walkitout (walkitout) wrote,
walkitout
walkitout

Amazon bid for Amanda Hocking 4 book print deal (and a weird market share number)

http://www.crainsnewyork.com/article/20110401/FREE/110409990

The claim is made that Amazon with Houghton Mifflin Harcourt put together the highest offer, but wanted exclusivity for the e-book and thus lost to SMP. The same anonymous source is quoted: "“[Amazon] has less than 65% share of the e-book market and dropping, and 20% to 30% of the print market,” the executive said. “[The author and agent] would have anticipated significant lost sales.”"

The idea of doing the print deal with Houghton Mifflin Harcourt was they could get the books into Barnes & Noble. "But there was a question whether the bookstore chain would stock a book published by its biggest rival, even if the title carried the logo of a respected trade house."

Just in case anyone was thinking that we should feel sorry for any of these participants, this should help reduce any sense that there are any innocent bystanders in this transition.

ETA: I'm trying to figure out why the executive believes that Amazon is at 65% market share in e-books and falling. It's not true -- that's not in question. The question is _why_ would that person believe that.

Here's what I've found:

http://www.bloomberg.com/news/2011-02-22/barnes-noble-falls-after-dividend-halt-same-store-sales-rise.html

"The Kindle has a market share of 67 percent in the U.S., followed by the Nook at 22 percent, according to Goldman Sachs Group Inc. Amazon.com also generates 58 percent of e-book sales, followed by Barnes & Noble’s 27 percent, Apple Inc. at 9 percent and Borders with 7 percent."

In the first sentence, "Kindle" refers to device sales. In the second sentence, I believe "Amazon.com" refers to content sales. The percentages supplied do not include SmashWords, Sony, etc., and add up to more than 100%.

None of these numbers are broken out in any kind of official release or accounting from the companies involved (please, please, please prove me wrong. I'm begging you to do so.).

ETAYA: I've done some more digging on who has put out ereader analysis. There appear to be a couple heavily quoted sources, Yankee Group and Goldman Sachs. I seem to recall some Forrester analysis also but I'm not seeing references right at the moment.

A bunch of the analysis was put out last year after numerous readers debuted at CES but before August, when several of them went bust -- definitely before the end of the year when the Cool-er and some other readers finally went down. Without seeing the original reports (which were for-pay and not cheap when they came out, and presumably not free and possibly not available now), it's hard to know precisely what assumptions went into their analysis. I would imagine that they assumed at least a few of those ereaders would successfully take off as a product, and that they would take away from Amazon's market share altho everyone would enjoy growth. These assumptions were prevalent last spring and early summer -- those ereaders came out at a lower price point than Amazon with fewer features. In August of last year, the wifi only cheaper kindle came out (with a better screen and at a lower price point), thus destroying any chance those ereaders may or may not have had to take root in the marketplace (and I believe with the kindle 3, the regular kindle was cheaper than the wifi or nofi new entrants). Another assumption last year was that the agency model and the entry of the iPad would render irrelevant Amazon's catalog and/or pricing lead (another assumption which turned out to be false, altho obviously some ebooks are more expensive everywhere than they were before).

I'm going to post separately about data quality, publishers and so forth.
Tags: publishing
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