This post has been updated with a response from Amazon.
The dispute between Amazon.com, Inc. (NASDAQ:AMZN) and the publisher Hachette continues, and Amazon has fired the next shot. The online retailer reportedly sent letters to some authors published by Hachette and their agents, offering them 100% of their e-book revenue.
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Amazon battles Hachette
The two e-book publishers have been fighting about their contract for some time. Until they can agree, Amazon has pushed back the release of books published by Hachette. The online retailer has also refused to keep them in stock and also increased the prices of the publisher’s books with the goal of pressuring the company to make an agreement quickly. Amazon also pulled the preorder button from upcoming Hachette titles and delayed shipments of some of the publisher’s books.
Now The Wall Street Journal reports that Amazon has written to Hachette’s authors to offer them 100% of e-book revenues. Hachette apparently rejected the retailer’s offer. It required both Amazon and Hachette to give all of their revenue shares on e-book sales to the authors. Hachette said it would return to negotiations with Amazon when the online retailer withdraws the “sanctions” it has imposed on its books.
Amazon has been fighting with Hachette to get a bigger share of revenue from e-books as well as lower prices for e-books. The dispute between the two companies has the potential to greatly impact the future of the entire book industry. Unfortunately the authors are the ones being published by the spat, as they aren’t selling any books.
The offer from Amazon is likely aimed at winning Hachette authors over to its side. In rejecting Amazon’s offer, Hachette reportedly made a comment about it being “suicide” to give authors 100% of e-book revenue. Amazon responded by noting that Hachette belongs to a massive $10 billion conglomerate, so the retailer said the publisher can afford to give up its e-book revenue.
Amazon wouldn’t hurt much
Amazon made up 60% of Hachette’s U.S. e-book sales in the U.S. last year, so giving up all that revenue would impact the publisher. However, Amazon wouldn’t take much of a hit because it sells so many other types of products. As a result Maxim Group analyst John Tinker told The Wall Street Journal that Amazon’s proposal is just a PR stunt aimed at improving its reputation with Hachette’s authors.
A short while after we published the initial version of this story, Amazon spokesperson Brittany Turner responded. She emphasized that Hachette is just a small part of its parent company, which in reality, wouldn’t be affected much either because of how little sales the parent company gets from e-books.
“You have to look at the parent company — Lagardère Group — rather than just the Hachette division,” Turner said in an emailed statement. “Kindle books are only 1% of Lagardère Group’s sales. They can afford it, and should stop using their authors as human shields.”
Previously several prominent authors published by Hachette wrote a letter attacking Amazon for the tactics it has used during the negotiations. Douglas Preston wrote the letter which was then signed by James Patterson, David Morrell, and other well-known writers.