digital content

Shocking WSJ Discovery: Higher Prices=Lower Volume!

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This piece by Barry Eisler originally appeared as a guest post on A Newbie’s Guide to Publishing on 8/4/15.

Barry Eisler here. Joe, thanks as always for the guest slot. I was going to mock this Wall Street Journal article somewhere, and there’s no better place than A Newbie’s Guide for that…

So okay, today the Wall Street Journal ran a piece headlined, “E-Book Sales Fall After New Amazon Contracts: Prices Rise, but Revenue Takes a Hit.” The article is behind a paywall, but you can access it by cutting and pasting the headline into your browser and clicking on the result of the search.

I just want to make sure I’m the first to congratulate the Wall Street Journal on its shocking discovery of a correlation between higher prices and lower demand. And, while I’m no economist, I’d like to humbly propose that the WSJ call its discovery something like, “The Demand Curve.” If this doesn’t win the newspaper a Pulitzer, I have one more suggestion: an even more radically new article on how a round object fastened to an axle can work as something called…a wheel.

Apologies for the snark, but where else but in publishing could a notion like “higher prices lead to lower revenues” even be controversial, let alone newsworthy? But the publishing industry is notoriously special, and Joe has been beating this drum for years. Five years ago, he wrote:

Naturally, people would rather pay less for something than more. And in a digital world, like we’re rapidly becoming, consumers have shown consistently in other forms of media that they place less value on downloads than on physical products.

When companies price digital content too high, consumers respond by pirating that content. That’s the ultimate in “devaluing.”

 

Read the full post on A Newbie’s Guide to Publishing.

 

Whose Game Are You Playing?

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This post by John Pettigrew originally appeared on Future Proofs on 5/4/15.

We hear a lot about Amazon, the new giant in the playground. But Amazon may actually be the least of the industry’s problems, because they at least play by rules we recognise. There are plenty of other giants out there who are playing entirely different games – but who may still stomp all over our playground. The question is, what do we do about them?

The publishing industry feels under threat from a lot of places these days. And the most commonly mentioned cause of this fear is surely Amazon. Starting off as just another book retailer, Amazon has grown hugely and very cleverly to become a true global giant.

Amazon seems to be the kid everyone’s afraid of – bigger, stronger, and not afraid to use its muscle to get what it wants!

Playing by the rules
However, Amazon is still playing in our playground, basically working with the same rules publishing companies are used to – getting books to customers more effectively and more cheaply than ever before. This is a game that publishers understand and play all the time. And we can see this by the way that publishers and Amazon are always talking about this or that, arguing about a particular situation and coming to new agreements.

The problem, it seems to me, is that Amazon isn’t actually what publishers should be most worried about. We fear Amazon, I think, because we understand it pretty well and so can predict clearly what effect its actions are going to have on us.

 

A different game
The true danger may not be Amazon but other giants who are playing entirely different games. Companies like Google and Facebook, who use content (including content from publishers) as part of their business but who don’t really care much about that content because their real business is selling advertising.

 

Read the full post on Future Proofs.