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Check Your Calendar: Hachette-Amazon Contract Dispute Started in November 2013

Amazon’samazon frown months-long dispute has been going on for longer than anyone had previously suspected.

The ongoing contract fight between Hachette and Amazon entered its Nth round today as the retailer removed the pre-order buttons for many Hachette titles. According to The Bookseller:

Amazon appears to have stepped up the pressure in its battle over terms with Hachette Book Group in the US, removing the pre-order button on a number of forthcoming titles including the new Robert Galbraith novel.

Instead of the option to pre-order, certain major titles are listed as “currently unavailable”, with customers offered the option of signing up to be emailed when the book is available.

Physical editions of J K Rowling’s next Galbraith novel, The Silkworm, out in the US on 19th June, and Tom Rob Smith’s The Farm, released in the US on 3rd June, are among the many titles affected by the removal of the pre-order option on the Amazon US site today.

Not all of the details have been disclosed by wither Hachette or Amazon, but it is clear that Amazon is seeking to renegotiate their contract with Hachette. Amazon is playing hardball by reducing the number of copies they stock and by giving Hachette exactly what they wanted under Agency pricing: an end to discounts from the retail price.

There are also reports that Amazon is selling Hachette ebooks at full price, though of course those cannot be delayed in shipping or stocking.

News about the contract dispute first broke earlier this month in the NY Times, which hinted at the dispute having gone on for months. Michael J Sullivan concurred, reporting on DBW that he had seen this going on since February 2014.

Now it seems that this dispute started even earlier than anyone had suspected. Earlier this week Kristin Nelson, an agent for a number of authors who have books with Hachette, wrote that she had noticed the stock issue as early as November:

This just hit the newswire in the last week but I’ve informally known about this since late fall 2013 (as early as November). The problem? My Hachette authors and I noticed this “shipping issue” multiple times and brought it to our Hachette Editors’ attention. 

Multiple times. Repeated emails. We were assured that all was fine. (Which we, of course, did not believe since it kept happening….)

This is yet another moment where big publishing could have chosen to partner with authors and agents by explaining the truth behind Amazon’s muscle flexing.

Instead, Hachette choose to go with “we don’t discuss contract negotiations” tactic, which leaves their authors in the dark, agents like me fuming, and fosters a general atmosphere of distrust that the publisher is not being forthright.

While most stories today will focus on the buttons being removed, I think the more important story is just how long this fight has been going on. We’re now in month seven, and Amazon has tightened the screws again.

I think we now know why Hachette’s parent company, Lagardère, reported a 5.3% drop in revenue in their publishing division last quarter. They don’t break out the revenue based on market (they have operations in France, US, UK, and elsewhere), so it wasn’t clear where the loss occurred, but I think we know.

I don’t think that drop in revenue is a coincidence; Amazon is having an explicit effect on the company’s bottom line.

Would anyone care to guess how big the drop will be in the next quarterly report?

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flyingtoastr May 23, 2014 um 12:15 pm

But Nate, I thought it was impossible that Amazon would abuse a monopoly position!

Nate Hoffelder May 23, 2014 um 12:15 pm

Amazon doesn’t have a monopoly, so your snide comment is moot.

fjtorres May 23, 2014 um 12:37 pm

If Amazon had true monopsony power over Hachette, which they are nowhere near, the Hachette losses would be far bigger. And they wouldn’t have dared to even sneeze in their presence.

Jesslyn H May 23, 2014 um 12:56 pm

As a customer that saw what 'agency' pricing did to the cost of ebooks, I hope Amazon stands strong.

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