ESR defines fisk: http://catb.org/~esr/jargon/html/F/fisking.html
"A point-by-point refutation of a blog entry or (especially) news story. ..."
I enjoy checking in at Konrath's A Newbie's Guide to Publishing Blog. He posted recently about the lawsuit.
He is always worth reading, but I'm actually going after the comments thread here. One or more anonymous commenters claiming to be (an) industry insider(s) presented several interesting perspectives.
(1) Customers of ebooks are not drawn to low prices. They are price insensitive between $1 and $14. They may prefer more expensive ebooks to less expensive ebooks.
"The Kindle Top 100 is packed with high-priced e-books. All the multi-hundred-days-in-Top-100 (sometimes thousand-plus) are full-price Big 6 books."
"I'm not saying the *existence* of high-priced e-books proves lack of price sensitivity. I'm saying the fact that people buy them in large numbers proves that. That's what the Top 100 is. It's a list of the e-books people buy most of."
"We're in an early, experimental phase, and we should look at data with open minds and no assumptions. And the data show no provable structural sensitivity within the $1 - $14 range."
These statements are made without insider knowledge of Amazon's actual ebook sales and in a blog in which numerous posts have been made over time describing pricing experiments on ebooks conducted by Konrath and others. Also, Econ 101. Also, some confusion between "plurality" (which is surely what the kindle top 100 represents) with "majority" (which is surely _not_ what the kindle top 100 represents).
Define: plurality in the voting sense (received the most votes of any candidate, but fewer than half).
(2) The major skill of the Big 5 (and 1/2) is Making Bestsellers.
"So how did Stockett and Larsson and James happen? They weren't already bestsellers. Dumb luck? Magic? Really? One after the another, just like that?" (Other commenters pointed out that Stockett did not sell well initially but the author herself heavily marketed the book to book groups directly; Larsson was a bestseller before US publishers got hold of his work; James was consumed widely for free and then as an indie pub long before the US publishers got hold of her fanfic, in turn based on the Twilight series. This is the point where I wondered for a moment if anonymous was a troll. http://catb.org/~esr/jargon/html/T/troll.html)
Bestsellers are the business model of the Big 5 (and 1/2): "they have a model where they survive if 20% or so make money, of which a handful will be solidly profitable, all tentpoled by one or two big earners every year which make lots. Laugh all you like, but no one anywhere in entertainment does better."
"I always thought mid-list authors were just kept around to see if one of them eventually breaks out and becomes a super-star like Stephen King or Rowling. Mid-list authors who never break out and even start to lose readership get dropped."
Authors who transition to self-publishing were authors that the big 5 (and a 1/2) didn't want anyway. "It's not about who had a previous legacy career and was dropped or constructively dropped - it's about who turned down an upswing offer from a legacy publisher in order to go it alone. ... But generally, when a corporation sheds loss-making or marginal lines, it's seen as a positive move, not a sign of imminent collapse." Commenters with counter-examples were dismissed except "let's examine the eight-figure walkaways, not the six-figure."
(3) While independently published ebooks do actually make some unknown amount of money, that money is probably not money that would have been spent on Big 5 (and 1/2) books in any past, present or future universe.
"Our working theory is that there's a revenue stream that we never saw anyway - used book sales - and as far as we can tell, indie e-book sales (especially bargain-priced ones) are mostly cannibalizing that stream, not ours. Reports from the used book world (and it's a huge market, dollar-wise) seem to bear that out. Demographically and in terms of previous habits that would make some sense."
(4) Publishers are not defending paper. They are defending, er, something else.
"But overall, publishers would be thrilled if print disappeared forever. It's an irksome industrial problem, always varying in raw material cost, always requiring unglamorous transportation and warehousing, easy to damage."
"Windowing titles gives bricks-and-mortar stores short-term relief (and as I said above, publishers always have that short-term monkey on their shoulders, because stores always owe them for 60 days' of sales); "high" (your word: I would say appropriate, in context) prices mean the publishers can continue their established business model, in which publication of a book is neither cheap nor free; Agency enforces that price floor; DRM is designed to prevent theft, like the locks on their street doors.
None of the above protects paper; and if publishers could transition painlessly to an all-digital world, they would."
"It's protective, not of paper as paper, but of the physical security (as it were) of the approx. 16% of their annual revenues that paper-sellers are withholding at any one time."
(5) Amazon does not release data on their ebook sales (that is, you only can get out of them information about your stuff that they sold, not about other people's stuff that Amazon sold) because Amazon is embarrassed about how few copies those other people are selling and is afraid that if that were generally known, it would hurt someone's feelings.
"Amazon won't confirm that data, which initially seems odd, because it would be a great advertisement for KDP, but we have no reason to doubt it. We think instead that it's the other end of the scale they need to conceal, because it seems likely that the vast majority of indie titles sell statistically close to zero, which would be a discouraging message."
It's a coherent universe -- all of the elements work to reinforce each other. Really, this explains _a lot_ about what's going on at the Big 5 (and 1/2).
Long ago, when Macmillan (the 1/2) and Amazon failed to come to agreement, Amazon delisted Macmillan's books and much commentary ensued. Amazon relisted Macmillan ("caved" was the common verb used in further commentary), saying they were doing so because Macmillan had a monopoly on Macmillan's books.
Amazon meant what they were saying.
If you listen to NPR or you watch TV talk shows or (presumably) listen to and watch other mass media or read reviews in the newspaper or in magazines (whether online or dead trees), you'll see a parade of reading material presented in a very appealing package and the only way you're going to get it is to pony up the Big Bucks. If you want to buy cheaper stuff, it's out there -- but the authors haven't been on NPR or TV talk shows or covered in the newspaper or whatever. When publishers say they are Making Bestsellers, to the extent they book these kinds of appearances of product or authors, they _are_ Making Bestsellers. It's what they do. In order for an academic press to get an author on, say, TRMS, Ms. Maddow has to decide that she freaking luuuurrrrves _Last Call_ and contact Daniel Okrent to get him on the show. (And I'm glad she did, because I bought it and it really is amazing and absolutely worth the money.)
When Konrath and Eisler and other mid-listers complain that publishers don't do anything for their authors unless you are already a bestseller, they mean that mid-listers don't get booked on NPR or The Daily Show or whatever. Unless by some freak chance (or unending author labor), the author is _already_ selling like crazy, at which point it becomes easy to get onto NPR or The Daily Show or whatever. There do exist mechanisms to pluck mid-listers from obscurity and catapult them to stardom without the publisher deciding to Make It Happen. Oprah's Book Club was one of the few.
The lock on bookings enjoyed by the Big 5 (and 1/2) creates an opportunity to charge monopoly prices. Do the Big 5 (and 1/2) lose sales as a result? Oh, HELL yeah. My entire life as a youngster was defined by not enough money for books so I NEVER bought new in hardcover: I went to the library, I bought used, I bought paperback, etc. And in between the desire to buy and the difficult eventuality of acquiring, I often forgot or lost interest. I now have enough money for books so I often buy new in ebook during hardcover release -- but I sometimes look at that price and stick it in my save-for-later basket and let a few more reviews roll in. Quite a lot of the time, I then decide not to buy and never to read (or, maybe, to get it at the library if it's right in front of me). Those are all lost sales due to a too-high price.
Anonymous is arguing (not in the quotes) that a price low enough to overcome this reluctance would wind up NOT charging me as much as I would willingly pay for many other books. Fundamentally, anonymous believes that there are not enough additional people willing to buy at the low price but unwilling to buy at the high price to make up for the lower per copy price charged.
That's a helluva an argument to make in a mass market, especially given the business model involved is generating bestsellers in a mass market. The Big 5 (and 1/2) believed for a long time that they couldn't move multiple product from a given name in a single calendar year (or, at any rate, not more than two), resulting in prolific authors writing under a host of pen names, much to the annoyance of fans constantly forced to engage in detective work to find the stuff they want to buy. The Big 5 (and 1/2) have belatedly realized they were actually wrong (the same way they were wrong about genre not being able to sell at hardcover prices, and standalone romance novels not being viable and paranormal in general being a nonstarter and so forth). VHS tapes used to sell at a price point perilously close to (or north of) $100, thus creating the rental industry -- it took an entire format generation to figure out that a purchase market existed at a $25 price point and another decade to work out that shaving another $10 would expand the market's dollar volume.
And as near as I can tell, there's never _been_ a media company that could get past the idea that people are willing to buy more media than they can actually consume. I mean, duh. It's not like food; it doesn't go bad and it satisfies some of our inclination to hoard. Ebooks have displayed this behavior enormously -- and media companies _still_ haven't figured it out.
The Big 5 (and 1/2) have enjoyed a commanding position in the book industry from several perspectives. They were single handedly supporting the existence of physical book stores (with the wholesale sales policy that anonymous claims is actually consignment). They were the only respectable outlet for authorial ambition. If you wanted to write a book and have access to retailers and end consumers, you had to work through them. If you wanted to sell books, you had to deal with them (or operate on the shorter discounts of academic and small press). If you wanted to buy a book, you had to buy what they had on offer -- or pay even more for academic or small press books. They have seen this dominance erode on all fronts, but great power remains in their hands.
It seems possible that just as retail changed when consumers had more choice, the other end of the supply chain might change when producers have more choice. In a world in which authors can readily hire the traditional work of publishers and enjoy a vastly greater royalty, with only a slight sacrifice in distribution reach (and possibly an increase in distribution reach, depending on the handling of non-US markets), the vast, cheap, high-quality pool of proto-books which publishers have constantly complained about having to sift through might suddenly become less-vast -- and much less cheap. [ETA: And already out there competing with them.]
Oh, and Oliver Poetzsch (bestselling German author whose US rights were acquired by AmazonCrossing) was on "On Point" a few days ago.