Hello Diesel eBook Fans,
I was just about to post our latest A5 Update (not too much cooking frankly) when I received a whole bunch of e-mails about an O’Reilly ToC interview that Diesel eBooks was featured in. Thought you might enjoy it considering it seems that Diesel is the only indie eBook retailer out there taking a stand and making our thoughts known about Agency . . . at least in public.
More to be posted soon. Stay tuned.
Indie ebooktailers and the Agency Model: Where Are They Now?
July 13, 2010
“Even though the big five has been a small part of our bottom line, we do want them back and I don’t want to do anything at this point to jeopardize our relationship with any of them. I definitely don’t want to see a market where only Amazon, Apple, and B&N are selling those titles.” ~ anonymous indie ebook retailer
“It’s ironic that the publishers who were going to level the playing field amongst retailers pretty much now only have their titles available on B&N and Amazon.” ~ anonymous indie ebook retailer
In the fast-paced news cycle generated around publishing and technology, the Agency Model discussion may seem like old news, but for indie ebook retailers, the story is still (rather slowly) being played out.
Just where do the indie etailers currently stand in regard to getting Big 5 titles back into inventory, and how has not having Big 5 titles available affected them? We asked these questions and more of Diesel ebook store’s Kelley Allen. (Actually we asked a few other etailers and distributors, but only Kelley was brave enough to answer us on the record!)
ToC: When the Agency model contracts came into play, what was your plan of action?
KLA: Batten down the hatches and ride out the storm! We immediately informed our customer base about the changes and took all the titles down. That was all we could do in the meantime.
ToC:What were the implications for your business and for your customers, and how did you deal with it?
KLA: We posted a nice little blog called “The Agency Model – Diesel’s POV Amid All the Chaos and Drama” that we wrote when the whole A5 thing first went down in early April.
We were rather bummed since all the large multi-billion dollar corporate stores got all their A5 titles up rather quickly.
As a result, we wrote a funny little melodramatic blog called JILTED that captured how we felt / still feel:
ToC: Have publisher and distributor partners been good about communicating with you regarding where things stand/whether progress is being made?
KLA: No comment since we are negotiating with three of the A5.
Our other distributor, Mobipocket, just wrote a very short e-mail to all their distribution partners instructing us to pull all their A5 titles. We posted on our blog about Mobipocket pulling their A5 titles.
ToC: Where do you currently stand in terms of access to Big 5 titles?
KLA: We are currently selling HarperCollins and Penguin. Penguin was the first to go back up on the site on May 10th (Day 40) and HarperCollins on May 13th (Day 43).
The new contracts all have confidentiality clauses and thus we are not at liberty to disclose terms.
ToC: Given that the wholesale pricing and terms will be changing (and possibly will vary according to publisher), how much work will it require to make programming changes on your site?
KLA: Quite a lot of programming changes! Matter of fact, we heard that a few of the smaller eBook retailers decided to just drop out since it was too much for them.
We have a blog posted here about the implications of Sales Tax.
We had to install a very comprehensive tax table to our backend system. In addition, A5 allows for no discounts and thus we had to modify our entire system to identify any A5 and prevent discounts on the site.
ToC: How is this affecting your bottom line? Are you losing customers? Are customers being supportive/ buying titles that you DO have?
KLA: Our sales are down as a direct result. However, we have been relatively vocal about any updates to our customer base and thus our customers are supportive. We also found that sales of titles for the Indies are increasing by large numbers.
ToC: A lot of the indie online ebook retailers, and their distributors, are reticent to talk about how the Agency Model disruption has affected their businesses. Do you worry that being vocal about the subject might offend your publisher and distribution partners?
KLA: It’s crossed our mind.
ToC: So why the industry-wide silence? And why are you willing to talk when others don’t seem to be?
KLA: Well, basically our distributor needs to sign individual contracts for each retailer for each A5. That means there could potentially be hundreds of contracts as a direct result of this. So, you better be extra nice to your distribution partner and their publishers!
Scott and I decided that we wanted to be vocal about all this despite any potential repercussions (and there have been!)
ToC: Have you been in discussion with non A5 publishers as to whether they are planning to go to agency model?
KLA: Yes. I have been talking to quite a lot of the smaller publishers / indies. Many seem not too anxious to jump full-heartedly into Agency and instead are adopting a “hybrid” approach – agency for Apple and wholesale for everyone else. I asked one rather large and highly respected Indie about how they could do it legally. They replied that there are some loopholes in the Apple contract to get around that issue.
ToC: Are you looking forward to Google editions? care to share any thoughts about how Google Editions may affect your biz? have you been talking with them?
KLA: We are not at liberty to talk any specifics but yes, we are excited about Google for a couple of different reasons. One, they are having a calming influence on the eBook marketplace. Two, they will be adding a whole different technical slant to the eBook experience for both the retailer and consumer. We’ve always had a strong relationship with Google and expect that to continue.