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Amazon’s Monopsony Is Not O.K.

nytimes.com

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Re: Amazon’s Monopsony Is Not O.K.

#171

Post by lt »

JoeAltmaier wrote: post #167
cstross wrote: post #162

Earlier quoted context omitted.

The problem is, there doesn't seem to be much elasticity in the size of the market. Books are rivalrous goods: an hour spent reading book A is an hour you can't spend reading book B, or watching a movie. And a lot of people prefer to watch movies -- or play computer games, or kick a ball around -- to reading books for recreation. Unless we can work out how to convince more people that reading for pleasure is fun then…

Its an error to assume folks actually READ the books they buy. I have a tall stack of books I'll get around to reading. I paid for them all of course.

Anecdotally: Guilty as charged, on both accounts.

I also have a physical stack of unread books, which I'll probably never get around to read now that I have a Kindle, created mostly due to impulse buying on bookstores. Some I also bought again digitally.

I'm now growing my virtual kindle queue, faster than I can read, but with a different approach: I added all my wishlist authors (including cstross, incidentally) to ereaderiq, which notifies me of price drops, and buy 1.99 daily deals or similar range. So far I got very good deals on good titles of Arthur Clarke, Kurt Vonnegut, Neal Stephenson, William Gibson and so on.

So, again, anecdotally, I might buy things that I'll never read, but the amount of titles that I haven't read is bigger than my daily reading time, and after a certain quality threshold, titles seem mostly interchangeable.

I'd guess the best price point is the one just on 'impulse buy'.

Re: Amazon’s Monopsony Is Not O.K.

#172

Post by davidw »

cstross wrote: post #162
seanflyon wrote: post #153

Earlier quoted context omitted.

> It's commodification, equating work of serious artistic or literary merit, or work that lots of people like, with work that is neither artistic, meritorious, or even popular. Books have a high up front cost and low unit cost. This means that quadrupling sales is better than doubling prices and books "that lots of people like" will always be dramatically more successful than books that are "neither artistic, meritor…

The problem is, there doesn't seem to be much elasticity in the size of the market. Books are rivalrous goods: an hour spent reading book A is an hour you can't spend reading book B, or watching a movie. And a lot of people prefer to watch movies -- or play computer games, or kick a ball around -- to reading books for recreation. Unless we can work out how to convince more people that reading for pleasure is fun then…

I don't have numbers, but I'd take a guess that Amazon, with the Kindle, has done a decent job of expanding the market some.

I know I read about 10 times as much (including a few of yours, thank you!) as before getting one, although I'm probably an extreme case because it's slow and expensive to get English-language books here in Italy.

This quote, from upstream in the thread, makes sense to me:

> Removing legacy middlemen is healthy. Skewing producers' bargaining rights is not. Disentangling publishers' rents (the fraction of publishers' profits which come from them being, before Amazon, authors' only choice for distribution) from authors' costs of production (what good authors need to be paid to compensate them for the time, skill and risk which goes into writing) is difficult.

You doubtless have a closer seat to the action and more skin in the game - do you think there is already an effect on authors? To me it seems a bit too early to tell exactly what is happening where, with who, with certainty. I don't see Amazon trying to squeeze so hard that it strangles authors, but I suppose they're big enough they might well do stupid stuff inadvertently.

I think books are great value for what you pay in terms of entertainment, and I'm a pretty fast reader.

Re: Amazon’s Monopsony Is Not O.K.

#173

Post by kuni-toko-tachi »

seanflyon wrote: post #159
kuni-toko-tachi wrote: post #74

Paul Krugman is a foam at the mouth kook. He's consistently wrong, and only continues to be "relevant" because he promotes a particular view of the world, which is both absurd and popular because it is based on feelings and not reality. Capitalism is based on grow and destruction. It is just as absurd to argue against Amazon as it would have been to argue for Blockbuster. Netflix comes along, and Blockbuster disappea…

You second paragraph is reasonable, but you have not supported your claim that "Paul Krugman is a foam at the mouth kook". Statements like that should not be made without justification.

I should have toned down that statement. The main disagreement that many people have with Paul Krugman is that he is a central planner, he believes that the state should be an economic actor. That premise is fundamentally flawed.

Re: Amazon’s Monopsony Is Not O.K.

#174

Post by JackC »

jasode wrote: post #119
JackC wrote: post #92

Earlier quoted context omitted.

Krugman's point is summed up in another quote from the comment you linked to: "Hachette failed to come to mutually agreeable terms with [Amazon]. That's their most important job as a publisher, and they blew it, to the tune of permanently costing their authors 50-60%+ of sales they'll never recover." When one buyer represents 50-60% of sales, the "most important job" of any seller is to come to "mutually agreeable te…

>When one buyer represents 50-60% of sales, ... One party to the negotiation can walk away; the other cannot. I don't follow the logic here. Your fatalistic assessment assumes Hachette (and other publishers) are paralyzed and cannot adapt . However, the business world isn't static therefore Hachette can walk away. (If not this particular contract renewal because of timing pressure then at least the next one -- if the…

First of all, believe me, I would love it if publishers came and asked me how to beat Amazon. A new online bookstore (with a radically different approach to DRM) would definitely be on the list. I agree with you that publishers are not necessarily beat.

But you can't wave away the power Amazon has in that fight. The number of businesses that can survive, say, a 50% drop in sales for a year is pretty darn small, and the number of businesses that will tolerate a 50% drop in sales for six months without tossing out the CEO is even smaller. That means Amazon has a lot of power right now to decide how practically every supplier in the book market behaves. And they are pushing in exactly the opposite direction with all that power -- they're trying to consolidate.

So this is dynamic in both directions -- it's a tug of war where Amazon's monopsony power will either increase or decrease. I feel like the smart money has got to be on increase. (See Amazon's P/E ratio.)

Re: Amazon’s Monopsony Is Not O.K.

#175

Post by [deleted] »

k-mcgrady wrote: post #170
Kalium wrote: post #154

Earlier quoted context omitted.

Which they haven't done and have shown no inclination to do.

Because the don't have the necessary power yet! In order to require exclusive contracts they would need to be the only viable option for writers which would happen if they squeezed out publishers, became a publisher, and only distributed through Amazon. It's unlikely this would happen but when you gradually give someone more and more power the risk of abuse gets higher.

[deleted]

Re: Amazon’s Monopsony Is Not O.K.

#176

Post by HelloMcFly »

icelancer wrote: post #136
HelloMcFly wrote: post #134

Earlier quoted context omitted.

I'm not a writer, so I'll defer to you on that perspective. As a reader, I love publishers and editors. I've waded into the self-published world more than most, and I don't see myself buying self-published work again in the future without significant (outlier-level) crowd-sourced reviews like Wool or The Martian.

I don't blame you. Most self-published stuff is garbage. ... Have you noticed that most PUBLISHED stuff is garbage, too?

I have noticed that the proportional amount of garbage is lower among published works, and that the resulting breadth of content is much easier to wade through to find quality content.

Re: Amazon’s Monopsony Is Not O.K.

#177

Post by HelloMcFly »

wutbrodo wrote: post #142
HelloMcFly wrote: post #129

Earlier quoted context omitted.

As a regular Goodreads user, I've found that it definitely hasn't been a good start thus far.

Wow really? My reaction to new social networks (even niche ones) is usually somewhere between apathy and irritation, but back in 2010 I remember being excited about Goodreads because I saw actual value there: it just make the system of book recommendations that I already rely on that much more efficient. It took until 2012 for it to suddenly gain popularity and for me to gain a critical mass of friends whose taste I…

Two thoughts on that:

1) You are using it in a way that I'm not able to. For you it is a tool that leverages pre-existing relationships, which I'm sure is great. I know about four people that use Goodreads, and their tastes just don't align to me. And unfortunately for me, the stand-alone recommendation service Goodreads offers that people like me try to rely on is just terrible.

2) Even if I had a critical mass of friends making recommendations, they themselves identified the books they should read somewhere. Yes, we can all socially recommend books we like for awhile, but eventually someone has to start separating the wheat from the chaff to start making those recommendations. Books are not movies or songs, and it's much more time-consuming to do this en masse. I don't trust Goodreads to facilitate upstream discovery (that can leveraged downstream via social recommendations) in a publisher-less world primarily populated by self-published books.

Re: Amazon’s Monopsony Is Not O.K.

#178

Post by Tyrannosaurs »

nsomaru wrote: post #165
Tyrannosaurs wrote: post #63

Earlier quoted context omitted.

And I'm sure the 90% that vanishes will be the 90% you want gone. What I'm curious about is why you think Amazon's actions will drive away those creating crap for the sake of money. When I look through the Kindle Store the thing that always strikes me is how many knocked together short books written by people with no great expertise there are. To me that's the main current impact of Amazon's democratization of publis…

the downward pressure on prices will dissuade people who are writing with remuneration as a primary driving source of output. that said, that doesn't solve the problem of discovery, although it does alleviate it a bit. that's the logic, feel free to educate me :)

Love of writing doesn't make the time needed to write a novel and it doesn't feed families.

Surely the quality of the output rather than the purity of the intent should be the driving metric? Weary journalists knocking out a book to order are realisticall better than 95% of enthusiastic amateurs.

Besides, most writers are notoriously penny less. Why do you think anyone is going into it for the money?

Re: Amazon’s Monopsony Is Not O.K.

#179

Post by Tyrannosaurs »

josu wrote: post #110
Tyrannosaurs wrote: post #104

Earlier quoted context omitted.

It's not intended as an appeal to accomplishment, more as a suggestion that he would have as much to lose in reputation than to gain by getting involved in such a thing if he didn't genuinely believe his position. EDIT: I'd also suggest that as a default with the participants in this particular disagreement, anyone with self interest at heart should probably think about siding with Amazon. Jeff Bezos doesn't lose too…

In the academic world Krugman-the-journalist has never had that much reputation. It was Krugman-the-academic the one who won the Nobel Memorial Prize. You can check out some of Krugman-the-journalist's most notorious contradictions here: http://wiki.mises.org/wiki/Paul_Krugman#Contradictions

Clearly we don't expect his journalism to have the same level of rigour as his academic work.

That's a very different thing to any suggestion he might be part of an orchestrated PR move by Hachette which was the original implication.

Re: Amazon’s Monopsony Is Not O.K.

#180

Post by pron »

WalterBright wrote: post #140
pron wrote: post #35

Earlier quoted context omitted.

The main point isn't one action or another but, and Krugman says it clearly, that Amazon has too much power. Modern democracies usually strive to prevent concentration of power in few hands, especially if those hands aren't elected. The market, however, does often favor concentration of power, and when that happens, democracies should protect themselves. The US in particular has had a history of businesses gaining to…

I read Rockefeller's biography "Titan" and could not find a single instance in it where Standard Oil's large market share "seriously hurt" the public. S.O. was a serious force in reducing the price of kerosene to the public - by 70%.

Did you skip the part where he (and his ilk) enslaved a large portion of the country in all but name? Or the part where the people begged government to help curb the robber barons, and Teddy Roosevelt wrestled power away from them?
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