Barnes & Noble E-Books Effort Won't Reverse the Insidious Consolidation of E-Publishing

Last Updated May 20, 2010 7:08 PM EDT

As my colleague Lydia Dishman reports, Barnes & Noble announced its own Nook indie publishing program. Unfortunately, it looks like it won't address the insidious consolidation already happening with the Amazon (AMZN) Kindle and Apple (AAPL) iBookstore: To wit, there are no checks or balances on the arbitrary discretion these outfits can wield. One company, be it Amazon, Apple or B&N, serves as agent, publisher and distributor -- and the consequences for authors and readers could be terrible. Let me explain.

Agent: Traditionally an agent will negotiate on the author's behalf for 15 percent of whatever money is made from the book deal. The Apple and Amazon models have fixed royalty rates, which makes the agent's money role less necessary. However, authors also lose the agent's biggest asset -- advocacy. Agents have a healthy social network (not online, but a real social network) and can call editors and publishers to task if there are issues with late payments, reneged contracts or, well, missing books.

I'm an author myself, and an odd thing happened two weeks ago: My best-selling Kindle-only book, Damon Brown's Simple Guide to the iPad, abruptly vanished without explanation from Amazon's Kindle Store (see screenshot). Amazon offers a single email contact for its publishers and, when the book suddenly reappeared on the Kindle earlier this week, I still hadn't received an answer as to why it disappeared in the first place. This is the dynamic currently being created on the digital platforms.

Publisher: Less than 1 percent of all books pitched to a traditional publishing house are accepted, edited and published, which is an understood fact. It is also accepted and understood that there are hundreds of publishing houses in America and thousands worldwide. A book rejected by one publisher can be pitched to another, more amicable house.

The issue here is the Amazon vs. Apple (vs. Barnes & Noble) fight to have one platform rule all -- which, if it comes down to that, gives the most ubiquitous platform the right to reject books it would rather not carry. Traditional publishers are on the Apple iBookstore and Amazon Kindle platforms, but they, too, are at the mercy of what the respective platform sees fit (see Amazon vs. Macmillan). Amazon, Apple and Barnes & Noble can be viewed as just distributors, but, unlike a physical Borders store, a reader cannot just go to another bookstore and purchase a rejected book since the distributor here actually owns the platform. In other words, the traditional publishers essentially have to have publishers in these new mediums.

Distributor: The distribution model issue has already been discussed thoroughly, from Amazon removing books already purchased on Kindles to Apple blocking content that goes against its sense of humor.

Not unlike online shopping or the nook reading device, Barnes & Noble's new publisher program will likely offer the same thing as Amazon two years after the fact.

Google (GOOG) is expected to start selling books by year's end, and, if I were to suggest a strategy, it would attract more authors and publishers by truly taking the best of traditional publishing:

  • Varying royalties: Should James Patterson get the same royalty as a first-time author? He doesn't in the paperback/hardcover world, but he likely does when selling books on the iBookstore. Amazon would like most of its Kindle books to be $9.99 because of marketing simplicity and, frankly, laziness.
  • An actual publishing department: Does Apple have a department dedicated to iBooks? Where is Amazon's active publishing unit? There are obviously engineers on the project, but where is the publishing house gatekeeper? Awful decisions are being made because no one seems to be at the wheel -- and, therefore, no one can be held accountable when mishaps happen.
Barnes & Noble adds another platform to the mix, but what difference will it make if it is following the same blueprint as the two current leaders? Not much. The only thing clear is that Google, or perhaps another dark horse, would have to step in to create other, fairer market conditions.