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Steve Jobs emails that show how to win a negotiation

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Re: Steve Jobs emails that show how to win a negotiation

#161

Post by jonknee »

rmrfrmrf wrote: post #90
jonknee wrote: post #71

Earlier quoted context omitted.

It's the top selling product on Amazon and has been so for years. They have sold a ton of them, it's ridiculous to think otherwise. Who do you think was buying all the Kindle books before there were other supported platforms? Amazon doesn't release sales figures. Period. Not of the Kindle and not of any product.

> [The Kindle is] the top selling product on Amazon > Amazon doesn't release sales figures. I'm not trying to step foot into this lose-lose debate, but you really can't say what has sold the most on Amazon without the release of sales figures. Amazon could easily be lying and none of us would know for certain.

I'm going to assume they haven't been committing securities fraud just like I assume Apple has really sold however many million iPads that they claimed.

Re: Steve Jobs emails that show how to win a negotiation

#162

Post by 6d0debc071 »

ojiikun wrote: post #107
seldo wrote: post #7

My two big takeaways from this are: 1. Amazon sells every Kindle ebook at a loss of $3 -- they pay $13 wholesale and sell it for $9.99. I thought this was a typo, but then Jobs repeated the figure (though he said $12.50). It was my impression that Amazon also sells the Kindle itself at near-cost, so does that mean that Amazon's entire ebook business has been running at a loss the whole time? 2. Jobs certainly did win…

All I took away from this was that AAPL wanted to make about $0, AMZN wanted to make about -$3, and in both cases the author makes about $3, meaning that of the $13 wholesale, the publisher is getting a 75% cut of the sale. I cannot fathom that the publisher performs any function possibly worth this much money. How, since we no longer have to ship dead trees, have we not evolved a system that gives authors 75% of the…

Well, publishers still do something - marketing and relationships mostly, I believe - but realistically they don't do anything worthy of that sort of money. It's just difficult to do things without them. I vaguely remember a story about a woman a while back who had just hired a publisher to do marketing for her though, rather than acting as a publisher and taking massive loads of money from it. So, it definitely sounds possible to get around them.

Sort of like the music market, from the sound of it - massive rip-off. But if they're the people who control the majority of the publicity....

Re: Steve Jobs emails that show how to win a negotiation

#163

Post by jhuckestein »

pizu wrote: post #155

Here is a vital lesson about how to make arguments and win in a negotiation, but nobody here has picked up on it. You are instead focusing on the numbers...which is a small part of the win... It's all about psychology and understanding the situation and the customer..let me explain: Notice how Murdoch uses "I" and "we" (referring to NewCorp/HC) all the time, while Jobs almost entirely uses "you" or "we" (as in HC and…

FWIW, I recall Jobs' biography mentioning that he was not a great negotiator because he was at times impulsive and abrasive. I think somebody in the book, maybe Jobs himself, is quoted as saying that Tim Cook was a much more effective negotiator.

Like others have said, this was not a difficult negotiation for Apple. Maybe Murdoch could have used the other verticals (video and newspapers) in a better way or tried to leverage an upcoming big release. I don't think they had reason to give in either way though.

Re: Steve Jobs emails that show how to win a negotiation

#164

Post by giulianob »

mtgx wrote: post #137
rkudeshi wrote: post #55

Earlier quoted context omitted.

A little backstory to explain the $13 wholesale -> $9.99 retail thing: Books have traditionally been sold to wholesale at $14, then sold at retail for $28 MSRP. When Amazon started selling ebooks, they stuck with the same model - they were buying ebooks wholesale from the publishers at $14 each. However, they proceeded to sell them to consumers at $9.99. Yes, they were losing money on every sale. Why? Because they kn…

> "Amazon's MP3 store, despite launching with cheaper and DRM-free music, has never been able to make a serious dent in iTunes' market share". Maybe because iTunes selling DRM'ed music for so long helped them gain that market lock-in, just like it helped Amazon get the same lock-in with DRM ebooks. If publishers knew what's best for them, they would force Amazon to offer DRM-free books before it's too late, and the p…

I think it's simpler than that. Most people don't have a clue about DRM. What they know is if they want to listen to music they go buy an iPod and buy music on iTunes. It's more about brand recognition IMO.

Re: Steve Jobs emails that show how to win a negotiation

#165

Post by TylerE »

6d0debc071 wrote: post #162
ojiikun wrote: post #107

Earlier quoted context omitted.

All I took away from this was that AAPL wanted to make about $0, AMZN wanted to make about -$3, and in both cases the author makes about $3, meaning that of the $13 wholesale, the publisher is getting a 75% cut of the sale. I cannot fathom that the publisher performs any function possibly worth this much money. How, since we no longer have to ship dead trees, have we not evolved a system that gives authors 75% of the…

Well, publishers still do something - marketing and relationships mostly, I believe - but realistically they don't do anything worthy of that sort of money. It's just difficult to do things without them. I vaguely remember a story about a woman a while back who had just hired a publisher to do marketing for her though, rather than acting as a publisher and taking massive loads of money from it. So, it definitely soun…

They also, in most cases, front an advance (with no guarantee of getting it back), which allowed the author to work on the book without starving.

Re: Steve Jobs emails that show how to win a negotiation

#166

Post by abraininavat »

ScottBurson wrote: post #79
bravura wrote: post #67

Is it just me, or does the following quote suggest that Harper-Collins was strongly outleveraged in the negotiation, regardless of Jobs's negotiating skill? "Apple is the only other company currently capable of making a serious impact, and we have 4 of the 6 big publishers signed up already. Once we open things up for the second tier of publishers, we will have plenty of books to offer. We’d love to have HC among the…

Yes, this was my takeaway too. Negotiating is easy, or certainly a lot easier, from a position of strength. The subtlety, though, is that sometimes it's about creating the illusion of strength, or even of future strength, when the present reality doesn't fully demonstrate that strength. Jobs did that masterfully here.

The subtlety, though, is that sometimes it's about creating the illusion of strength, or even of future strength, when the present reality doesn't fully demonstrate that strength. Jobs did that masterfully here.

I'm confused. You agree with the parent that Apple was in a position of leverage, then you suggest the subtlety is that sometimes it's about creating the illusion of strength.

Either the position of leverage was an illusion or it wasn't. Maybe Jobs was a master at gaining leverage by creating an illusion of strength, but (if you agree with the parent) this isn't a good example of it. This was someone who had leverage acting as if he had leverage.

Re: Steve Jobs emails that show how to win a negotiation

#167

Post by 6cxs2hd6 »

jamesaguilar wrote: post #47
jtbigwoo wrote: post #31

There's a great moment in the first Jobs email: >>4. $9 per new release should represent a gross margin neutral business model for the publishers. We are not asking them to make any less money. As for the artists, giving them the same amount of royalty as they make today, leaving the publisher with the same profits, is as easy as sending them all a letter telling them that you are paying them a higher percentage for…

I think he won before the negotiation started. HC didn't have anything to gain by refusing to work with Apple, and potentially had a lot to lose. You cannot win a negotiation where you have no leverage, unless the other party is unaware of your position. But I do agree that this is a great moment in this email exchange.

Exactly. While Jobs may have been a great negotiator, this set of emails doesn't really show it. The outcome of this negotiation was clear before it started. All Jobs had to do was be patient and reasonably polite.

Re: Steve Jobs emails that show how to win a negotiation

#168

Post by larrys »

ScottBurson wrote: post #108
larrys wrote: post #88

Earlier quoted context omitted.

Side suggestion for you. You are using bountyoss.com for what you do, I strongly suggest you lock up both bountyboss.com and bountyos.com as well. (bountybos.com and bontyos.com might also be a good idea but the other two definitely.)

Thanks for the suggestion, but I don't think I understand. You really think those are likelier typos than, say, "buontyoss.com"? Where does one stop? (I do have "bounteoss.com".) In any case, the site has had $0.00 in revenue to date. I don't think protecting variations on the domain name is my biggest problem :-)

bounteoss.com is good.

No hard and fast rule where you stop. In general the traffic counts more than the revenue (other than you need money to do the variations). The more people typing in the more people likely to typo. Other thing is not even typos it's visually what somebody sees and then types. For example for some reason my brain thinks "boss" so I am likely to type that. That's just me. Personally I like "bountyboss" as well for some reason. It rolls off your tongue (and that's important btw.)

I point out simply because you don't want to wait until it's to late (and of course I have no idea where you are at in this project so the advice could also apply to someone with more traction! Good luck it looks nice.).

Re: Steve Jobs emails that show how to win a negotiation

#169

Post by 6d0debc071 »

TylerE wrote: post #165
6d0debc071 wrote: post #162

Earlier quoted context omitted.

Well, publishers still do something - marketing and relationships mostly, I believe - but realistically they don't do anything worthy of that sort of money. It's just difficult to do things without them. I vaguely remember a story about a woman a while back who had just hired a publisher to do marketing for her though, rather than acting as a publisher and taking massive loads of money from it. So, it definitely soun…

They also, in most cases, front an advance (with no guarantee of getting it back), which allowed the author to work on the book without starving.

There's plenty of excellent, freely available, writting out there that didn't involve an advance. So, I'm sceptical of the necessity of that model.

But even if we assume that an advance was necessary - A couple of years of no starvation wages ought to be negligible compared to the sort of amounts we're talking about for a successful book. You don't pay fixed amounts back in terms of percentage of take - that's foolish. At worst you might pay it back with a risk premium, like a bond.

Publishers would presumably have you believe that they're providing a service, at risk to themselves, and that risk is sufficient to justify their take. That they have to make as much money as they can on the few successful books to pay for the masses of dross that they fund. But this just makes it an exceptionally bad deal for people who are consistently good. If you have a track record, then you should be in a different risk pool.

The questions are really ones of risk management and information asymmetry: how many successful books are you going to get and how well can you predict your risk? Does the author even need an advance? Are the editors even honestly trying to predict the success of a book or are they just going with their gut or their political bias or whatever? It's not a very competitive market after all.

If people had the option to not take an advance, and to take a much larger cut of the sales, I think many would.

Re: Steve Jobs emails that show how to win a negotiation

#170

Post by raldi »

giulianob wrote: post #164
mtgx wrote: post #137

Earlier quoted context omitted.

> "Amazon's MP3 store, despite launching with cheaper and DRM-free music, has never been able to make a serious dent in iTunes' market share". Maybe because iTunes selling DRM'ed music for so long helped them gain that market lock-in, just like it helped Amazon get the same lock-in with DRM ebooks. If publishers knew what's best for them, they would force Amazon to offer DRM-free books before it's too late, and the p…

I think it's simpler than that. Most people don't have a clue about DRM. What they know is if they want to listen to music they go buy an iPod and buy music on iTunes. It's more about brand recognition IMO.

They may not have a clue about DRM, but what they do understand is, "If I switch to , I won't be able to use it to listen to my existing music collection, or read any of the books I already bought, or run any of the apps I downloaded?"

And that is all caused by DRM.

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