The book business believes that Amazon is unfair in the way it sells books. It believes, in fact, that Amazon in its sales practices — pressuring the book publishers to lower their prices and profits — is the enemy. Amazon's ultimate design, publishers believe, is to ruin them or to wholly shift the center of gravity in the business from the creators of books to Amazon, the dominant seller.
And this seems to be truer than not.
The book business response has been to protest hotly and try to wage a moral war against what it sees as an immoral competitor — having, for instance, its writers sign petitions and ads. To its credit, few believed usually inefficient publishers could ever mount such an impassioned defense. But if the adage about not being able to win at the negotiating table what you can't win on the battlefield is correct, book publishers don't have much of a chance against Amazon's dominance. In fact, their efforts to fight what they perceive as the Amazon monopoly have only succeeded in getting publishers charged with antitrust practices in their combined effort to have Apple help bail them out.
No, it would seem that the only clear avenue to fighting Amazon is for publishers themselves to do the one thing that they have, to their consistent disadvantage, wanted someone else to do: sell books.
Indeed, while Amazon may be the worst thing to have ever hit the book business, dealing with Barnes & Noble, previously the dominant book retailer, was hardly a walk in the park. B&N used its real estate and its right to return books to publishers for a full refund with as heavy a hand as Amazon now uses its ability to speedily — or slowly if you oppose them — fulfill orders.
Books, alas, will always be at a marketplace disadvantage if book publishers lack the leverage to control the way they are sold.
But publishers have been out of the retail business, with which once they were intimately connected — maintaining their own stores and close relationships with independent sellers — for so long that they surely feel there is no coming back.
And yet, between that and oblivion, is there another option? Amazon now controls, by some estimates, more than 40% of the physical book market, and 70% of the electronic book market. Its power is increasing, not diminishing. Were the book business to win a moral victory now, it would only later face another certain comeuppance. Amazon not only does not see books as a product different from any other — it sees the transformation of books into electronic products, ultimately far from the nature of a book, as a unique opportunity for the advancement of its own reading device, the Kindle.
The curious thing is that while Amazon is undercutting publishers (suggesting, in the case of Hachette, its most forceful antagonist, that both Hachette and Amazon forgo e-book profits, handing them directly to writers), publishers actually have much greater leeway to undercut Amazon.
Amazon is still buying books from publishers at something around a 50% markdown for physical books. Discounted beyond that, Amazon begins to lose serious money, whereas publishers have further room to discount and yet still profit.
Publishers have, for a long time, mostly agreed not to compete with booksellers — in fact, monopolistic booksellers have grown so strong they've insisted publishers not compete (or else!). Now, however, seeing the ultimate outcome, all bets and accommodations should be off.
And why not go into selling books? The remaining few, consolidated, publisher houses are all surely in a position to create and fund physical bookstores that might compete with Amazon, in sensibility, taste, style and pricing. Let us imagine seed investing in a new wave of independent bookstores, in an artisanal selling, a kind of Brooklynization of the book business — surely an idea whose time has come. But a way to buy books in a more salubrious environment than Amazon, and at cheaper cost, is just part of the attack.
Amazon is trying to control the book business through e-books. It wants to control e-books not least of all because they are not books. Migrating people to this medium means Amazon will own a potentially unlimited new entertainment platform — which, along the way, will have compromised the very form and meaning of a book. Indeed, publishers, one might suspect, want not so much to protect the book, but to also enjoy the upside of wherever the new e-book form will lead.
But their future, if they have one, will only be in real books. In rebuilding a market for the physical object. Making better objects. Rebuilding the culture of books (for which an actual bookstore is necessary). Children, in new research, gain much less from reading (or, in the new word, accessing) books on a screen than they do reading actual books. Perhaps adults do too.
Publishers, it must be said, have been poor stewards of books. Their restlessness with the form has turned books into a bastard entertainment product, with every celebrity a credible author. It is an easy jump from there to a multimedia screen, far from the world of a printed page — which is the publishers' world, whether they like it or not.
Amazon does not care about books, a minor part of its business. It cares about using books as the malleable form that opens the way to new technology and hardware and entertainment products, in the end leaving books and publishers as cultural detritus.
Publishers, if they are to prevail and, in fact, if they are to save books, have to start using the physical book, the true book, to undercut e-books, these unreal books, a form and business in which publishers will in the end have no place.
You can find the original article at: http://www.usatoday.com/story/money/columnist/wolff/2014/10/19/amazon-and-the-book-business/17376253/