ImageWorks Creative Blog

Hey, John Sargent, CEO of Macmillan Books, Screw You!

Posted by Scott February 1, 2010

In this blog piece, Business Insider CEO & Editor-in-Chief shares his thoughts on e-book pricing and Amazon.

John Sargent, CEO of publisher Macmillan, has taken out a full-page ad to explain why he is insisting that Amazon raise prices on its ebooks to $15 in some cases.

So we're going to take out a full-page post to explain to John why, on behalf of book buyers (and writers) everywhere, we're cheering for Amazon on this one.

First, to clarify what is happening here, Macmillan is already getting its money: Macmillan is selling ebooks to Amazon at whatever price it wants to set ($10-$15), and Amazon is turning around and selling them at a loss, sometimes for $9.99. We're not against Macmillan charging what Amazon want it wants for its books. We're against its telling Amazon what it has to charge for them.

Also, we don't want to pay $15 for ebooks, and we don't think we should have to. The marginal cost of an incremental ebook is pretty much zero. So why on earth should we pay $15 for it?

Thanks to Amazon, we can buy red-hot first-run physical books for about $15. And now John is insisting that we pay the same amount for some bits downloaded to the Kindle? Give us a break.

John argues that if we aren't forced to pay $15, writers won't write good books, the world will go to hell in a handbasket, and Macmillan will collapse.

Let's take those points one at a time, in reverse order.

First, if Macmillan collapses, so be it. Someone else (Amazon?) will happily publish whatever good books Macmillan would have published. Macmillan's editors will find other employers, perhaps at Amazon.

Second, the world is doing just fine, thanks. Good books will always be published. Perhaps not in precisely the same form, but they'll be published. And, thanks to Amazon's new low-cost distribution model, more of them will eventually be published than ever. We don't need someone like Macmillan sitting between us and good books.

Third, don't give us that crap about how writers won't write good books unless Amazon is forced to charge $15 for them. If Amazon sells books for $9.99, writers will sell more copies of the books than they would if Amazon charged $15. If the writers take advantage of Amazon's new "70% royalty plan", they'll make a much bigger slug of that $10 than they do of the $15. And if and when the publishing industry finally begins to understand the price/volume trade off and Amazon sells the same books for $4.99, the writers will sell a even more of them and do just fine (especially if the publishers' share is squeezed).

Also, please don't argue that, if Macmillan goes bust, books will be bad. Many publisher editors don't really edit books anymore. They acquire, package, and market them. And that's fine: Everyone's strapped for time and money these days, and editors just don't have the time or money to edit anymore. (But books are still fine. In part because many writers hire freelance editors themselves.)

Yes, if Amazon charges $9.99 for ebooks and "prints" them instantly, some writers will conclude that they don't have to write 100,000 words and wait a year for the publishing industry's dinosauric practices to finally get the thing into physical print...and they'll write shorter, more timely books that will skip the whole "hardcover" process altogether. But, again, that's Macmillan's problem, not ours.

Did Steve Jobs seduce you with that temporary "charge-whatever-you-want" speech? Well, Steve has been known to seduce people from time to time. Just imagine what will happen once Steve has put the Kindle out of business and Steve owns the ebook platform instead of Jeff Bezos. That's right: You'll get held up even worse than Jeff's holding you up today. Just ask the music industry. Careful what you wish for.

So, bottom line, John, take your $15 ebooks and shove them! We're with Amazon on this one.

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