Amazon pulls a Microsoft

There is no setup fee at

There is no setup fee at createspace.com (Amazon's POD service) and the only printing fee happens at the point-of-sale. This is ridiculous, I'm starting to think that this whole uproar is orchestrated by a bunch of whiny POD printers. If we turned the analogy to music, and compared a publisher to a record label everyone would be for this, but since there's apparently some mythical unicorn horn magic associated with being a small publisher somewhere in the mountains of Vermont, we should all feel they are being horribly victimized by Amazon's move. I reiterate, with createspace, there is no setup fee if you don't want, there is only a charge to print when you sell something. This means, unless you are a total idiot, and you create a book that no one wants, there is no chance in hell that you can lose money on this. Amazon is not cutting anyone out, in fact, they are inviting authors to offer anything they want at virtually no overhead on Amazon.com THE SITE. This is nothing like Walmart; it is empowering authors and content-creators who would normally have to work with a publisher to get onto Amazon. I'm starting to think that small publishers don't like this.

Open your eyes

I think your perspective on this is very limited.
Are you a self-published author? Are you a publisher?

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"with createspace, there is no setup fee if you don't want, there is only a charge to print when you sell something."

Existing small publishers and self-published authors are faced with having to redo their cover files and bookblock files to suit the requirements of CreateSpace. For those with many titles, this can mean either a lot of work or paying many hundreds if not thousands to other people to perform this work.

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"it is empowering authors and content-creators who would normally have to work with a publisher to get onto Amazon"

Authors are already empowered to "get onto Amazon", without having to work with a publisher. So this is a mute point. The difference is that currently they can choose who produces their book. They can also choose what discount Amazon gets, and thus how much profit they (the author) makes. Being forced to use Booksurge and CreateSpace negates their right to choose their print provider, and it takes away the option of choosing the discount on their book title to Amazon, meaning they stand to lose from 1/3 to 1/2 their current income.

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"unless you are a total idiot"

Looking at the tone of your entire comment and the complete lack of any sound logic to your points, I am wondering if this particular statement was a subconscious self-projection?

Regards,

Jonathan

Amazon - loss of trust and future profit

Wishing to use a POD service I've found that the Amazon companies (surge and create) are overpriced and can not offer the page format or page count I require, where as others can. Therefore Amazon alone can not serve the market. But now that this situation has come about; should not all POD companies pool together to create an on-line outlet to compete with Amazon? There has to be profit in this game given Amazon's percentage.

Correct... in part

Adam,
Thanks for pointing this out. You are correct, yet this is not the whole story.

If a self-publishing author wants to use the Amazon Advantage program, they must accept granting Amazon a 55% discount on their book. Currently these authors can grant Amazon as little as 20% (the author keeps 80% less production costs).

Amazon also have ProMerchant system, offering fulfillment services and drop-shipping services etc. But this can require a monthly fee, and it requires the author to ship stock to Amazon (at the authors expense) and to have that stock stored at Amazon. One of the advantages of POD is that you get away from the whole issue of paying for and dealing with stock.
This ProMerchant option may in fact be a viable option for many sellers, and potentially even more profitable because Amazon only take a 15% cut, although if they don't have a US bank account, and US issued credit card, and a US postal address, then I understand they'll not be granted a ProMerchant account.

So authors outside the USA have a problem in that regard. It also may mean paying the monthly fees (depending on what sort of account they get with Amazon) and having to manage the stock getting to Amazon etc. So the author is disadvantaged relative to the current arrangements they have.

Although to be perfectly honest, I think all of the above (your points and my response) are somewhat irrelevant. The net result is that Amazon are misusing their corporate power to discriminate against authors using POD production services in order to effectively force many of those authors into using Amazon's POD production services. Yes, the authors have numerous other options (as we've just partially explored) but that doesn't make Amazon's course of action any more justifiable and socially acceptable.

Regards,
Jonathan

Jonathan, As Walt already

Jonathan,

As Walt already stated, "Bookstore retailers expect to get a 40% discount, while distributors and wholesalers demand between 50% and 65% discount (so they can pass along that 40% to the retailer)." So why would an author expect Amazon to only take as little as 20% of the cut? Createspace takes a 40% cut which is the industry standard for retail. If author's were getting 80% minus production costs, that is the best cost structure EVER for authors (outside of direct customer sales).

While it seems like a pretty crude move on Amazon's part, they could have handled this in another way. They could have first cut off their relationship with other POD publishers as vendors. Then in another breathe they could have made an announcement about content-owners using Createspace. Createspace pricing terms are not off-the-mark for the industry and there is no printer exclusivity. Amazon has a choice to cut our their vendors - They are a customer of those vendors (e.g. publishers). Now they've recognized that they can make those vendors' their customers. Is it a powerplay? Definitely. Is it a powerplay to better buying customers? most likely. Amazon isn't known for effing over its customers. And for as much speculation that all the small publishers out there have made that the rhetoric about customers is BS, having POD in-house has tremendous potential benefits for customers that makes it easy to see why Amazon wants this.

I can understand concerns about overhead for moving books over to the service, and concerns over the quality of printing. Amazon should address these issues, and if they want to be successful in this POD endeavor, that is exactly what they'll have to do.

I can't understand the sentiment that Amazon is forcing authors to use only their printer. It's simply not true. As technology advances, retailers at the point-of-sale will push more an more to have the product made on-demand with them. This is just another step toward that and I suspect one day soon you'll see Borders and B&N trying the same approach.

Amazon Marketplace

Adam,

As publisher at an independent micro-publisher who has been selling on Amazon for over 10 years, I can tell you that trying to compare Amazon Marketplace sales (that's what those 3rd party sales are called) to Amazon-direct sales is comparing apples and oranges. First, many buyers are just more comfortable using that Amazon "Buy" button (or the "one-click" button) than buying from somebody they don't know.

Most small publishers keep both "hurt" copies (usually copies returned from previous sales) and brand new, autographed copies listed on Marketplace. But still, those sales represent such a small fraction of Amazon-direct sales that it would not be worth the effort if Amazon charged anything at all for the listing (currently, they don't).

If, as somebody else noted, 3rd-party sales account for over 25% of total Amazon sales, that must include a lot more than just books. I'm not sure where those stats come from, other than they don't come from Amazon since Amazon doesn't publish those numbers (for good reason). Those stats also would include all those thousands of out-of-print books that Amazon lists but does not have in stock, further diluting the usefulness of the stats.

The Amazon Advantage program includes the worst terms in the retail book business. Bookstore retailers expect to get a 40% discount, while distributors and wholesalers demand between 50% and 65% discount (so they can pass along that 40% to the retailer). So, Amazon Advantage demands wholesaler terms even though they are actually a retailer. Which is why we only have one of our eight titles offered through Advantage (we have the only remaining inventory of that title and no more are planned to be printed).

Our other seven titles are printed digitally by Lightning Source Inc. (the world's largest print-on-demand printer) which gets them listed in the Ingram Book catalog (making them readily available to bookstores, libraries, etc.) and on Amazon (who buys copies directly from LSI).

Amazon wants to end that LSI connection for independent publishers and force them to use Booksurge, which will drive up our costs and reduce our market exposure significantly. Initially, they are just targeting those euphemistically labeled "self-publishing" or "POD publishing" companies, but this is clearly just the first salvo.

I doubt this would come directly under anti-trust limitations but certainly should run afoul of restraint-of-trade laws.

Walt Shiel
Publisher, Slipdown Mountain Publications LLC
SlipdownMountain.com
FiveRainbows.com

Thanks Walt

Thanks Walt for your input. Very well put.
Greatly appreciated.

Jonathan