Killing Themselves Over eBooks

I’ve said it before myself. NY Big Boy Publishers are only hurting themselves (well, along with their readers and their authors, I suppose) with their stance on eBooks. Here is an interesting blog post on the subject of DRM by author Charlie Stross: “Cutting Their Own Throats”

Excerpt:

The corporate drive for DRM is motivated by the fear of ebook piracy. But aside from piracy, the biggest ebook-related threat to the Big Six is called Amazon.com. Until 2008, ebooks were a tiny market segment, under 1% and easily overlooked; but in 2009 ebook sales began to rise exponentially, and ebooks now account for over 20% of all fiction sales. In some areas ebooks are up to 40% of the market and rising rapidly. (I am not making that last figure up: I’m speaking from my own sales figures.) And Amazon have got 80% of the ebook retail market.

For various reasons the major publishers don’t sell direct to the public themselves — they go via external retail channels. Of these channels, Amazon is the 500kg gorilla of internet sales. Amazon has ruthlessly used its near monopoly of online sales to exert monopsony buying pressure against suppliers, forcing the likes of Holtzbrinck or Penguin or Hachette to give them a deep discount on ebooks. In the past they have de-listed publishers’ paper editions during negotiations, chopping their sales off at the knees in an attempt to force them to grant favourable sales terms. When Amazon extract deeper discounts from their suppliers, they pass some of the discount on to the public — this expands their monopoly position on the retail side by undercutting their rivals. It’s good for customers in the short term, but it’s not good for anyone in the long run: they’re sweating their suppliers, all the way back down the supply chain (read: to authors like me) and sooner or later they’ll put their suppliers out of business.

Anyway, my point is that the Big Six’s pig-headed insistence on DRM on ebooks is handing Amazon a stick with which to beat them harder.

Read the entire article on Charlie’s Blog and add to his hundreds of comments on the post. More comments and discussion here.

BUY Charlie’s books on Amazon.com.

What do you think about DRM and the Big Boy’s stance?

 

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