective strategy for getting viewers to it.

Basically, bookstores — and book departments in big box stores and grocery stores, etc — are still where most readers discover books or authors they want to read.  So, until publishers figure out how to effectively use social media to reach their customers, they need to protect the physical stores.  Besides, I love bookstores and don’t want to see them disappear.

On a more depressing note, there’s more news on the Borders front.  Last Friday, John Wiley & Sons, Inc., filed notice with the SEC that it would “will take a pre-tax bad debt charge of $9 million in its third quarter of fiscal 2011 in regard to what it is owed by Borders. Wiley said it made the decision to take the charge, ‘based upon the status of our current business relationship with Borders Group Inc. and potential future adverse financial events that may affect this customer.'”  Because of Borders’ financial issues, Wiley stopped shipping books to Borders in December.

One last note.  I’m hearing some good rumblings from the editorial board as they discuss some of the submissions received last month.  If you sent us something last month, you should hear back by March 1st.  If you haven’t heard by the 7th, please drop us a line at submissions-at-nakedreader-dot-com.

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More Links of Interest

The NY Times has revealed “its new e-book bestsellers that will appear in print in its February 13 edition.”  It’s going to be interesting to watch this over the next few weeks and months, especially since they have the list broken down into bestsellers as e-books, as print books and then as a combined list.  The list is also broken down into fiction and non-fiction bestsellers.

There’s additional news on the “is Amazon a publisher or a bookseller?” front.   I think it’s pretty clear Amazon is a publisher, at least on a small scale when it comes to print books (CreateSpace not counting in my opinon since is it POD).  However, the fact they are willing and eager to go after authors who have been dropped by their publishers is yet another indication that the industry is changing.  It also proves what I’ve always thought — the publishers are foolish for cutting their mid-list authors loose.  These authors might not sell mega-numbers, but the publishers know there is an established fan base that can be counted on to sell X-number of books.  That’s money in the bank.  Unfortunately, the publishers don’t seem to understand this.

In an attempt to help members (independent booksellers) expand their online presence, the American Booksellers Association has partnered with Monsoon Commerce Solutions.  This will allow members to list their used inventory on more than a dozen online marketplaces for free.

Here’s more on the Apple decision to reject the Sony e-book app and its possible implications.

Finally, even more evidence that e-books are a market that publishers have to embrace.  Second quarter sales at Harper Collins were down.  Part of the reason for this, according to HC, were fewer titles being offered.  However, even as sales overall fell, e-book sales rose 400%.  Think what they would have done without the agency model.

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Borders Redux and more

Let’s start with the “and more”.  Today’s guest post by Sarah A. Hoyt is going to be delayed a bit…possibly longer than a bit.  Sarah has decided to mirror my life for the past 20 hours or so when I was without internet service.  She called a few minutes ago to let me know that her internet is now down.  So, as soon as it comes back up, she’ll send me her post and I’ll put it up.  In the meantime, more news on the Borders debacle.

I’ve read two reports this morning stating that Borders has gotten a commitment from GE Capital for a $550 million credit facility.  Now, this isn’t a done deal yet.  Before receiving the lifeline, Borders is going to have to meet certain conditions.  According to Shelf Awareness, “the credit is contingent on Borders securing $175 million of senior credit facility with other lenders as well as $125 million of junior debt financing with other lenders or “certain vendors”–that is, publishers, who surprisingly enough do not seem interested in taking on Borders debt instead of being paid.”

In order to get this loan, there are certain things Borders will have to do.  One of the requirements is that it will have to close under-performing stores.  But wait, shouldn’t they have already done that?  This is a company that has been in trouble for years, not just weeks and months.  If there are stores that aren’t paying for themselves and don’t look to be able to recover, why are they still operating?  At some point, management has to recognize that you can’t continue operating in the red.

Other requirements are getting concessions from vendors and landlords.  But the most important one is convincing publishers to take on part of the debt load, something I wouldn’t expect them to want to do.  Why take on more debt from a company that, at the moment, is unable to pay you for stock you’ve already sent them?

Also from the Shelf Awareness articleBorders’s plan for the future has five key parts, it said, including expanding and enhancing the Borders Rewards Plus program; “aggressively growing” Borders.com and e-book market share; expanding the retail mix, “including non-book offerings”; “aggressively” reducing costs “across the business, including costs in the supply chain network and store portfolio”; and making “strategic investments in IT to improve the customer experience.”

So, let’s see, they want to expand a reward program that isn’t working because most people don’t want to pay to get discounts.  While I agree growing their e-book market share is a reasonable goal, it is probably too little, too late.  They waited too long to get into the market.  They don’t have an easily navigable site for e-books.

The expansion of their retail mix, “including non-book offerings” is what really boggles my mind.  Already when you walk into any of the Borders stores in my area, you are struck, not by the books they have to offer, but by how few books when compared to non-book items.  There are toys.  There are gadgets.  But there are fewer and fewer  books.  There is also a much smaller collection of music — if any — and it is the same with videos. Basically, when I walk into a Borders these days, it’s like walking into a modified Walmart or Target.  The only thing missing are groceries and diapers.

The last two items in their plan sound good but I am not going to hold my breath.  This is a company that has failed to cut costs as needed, running full tilt toward bankruptcy.  Now it wants those companies it owes money to to forget about bad business practices and to invest even more money into what is, in all likelihood, a failing venture.  This truly is a no-win situation, or has the potential of being one, for publishers and readers alike.

For more information on this, check out this article as well.

In other news, Amazon’s sales for the last quarter rose 36%, but their profits increased only 8%.  That sent stocks down last night but, iirc, they are back up this morning.  Amazon also reported that they are now selling more kindle e-books than paperback books.  This is despite the fact paperback sales continue to increase.  According to Amazon, they now sell 115 kindle e-books for every 100 paperbacks.   Amazon had predicted this would not occur until the second quarter of this year.  It is, in my opinion, another indication that the e-book revolution is here to stay.

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