On Amazon, Apple and dick moves
John Scalzi’s helpful write-up of this past weekend’s ridiculous battle between Amazon and Macmillan can be summarized quite succinctly:
Don’t pull dick moves.
It’s okay to play hard. As an Amazon customer and fan of the Kindle, I want Amazon to keep e-book prices low. As an author and Kindle self-publisher, I want writers to make money.
Conflict between these two goals isn’t a bad thing; it’s business. Business is good. I know Amazon is a huge and powerful retailer that can muscle around its suppliers. I also know the folks at Macmillan aren’t all rainbows and puppies. But as a customer, I should never be aware of their negotiations. I should simply buy books.
When Amazon suddenly yanked all of Macmillan’s titles, it not only exposed the behind-the-scenes conflict, but punished otherwise neutral parties, including customers and authors.
Dick moves, defined
A dick move is an action which to an outside observer appears excessive or petulant.
Or, more tautologically, a dick move is something which, when performed, leads observers to note: “Wow, what a dick!”
Last weekend, Amazon pulled a dick move. It then took too long to admit it was wrong, and finally had to accept Macmillan’s terms. It was a huge bundle of fail, and very much unlike a company that has done so much so well.
Many industry observers speculate that the announcement of Apple’s iPad precipitated this round of crazy. In the demo shots of Apple’s iBook store, book prices are significantly higher. Did Apple do this deliberately, trying to stir the pot? Maybe. And if so, was that a dick move?
Not really. Dick moves tend to be more obvious and punitive.1 But with the iPad, Apple is setting itself up for a series of awkward decisions, any one of which could easily become a dick move:
Will the iBook store include every book a publisher wants to sell? And if not, what will be Apple’s criteria? Will they review every book the way they review apps? Will there be age ratings? If so, how will they determine those ratings?
Will Apple let individuals publish to the iBook store, the way Amazon does? Trying to get an independent film sold through iTunes is tough. Apple will only deal with studios and aggregators, which not only minimizes its exposure to crazy filmmakers, but also helps ensure that copyright is valid. Getting an e-book sold through Amazon is comparatively straightforward.
Will Apple let users read any ePub file through the iBook reader, or does it have to be bought through Apple? The iPod and iPhone will only run apps bought through Apple, but they will play any mp3 file you throw at them. Book files feel more analogous to music files than apps. Let’s hope Apple agrees.
Will Apple give third-party readers and sellers (such as the Kindle app and Stanza) equal access? A book-reading application doesn’t seem like it would require magic and undocumented access to the iPad’s hardware. The iBook app should compete on a level playing field.
How will Apple set prices on books? Apple has two basic philosophies on pricing: the App Store model, in which publishers have wide flexibility in setting price, and the iTunes model, in which tracks and albums are strongly pushed toward fixed price points.2 Will Apple allow free books? Kindle doesn’t, except through special arrangement with publishers.
For Apple, the best way to avoid dick moves on these five points is to allow robust competition. Apple doesn’t need to worry about selling every book to every customer as long as third parties can bring them to the iPad.
- Same with the exclusion of Flash on the iPad. You can be sure Steve Jobs knew there would be a blue lego popping up during his demo, but let it go undiscussed. ↩
- The App Store model has resulted in a race to the bottom at 99 cents. One could argue that price floors rather than price ceilings might better support the publishing economy. ↩
Articles
February 2nd, 2010 at 3:37 pm
“A dick move is an action which to an outside observer appears excessive or petulant.”
In case you didn’t know, Amazon isn’t trying to make a margin on wholesale books but is instead trying to own the whole supply chain. This is how they justified taking 70% revenue from Kindle “publishing platform” sales.
Caving to macmillian isn’t a dick move but rather is a last grasp at remaining in control. Apple’s entry into the marketplace with higher prices for consumers is the dick move.
February 2nd, 2010 at 3:53 pm
They haven’t actually capitulated to Macmillan yet. They’re just preemptively stating that they know they have to. As of this comment’s posting (5:54 pm on Feb 2nd) Amazon is still not selling Macmillan books. (Only through their Marketplace, which is indirect.) I find this discrepancy (saying “we surrender” without actually surrendering) additionally “dick.”
What’s ironic is that the $9.99 e-books are loss leaders. Amazon loses money on many Kindle books in order to sell more KINDLES. Macmillan’s higher prices will actually (short-term) give Amazon more money per sale. (I’m not sure about long-term… but I doubt that Kindle sales will be too greatly impacted by a few high titles. There will always be cheap e-books out there, and people who want to read on Kindles.)
The whole thing aggravates me. As a writer, as a reader, as a tech-lover.
February 2nd, 2010 at 3:59 pm
The thing that drives me up a wall more than any of the 5 above, is the monogamous relationship between an iAnything, and the ONE computer it first sees when its hatched! — It KILLS me that they know we all have a laptop and desktop now and the iPhone (in its extra-crippled synch-without-a-master-slave-relationship-idiom) can grab books/songs from one, but won’t even look at the other. I’m not asking it to wear a ball-gag and go sleep with homeless people from Craigslist. – I’m asking it to pick up my laundry from the neighbor. My iPhone should be allowed to have two dads.
And OMG! (unrelated) News report just said that Man pulled from rubble in Haiti was triaged & trached using a first aid app from the app store. — Surviving a 7 point deluge of rubble? Yeah… There’s an app for that.
February 2nd, 2010 at 4:12 pm
To be fair, Macmillan is guilty of its own dick move… which, in turn, prompted Amazon’s. Macmillan bargaining position was as firm and unfriendly to consumers and writers as Amazons’ was. The difference was that Amazon’s was short term. Macmillan’s was rather longer term. Had Amazon not agreed to the agency model, Macmillan would’ve windowed its titles available to the retailer, giving Amazon a narrower catalog of books — all books, including new releases, ebooks, and analog books — to sell than its competitors. How’s this better for consumers and authors? It’s not.
Don’t get me wrong: as a writer I’m in favor of all writers getting paid more. But I fail to see how consumers are going to look at a $15 ebook and think it’s a good deal. Hell, I think $10 is pricey for an item I don’t even get to own (check your EULAs, folks). By now most people understand that the cost of producing an ebook is far greater on the first copy than it is on the second one or the hundredth one or thousandth one or ten-thousandth one and so on. I’d much rather sell more books at a lower retail price than sell fewer books at a higher one… primarily because book royalties typically increase with the number of units sold. (It’s also my understanding that Macmillan slashed its author royalties in December… so, there’s that.)
So, as I see it, there was plenty of dick move to go around and regardless of which side “won,” we could’ve easily predicted that the losers were always going to be consumers and authors.
February 2nd, 2010 at 4:24 pm
I don’t know the writer, but I thought this was an interesting perspective on the Flash/iPhone/iPad issue. In summary, interacting with today’s Flash apps is often predicated on using a mouse/keyboard. The experience with a touch interface is unpredictable.
http://mantia.me/blog/flash-design-is-the-problem/
February 2nd, 2010 at 5:03 pm
It seems like we’re in a situation where market forces will be able to do their dance and find the best possible price for e-books. $15 is very likely too high, especially when consumers don’t get to transfer or lend the book, etc., but there’s also no rush here. It’s not a situation like music was, where the industry itself is in danger of imploding unless consumers can get on board with paying for the digital version immediately.
As Kristan pointed out, Amazon wanted to entrench Kindle and the Amazon brand, nothing more. It is interesting that Apple, who has been notorious for driving hard bargains with content providers in the past, are playing so nice with the publishers on this one. Is it because they just want to get their foot in the door, or because they put so little stock in the e-book market that they’re not worried about the deterrent a $15 e-book may pose?
February 2nd, 2010 at 7:21 pm
This thread is important. -agression- humans never solved it! In schools we play like animals trying to survive, but we are not going there for that purpose. if kids played different in the school. this would never happen. problem is cool/attraction is rooted in agression. and humans are dumb from core.
we make the game and play it.
February 2nd, 2010 at 7:37 pm
Very, very funny…
…and true.
February 3rd, 2010 at 12:00 am
Remember when Amazon pulled all of those copies of 1984? I’m telling you man, buy a book, and they can never take it away. I’ll be going to bookstores until the last one closes, which hopefully won’t happen for a very very long time.
February 3rd, 2010 at 12:29 am
While they and Apple spend time in a multi-way choke each other to death match, people on the net are still degluing books, scanning them, and putting them on torrent.
It’s as if on the way to cheap online per song purchasing of only what we want at a price point we like, they all choked and dug in their heels at a $5/song rate. The MP3 trading would have simply buried them all over again.
So, whatever, let them be dicks. The organic responses of the people will be to neuter them if they don’t get their act together and remove their heads from their posteriors.
February 3rd, 2010 at 2:15 am
Kid, you’re too good to work blue like this. Leave the dick moves to the other writers.
But a comment of yours really hit home. “Apple will only deal with studios and aggregators, which not only minimizes its exposure to crazy filmmakers, but also helps ensure that copyright is valid.”
For a while that was our policy at IMDb. It just made sense. It kept the craziness at bay.
But when we opened up that public submission channel, the cool content that came in far outweighed the occasional person who needed their technological hand held or their crazy soothed.
What’s the saying? Chaos is just another word for opportunity.
February 3rd, 2010 at 4:26 pm
In a way, I consider Amazon’s move a favor. I’m in the market for my first e-reader, and after this stunt, I know I won’t buy a Kindle. Is Amazon gonna limit what their customers can buy each and every time they have to negotiate with a new publisher?
So, THANKS Amazon! It’s a Nook for me- LOL.
February 4th, 2010 at 12:34 pm
Is it just me, or is this kind of like when music files went digital and record producers still wanted to get thirteen bucks for an album? I just can’t help but wonder if we are about to see the implosion of another information industry- one that is trying to hold onto the vestiges of its old business model.
February 5th, 2010 at 9:06 pm
@dziga1929 for me it
s nature, its wild and unexpected. it`s always gunna be hard to survive.living here with a moon and all, anything is maybe coming. who knows what life is? no one.-I read this and learned from it. god shame on me. thanks John
February 6th, 2010 at 4:59 pm
You really are a good dude. Keep on rockin.
February 9th, 2010 at 7:41 pm
@Jeff I wrote a Jeff into my movie. I`m really putting value into the script. The rest of the characters gonna be norwegian. I\ m having one cool american there ;=9)-I could zoom in to the characters, do a party or do backgrounds. All about dick-moves. Gunna be great, but not as my first project. dick-moves are not for beginners.