Amazon: The Next Iteration
Nick is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
In “Part 2: A Hammer on the Publishers – Amazon trying to wring deep discounts from publishers” the Seattle Times focuses on the buggy whip publishers without realizing Amazon (NASDAQ: AMZN) is not so much creating the final frontier, as much as voyaging into the undiscovered country hoping to figure out how to be a part of it.
During an interview with the Nerdist, musician, director, writer Rob Zombie shared with host Chris Hardwick that the problem now in the digital age is simply too much garbage content, and that there needs to be something that improves what is being created:
Zombie: I feel like when it was harder to do stuff that immediately separated some people who were never going to do it. It was already so hard to get to Point A that it got rid of half – now, anyone can shoot their little web videos and it floods the space with people...it doesn’t thin the herd quite as much as it used to. It used to be, “We got to get in the van and drive to Minneapolis – I quit, I’m going to keep my job at the 7-11.” Any little hardship would make people quit, now its easy and I don’t know if all that [access] helps…The Internet makes it so easy to connect to [like-minded] people and you feel safe from your bedroom and it pulls you deeper into a hole. For me [before the Internet], I was shy and withdrawn…but I forced myself to go out and get a life.
Hardwick: I have this theory that those big eyed little aliens we see are actually future humans. That’s how we will evolve all pale and thin because of staring at screens and growing big heads...
Jeff Bezos “sees four lights,” and at the moment he seems to understand all the options, while traditional publishers seem unwilling to consider more than just a couple.
Amazon is not so much ruthless in pushing the frontiers of publishing, as it is aggressive in seizing the high ground (moral and otherwise) in an obvious transition open to a number of players (most of whom have chosen to cling to the doomed familiar). So, like the seminal Star Trek: The Next Generation episode Bezos is fond of quoting, he sees the options available despite how easy it would be if he just went along with what the grand inquisitor tells him to accept.
The Seattle Times, recalling the New York Times, quotes an author on how Amazon is destroying the fabric of book culture by, “fondly describing how employees at one Chicago store ‘optimistically set up seven folding chairs, then occupied those chairs themselves when nobody showed up for the reading.’” Unfortunately, that nostalgia may be more of a sign that the old book culture was not only limited, but possibly broken. Uncharacteristically in its four-part series, the Seattle Times does a good job of summing up what Amazon hath wrought:
[Paul] Alexander wrote a 9,500-word story called "Murdered" last year and had it published as a Kindle "Single," a short-form e-book. Priced at $1.99, "Murdered" enjoyed a four-week run as Amazon's top-selling Single. The true-crime story continues to generate royalties for Alexander, who figures he has taken in about $50,000 from the mini e-book — more than if he had written it for a major magazine.
And with more leeway on word count, Alexander said, "It gave me a freedom I didn't have before."
Rosetta Books, his New York-based publisher, has helped produce eight Kindle Singles since Amazon launched the program in January 2011. Rosetta CEO Arthur Klebanoff says it's a good way for writers to get noticed.
"There's very heavy visibility, so if the author has other books, there's a lot of cross-promotional benefits," he said.
Again, typical of those losing a battle, publishers base their arguments on concepts like “respect” and “being offended”, but offer little in the way for consumers and authors to take up their cause (as these two are fundamental to the transaction). Just like farmers and merchants opting for selective rape by a distant king rather than continual pillage by a local noble, authors are opting for the next phase in publishing (and at the moment Amazon has elected to court content originators with over three times the benefits than what is offered by traditional publishers – up to 70% royalties instead of the old industry standard of 17.5%). Sure there will be new problems, but at least for the next few years, those with the content and the best access to consumers will reap enormous benefits while the freed up capital is thrown at the next series of efficiencies.
Another independent publisher puts the traditionalists’ problem into perspective (while avoiding the fatal conceit that it might be time to find a new career), “They want more margin than what is reasonable to give. At some point, enough is enough. What we and our publishers do to bring a book to market is so much riskier than what Amazon does to bring it to the reader.” While this is true, it also displays an arrogance that what publishers and editors do includes controlling the gate.
Most writers will be the first to admit they are incapable of editing themselves well. Most are also woefully incompetent when it comes to marketing and distribution. However, the increasing success of writers through Amazon’s self-publishing program shows that the public has been done a disservice by the old publishing gatekeepers – both independent and conglomerate.
While the new model offered by Amazon theoretically does away with the middleman publishing house, what it really does is accept the growing power of the content originator and develops a more venture capital approach which offers a strong incentive for the originators to choose Amazon as their main partner. It is easy to see freelance editors and freelance publishers offering their service to content originators for a percentage of the royalties (more likely than an up front fee since authors are always broke). In this new phase, the author will have a much stronger role in determining partnerships (and this should also inaugurate a new phase of competitive publishing houses that are built upon successful experiments with content originators who will be more like partners rather than clients – achieving the mutual respect currently pined for).
For Amazon’s part, the more it can offer consistency, accessibility, and stability in its pricing model and platform to content originators, the more likely it is to maintain its tenuous dominance in this phase of publishing. There is also no reason to think that less bloated traditional publishers might be able to fit into the new model as well (after all, their brand still conveys a sense, right or wrong, that one is purchasing and reading a “real”, well-crafted book). Although, Amazon now dominates print-on-demand and is constructing its own niche houses, so even in the world of the physical book, the traditional publishers are being outflanked.
No one disputes that a good editor is more than just a proofreader and in this new phase of publishing could share responsibilities with freelance publishers by improving the overall cohesiveness and internal quality (hyperlinking and visuals in particular). Still, in an age where more content is produced each year than has been produced since the dawn of writing, a publisher’s brand will become even more important -- just as a well-regarded brand is a modern symbol of trust that helps distinguish similar-looking digital content on offer. Publishers can be key in creating a style and a guarantee for overwhelmed consumers trying to discern the best edition amongst the crap ton of The Collected Works of Dickens or the best set of travel guides on offer. Publishers need to see themselves less like quality control and more like quality insurance.
Still, if what the Seattle Times portrays is true, it is hard to see Amazon maintaining its dominance if they behave in the same faceless, nameless, monolithic way described in the article. Otherwise, Bezos is right to assume that it is truly Day One and Amazon could easily end up being just as highly-dispensable as the traditional publishers are now proving to the indispensible content originators. Still, far more than any other competitor right now, Amazon is finely attuned to market dynamics and it already appears that they are accommodating even obscure foreign language writers by offering them access to audiences heretofore unavailable.
Catering to the self-help and romance obsession of the public should be straightforward and fit well with the new Amazon publishing houses it is creating basically with the old publishing houses’ talent. More exciting, and taking a page from the transitioning music industry, the new phase of publishing made possible by Amazon should allow content that appeals to smaller audiences to flourish and give rise to new associations (book clubs of yore), critical filters (just like video killed the radio star, its bastard child the podcast will avenge), and magical algorithms programmed by our robot masters should also spring up that will allow consumers to navigate this new world bravely (while possibly going boldly in the process).
Nick Slepko has no position in any company mentioned here at the time of publication. Motley Fool newsletter services recommend Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.