Did anyone else get this email from Amazon to Kindle Book Authors?

12 replies
Here's the email I just got.

Dear KDP Author,

Just ahead of World War II, there was a radical invention that shook the foundations of book publishing. It was the paperback book. This was a time when movie tickets cost 10 or 20 cents, and books cost $2.50. The new paperback cost 25 cents - it was ten times cheaper. Readers loved the paperback and millions of copies were sold in just the first year.

With it being so inexpensive and with so many more people able to afford to buy and read books, you would think the literary establishment of the day would have celebrated the invention of the paperback, yes? Nope. Instead, they dug in and circled the wagons. They believed low cost paperbacks would destroy literary culture and harm the industry (not to mention their own bank accounts). Many bookstores refused to stock them, and the early paperback publishers had to use unconventional methods of distribution - places like newsstands and drugstores. The famous author George Orwell came out publicly and said about the new paperback format, if "publishers had any sense, they would combine against them and suppress them." Yes, George Orwell was suggesting collusion.

Well... history doesn't repeat itself, but it does rhyme.

Fast forward to today, and it's the e-book's turn to be opposed by the literary establishment. Amazon and Hachette - a big US publisher and part of a $10 billion media conglomerate - are in the middle of a business dispute about e-books. We want lower e-book prices. Hachette does not. Many e-books are being released at $14.99 and even $19.99. That is unjustifiably high for an e-book. With an e-book, there's no printing, no over-printing, no need to forecast, no returns, no lost sales due to out of stock, no warehousing costs, no transportation costs, and there is no secondary market - e-books cannot be resold as used books. E-books can and should be less expensive.

Perhaps channeling Orwell's decades old suggestion, Hachette has already been caught illegally colluding with its competitors to raise e-book prices. So far those parties have paid $166 million in penalties and restitution. Colluding with its competitors to raise prices wasn't only illegal, it was also highly disrespectful to Hachette's readers.

The fact is many established incumbents in the industry have taken the position that lower e-book prices will "devalue books" and hurt "Arts and Letters." They're wrong. Just as paperbacks did not destroy book culture despite being ten times cheaper, neither will e-books. On the contrary, paperbacks ended up rejuvenating the book industry and making it stronger. The same will happen with e-books.

Many inside the echo-chamber of the industry often draw the box too small. They think books only compete against books. But in reality, books compete against mobile games, television, movies, Facebook, blogs, free news sites and more. If we want a healthy reading culture, we have to work hard to be sure books actually are competitive against these other media types, and a big part of that is working hard to make books less expensive.

Moreover, e-books are highly price elastic. This means that when the price goes down, customers buy much more. We've quantified the price elasticity of e-books from repeated measurements across many titles. For every copy an e-book would sell at $14.99, it would sell 1.74 copies if priced at $9.99. So, for example, if customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000. The important thing to note here is that the lower price is good for all parties involved: the customer is paying 33% less and the author is getting a royalty check 16% larger and being read by an audience that's 74% larger. The pie is simply bigger.

But when a thing has been done a certain way for a long time, resisting change can be a reflexive instinct, and the powerful interests of the status quo are hard to move. It was never in George Orwell's interest to suppress paperback books - he was wrong about that.

And despite what some would have you believe, authors are not united on this issue. When the Authors Guild recently wrote on this, they titled their post: "Amazon-Hachette Debate Yields Diverse Opinions Among Authors" (the comments to this post are worth a read). A petition started by another group of authors and aimed at Hachette, titled "Stop Fighting Low Prices and Fair Wages," garnered over 7,600 signatures. And there are myriad articles and posts, by authors and readers alike, supporting us in our effort to keep prices low and build a healthy reading culture. Author David Gaughran's recent interview is another piece worth reading.

We recognize that writers reasonably want to be left out of a dispute between large companies. Some have suggested that we "just talk." We tried that. Hachette spent three months stonewalling and only grudgingly began to even acknowledge our concerns when we took action to reduce sales of their titles in our store. Since then Amazon has made three separate offers to Hachette to take authors out of the middle. We first suggested that we (Amazon and Hachette) jointly make author royalties whole during the term of the dispute. Then we suggested that authors receive 100% of all sales of their titles until this dispute is resolved. Then we suggested that we would return to normal business operations if Amazon and Hachette's normal share of revenue went to a literacy charity. But Hachette, and their parent company Lagardere, have quickly and repeatedly dismissed these offers even though e-books represent 1% of their revenues and they could easily agree to do so. They believe they get leverage from keeping their authors in the middle.

We will never give up our fight for reasonable e-book prices. We know making books more affordable is good for book culture. We'd like your help. Please email Hachette and copy us.

Hachette CEO, Michael Pietsch: Michael.Pietsch@hbgusa.com

Copy us at: readers-united@amazon.com

Please consider including these points:

- We have noted your illegal collusion. Please stop working so hard to overcharge for ebooks. They can and should be less expensive.
- Lowering e-book prices will help - not hurt - the reading culture, just like paperbacks did.
- Stop using your authors as leverage and accept one of Amazon's offers to take them out of the middle.
- Especially if you're an author yourself: Remind them that authors are not united on this issue.

Thanks for your support.

The Amazon Books Team

P.S. You can also find this letter at www.readersunited.com
#amazon #authors #book #kindle #letter
  • Profile picture of the author Raja Kamil
    Yes, I got it too.
    hurm .....
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  • Profile picture of the author laurencewins
    Yes I got it too, which is odd as I don't have any kindle or Amazon books for sale.
    Signature

    Cheers, Laurence.
    Writer/Editor/Proofreader.

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  • Profile picture of the author Michael Oksa
    That's an interesting letter.

    Amazon and Hachette can, as businesses, charge whatever they like for their products. However, it's the collusion that's a bigger problem. Amazon should not try to dictate what another publisher charges, but Amazon can certainly comment on it.

    The clever part is how the letter uses language, history, and emotion to get others to take action. This isn't just a letter describing a conflict, it's a sales letter...and what can we learn from that?
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    "Ich bin en fuego!"
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  • Profile picture of the author WeavingThoughts
    Amazon management is crazy. If somebody wants to sell ebooks at $1000 each. Let them be. Let the market decide whether it will sell or not. Amazon should stop acting ethical when it is the unethical one here.
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    • Profile picture of the author rlhurst
      Originally Posted by WeavingThoughts View Post

      f somebody wants to sell ebooks at $1000 each. Let them be. Let the market decide whether it will sell or not.
      I agree with this completely!
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      I do voice over work... here's a SAMPLE
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      • Profile picture of the author talfighel
        Originally Posted by WeavingThoughts View Post

        Amazon management is crazy. If somebody wants to sell ebooks at $1000 each. Let them be. Let the market decide whether it will sell or not. Amazon should stop acting ethical when it is the unethical one here.
        Sales will be low but people are willing to pay this price for a solution to their problem.
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        • Profile picture of the author Alexa Smith
          Banned
          There are some highly misleading statements in the email, including some that rest on entirely fallacious "logic".

          In this interesting article, Laura Miller explains why it might be in self-published authors' interests to side with Hachette in the ongoing Amazon dispute: Amazon is not your best friend: Why self-published authors should side with Hachette - Salon.com

          This article from Thursday's New York Times comments on the 900 authors "battling Amazon": Plot Thickens as 900 Authors Battle Amazon

          And here's the BBC's take on the same subject (published yesterday): Authors Rally Against Amazon in Hachette Dispute.

          .
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        • Profile picture of the author droog
          This was a strange email from amazon. Using emotion to frame this debate that amazon is looking after the author's best interest when instead it's looking after amazon's best interest (not dogging that).

          Kindle's lending library, Kindle Select free book promotions, etc. and now Kindle unlimited- all the books you want for $9.99/month. Long term it's great for amazon and it's customers but I'm less sure about how great all this is for authors. As more authors compete amazon can use these types of methods as authors take more desperate measures just to get eyeballs.

          It reminds me of something I read about Walmart years ago where product suppliers were ecstatic at first to be able to sell their items through them because the volume was so incredible. Then Walmart becomes relentless on forcing them to constantly lower their prices until they were just treading water or could no longer turn a profit.

          Bottom line, amazon looks out for it's own interests and it's customers. Authors/publishers are a distant third. Again, not dogging that, but authors who think amazon has their best interest in mind are delusional.
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  • Profile picture of the author aksingh000
    Why is Amazon horrified. For every 2$ they pay to the authors they earn more than 2000$ indirectly from their effort. Not only this Amazon CEO considers books as garbages .Their sole interest in money.
    They are not worried about publisher's future.
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  • Profile picture of the author NK
    I actually wished that email had contained some sort of background to the whole thing. Was completely clueless to what the email was all about until I came in here to read this thread.
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    Affiliate Link Cloaking & Tracking Software - The most powerful tool available for affiliate marketers who are sick and tired of making way too little money!
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  • Profile picture of the author aabagail
    Exactly, like you, there are many people receive the mail. I have received the mail as a kindle book author. Thanks for sharing this.
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    Cool

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  • Profile picture of the author Valdor Kiebach
    Typical of US business to be price fixing and greedy. Engaged in illegal activities but doesnt give a f*ck as long as they can overcharge and dictate prices to the rest of the ebook market.

    They will be giving cookies to Eastern European Nazis next...
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