This agreement is a fair way all three parties meet - the demands and expectations of Amazon and the publishers as well as the interests of authors.
Amazon had been in a protracted contract dispute in Germany with Bonnier since May 2014, and had been using the same tactics, and facing the same criticism there as in the US, including a letter signed by authors, an antitrust complaint filed by a book industry trade group, and a possible investigation from EU authorities.
The Simon & Schuster negotiation, on the other hand, was much less bitter all around. The first that anyone knew that there was a deal in the works was when CBS head Les Moonves happened to mention the detail in an interview in July.
The WSJ reports today that:
Amazon.com and CBS Corp. ’s Simon & Schuster publishing arm have reached a new multi-year print and digital contract, according to people familiar with the situation.
Details of the new contract couldn’t be immediately learned, including how e-book revenue will be split. However, one person familiar with the negotiations said that the new agreement replaces an existing contract that doesn’t expire for two months.
Update: Publishers Lunch reports that the deal "preserves the basic construct and terms of agency, our source indicates, with S&S authors retaining the same share of income -- 25% of receipts that are 70% of the consumer selling price -- that they have had since the publisher first moved to agency in 2010". It's not clear what Amazon got out of it, aside from limited discounting, but clearly they must have gotten something.
Update: Amazon commented on the deal on Tuesday. They don't have much in the way of details but they do say that " Importantly, the agreement specifically creates a financial incentive for Simon & Schuster to deliver lower prices for readers. " I think that is what Amazon wanted all along.
In related news, Amazon also signed a deal with Perseus Book Group about a month ago; the terms of that contract were not disclosed, and the deal was done before anyone knew that it was in the works.
In the past 6 months Amazon has signed deals with 3 publishers, including two majors and a medium-sized publisher. There is still no deal with Hachette, and looking at the viciousness with which Hachette has been conducting their media campaign I don't get the impression that Hachette expects to have a deal any time soon.
Hmm. At this point, folks, I have to wonder just who is the real problem in the Amazon-Hachette negotiations.
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