Len Sherman
In the fight over e-book pricing, why Amazon is not the bully
[Commentary] As a fight over e-book pricing intensifies between French book publisher Hachette and online retailer Amazon, some are suggesting that Amazon customers are being left behind.
While details of the ongoing standoff are sketchy, it has become clear that Amazon is pressuring Hachette by making access to its books difficult on amazon.com. As an author whose recent book was published by Hachette, Fortune's Adam Lashinsky earlier penned an article that takes issue with Amazon's behavior as contrary to the company's ostensible obsession with customer service.
Turning Lashinsky's argument around, I'm trying to understand what strange universe he lives in to believe that consumers won't come out ahead if Amazon wins this fight. Lashinsky may be conflating author interest with consumer interest, and I can understand his disappointment in being collateral damage in this fight. But as he notes, consumers have alternative choices to buy his book (as I already have).
After the dust settles, if Amazon wins, he will wind up selling more books at lower retail prices and probably earn higher royalty payments. I think Lashinsky should redirect some of his wrath on Hachette, who, like other major publishers, pays only a 25% royalty rate on e-book sales, compared to 50% from native e-publishers like Open Road Media or 50%-70% from Amazon (depending on e-book price).
[Sherman is an adjunct professor at Columbia Business School, where he teaches courses in business strategy and corporate entrepreneurship]