There is currently a debate raging over e-book pricing. The charge is one of price fixing and the debate affects all book publishers. Even though the press has focused on Apple as the target of the DOJ investigation, the lawsuit also affects five other publishers:
Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster. Of these six defendants, three have settled with the DOJ: Harper Collins, Simon & Schuster and Hachette. Any time vendors collude to set prices at a specific level in order to improve profits its price fixing. The law is blind as to the reasons behind the price fixing, engaging in this practice is simply against the law for any reason.
The supposed point of the lawsuit is to restore competition to the market, but more than a few people see the opposite happening if the DOJ is successful. There is a fly in the ointment—Amazon. It seems that Amazon has actually been pricing e-book content at a loss in order to promote the Kindle, which has placed the publishers in an unenviable position of losing money in order to remain competitive. Healthy debate on the topic is probably the best course of action until all of the facts come to light, but debate of this sort seldom occurs. Some industry pundits are wondering whether Amazon should be part of the lawsuit as well. A few have come outright as said that Amazon is more of a problem than the publishers for these reasons:
- The lawsuit will hurt professional authors financially.
- A decrease in compensation will end up closing smaller bookstores.
- After Amazon buries the competition, buyers will be hurt by the resulting monopoly.
- Lower book prices will adversely affect the quality of content available to readers.
- Amazon already uses the same model as the publisher do, but hasn’t been named in the lawsuit.
At issue here is one of fairness and eventual results. It’s not fair for the DOJ to pursue price fixing for some actors in this situation and not others. If the DOJ is serious about fixing the current problems with competition in the e-book market, then it really does need to do something about Amazon. Otherwise, the result will be a monopoly that will hurt everyone and prove incredibly expensive to fix. More importantly, professional authors already make little money for their efforts—squeezing them further will definitely result in a loss of the incredible wealth of professional authors available today. Fixing the problems in the market will prove considerably more easy than trying to reestablish the author base used to write books when they become completely unprofitable.
Perhaps this will eventually work out in an unexpected way. This may be yet one more nail in the coffin that is currently killing books as a means for exchanging information. The interactive tools that are being developed for use with books may eventually take over and everyone will use them for all sorts of training. However, these tools are currently in their infancy and authors like me are only now beginning the build the expertise required to use them. In the meantime, it’s important that the DOJ take appropriate actions to ensure true competition in the marketplace.
What is your take on this issue? Do you even read books anymore to obtain information or do you rely on some other source? Let me know at [email protected].
