The war over ebook pricing got toasty this weekend. On the heels of the iPad release, Macmillan delivered an ultimatum: either Amazon agree to let it control ebook prices (Apple agreed to similar restrictions for the iPad) or Amazon wouldn’t be allowed to sell Macmillan ebooks until much later than their competitors, so called “deep windowing.” Amazon responded by pulling all Macmillan offers on their books from its site, not just ebooks but the old fashioned paper variety too. As an added sting, the books can still be purchased second hand. John Sargent, CEO of Macmillan, posted his volley on the dispute in a paid advertisement on Publishers Lunch. Amazon, so far, has only responded in the Kindle Forum.
The New York Times came out in favor of Macmillan, which isn’t surprising since they too would like to dissipate Kindle control. Yahoo and a few other online media outlets are declaring Amazon the victor, also not shocking. So what gives? Is this just a massive hissy fit on the part of Jeff Bezos?
This all feels like we’re watching Jeeves and Robocop bicker. The publishing world seems so refined (Sargent’s letter is filled with niceties and compliments) compared to gun-toting Amazon. Much of the commentary is shocked that Amazon would leverage one successful business to create a stronghold in another, and even more irate that while Amazon has said it will put Macmillan books back up for sale… they haven’t quite got to it yet. A couple things are certain. First, the move to yank Macmillan is much more costly to the publisher than it is to Amazon. Second, unlike Macmillan, Amazon knows exactly how much this move is costing it. Macmillan, who could see an even softer financial quarter if this ban continues, is clearly not the winner.
But what about Amazon? Though they haven’t acted on it yet, they clearly blinked. They come across as more than a bit freaked out about the iPad, and their stock fell more than 5% today. Also not the winner.
For now, the winner seems to be all other publishers. Yes, some customers in search of a Macmillan book will leave Amazon all together and get the book they want from Barnes & Noble or Powell’s, but more will buy a book–either in paper or ebook form–from another publisher. No other publisher has saddled up next to Macmillan, no standing together as an industry, instead they’re waiting to see how much damage is inflicted, willing to let Macmillan take a beating first. And that is likely a big part of Amazon’s strategy, to scare other publishers into not contemplating a similar move.
And the losers? Macmillan may have a soft quarter, but the writers they publish seem more concerned with less lofty things, like paying the mortgage or the gas bill. Several, including John Scalzi, Tobias Buckell, and Charles Stross, are irate not with their publisher, but Amazon. Which makes Amazon’s attempt to appeal directly to authors, even in its post in the Kindle Boards, a tad ironic.