One of the bedrocks of quantum physics is the wave-particle duality — for example, light can be seen as a wave of electromagnetic radiation, but also as a particle [a photon] to explain the photoelectric effect. Depending on the vantage point, light is either a wave or a particle — meaning it is both. If you maintain that light is solely one thing or the other, you exclude a number of phenomena from rational explanation.
The same with books. Books are essentially artifacts and commodities, depending on how you view them. Artifacts in that the text, or “work,” is a discrete cultural entity. There is only one Quixote by Cervantes. (Although, Jorge Luis Borges postulates another Quixote in his story, “Pierre Menard, Author of the Quixote.” Many textual critics consider Menard’s Quixote [via Borges] to be another work, discrete from Cervantes’ Quixote.) However, some book artifacts are more culturally important, or relevant, than others. For example, one cannot argue sanely that The Complete Idiot’s Guide to Classical Mythology is culturally equivalent to Toni Morrison’s Beloved. The work (for Barthesians, the “text”) is unique and irreplaceable. This irreplaceable work can be made manifest (its physicality) as the author’s manuscript, which is usually one of a kind. Most trade book contracts recognize the irreplaceable nature of the author’s manuscript and require its return to the author after the book has been produced. This author’s manuscript (depending on the author’s, and the book’s, reputation) can command a considerable sum of money since this object is a one-of-a-kind object. Just think how much a holograph manuscript of Hamlet in Shakespeare’s hand would be worth if one ever was unearthed. Very limited editions of a work, also enhance value. Editions of Gutenberg’s 42-line Bible are practically priceless due to the book’s reputation and scarcity. (A Gutenberg Bible is valued in the $25-35 million range, in the ballpark of the greatest pieces of art.) So, if a book (work) exists in an author’s manuscript or a very limited edition, it behaves as an artifact.
However, Gutenberg’s invention of the printing press and moveable type have permitted something not quite possible (yet) in the art world. We can replicate this work (that “text”) ad infinitum without altering it. The text inherent in the author’s manuscript can be the exact one inherent in a printed book (or ebook). The same cannot be said for a work of art. A picture can be taken of the Mona Lisa, and then replicated via printing, but it is not the exact same object. The same with Michelangelo’s Pietà. Scale reproductions in plaster are nothing compared to the real work. One could, I suppose, sculpt an exact replica, but first, it’s not sculpted by the same hand and second, it’s not the sculpted of the same stone. The object is unique (an artifact) but its replication is, by nature, not unique (and, therefore, a commodity). A copy.
Problems arise when one views a book solely as an artifact or solely as a commodity. As a small literary publisher, I can (and often do) make an argument that I publish (bring to the attention of others) works that I feel are culturally important, that these are important objects to bring into our understanding of what we call reality. That’s definitely the artifact-ish side. I could not make the same argument if I were, say, the publisher of The Couch Potato Guide to Life: Better Living Through Television. But in terms of the marketplace, the work I publish does not sell well. My activities in publishing these works depend to a great extent on my ability to spend my own money and donate my time and effort. If the works sold better, I’d be able to publish more. Therefore, I cannot afford to solely view these works as artifacts. They are also objects that can be bought and sold. The more they sell, the more I can do.
This might be an extreme way of putting it, but if I were solely to view these works as artifacts, I’d soon lose my house, my shirt and, most probably, my sanity and family. If I were solely to view these works as commodities, I’d be publishing the equivalents of The Couch Potato Guide to Life and making (quite probably) far more money, but providing no lasting value (or advancement) of our culture.
I cannot afford to view these works solely through either lens, but through both lenses. Books are both commodities and artifacts.
If books can behave as commodities, it naturally follows that they have to adhere to the regulations of the marketplace, including the regulations put on the marketplace by governments. If one accepts the appropriateness of governmental regulation of economic activity (as I do; otherwise, laissez-faire capitalism will result in the worst sort of social darwinism), there are two major no-no’s: dumping and price-fixing.
Dumping is a practice of a company lowering the price of a product to unrealistic levels (meaning: the price will not sustain the costs of manufacture) in order to drive competitors out of business. A company can do this if it has enough cash reserves to absorb losses and outlast competitors, or has enough diversified income to offset these losses. There’s a fine line between dumping and loss leaders (a product sold below cost for a short period of time to draw in customers, who will also buy other products).
When Amazon started selling ebooks and its ebook reader, the Kindle, it started down the path of walking that fine line. Amazon wanted to create a market for its ereader. What better way to do it than to price ebooks aggressively and cheaply? Why pay lots for an ereader and then pay through the nose for content to read on it (at that time, most publishers were pricing ebooks at just below, at or even above print prices — no huge bargains). It doesn’t take a genius to figure out if you want to create demand, lower cost. Amazon did just that. They were selling ebooks at lower prices than they were buying them from publishers for in order to increase demand. Publishers got upset because they could not compete selling ebooks direct with Amazon’s prices, plus Amazon was exerting pressure on them to reduce the “wholesale” prices the publishers charged Amazon. But Amazon’s practice led to a surge in ebook sales. Mission accomplished. Except that the major book publishers were ticked off. (They are also still ticked off at the “first sale doctrine” and are perturbed that a used book sales market exists.)
On the more up-and-up side, Amazon wanted to increase demand for its ereader and for ebooks. Done. One the more shady side, it wanted to drive other ereader manufacturers out of business and create a monopoly. If it had a monopoly on ereaders, it could easily gain a monopoly on ebooks. When ereaders started entering the market, there were a number of manufacturers. None really grabbed a sizeable part of market share. Enter Amazon & Kindle and the grab for market share was on. By late 2009 the only company that could possibly compete with Amazon was Apple, with its soon-to-be-released iPad (as well as its iPhone & iPod). Instead of attempting to compete head to head with Amazon, Apple sought to exploit these major book publishers’ anger against Amazon. Of course, Apple did not want to artificially lower the price of its iPad (or other products) so as to compete more closely on price with the Kindle. Next best thing was to take away supply. If you want these books from these publishers, you need our ereader. And the publishers signed on when Apple agreed to keep the price of ebooks artificially high (or at least higher than Amazon would allow). Apple agreed that the ebooks would never be sold below the wholesale price, and that the retail price would be one that the manufacturer (publisher) set.
Imagine if the 6 major shoe manufacturers agreed to sell only to retailers who sold their shoes at retail price. No more shoe sales. That’s price-fixing. When either manufacturers, or retailers, or both, get together and agree to sell at only one price point, the government (which is charged to look out for the interests of the many over the few — at least, that’s the theory) takes a dim view of it. One of the hallmarks of capitalism is competition. Price depends on supply and demand, and the need to make a profit. Loss leaders are usually short-term (temporary) expedients to increase demand.
On this issue, there’s no absolute right or wrong. Amazon did good to keep costs to ereaders/ebooks low. Amazon did bad because it sought to monopolize the ebook/ereader market. The big 5 publishers did good to try to make an argument that good product does cost. They did bad by trying to keep prices artificially high. Apple did good in trying to fuel the market for ebooks. Apple did bad because, believe it or not, they want the same thing Amazon does: to monopolize the ebook/ereader market.
(Somehow there are these notions that Apple is the White Knight and Amazon the Evil King. Wake up: nothing is ever black and white.)
What’s more worrisome is that while HarperCollins, HMH and Simon & Schuster have caved in and are settling the DOJ lawsuit, Macmillan, Penguin and Apple are set to defend themselves against the suit. And, if they don’t settle along the way, this one is sure to go all the way up to the Supreme Court. And if it gets to the Supreme Court, given its current makeup and history of decisions, I’m pretty sure the Supremes will throw out the DOJ suit and side with big business versus the consumer.
You can pick your poison. I’m picking what I’ve been saying all along: Publishing is not dead as long as you deliver quality product at a reasonable price. Just who is looking out for the bottom line? Not the bottom line on a cash flow statement, but the reader. Who is looking out for the reader’s best interest?
Best way to deal (legally) with Amazon is get into a price war. Tackle them head on. Running home with the ball and saying they don’t play fair is not going to solve the problem. Standing up to Amazon and fighting fire with fire might yield more constructive results. That way we will find some equilibrium at some point on a fair price for consumers, and one that will allow manufacturers and retailers to stay in business.
Right now, I keep wondering what Google, Facebook and Microsoft are going to do. Where, and how, will they enter this fray? Or is there a brash dark horse company out there foolish enough to take these giants on?
Note: I do not fully support any company discussed in this post, but Quale Press does use Amazon's CreateSpace subsidiary as its POD vendor and digital press.