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How Amazon Kills Books and Makes Us Stupid

Amazon offers infinite choice and rock-bottom prices: those aren't necessarily good things.

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Another London publisher, head of a well-known transatlantic university press, complained about the way Amazon undermined his company's efforts to sell its titles direct. "They told us, in no uncertain terms, that if we tried to match the reduced price at which they were selling our titles they would take the lower price as the basis for calculating their discount, allowing them to price-cut still further."

Blocked at every turn in their attempts to escape this relentless race to the bottom, publishers have seen their revenues fall, forcing many to make cutbacks and concentrate more on lead titles, the blockbusters that, accountants tell them, are the most profitable component of their business. Fewer staff and falling promotion budgets mean that books by less established authors—the "mid-list"—receive ever shorter shrift.

The mid-list is the place where new talent has traditionally been nurtured, where publishers can take chances on less predictable titles. "Look at books like Amitav Ghosh's Sea of Poppies or Roberto Bolaño's Savage Detectives," says Paul Yamazaki, chief buyer at City Lights in San Francisco. "These are serious, sophisticated books that began life with modest expectations, but after dedicated work by the publisher and independent booksellers, they went on to reach wider audiences. This sort of publishing is under threat today."

The accumulated effect of Amazon's pricing policy, its massive volume and its metric-based recommendations system is, in fact, to diminish real choice for the consumer. Though the overall number of titles published each year has risen sharply, the under-resourcing of mid-list books is producing a pattern that joins an enormously attenuated tail (a tiny number of customers buying from a huge range of titles) to a Brobdingnagian head (an increasing number of purchasers buying the same few lead titles), with less and less in between. Responding to the effects of price wars last fall the American Booksellers Association warned, "If left unchecked...predatory pricing policies will devastate not only the book industry, but our collective ability to maintain a society where the widest range of ideas are always made available to the public."

Authors, too, can be added to the list of price-cutting's victims. In the fall of 2008, as the crisis of publishing began, a boss at Scribner, where I was a senior editor for two and a half years, announced at an editorial meeting that when it came to advances, "$50,000 is the new $100,000." Speaking with agents at this spring's London Book Fair, I found widespread corroboration that advances had indeed dropped precipitously.

This is partly a reflection of the overall dismal state of the market. US book sales fell by nearly 2 percent in 2009, after a drop of more than 2.8 percent the previous year. It is also related, however, to a clause in many publishers' contracts that reduces royalties paid to authors if sales are made to booksellers at a high discount, in some cases reducing the royalty by half. In this respect publisher, bookstore and customer appear to benefit from the lower price at the expense of the author. But lower advances and royalties make for less-well-researched books and an author pool increasingly populated by hobbyists rather than those whose primary qualification is the ability to write.

It's hard to see how the allure of infinite choice and rock-bottom prices conjured up by Amazon can be dispelled, but there are slivers of hope. Independent bookstores, especially those hosting regular live events, may be making a comeback. Last year, membership in the American Booksellers Association rose for the first time, after two decades of decline. And 37 percent of 18- to 34-year-olds told a recent survey they preferred to buy their books from independents. At the other end of the business, the emergence of Apple as a competitor to Amazon, and Google's recent announcement that it will set up its own online bookstore, may allow publishers wiggle room in negotiating terms.

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