Book Price Wars

What might be seen by some as good for the consumer in the short term might a raw deal if you ask me. The New York Times is running a story today about the on-going price war between Amazon.com and Walmart.com over 10 heavy-hitting books that will hit the shelves this Christmas season, as each has tried to outdo and undercut the other, bringing the price on these books down to $9 (and $8.99) respectively. Now, while that in itself isn’t so bad – it’s only 10 books, so let’s no overreact – there is a real danger playing out here, which the literary agent of John Grisham points out:

“If readers come to believe that the value of a new book is $10, publishing as we know it is over,” said David Gernert, Mr. Grisham’s literary agent. “If you can buy Stephen King’s new novel or John Grisham’s ‘Ford County’ for $10, why would you buy a brilliant first novel for $25? I think we underestimate the effect to which extremely discounted best sellers take the consumer’s attention away from emerging writers.”

I mean, it’s true that James Patterson’s statement is a bit overstated:

“Imagine if somebody was selling DVDs of this week’s new movies for $5,” Mr. Patterson said. “You wouldn’t be able to make movies.” He added, “I can guarantee you that the movie studios would not take this kind of thing sitting down.”

The movie industry and the music industry in recent years both had to deal with issues of people not just getting things on the cheap, but getting infinitely reproducible works for free in an era of internet privacy and digitalization. So far, piracy doesn’t strike me as having been nearly as much of a problem for book publishers, though it certainly does exist. But at the end of the day, I worry about 2 conflicting things with books getting published:

1) That we’ll move full on digital and the market will be oversaturated with cheap/damn near free books written by crappy writers. This might be a post for a later day, because right now the worry is more about

2) That margins will become so thin for publishing houses that they’ll be forced more and more to go for the sure thing and less willing to take chances on someone new, and also be so stingy that new authors will become discouraged or even unable to produce.

On this point, yes, yes, I know some people will write anyway, but let’s face it, not everyone is going to be the marketing sensation that is Stephen King and yet they still might deserve to enjoy a living, if not one as extravagant as even the crappiest mass-produced Disney channel tween singing spectacle. No, at least they didn’t have to contend with piracy to the degree that movies and music have had to, but your average novelist isn’t enjoying the lifestyle that the average actor, director, or musician does (or major league athlete, for that matter, but that’s another discussion).

At least in the piracy discussion, it was producers of works fighting against their own consumers. That’s a crappy situation, but it was more about negotiating a fair price and fairer system. I don’t think the consumers ever really got it, but things did get better once the RIAA decided that they could both provide an avenue for digital music and the Rhapsody and iTunes started showing up. Now if I want to hear a song, it’s just so damn convenient to shell out my $1.29 or whatever and get it instantly than it would be to hunt down through pirating channels. There’s your market.

In this negotiation, however, neither the publishers nor the consumers are the main movers and shakers. It’s not even the publishing houses, but the middlemen. The ones who have the least to do with the work itself, the very moneychangers in the temple, the retailers. Especially Amazon. I understand that Amazon is paying out the wazoo and losing money on every new book they put out for the Kindle at that $9.99 price point and that most (if not every) attempt to go over that meets with rebellion by their consumer base. Amazon is trying to make sure that they’re able to sell their device (and have already had to cut the price on that as well). But what they’re aiming for is nothing less than a solid, commanding share of the e-book market in perpetuity, so it’s a noteworthy investment for them. Still, I can’t help but wonder what’s going to happen the day that Amazon gets that share, turns around to the publisher and starts dictating prices to them. They already have that kind of muscle to a degree. But when Amazon does win this e-book reader thing, and while that debate is likely to still be open a year from now, they really could walk away with the whole thing, what’s going to happen?

If Amazon and Walmart can also do the same for hardback new releases, then I think we’re in a heap of trouble. The ebook market might be growing rapidly, but it’s still just a share. And I don’t mean to sound entirely hypocritical – I can’t really afford $25-$30 new releases myself, that’s why I don’t buy them (normally). But at the same time, I don’t think it’s because publishing houses are in a position to really gouge much (and I don’t mean to sound naive, but the RIAA really acted like dicks there for a long while in comparison): there aren’t enough readers out there anyway.

I fear that it’ll be really bad, that it’ll mean a lot fewer books, a lot fewer new authors, a lot of authors writing surefire winners according to formula rather than being innovative and creative. And what makes it really yucky is that it all boils down to cheap new releases.