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Mar 27, 2008

March 27, 2008

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Some Print on Demand (POD) publishers are privately screaming "Monopoly!" while others are seething with rage over startling phone conversations they're having with Amazon/BookSurge representatives. Why isn't anybody talking about it openly? Because they're afraid - very, very afraid.

Amazon.com purchased BookSurge, a small POD publisher/printer back in 2005. Amazon also lists and sells titles for the largest POD printer, Lightning Source, which is owned by Ingram (the large book distributor). According to their website, Lightning Source serves more than 4,300 publisher clients and has more than 400,000 titles in their system.

You'd think Amazon's purchase of BookSurge might have made things a bit uncomfortable between the two companies. However, they continued to work together, getting books on demand to Amazon.com's loyal customers. Things appeared to be cruising along just fine, but perhaps not anymore.

Reports have been trickling in from the POD underground that Amazon/BookSurge representatives have been approaching some Lightning Source customers, first by email introduction and then by phone (nobody at BookSurge seems to want to put anything in writing). When Lightning Source customers speak with the BookSurge representative, the reports say, they are basically told they can either have BookSurge start printing their books or the "buy" button on their Amazon.com book pages will be "turned off."

The book information would remain on Amazon, and people could still order the book from resellers (companies that list new and used books in Amazon's Marketplace section), but customers would not be able to buy the book from Amazon directly, nor qualify for the coveted "free shipping" that Amazon offers.

Don't believe it? I didn't believe it either. I am Angela Hoy, the co-owner of POD services company BookLocker.com and publisher of WritersWeekly.com. I am well-known in the industry for my activism performed through WritersWeekly Whispers and Warnings. Over the years, we have helped writers recover tens of thousands of dollars in fees from deadbeat editors and publishers, helped them negotiate better contract terms, assisted writers in obtaining payment after their copyrights have been violated, and even assisted police in collecting evidence to prosecute criminals who have preyed on writers. I am also the author of 11 non-fiction books.

Still doubting the reports could really be true, I emailed an Amazon/BookSurge representative who's been trying to get us to talk to him by phone. John Clifford of Amazon/BookSurge called me at 12:30 p.m. on Wednesday, March 26, 2008.

My first comment was to tell him we heard a rumor that POD publishers who didn't use BookSurge would have the "buy" button on their Amazon.com book pages turned off.

He said, "What? Who told you that? That's not true!"

I told him I'd heard some rumors from the "POD underground."

He said he'd previously tried to talk to my husband, Richard Hoy, the President and CEO of BookLocker. I explained that we had a very bad experience with BookSurge in the past and that he was, naturally, hesitant to do business with them again. (Google the words BookSurge complaint without any quotes to see other customers' comments about them as well.)

He claimed the people who worked for BookSurge back then are probably all gone (but that didn't explain the more recent complaints). He made his sales pitch, talking about percentages and such, and said many POD publishers are resisting their attempts to convert to BookSurge. Mr. Clifford also said BookSurge's aim was to help Amazon customers get their books faster.

What he didn't say was that Lightning Source not only packages books for Amazon customers in boxes that feature an Amazon.com return address label, but also drop-ships those orders directly to Amazon customers at Amazon's request. Hmm...

He stated several times that books not converted to BookSurge's system would be "taken down." Since that wasn't exactly what we'd heard, I asked about books that perhaps weren't selling well, that aren't good candidates for converting to BookSurge (books that would remain for sale through Lightning Source, but would never be converted to BookSurge due to the time/expense involved).

Contrary to what he stated at the very beginning of our conversation, Mr. Clifford finally admitted that books not converted to BookSurge would have the "buy" button turned off on Amazon.com, just as we'd heard from several other POD publishers who had similar conversations with Amazon/BookSurge representatives.

Mr. Clifford said authors of those books could participate in the Amazon.com Advantage Program, meaning they would have to pay Amazon $29.95 per year PLUS 55% of the list price of their book, as well as buy and then send those books to Amazon directly for them to warehouse and ship to customers.

I explained to him that we had more than 1500 books in print and that it would take quite awhile to convert all of those over to BookSurge's system. He said as long as the relationship was "moving forward" that the "buy" button would remain active on our authors' books that had not yet been switched.

Another comment Mr. Clifford made was that their eventual desire is to have no books from other POD publishers available on Amazon.com.

WHAT ARE THEY THINKING?!

I have to wonder if Jeff Bezos is even aware of what is going on within his organization. Here is Amazon's Vision Statement, taken directly from their website:

"Our vision is to be earth's most customer centric company; to build a place where people can come to find and discover anything they might want to buy online."

What it doesn't say is, "Our customers can buy any print on demand book they might want online...as long as we also get paid to print it."

Nobody likes being backed into a corner, and saying "do this or else" naturally breeds angry rejection and hostility. If we did agree to sign the contract, pulling and transferring files to Amazon/Booksurge would take an enormous amount of time and money. From the POD publishers we've talked to, and from our own experience at BookLocker, we could all be looking at a dire and immediate threat of revenue cuts if we refuse to sign the Amazon/BookSurge contract. Most importantly, there could be an outcry from and potential financial hardship on the authors, who are completely innocent in all of this.

In BookLocker's opinion, and the opinion of all the fellow Lightning Source customers we talked to, the Amazon/BookSurge proposal does not appear attractive at all (yes, we obtained the contract and the file submission specifications). Amazon/BookSurge would make money two ways on Amazon.com sales - first the fee for printing the books, and then 48% of the list price of each sale through Amazon.com. Lightning Source allows its customers to set their own discount rate for Amazon and other retail sales, and does not force POD publishers or authors to pay "48%."

Furthermore, it could take the larger POD publishers months to submit their book files to Amazon/BookSurge, at a considerable cost and number of man-hours. This makes the deal even less attractive. Finally, while the initial list of books submitted by POD publishers could be submitted to Amazon/BookSurge for free, the contract states future books would cost $50 each to process. The cost for individual authors to publish through BookSurge is considerably more, with an average publishing package cost of more than $1,000.

Since Amazon/BookSurge does not offer Ingram distribution (Ingram distribution is considered imperative in the industry for bookstore sales), any company that accepts the Amazon/BookSurge deal, who desires to keep offering Ingram distribution, may need to maintain two copies of the book files. Since the Amazon/BookSurge current specs don't match the Lightning Source specs, future book files, both interior and cover, may need to be formatted separately. So, they would have to pay double the setup fees and might have to do double the formatting work as well...or pay designers to do double the formatting work.

Likewise, self-published authors who believe they must have Ingram Distribution AND an active "buy" button on Amazon to be successful may need to pay double the setup fees (to a POD publisher AND Amazon/BookSurge), and also may need to create two separate sets of formatted files.

In the event where two versions of a book might be available, Mr. Clifford said the Amazon/BookSurge version of the POD book would trump (override) the version offered by Lightning Source on Amazon.com.

AMAZON WAS BUILT BY BOOKS....That Were Written By AUTHORS

When authors get wind of this, we believe they are going to be livid. Authors are also readers. They love books. We suspect they buy from Amazon in droves. I, myself, have been an Amazon junkie for years, not only heavily promoting Amazon.com in my non-fiction books for writers and on our very popular website, WritersWeekly.com, but also listing my own books for sale there, ordering other authors' books, DVDs and numerous other products as well. I pulled up our Amazon customer account and looked at our receipts. We've spent $1508.81 at Amazon.com in the past six months. Multiply that by the number of authors this will affect...authors who, like me, have a multitude of websites to choose from when doing their shopping online.

In addition, authors participate in the Amazon experience, via blogs on the website, by posting reviews about other books, and more, activities that help to continually make Amazon bigger and better. Authors are a loyal bunch! For years, they've been faithfully sending their readers to Amazon.com, again and again, even when they earned lower royalties for doing so.

It's not inconceivable to think that this group, if shoved against a wall like this, won't simply pledge their allegiance elsewhere. Let's face it, BarnesandNoble.com offers free shipping on orders of $25 or more, too. Authors can change the links to their book pages on their websites, in their ezines and press releases, and even in their email signatures to their book's page at BarnesandNoble.com. Authors can spend their own money elsewhere as well (as I plan to do). I imagine BarnesandNoble.com will be very happy to process the extra book sales that could result from all of this.

Amazon.com might also upset countless companies that have Amazon Affiliate bookstores on their websites (many authors have these, too!). If Amazon/BookSurge were to follow through with turning off the "buy" buttons for thousands of POD titles, customers following those links from other websites could be confused and annoyed. After clicking on a link, they would find no easy way to purchase the book directly from Amazon, and no way to obtain free shipping on that book, even if they're willing to buy more products to meet the $25 free shipping threshold. One would think Amazon must know the free shipping strategy works to upsell customers on additional products. That's why they offer it. Without it, these customers could have no incentive to buy more products because the product they surfed in to buy does not qualify.

One has to wonder if traditional publishers will be next? Will Amazon eventually require all books sold through Amazon.com to be printed by BookSurge?

Let's all hope and pray this situation is one huge, misguided idea from some mid-level management person and not corporate policy being dictated from the office of Jeff Bezos.

What can you do? Let Amazon know what you think about this "offer" by Amazon/BookSurge.

The names of their Officers and Directors are here: http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-govManage

Amazon's Investor Relations Team email address appears near the bottom of this page: http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-faq

Their address is:

Amazon.com, Inc.
P.O. Box 81226
Seattle, WA 98108-1226

Next, tell your author friends, your book buyers, your website visitors, your ezine subscribers and everyone else about this situation. Amazon.com was built on books. Books are written by authors. Unfortunately, it appears authors may ultimately be the innocent pawns in this power struggle.

~~~~~

COMMENTS ARE WELCOME BY READERS! Please email your comments to Angela and she will post them right here. Please let her know in your email if you do NOT want your name published. Email angela@writersweekly.com OR angela@booklocker.com.

Angela Hoy is the publisher of WritersWeekly.com, which offers free job listings and paying markets for freelance writers every Wednesday. Subscribe at WritersWeekly.com. She is also the publisher at BookLocker, which offers full-service, affordable print on demand publishing and free ebook publishing.

~~PERSONAL POSTSCRIPT TO AUTHORS FROM ANGELA~~

There is no reason to panic. We are not aware of any cases yet where the "buy" button has been removed. It is possible, after recognizing everyone's concerns, that Amazon might change its mind.

If they do turn off the "buy" buttons, though, not having an active "buy" button on Amazon.com is not the end of the world.

After selling books for eight years, it has been our experience that "chance purchases" of self-published books on Amazon.com are not the norm. Authors slap books up on Amazon.com all the time, don't market them, and sell zero copies. For most self-published authors, sales are almost always author-driven, meaning the bookstore link you use in your marketing efforts is what's driving your sales, not just simply having your book listed on Amazon.com.

We know from experience that the customer is going to buy your book from where you tell them to buy your book. If you want your customers to qualify for free shipping, you can send them to BarnesandNoble.com, and tell them their order might qualify for free shipping (many people don't know BarnesandNoble.com offers free shipping!).

OTHER ARTICLES ABOUT THIS TOPIC:

A New Amazon Mandate? Say it ain’t so, Jeff by Morris Rosenthal

GROUPS DISCUSSING THIS TOPIC:

http://finance.groups.yahoo.com/group/pod_publishers/ by Morris Rosenthal

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Posted: Mar 27, 2008 5:02pm

 

 
 
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Ruth Jamieson
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