Keith Riegert, Langone Managing Editor
Imagine logging onto Apple’s iTunes to look for a new movie to rent only to find yourself scrolling through endless selections of cheap, homemade movies—all bargains compared to the latest new, big-studio release and boasting plenty of positive customer reviews. Would you spend a dollar (and two hours of your life) to give one a shot?
An analogous situation is now facing readers everywhere thanks to the meteoric rise of self-publishing driven by the book market’s largest retailer, Amazon.com. Last year, Nielsen estimated that self-publishing’s share of the book market had reached a whopping 18%; and, according to Bowker, nearly half-a-million new self-published titles went live in 2013 alone. The results are clear, search Amazon.com for any trendy topic—from “the Paleo Diet” and “historical romance” to “coloring books for adults”—and you’re sure to encounter a chaotic mix of publishing-house and self-published titles.
A Gold Rush in Times New Roman
For consumers, the introduction of self-published titles has lead to some fantastic benefits. Publishing houses, once “gatekeepers” of the book market, no longer control the content; and there’s now much more to choose from. In addition, the onslaught of new titles has pressured many houses to drop prices—especially on e-books. Big-five publisher, Hachette, may have publicly duked it out with Amazon over digital prices, but, today, many big-name publishers are willingly giving in to $1.99 (and below) prices to compete with the plethora of bargain-priced options on the market.
For Amazon, the upside of buoying the self-publishing industry has been equally sweet. Amazon’s subsidiary self-publishing platform (one of the nation’s three largest), CreateSpace, has effectively cut out distributors and publishers from the value chains of tens of thousands of new books; leaving just Amazon, the author and the reader to divvy up who gets, and pays, what. In addition, Amazon’s open book market has given the bookseller even greater sway with large and independent publishing houses—putting more pressure on what were already falling prices and slimming margins.
Fighting Back a Blazing-Hot Market
The problem Amazon faces going forward is how to properly influence the industry it has helped create. For every self-published title, like Fifty Shades of Grey, that strikes literary gold, there are thousands of (objectively) terrible self-published books that float aimlessly and eternally on the e-commerce site.
Eventually, enough poorly crafted books could, conceivably, turn the tide of public sentiment against the young self-publishing industry. In a poll I conducted using Amazon Mechanical Turk (both irony and selection bias noted), 48% of respondents said they had no preference if their next book was self- or professionally published (interestingly, 11% actually preferred self published books). But it was the 41% of respondents that wanted their next read to come from a publishing house that got me thinking: With no clear way to isolate quick, self-published titles from professional books, could Amazon eventually open itself up to competition from an online (or e-commerce-brick-and-mortar hybrid) upstart that duplicates Amazon’s business model simply without the self published titles?
When I posed that question to Stern’s Professor of Marketing, Russell Winer, he gave me a firm answer: “I don’t think it’s going to happen,” he said, “not in books; I just don’t see it. Amazon’s prices beat, pretty much, everybody’s already. They offer same-day delivery in some areas. Bezos has been a genius in figuring it out. It’s a pretty amazing story. And Amazon’s roots in books are pretty strong there.”
With a twenty-year head start in the market, vested interest in books, remarkable path of innovation and, now, a bold move into brick and mortar book retail, I have to think that Professor Winer is right. Even if millions of self-published titles create a headache for publishers and readers alike, it’ll be nearly impossible for an upstart to shake things up and compete with Amazon on the playing field Amazon itself built. But, the way things are headed…the publishing industry sure could use the healthy competition.