Shining a bright light into the dark corners of the shadow-world of literary scams, schemes, and pitfalls. Also providing advice for writers, industry news, and commentary. Writer Beware® is sponsored by the Science Fiction and Fantasy Writers of America, Inc.

February 26, 2010

Wanted: Guest Bloggers

Posted by Victoria Strauss for Writer Beware 

Would you like to guest blog for Writer Beware?

To vary our subject matter and present differing points of view, we're looking to publish occasional guest blog posts on subjects relating to publishing, books, writing, and, of course, literary schemes and scams. If you're interested in writing about a current issue or problem in the industry, if you have a point of view about writing or publishing that you'd like to share, if you've had a writing or publishing experience that you think would help, inform, and/or warn other writers--we'd like to hear from you.

Here are some examples of guest blog posts we've hosted in the past:

Distributor vs. Wholesaler--Getting Your Book on the Shelf

Playwriting in America: Percentages, Pitfalls, and Pay-to-Play

A Reviewer's Plea

Posts must be at least 500 words, and can be as long as 1,200 words. We're not a paying market, but we'll give you a byline, a bio, and links to your website, blog, or whatever. We'll expect you to be available to respond to comments on your post.

Right now, I'd especially love a post or posts on the schemes and scams that threaten freelance writers.

We do have some guidelines.

- You must have expertise in your subject. That doesn't mean you have to be a literary agent, editor, or even a published writer (though we would love to have guest blog posts by industry professionals)--but you do need to have some experience or skill that qualifies you to know what you're talking about.

- Your primary purpose must be to inform, not to promote. I understand that guest blogging is a way to raise your online visibility, and that's fine. But please don't contact me if you're just interested in writing a puff piece in order to drive traffic to your own website or business. I get such solicitations a lot, and I trash them all.

- Your views must be compatible with the general tenor of this blog. If you're a regular reader, you'll probably have a sense of what that is. If you're new, read back for a few months to get a feel. I'm not suggesting that guest bloggers have to toe any sort of party line--I'm always open to different and provocative viewpoints. But if, for instance, you want to argue that literary agents are greedy, cruel, and indifferent to real talent, I'm not interested, because I think you're wrong. Or if you want to predict that in 10 years there will be no more publishers and every author will be a mini-entrepreneur servicing a niche audience...I'm not going to go for it, because I don't agree.

- If you have an idea, contact me even if you think I might not be interested. You never know!

So if you have an idea for a guest post, please contact me, and we'll discuss it!

February 23, 2010

Another Vanity Award: The 2010 Creative Spirit Awards

Posted by Victoria Strauss for Writer Beware

Is it irony or coincidence that, only a few days after blogging about vanity awards, I should be spammed by one?

Perhaps you have, too. It's an outfit calling itself the 2010 Creative Spirit Awards.

The 2010 Creative Spirit Awards
Celebrating the Creative Spirit in Books, Film, and Music!
The March 1st Early Bird Deadline is approaching fast!
If you haven’t already submitted, we invite you to submit today!

It's every Author, Musician and Filmmaker’s desire to generate notoriety, credibility and buzz about their work, and winning this significant award is the vehicle in which to make your creation stand out as the exemplary work it is. To further help winners achieve this recognition, following the close of the competition, press releases with information on the Creative Spirit Award™ Winners will be sent to key book sellers, film and music distributors, and other sales and marketing entities.

Being a Creative Spirit Award™ winner will inspire confidence in buyers, distributors, readers and prospective clients that Creative Spirit Award™ winning productions are of high quality and worthy of their attention.

The Creative Spirit Awards™ celebrate the individual artist as well as their work through a panel of judges who have excelled in their respective fields. As such, awards are only presented to those filmmakers, musicians and authors who create fresh, standout, and exemplary creations in their field. Each work is judged solely on its own merits and not in competition with other submissions. The Creative Spirit Awards™ honors its winners with Platinum, Gold, or Silver Awards.
Googling "Creative Spirit Awards" reveals that many blogs and websites have posted this announcement, some with approving commentary. But a visit to the Creative Spirit website turns up a number of red flags.

The award, which is in its "inaugural year", offers dozens of categories in which film makers, musicians, and writers can enter (often a signal that an awards program is a moneymaking scheme).You can submit your work with the click of a mouse--in fact, that's the only way to find out how much the entry fee is ($50--high fees can also signal a moneymaking venture)--but you must send payment first, and only once your payment has been logged and confirmed will you receive instructions on submitting your materials. Now, I'm not suggesting that this is a ploy to take your money and run--but speaking for myself, I'd be a bit reluctant to pay for entry without actually being able to enter.

Creative Spirit promises that "[o]nly industry professionals will make up the judging panels in all three competition categories creating a total and unique peer-based judging system." Those industry professionals aren't named, however, and that's a problem. The prestige of an award or competition has a lot to do with the prestige of the sponsoring organization (more about that later), but also with the credentials of the judges. If you don't know who the judges are, you have no way of knowing whether they're as qualified as the award sponsor claims--or even if there are judges. And the people you will want to impress if you win won't know either--so they may not be very impressed.

Also, you don't actually win anything. Competition winners are eligible to receive a trophy (still being designed, so sorry, no photo), but oh dear--receipt isn't automatic. If you want one of these "exquisite statues" (the Awards page says they're created by "the same skilled artisans who create the Golden Globe Awards"), you must order it. Also from the Awards page: "After judging is completed, winners will be alerted...and instructions on how to order your statue(s) and other merchandise will be included."

I don't know about you, but if I won an award (and hey--I have), I'd be just a tad surprised to discover that I had to send away for it. Granted, there's no explicit mention of money here, but it's a fair bet that if winners want a trophy, they'll have to buy one. And if the trophies are moneymakers for the awards sponsor, that's a powerful incentive to identify a lot of winners (which would explain why the email solicitation promises that "[e]ach work is judged solely on its own merits and not in competition with other submissions"), which in turn is a strong indication that these are not, in fact, the rigorous awards they claim to be.

The opportunity to spend money doesn't end with trophies. Platinum and Gold winners (but not Bronze winners) can participate in Creative Spirit's Ad-Share program.

Available only to Platinum and Gold winners, each artist will be able to advertise their award-winning project in specially designed full page, full color Creative Spirit Awards™ advertisements in some of the top industry magazines. For a nominal fee per month, the image of your book, CD, or DVD cover will be featured as a Platinum or Gold Winner along with four lines of text below your image which will be comprised of 1) the title of your work, 2) author, musician or band name, or producer and/or director name, 3) the publishing company, production company or studio name, and 4) the work’s website address. There is no minimum or maximum monthly enrolment meaning you can advertise your award-winning work for one or twelve months.

This is very similar to the advertising that some self-publishing companies offer as part of their a la carte marketing services (here's an example). The costs can be high--and there's little evidence that such ads are effective.

So let's recap. A brand-new award with no track record, no named judges, an entry fee that must be paid before you can actually enter, trophies you probably have to buy, and probable solicitations to buy other things as well. Sure sounds like a vanity award to me.

According to Creative Spirit's About Us page, "[t]he competition was created by award-winning industry professionals, and not by a corporation." Its domain is registered to Dav Kaufman, self-published novelist and writer/director/producer of two indie films. Casting no aspersions on Mr. Kaufman's achievements, that's not really the kind of organizational sponsorship that lends prestige to an award.

All in all, it's hard not to conclude that the main purpose of these awards is to make money for Mr. Kaufman. Caveat creator.

February 19, 2010

Beware of Fake Awards

Posted by Victoria Strauss for Writer Beware

Here's a story that, for sheer weight of irony, I wish like anything I'd been the one to break. But author and publisher Michael N. Marcus beat me to it, in a recent post on his Book Making blog.

Everyone loves an award, right? Awards acknowledge excellence and achievement, raise the profile of the awardee, and garner the respect of peers (that's the theory, anyway). There are plenty of big prestigious awards whose names everyone recognizes, and lots of small, semi-prestigious awards that may be recognizable only within a particular niche or audience, and vast numbers of tiny, all-but-invisible awards that may make you feel good, but will provoke stares of incomprehension if you mention them to someone else.

There are also--you guessed it--vanity awards, where the goal isn't to recognize excellence, but to entice entrants or winners to hand over cash to the awards sponsors.

For instance, the awards given by the Small Business Commerce Association, which honor "businesses that we believe have achieved exceptional success in their local community." Sounds cool, right? Wrong. Like the infamous, and now-defunct, scheme, the aim of the SBCA awards is to identify thousands of "winners," and persuade them to buy stuff: in this case, plaques and trophies. In its own form of award, the BBB gives the SBCA a C-, based on the questions it has received about the business, and the company's failure to respond.

You'd think it would be transparently obvious that an awards program that makes you buy your own trophy is not legit. And many people are wise to this kind of ploy--if you Google the SBCA, you'll find much angry, bemused, and amused discussion. But these schemes wouldn't exist if they didn't work at least some of the time. The same websearch turns up plenty of happy suckers.

Including, as it happens, Outskirts Press--a self-publishing service/vanity publisher whose put-your-book-cover-on-a-stamp "promotional" service I made fun of a few months back. A sharp-eyed Michael Marcus--who is familiar with the SBCA, having been solicited for one of its fake awards himself--recently spotted a December press release from press-release-happy Outskirts, touting its receipt of a 2009 Best of Business Award from the SBCA. I couldn't put it better than Mr. Marcus does:
The number of news media that published the Outskirts press release is ONE.

Oops! I'm sorry, folks, but the number should probably be ZERO.

That alleged news medium that published the press release, called Self Publishing News, is actually a blog produced by (drum roll please) Outskirts Press.

So, we have a vanity publisher, using its own vanity blog to publish a vanity press release bragging about a vanity trophy.

I couldn't make this up.
No, indeed.

Even funnier: It seems this isn't the first time Outskirts has been hornswoggled by a fake award. Last August, another press release announced Outskirts' receipt of the 2009 Best of Parker Award from the U.S. Commerce Association. The BBB has received questions about the U.S. Commerce Association similar to those they've been receiving about the SBCA, and it doesn't seem unreasonable to assume that, like the endlessly proliferating Who's Who schemes, these very similar "awards" are in fact run by the same people. Check out, for instance, the nearly identical descriptions of the awards programs on the two organizations'  websites. From the SBCA:
Each year, the SBCA identifies businesses that we believe have achieved exceptional success in their local community...Nominees are typically local businesses that enhance the positive image of small business through service to their customers and community.

And from the USCA:
Each year, the USCA identifies companies that they believe have achieved exceptional marketing success in their local community and business category. These are local companies that enhance the positive image of small business through service to their customers and community.

The USCA is currently being sued by a Las Vegas company for trademark infringement.

Fool me once, shame on you. Fool me twice...

February 17, 2010

Inspired Living Publishing: Another Vanity Anthology Scheme

Here's an email solicitation currently doing the rounds, from Linda Joy, President and Founder of Aspire Media Inc., and Publisher and Editor of Aspire Magazine:
Will 2010 be YOUR year to embrace your wisdom, step forward and claim your dream of being a published author?

If you answered YES then YOU may be one of the over 40 co-authors that I, along with my team of experts, will be working with this spring to bring your collective wisdom to the world!...

Now, in a personal project of mine I will bring the same passion and commitment that I've brought to Aspire, to bring YOUR story, wisdom and insights as a co-author in my upcoming anthology: A Juicy, Joyful Life: Inspiration from Women who have Found the Sweetness in Every Day

The email includes a link, the clicking of which takes you to Inspired Living Publishing, publisher of the above-referenced anthology, first in the Inspired Living series. Here, "inspired, engaged entrepreneur[s]" who are "ready to move forward with the vision for your business and your desire to be a published author" can sign up for "updates on this exciting new opportunity."

The update comes in the form of another email from Ms. Joy, with a link that whisks you to a different Inspired Living Publishing page--and here's where we get down to the nitty gritty.
"Imagine the words...Published Author

*...printed underneath YOUR name on YOUR business card.
*...being spoken as YOU are introduced as the key-note speaker in front of a full audience
* you introduce yourself to a potential client.

You’ve thought about it, envisioned it and NOW it’s time to ACT on it…

It’s no coincidence that you’ve attracted this opportunity! You have been waiting for the divine opportunity to become a published author – one that is in alignment with your vision and that is with a well-respected brand in women’s inspirational publishing.

Let's leave aside for the moment the question of whether Ms. Joy's Aspire Media--which consists of an online magazine with a claimed circulation of 42,000, and a series of conference events in the New England area--is indeed a "well-respected brand in women's inspirational publishing," and concentrate on the "divine opportunity." There isn't actually much writing involved--all you need to produce is a 1,200-word story. Ms. Joy and her "team of experts" will then create the book, and provide "a variety of information products" to help you promote and sell it. It's a tried and true business model, Ms. Joy claims, that has been used before with great success--in fact, it's "the same business model that Mark Victor Hansen used to create the Chicken Soup for the Soul series."

Well. Actually, not so much. Chicken Soup contributors receive $200 and 10 free books. For Inspired Living contributors, the money flows in the opposite direction. They can pay $5,497 for an "Ultimate Platform Building Package" (450 books, their name on the cover and a bio in the back, ebooks and CDs, plus a press release and assorted promotional items of dubious effectiveness) or $3,697 for a "Launch Your Brand Package" (300 books, a bio only, ebooks and CDs, and fewer promotional items than the more expensive package), or even $2,197 for an "Aspiring Author Package" (150 books, a bio, and nothing else).

Writers who want to get in on this not-so-amazing deal must sign up for a 30-minute phone conference with Ms. Joy. Ostensibly, this is to narrow down the field of aspiring writers (writers must first fill out a fairly detailed questionnaire, including such questions as "What would it mean to you, both personally and professionally to be part of a best selling anthology?"), but mostly, I'm guessing, it's to sell potential contributors on the idea of paying several thousand dollars for a slot in a vanity anthology.

I wonder if Ms. Joy is aware of another, nearly identical vanity anthology scheme that I did a writeup on a couple of years ago--the Wake Up...Live the Life You Love series. There, too, you can have your 1,200-word article included in an anthology, and pay from $2,700 to $5,500 for a few hundred books and some publicity materials. The come-ons for the Wake Up books tout them as "best-sellers," but this claim is not exactly supported by their Amazon sales rankings, which in most cases are 1 million and higher. Of course, with such books, the public is only an incidental consumer; the target audience is the books' authors.

Whereas the Wake Up books are a long-running franchise, the Inspired Living series seems to be Ms. Joy's first venture into vanity anthologizing. But the bottom line is the same: The real "opportunity" in such schemes is not for the contributors, who must hustle their own books and who receive little meaningful support in doing so, but for the publisher, whose profit is assured before the anthology is ever printed.

February 12, 2010 Not Quite What It Appears

Earlier this week, I received an email from a company called, enticingly titled, "Authors: We Want Your e-Books & Articles!"
Dear Authors,

We want your e-books -- and we'll pay you for them!!

* e-Books
* Newsletters
* Excerpts from books
* Self-Published Articles

Now, there's a new idea... actually get paid for writing your e-books and articles!

We're launching a brand new website, where visitors can download free e-books on everything from running a business to fixing a car... and WE PAY OUR AUTHORS US $0.20 every time an e-book is successfully downloaded!

Gee, 20 cents a download--who could resist? Me, for one. I might have written this off as just one more random spam--but then I began hearing from writers who'd gotten the very same email offer. The volume of questions began to suggest a sizeable spam campaign, which always gets my Writer Beware radar twitching.

Visiting the MyFreeRead website, I learned that " works with a leading cost-per-action ad network. Visitors simply take a fun online survey and look at a few ads, then they can download their favorite e-book ABSOLUTELY FREE! All offers are optional, and visitors never have to buy anything."

(Per Wikipedia, cost-per-action "is an online advertising pricing model, where the advertiser pays for each specified action (a purchase, a form submission, and so on) linked to the advertisement.")

I searched MyFreeRead's website, but nowhere is the "leading CPA ad network" named. So I emailed Lisa Davis, MyFreeRead's Coordinator, to ask. Within minutes, I received this response:
That's confidential. Why should it matter?
Well, I wrote back, because of concerns about malware, tracking cookies, and the like. There's a lot of that stuff about, and I wouldn't want to think my readers were targets.

I wasn't entirely surprised when I didn't hear back.

MyFreeRead appears still to be building its catalog, so there are currently no actual ebooks available for download. However, there's a sample download page, and if you click the "Download" button, a window pops up with a choice of surveys. Hovering my mouse over these surveys, I discovered that their source is (warning: if you click that link you will be ambushed by audio), "a performance-based, online advertising network that develops technologies to promote incentive-based advertisements across niche websites."

In other words, as a website owner offering products to the public, you can sign up to become a CPAlead "Publisher," which enables you to create a "gateway" that forces would-be consumers of your products to take a survey (examples: "Which Twilight Character Are You?" "Do You Shop at Target?" "Want a Free BMW?"), and then watch ads from CPAlead's advertiser clients, before they can download your product.

You can see why this would be popular with website owners. Scroll down to the bottom of this blog post, and you'll see some examples of the kinds of payouts CPAlead provides for each completed survey--from a high of $4.50 (for "Win a Dell Laptop") to a low of 45 cents (for "Can You Spot the Frogs?"). This extremely long discussion thread at the Digital Point Forums contains testimonials from people who claim to have earned substantial income with CPAlead. Plus, per CPAlead's Terms and Conditions, you can set yourself up like a multi-level marketing scheme, recruiting "sub-publishers" to distribute CPAlead's offers and surveys, and, presumably, to give you a cut of their income.

But how do consumers respond? Not well. Google, and you'll find numerous conversations about how to block it. Worse, on the discussion boards at Web of Trust, a safe-surfing utility, there are complaints about phishing, malware, and adware associated with CPAlead's advertisers.

It seems clear that is not an epublishing endeavor, but a way for Ms. Davis to make money via an advertising network. The 20 cents that authors are paid for downloads will, in many cases, barely make a dent in her profit. Authors, is worth 20 cents to you to annoy your readers in this way? Especially when you can self-publish to the Kindle, and set your own price?

February 9, 2010

DOJ Weighs in on Amended Google Book Settlement

Posted by Victoria Strauss for Writer Beware 

Last September, the US Justice Department urged the courts to reject the Google Book Settlement, citing concerns about class action, copyright, and anti-trust laws. The DOJ's brief put the Settlement's approval process on hold, and forced the parties back to the negotiating table--resulting, in November, in the filing of an Amended Settlement. New deadlines were set for authors and for the filing of objections, and the Fairness Hearing (to determine if the Settlement will stand) was postponed to February 18, 2010.

On Thursday, in a statement of interest filed with U.S. District Court Judge Denny Chin in New York, the DOJ indicated that, while it continues to believe that the Settlement could provide a major public good, and acknowledges that the Amended Settlement Agreement includes "substantial" changes, it's still not satisfied. (The filing can be seen here.)

The DOJ's strongly-stated concerns fall into the same areas it highlighted in its previous filing.

- Copyright. Not to put too fine a point on it, the ASA violates current copyright law, by requiring rights holders to opt out rather than to opt in.

"In its current form," the DOJ writes, "the ASA is inconsistent with the policy of the Copyright Act, as established by Congress, making the argument that the ASA furthers the purposes of the Act a difficult one. The ASA seeks to carve out an exception from the Act’s normal rules and presumptions, which require a rightsholder to affirmatively grant permission for the kinds of uses contemplated by the ASA. The parties claim that creating an opt-out exception would better serve the purposes of the Constitution’s Copyright Clause by promoting the progress of science and the useful arts. That, however, is a judgment better suited for legislative consideration, rather than one for courts to make in the context of approving a settlement."

- Anti-trust law. The DOJ feels that the legal rights granted by the ASA "confer significant and possibly anticompetitive advantages on a single entity – Google. Under the ASA as proposed, Google would remain the only competitor in the digital marketplace with the rights to distribute and otherwise exploit a vast array of works in multiple formats. Google also would have the exclusive ability to exploit unclaimed works (including so-called 'orphan works') without risk of liability."

In other words, although the ASA leaves Google competitors theoretically free to build a digital library by the same methods Google has used, it's highly unlikely that any entity would be willing to open itself to the infringement lawsuits that would surely follow. Google thus gains what amounts to a monopoly. "Nothing in the ASA," the DOJ writes, "addresses this concern."

- Class action issues. "Although the United States believes the parties have approached this effort in good faith and the ASA is more circumscribed in its sweep than the original Proposed Settlement, the ASA suffers from the same core problem as the original agreement: it is an attempt to use the class action mechanism to implement forward-looking business arrangements that go far beyond the dispute before the Court in this litigation."

In other words, while the original lawsuit was intended only to address Google's unauthorized scanning of in-copyright works, the ASA empowers Google to go far beyond simply scanning, enabling it also to become a dominant publisher and retailer of digital books.

The DOJ is concerned that the class representatives don't have the right under existing laws to grant Google these sweeping rights. It also questions whether the class adequately represents absent members (foreign rightsholders and authors of orphan works), and whether class members received sufficient notice of the ASA and its terms.

If the anti-trust concerns are resolved, and the Court decides that the class will stand, the DOJ recommends that a number of additional safeguards be incorporated into the ASA, including:

- An "opt-in regime," or, if the Court approves an opt-out regime, a substantial waiting period before Google can exploit in-copyright works without permission from the rightsholders.

- A delay in the acceptance of the ASA, to give the Book Rights Registry a chance to "set standards designed to further reduce the volume of unclaimed works after expiration of the waiting period"--i.e., to reduce the number of orphan works--and, to the same end, a "reasonably diligent search" for rightsholders of unclaimed works after the waiting period has expired.

- Limiting Google's license to commercially exploit unclaimed works to a defined term, say five or ten years, with the option to renew.

In conclusion, the DOJ reiterates the shortcomings of the ASA, but leaves the door open for continued negotiation:

Despite the commendable efforts of the parties to improve upon the initial Proposed Settlement, many of the problems previously identified with respect to the original settlement remain in the ASA. The United States remains committed to working with the parties on the settlement’s scope and content.

Will the parties return to the negotiating table, postponing the Fairness Hearing yet again? Stay tuned.

February 4, 2010

Are You a Published Author? Now You Can Tell the World!

Posted by Victoria Strauss for Writer Beware

Hey, Published Authors: Feeling artistically discouraged? Critically devalued? Culturally marginalized? Alternatively, are you just so full of self-admiration and self-confidence that you could absolutely pop?

A Customized Author Plaque from ZLS Publishing ("The Authorpreneurial Publisher") might be just the thing.

That's right, writers. You can get your book cover laminated onto a wooden plaque, along with "engraving options" such as "Bestselling Author – 5,000+ Books Sold + your name," or "Author Extrordinnaire [sic] -100+ Books Sold + your name." (Talk about faint praise!) The plaques come in a range of colors (white, black, blue, etc.) and a variety of sizes, from dainty to hefty.

Just imagine the many uses to which you could put your plaque! If you can't, ZLS suggests:

1) To be used and shown during your book signings.
2) Picture of your plaque to be placed on your website.
3) To give as Holiday gifts to authors or family members you know.
4) To be used and shown during your speaking engagements.
5) Use as part of your overall book marketing package.

And the cost? A mere $125 for the dainty size, and a somewhat heftier $325 for the hefty size, plus a few dollars extra for engraving.

(ZLS also sells Customized Author Shopping Tote Bags, Customized Author Pencils, and Customized Book Signing Author Balloons. And if the demise of has you missing those offers to put your poem on a plaque, ZLS can help.)

So if the vanity shelf in your office with all your titles ranged upon it isn't quite enough to sustain your self-confidence, or if your self-promotional arsenal is lacking that certain je ne sais quoi, or if you just want to say it loud, you're a Published Author and you're can now go plaque yourself.

February 1, 2010

Dispatches from the Ebook Wars: Macmillan vs. Amazon

For some time, publishers and others have been concerned about Amazon's policy of pricing ebooks at $9.99, regardless of the price tag publishers put on them. Many feel that Amazon's discounted ebook pricing is an attempt to control and monopolize the ebook market by forcing a pricing standard. Some in the publishing industry have even called the practice predatory. (Readers, of course, are more likely to applaud cheaper ebooks, but many publishers, which have fixed costs to earn back whether a book is ink on paper or pixels on a screen, regard the $9.99 price point as a major threat to revenue.)

Over the weekend, a publisher finally went head-to-head with Amazon on this issue.

Earlier last week, John Sargent, CEO of "big six" publisher Macmillan, presented new terms of sale to Amazon for Macmillan ebooks. Under the so-called "agency" distribution model (which means that Amazon could not discount the books--see below for an explanation), digital editions of Macmillan trade titles would be priced from $5.99 to $14.99, and digital editions of first-release hardcovers would be priced from 12.99 to $14.99. Amazon found this unacceptable, and on Friday, it yanked the buy buttons from all of Macmillan's titles, both digital and print--a move that forced Sargent to issue an emergency explanation to Macmillan authors/illustrators via industry newsletter Publishers Lunch.

You may remember that Amazon employed this very same power play back in 2008, when it decided that it would sell no print-on-demand titles that weren't produced by its own POD subsidiary, BookSurge (now CreateSpace), and disabled the buy buttons of some POD-based publishers that refused to deal. That decision spawned a lawsuit (recently settled), but ultimately, Amazon prevailed.

This time was different. On Sunday, in a message posted to its Kindle forum, Amazon gave in, if not entirely graciously. Despite "strong disagreement" with Macmillan, Amazon "will have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books." (An interesting use of the word "monopoly," given that Amazon's own pricing policies have been subject to the same accusations.) Amazon goes on to say that "customers will decide for themselves," and that "we know for sure that many independent presses and self-published authors will see this as an opportunity to provide attractively priced e-books as an alternative." (Take that, bad big publishers.)

So what's behind the dispute? Basically, competing distribution models for ebooks. Under the familiar wholesale model that is the norm for print books, and till now has been the norm for ebook sales from major publishers, publishers sell to intermediaries--such as bookstores or distributors--at a fixed discount, and the intermediaries then re-sell to the consumer at whatever price they choose. What Macmillan proposed is known as the agency model: Publishers sell directly to consumers via "agents"--such as Amazon or Apple's iBooks store--which get a commission on those sales. In the wholesale model, consumer prices are controlled by the intermediary, whereas in the agency model, they are controlled by the publisher. You can see why Amazon, with its aggressively competitive discounting policies, would not be enthusiastic about the agency model (even though, as agent Nathan Bransford points out, $9.99 ebooks are a loss leader for Amazon).

While this might seem to be a two-way tug of war--Amazon vs. publishers--there's actually a third player involved: Apple, whose brand-new iPad is perceived by many as a possible Kindle-killer, and which has adopted the agency model for ebooks sold through its iBooks store. There may have been an Apple in Amazon's eye when it blinked on Sunday. Other hints that Amazon is concerned about Apple competition emerged in the weeks leading up to the iPad's launch: Amazon increased royalties to 70% for authors and publishers using Kindle's self-publishing system (developers of apps for Apple products receive 70% of revenues), and opened up the Kindle to outside developers to stimulate the creation of Kindle apps.

As of this writing, the buy buttons for Macmillan books are still MIA at Amazon.

For a fuller analysis of the wholesale/agency issue, see this post from Mike Shatzkin's Idea Logical blog.

There's good analysis also from Macmillan author Charles Stross.

More analysis from agents Ashley Grayson and Rachelle Gardner.

A roundup of stories on the dispute.

Most people seem to think that Amazon is the loser here, but James McQuivey of Forrester Research offers an interesting opposing view.
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