Wednesday, 31 March 2010

Confirmed: GE Capital Secure Term Loan For Borders Group US Survival

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Just released on the newswires:

ANN ARBOR, Mich., March 31, 2010 /PRNewswire via COMTEX/ --

Borders Group, Inc. today announced that it has entered into an amended and restated revolving credit agreement. The new, $700 million senior secured asset-based credit facility matures in March 2014 and replaces the company's existing revolving credit agreement, which would have matured in July 2011. Banc of America Securities LLC, Wells Fargo Retail Finance, LLC, J.P. Morgan Securities Inc. and GECapital Markets, Inc. acted as joint lead arrangers and book runners. Bank of America, N.A. will serve as the administrative agent. Borrowings under the facility will be used for general corporate purposes.

The company also closed on a $90 million term loan credit facility, which will mature in March 2014 with the exception of $10 million of that facility, which Borders will amortize over four months beginning in September and concluding in December of this year. Banc of America Securities LLC acted as sole arranger and book runner on the facility and GA Capital LLC will serve as the administrative agent. Lenders are expected to include an affiliate of Stone Tower Capital LLC, a $39 billion credit focused asset management firm; funds managed by Tennenbaum Capital Partners, LLC, a Santa Monica-based special situations investment firm; and Gordon Brothers Merchant Partners.

Separately, Borders Group has met its obligation to Pershing Square Capital Management, L.P. for payment of the $42.5 million senior secured term loan due April 1.

Details of the financing arrangements will be included in a Form 8-K to be filed with the Securities and Exchange Commission.

"We are pleased to have the continued support of our lending group and term loan investors," said Borders Group Chief Financial Officer Mark Bierley. "With the completion of these transactions, the company can turn its focus to driving sales growth and improving profitability."

Conference Call Tomorrow, April 1 at 10:30 a.m.

Borders Group will hold a conference call tomorrow, April 1 at 10:30 a.m. Eastern. The call will be webcast by Thomson Financial and can be accessed at A replay will be accessible on the Web site through April 30. In addition, a replay phone service will be available toll-free at 800-221-1283 or for international calls at 402-220-3753. The phone service will be available through April 16 until 11:59 p.m. Eastern.

Did Lulu Get a Shed-Load of iPads with Apple Deal?!

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Looks like Lulu got a shed-load of free iPads after this week's agreement with Apple. Their latest 'fantastic' offer to celebrate 'the momentous occasion' is a free iPad with three promotional publishing packages. I'm not sure if the 'momentous occasion' is their deal with Apple, though, I suspect they mean the release of the iPad itself. Still, the packages might be pretty, pretty steep at the prices listed below, but there isn't too many author solutions services offering free iPads. Remember, authors, read the fine print and know the full details of any of three 'Star iPad' packages. This is a limited offer for a few days and is strictly for US based customers.

"Ready to publish your next book? Let us help. Lulu’s all-Inclusive Publishing Packages are fantastic for getting the professional pre-publishing services your book deserves. Our publishing experts will make your title bookstore-ready and, for a limited time, we’ll help you celebrate the momentous occasion with a free iPad!"

Overview of promotional offers.

Steve Almond's Exploits with Publishers and Self-Publishing

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Steve Almond recounts his experience of how rock and roll can save your life, pissing off some of New York's top literary agents and publishers...oh, and his journey into self-publishing.

"To say that I’ve had a checkered history in publishing would be like saying Elizabeth Taylor had a checkered history in marriage. In the past decade, I’ve churned through three houses, and twice as many editors. I’ve pissed off half the agents in New York City, and told the other half (with unreasonable glee) to fuck off. At one point, I actually had to be physically separated from one of my publishers."

You can read more of Almond's exploits over on The Rumpus.

Borders US Set To Make Fools' Day Deadline

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Borders Group US are facing D-day on April 1st. A substantial loan of $42.5m secured two years ago from Pershing Square Capital for the refurbishment of retail stores and an IT upgrade is due to be repaid on Thursday, this week.

A number of reliable financial sources, including Bloomberg US, are reporting late Tuesday evening that a deal for repayment will be in place before the Thursday deadline expires. Borders Group US has not recorded a profit since 2006 and there have been growing concerns this month that the book retailer would collapse and follow its former financial sibling Borders UK who went out of business in late 2009, despite re-ownership and reinvestment.

The latest security on the outstanding loan deal to Pershing Square Capital, if successful, will certainly buy the bookstore chain much needed time, but it long-term viability remains a long way off.    

Borders Group US CEO, Ron Marshall, resigned in January of this year after an unsuccessful term trying to reverse the slide of the ailing retailer. Michael J. Edwards was hired as interim CEO in September of 2009 while Korn/Ferry International tried to find a long-term CEO replacement.

Tuesday, 30 March 2010

Shss! It's Softly, Softly For Lulu in The eBook Wars

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This week seems to be the week that anyone remotely connected with selling ebooks is announcing a hook-up deal with Apple or Amazon. We have already seen announcements from Author Solutions' deal with their brands, AuthorHouse, Xlibris, iUniverse and Trafford for inclusion on Amazon's Kindle, and yesterday, news came of the popular Smashwords announcing a distribution deal on their ebooks with Apple for inclusion in the new iPad iBookstore.

Since early yesterday, at least a dozen different digital technology websites and self-publishing news sites have been reporting a deal struck by DIY self-publishing service Lulu. If you dig a little deeper, all of the reports I have seen actually cite one source; Dean Takahashi of, writing yesterday on the Digital Beat section of the site. Just for the record, here is what Dean reported:

"Electronic book publisher Lulu told its top authors over the weekend that their electronic books can be made available on Apple’s new iBookstore that is debuting with the launch of the iPad on April 3.

This is one more way that indie books by self-published authors can appear on Apple’s iPad platform, which is a tablet computer that is expected to be one of the hot gadgets of the year. The self-publishing book company said that authors whose work is in iformat can use Lulu to publish their e-books on the iPad. Lulu will convert the books from the Lulu format into the ePub format at no cost. Authors will receive proceeds after Lulu and Apple take their cut.

Lulu said it would automatically convert books for submission to the iBookstore, unless authors didn’t want their books published on the iPad. Smashwords, another self-publishing e-book company, also said over the weekend that its books can be made available on the iBookstore. Lulu supports the ePub and PDF formats, with or without digital rights management."

I have no doubt Dean is spot on in what he has reported, but what I find odd is that in a 48 hour period when every man and his dog was announcing a deal, Lulu chose to tell 'its top authors over the weekend that their electronic books can be made available on Apple’s new iBookstore that is debuting with the launch of the iPad on April 3'. If we are to go on recent announcements and Lulu's general megaphone marketing approach--particularly this year--one would have thought such a significant announcement warranted a press release, and at the very least, a posting on their widely read Lulublog.

Not a sausage! Although...

The news from Lulu on books being converted to epub for the iPad was flagged as in the pipeline more than two weeks ago, but I wonder if this free 'deal' is quite what it first appears for Lulu authors. What particularly grabs my attention is that Lulu have--according to Dean Takahashi--told their 'top authors'. The real point here is how Lulu quantify top authors. I mean is it top authors, top-top authors or top-top-top authors. This deal certainly does not include me, but does it include you if you are a Lulu author? Lulu has extended the reach of its marketplace this year to boast established authors like John Edgar Wideman, Jeremy Robinson, Simon Levack, and Stephen Covey. Are they top-top-top authors? In regards to the latest news by Lulu, I just dunno. Tonight, I'm none the wiser. Enlightenment is the order of the day.

Come on Lulu, get it together!

Monday, 29 March 2010

Author Solutions Announce Kindle Deal with Amazon

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On the same day Smashwords announced a deal to have their premium ebook catalogue listed in the new Apple iBookstore, Author Solutions Inc (ASI) announced a deal with Amazon to have books published through iUniverse, Xlibris, Trafford and AuthorHouse available on the Kindle ereader. From the press release below authors will take it as read that any of the four Author Solutions' brands will offer this as part of their basic publishing packages on all newly published black-and-white interior books, and not as a premium add-on.

BLOOMINGTON, Ind. March 29th 2010-- Author Solutions, Inc. (ASI), the world leader in indie book publishing, announced today the signing of an agreement with Amazon to distribute all new black-and-white AuthorHouse, iUniverse, Trafford Publishing, and Xlibris titles through its popular eReader, the Kindle.

“The Kindle was a pioneer in the rapidly expanding eReader market, and we’re pleased to be able to offer our authors’ books through this platform,” said Kevin Weiss, ASI president and chief executive officer.

A default price of $9.99 will be set for every ASI title made available through the Kindle, but each author will have the opportunity to set his or her own price. E-book distribution through the Kindle will be included as a free service for all new black-and-white ASI titles.

For more information on Author Solutions and its leadership of the indie book publishing revolution, visit

I checked out one of the Author Solutions brands this evening by running a keyword search on AuthorHouse's website, and the only mention of the Kindle ereader was the short piece below under marketing and author resources.


In this digital age, everything is going paperless … even books. You can have your book placed in a digital format that readers can read on their wireless reading device, Kindle. This allows your readers to have access to your book immediately after buying it and is the reading device of choice for many young readers.

UK OFT Receive Complaints on Amazon Seller Agreement

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Last week Amazon UK informed sellers using their Marketplace that they could no longer list book titles on other online retail sites, including the seller’s own site, for less than the listed Amazon retail price. The deadline for sellers to agree to this is Wednesday 31st March, and those sellers who do not agree will face delisting by the internet retail giant.

Over the weekend, the Scotland on Sunday reported that up to a dozen retail stores have complained to the UK’s Office of Fair Trading.

“Up to a dozen stores have now complained to the OFT that Amazon's actions are unfairly restricting their ability to sell books to customers at lower prices.

Books typically sell for 10 per cent less on some alternative websites – as Amazon charges fees for its services – but the company says it has been forced to act to protect its low-price promise to readers.”

The Office of Fair Trading is currently considering the complaints and will make a response ‘in due course’.

Publishing Perspectives: Simon Levack

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Of all the publishing perspectives and self-publishing experiences we have brought to you over the past two years, most of them have dealt with the transition from self-publishing success to the mainstream world of large publishing houses. Success can be measured in several ways in self-publishing, dependent on whether we look at success from the perspective of author or publisher. For an author, it may be connecting and expanding their readers and attaining a modest degree of sales and profit. For a publisher, it may be the opportunity to take on an author with some proven success and the potential to become an A-listed author with a long future.

Recently, we looked at David Fulmer and the innovative Five Stones Press. Fulmer spent many years with a mainstream publisher before finding himself out of favour and searching for a way to publish his latest novel, The Fall. In a retracting publishing climate, authors are finding it increasing difficult to gain publication—even within the mainstream industry—so much so, we are seeing a growing trend of authors looking to alternative paths outside of the recognised traditional publishing machine.

Our story begins in Kent, England, 1965. A local boy attends grammar school, takes a law degree and becomes a solicitor. There is nothing out of the ordinary here. This local boy was an avid reader and he spent much of his youth writing or thinking about writing.

“I devoured my parents' collection of thrillers and airport novels (my father was a lifelong commuter and business traveller), and so popular fiction was in my blood from an early age.

I took up writing seriously in my early twenties, while getting over a severe illness. No doubt being reminded how fragile health and therefore life are helped to concentrate my mind. I took (and dropped out of) a correspondence course and started sending stories and articles out to magazines. Practically all of them, of course, were rejected, but I had some success in competitions. I have been writing fairly steadily, with a few breaks, ever since.”

In later life, our local Kent boy read Inga Clendinnen's ‘Aztecs: An Interpretation’, and this began an interest and fascination with the Aztecs and Mesoamerican civilization. So intense was his interest in this subject, cajoled by his wife, he would go on to write four books of historical mystery novels, three of them published by St. Martin’s Press and Simon & Schuster.

Simon Levack sent an entry into the Crime Writers’ Association’s competition for unpublished authors in 2000. The competition was called The Debut Dagger, and it required an author to submit the opening chapter of a crime novel. Levack’s submission was a little different. The backdrop was the ancient Aztec civilization—an unusual setting for a crime novel. Levack won the competition with his entry, A Flowery Death, later to become his first novel, Demon of the Air. He completed the final draft of the novel two year later and his agent managed to attract the attention of St. Martin’s Press who acquired it in 2002 along with the rights to the sequel. Demon of the Air was published in 2003.

Levack did what all sane authors do with a comfortable and successful 9 to 5 job when they get a book publishing contract from a major publisher—he quit so he could concentrate full-time on his second novel. 

“I gave myself a year to finish my second book and hopefully write the third; in fact it was 2005 before I finally decided it was time to go and look for a proper job again. Since then I have applied myself to a variety of occupations, including writing.”

The second book was Shadow of the Lords, published by St. Martin’s Press in 2005, but already, despite glowing literary reviews, the signs were ominous for Levack. In an interview with Jeri Westerson, Levack reflected on his own views of how his books were being received and what the outlook was for him as a mainstream author.

“I wish I knew what happened! Judging by the reviews they garnered on both sides of the Atlantic both Demon and Shadow should have done very well, but in fact sales of both have been patchy at best. But in reality nobody knows what makes one book succeed commercially and another fail. I suspect that if there is any one explanation it is perhaps that the setting of my stories is too strange for many readers, and that what I thought of as one of their strengths - the absence of any modern Western perspective - was actually seen by many potential readers as a turn-off. “

Levack’s third in his series of historical mystery novels was published by Simon & Schuster UK in 2006, and though his network of readership was dedicated, and even growing wider at that time, the transfer to sales was not materialising. Levack had managed to secure a full-time literary seat at a local University, but ultimately, he found himself with the fourth book in his novel series, professionally edited and without a publisher.

“Whatever the reason, after City of Spies Simon & Schuster (my UK publishers) decided enough was enough and nobody else wanted to pick up the series part way through. I decided to publish Tribute myself as a print-on-demand title because the book had been written and thoroughly edited and I didn't want to disappoint those readers who were waiting for the next instalment.”

Levack chose what he perceived as the natural choice for an established author with a readership. His fourth novel, Tribute of Death was published through Lulu in 2008. We have already seen this year John Edgar Wideman pursue a similar path to publication in an effort to continue to make their books available. For these authors, this is perhaps the nub of why an established author chooses to use a publishing service, rather than continue to wait for another mainstream opportunity.

Will Levack or Wideman return to the mainstream channel of publishing? Yes. And I believe it will be at the first opportunity they get. While the sun shines on self-publishing methods at the moment, and it provides an option for the disenfranchised traditionally published author at the moment, much will be revealed about the alternative methods to publishing when Stephen King, James Patterson, JK Rowling et all decide themselves to give the cold shoulder to the establishment and decide that their brand is stronger than the logistical power of the publisher. That in itself is an extraordinary challenge, but the glitteringly successful are perhaps the best placed to take advantage of what self-publishing has to offer. Of course, they may not have the necessary will or inclination, but they have the brand and the means to do so.

Simon Levack (b.1965) is a British author of historical mystery novels. To date he has published four books: Demon of the Air, Shadow of the Lords, City of Spies and Tribute of Death. All are set in Precolumbian Mexico on the eve of the Spanish colonization of the Americas and feature as the protagonist Yaotl, a fictitious slave to Tlilpotonqui, the Cihuacóatl or chief minister in the Aztec state of Tenochtitlan under Hueyi Tlatoani, or Emperor, Moctezuma II. Demon of the Air won the Debut Dagger Award, given by the UK Crime Writers' Association, in 2000. He has also published short stories in Ellery Queen's Mystery Magazine featuring the same character and setting. His work has been noted for its historical detail, complex plotting, humour and often graphic violence. He has acknowledged Australian historian and anthropologist Inga Clendinnen and the work of Bernardino de Sahagún, compiler of the Florentine Codex, as influences; he has also (in an interview with the Criminal History ezine) indicated that science fiction has been an influence on his work.

Thursday, 25 March 2010

Nathan Bransford on Self-Publishing Advice

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One of Curtis Brown's literary agents, Nathan Bransford, has written an illuminating piece on guidance for authors considering self-publishing with Should You Self-Publish? Ten Questions to Ask Yourself. There is a lot of advice dished out to authors about self-publishing, but in my opinion, though much of it is well-meaning and sincere, it comes from individuals from various facets of the publishing industry with either loaded agendas, or those adopting hand-me-down information which gets twisted and confused and presented in an entirely misguided way.

1. Have you taken the time to research both the traditional publishing process and the self-publishing process?

This is your book we're talking about here! You probably took a year or more to write it - why rush into a decision about its fate? Why take the next step without really knowing what you're doing?

Too often people rush off to self-publish out of frustration with the traditional publishing industry and treat it as a way of sticking it to The Publishing Man - this is so extremely misguided. Don't let frustration cloud your judgment. Any decision about how you're going to proceed should be based strictly about what is best for your book and your career, not about proving someone wrong.

I have ten blue lights to self-publishing which all light up, one by one, accompanied by the 'ding' sound of a bell when an author approaches me for advice. When I consider taking on consultancy work, I instinctively look for an author with savvy and experience of the book world. They don't have to be published authors, but they need to know what it takes to be published and how to be published.

Reading Nathan Bransford's piece this evening made ten lights go on, accompanied by the ten distinct 'dings'. A  wonderful, thoughtful and balanced list of advice for authors considering self-publishing.

If you are considering self-publishing and you are at odds with what you read on this site, from someone who passionately believes in self-publishing for authors under the right circumstances, then, go read this from Nathan Bransford.    

Ingram Digital May Stop eBook Availability until Agency Model in Place

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Ingram Digital’s General Manager Andrew Weinstein has sent a letter to its client retailers informing them of the possibility that they will be forced to stop the availability of ebooks titles in their catalogue listing from publishers who intend implementing the agency model. From as early as April—of the largest New York publishers—Ingram Digital may only list Random House ebook titles because they remain the one large publishing house likely to opt of implementing the agency model, preferring to adopt a wait and see approach.

According to today’s Publisher’s Lunch (subscription only), Weinstein informed retailers:

"the publishers opting to do business in an agency model have left us little has become clear that not only will Ingram need to agree to do business with publishers in an agency model, but so will each retailer Ingram powers today."

Speaking directly to Publishers Lunch, Weinstein explained that Ingram Digital had been placed in a difficult situation with a number of publishers informing them of their wish to stop using the current wholesale model for ebooks and move quickly to the agency model. The urgency and speed of the implementation by publishers of the agency model has created a problem for Ingram as they have yet to finalise terms of an agency model agreement with their own retail clients.

"A number of publishers have told us that we can no longer sell titles the way we have been doing for last 10 years. Short of coming to agreement, we're not authorized to continue as we have been doing."

The key issue for Ingram Digital under an agency model agreement with publishers is how the proposed 30% split is shared between Ingram as wholesaler and their retailer clients. Weinstein concluded by informing Publishers Lunch that they were committed to reaching agreement with publishers whether they adopted the agency model or continued with the wholesale models—Ingram Digital were positioned to support both.

June Caldwell's Summary of Publishing Day at IWC

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June Caldwell presents a thorough summary of last weekend's Publishing Day at the Irish Writers Centre which was hosted by author John Boyne.

The IWC Publishing Day was a great opportunity to scrutinise the links between the author, agent, publisher, publicist and reader. Author John Boyne (Boy in the Striped Pyjamas, among many others) spoke from the heart about the slow hard work of writing. “Make no mistake; it’s a difficult, slow process, requiring lots of deliberate effort,” he said. He also spoke about the importance of ‘intuition’ in the author’s life when it comes to “dreaming up ideas” and sticking to them if they demand to be written. “If you have that burning sensation that says ‘this is not going to let me go until I write it’...then just write it,” he urged.

You can find Caldwell's full summary here on the IWC blog.

HarperStudio: Enigma, Enterprise or Endgame?

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Last week we reported that HarperStudio supremo Bob Miller was departing the innovative HarperCollins imprint to move to Workman Publishing as Group Publisher. It sparked a great deal of debate as well as anxiety as to the future of the imprint both on the HarperStudio site and wider spheres. So much so, associate publisher Debbie Stier decided to shift some of the debate to a page to try and address questions coming from authors, readers and interested parties. The debate has continued to flow over the past few days touching on the future of the imprint as well as general publishing topics.

Is Harper Studio still accepting proposals &/or MSS through 2010, or is everything on hold? --Christopher Davis (
Feel free to submit to Julia Cheiffetz, but it's probably safe to assume that we won't make any decisions until after we make a plan for going forward.
Do you think consumer brand awareness has helped you sell *considerably* more books? Do you think your brand has made an impact in the general public consciousness or only in the publishing world?
No, not *considerably* more books -- but I can see that if we had more time to put in more effort, we could get to the *considerably* level. And I think the brand has made an impact (or impression may be a better word?) in the small world of publishing, authors, and maybe even the blogging community. Not sure "public consciousness" is a realistic goal. There is a way longer conversation to be had about these questions. Question back to you: What do YOU think?

HarperStudio and Bob Miller certainly put the ‘I’ in innovation when it came to a presenting a new imprint from a large publisher. Quirky, idealistic, and surprising independent of the mother ship, HarperStudio offered a cap on author advances ($100,000), kicked the return of mint books into touch straight away (how that madcap idea was ever presented on a silver platter to retailers, I’ll never understand), and most significantly, offering authors a 50/50 share on royalties. But where HarperStudio really scored the home run was the collective ability of their staffers to engage with readers as well as authors. In short, the personalities and creative energy which overflowed from HarperStudio were given their heads as well as their hearts and allowed to run the gauntlet for a new wave of modern publishing under the rusting framework of a dogged and tired old bridge to the new world.

I speak of HarperStudio as if we were seeing the tragic demise of a promising sporting hero, cut down in their prime, never to truly fulfill the promise so many hoped and expected.

Incoming boss, Michael Morrison, currently still working for General Books and Canada, arrives in May. From following the questions posed to associate publisher Debbie Stier and senior editor Julia Cheiffetz over the past few days, the gathering anxiety of contracted authors as well as submitted authors is that Morrison will arrive with a cheap wooden coffin under one arm and tightly grasping a hammer and bag of nails in the other hand. His task, honourable duty and instructions of the HarperCollins board members ringing like a mournful Sunday march loud in his ears:

‘Jez, Mickey, I dunno what we were thinkin’ in 2008 bringin’ in that Miller headfuck from Hyperion, I just don’t know. All that Greek and Titan stuff must have went to his head. I mean, 50/50 royalty share—that’s not a royalty—that’s a fucking lottery! And no book returns? Jez, how are we to shift 100k units of some celebrity shit if we don’t take back 50k and wipe our fuckin’ asses with every page of it. Doesn’t Miller realise the escalatin’ cost of toilet paper right now!

Mikey baby, do your sweet Uncle Johnny a favour, bury that Studio shit. Honour the current contracts like you honour you mudda. But no more Crackpot Studio, understand? Now go and turn out the lights over there. I gotta take Steve Jobs on line 2”

What would be welcomed by all is if Morrison set aside any pre-notions, and more importantly, the coffin and nails, and just for one more year, let HarperStudio and its staffers have their hearts and their heads. He just might be surprised what a potential jewel his predecessor has bequeathed him.

And what is in store for workman publishing? Hang on and get ready for the ride of your lives!

Wednesday, 24 March 2010

Amazon UK Impose Price Parity Participation Agreement

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Amazon UK have introduced a Price Parity Participation Agreement making sellers, and one would assume by default self-publishing authors, to adhere to a listed price parity on books available on other online vendors - meaning, Amazon UK will not allow sellers have books on sale outside of the Amazon Marketplace listed at a price that undercuts the Amazon listed price. Sellers will have to adhere to the agreement no later than May 1st.

And this ominous FAQ leaves no chance of compromise for sellers on the Amazon Marketplace...

"What happens if I am not willing to offer parity with respect to price or other applicable terms?

Sellers who are not willing to offer parity should remove their listings, as Sellers that do not comply with our terms and conditions will lose their selling privileges."

More from

Price Parity

Price is one of the most important factors customers use when making buying decisions. In order to offer buyers the best possible experience on, beginning 31st March, Amazon will require price parity for all sellers selling under the Marketplace Participation Agreement. Price parity for these sellers means that the item price and total price (total amount payable, excluding taxes) of each product a seller offers on must generally be the same or lower than on the seller's other non-physical sales channels. We believe this practice increases customer trust, which can result in more customers and sales, and increased value of the Marketplace to sellers. Although the Participation Agreement will reflect this change on 31st March, sellers will have until 1st May to make the necessary price parity changes.

Please read the FAQs below to learn more about this change to your Participation Agreement.

What do you mean by price parity?

Price parity generally means that your offer for each product you list on is at least as good as your best offer for that product on any of your non-physical sales channels. More specifically, it means that the total price and corresponding item price of each product you list on are at or below the lowest total price and corresponding item price at which you offer the product via any of your other non-physical sales channels. Price parity also applies to offers by your affiliates. Specific terms will apply to products fulfilled using FBA and other products subject to delivery rates.

For further FAQ's.

Tuesday, 23 March 2010

Or Books Co-founder Asks: Is Amazon Really Worth It For Small Publishers?

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Last week we asked; is Amazon taking aim once again on publishers? Amazon is  reported to be threatening to pull the ‘buy buttons’ once again on publisher’s books if they do not get concessions on deals surrounding the new agency model.

From last week’s story:

“Currently several large publishers are in negotiations with Amazon about the implementation of the agency model for e-books. According to the article in the New York Times, two industry executives have disclosed to the newspaper that Amazon is looking for concessions on the deal, including extending any new deal to three years and an assurance that no other e-book competitor the publishers deal with will undercut the agreed Amazing price.”

While large publishers may bring more weight to negotiations, it is unlikely Amazon will extend any leeway to publishers outside of the big six publishing houses, and certainly there would seem little likelihood of Amazon offering any favours to independent publishers.

OR Books co-founder, Colin Robinson, wrote a piece in the Huffington Post yesterday that left no one in any doubt where Or Books stand regarding independent publishers and the kind of relationship they have with Amazon. In his article entitled ‘Bedtime for Bezos’, Robinson stated the position of the new start-up publisher he co-founded with John Oakes:

“…we have a simple message for publishers being menaced in this way: You are in an abusive relationship. It's doing little for you that you can't do better yourselves. It's time to say "IT'S OVER.

With sales of $24 billion in 2009 (up 26% on the previous year), Amazon didn't get to where it is today by being touchy-feely. This is a company, after all, founded by Jeff Bezos, a man so devoted to the cold science of calculation that, for evening companionship after a hectic day on 80s Wall Street, he developed a system called "women flow", a variation of finance's "deal flow".

It was hard ball from the start for the Or Books co-founder. They made an early decision not to list their books on Amazon and concede a retailer discount of up to 60%, preferring to use their viral marketing, other online retailers, high street and independent bookstores, as well as their own online bookstore.

“…we looked hard at what Amazon costs a small publisher, and what it provides in return. We decided it wasn't worth it; that we would be better off on our own.”

For Or Books and many other independent publishers, the real struggle is their concession of such a high discount to Amazon, leaving the independents unable to match the listed Amazon price on their own online bookstores. It may be better to invest the money conceded on a heavy retail discount into direct and acute marketing and advertising of titles. Ultimately, Amazon is simply listing and making books available for purchase, while the independent publisher is actively trying to find customers and create a unique connection with them.

Or Books hit the New York Times bestseller lists with their first book, ‘Going Rouge: Sarah Palin - An American Nightmare'. Their second title to be published is ‘This Time We Went too far: Truth and Consequences of the Gaza Invasion’ by Norman Finkelstein.

About Or Books
OR Books is a new type of publishing company. It embraces progressive change in politics, culture and the way we do business.

Our list is highly selective: we publish just one or two books a month, combining established authors with new discoveries.

Our editorial standards are fastidious; our design clear and elegant.
We employ exciting promotion with highly creative use of video and the Internet.

To avoid the waste of unsold stock and returns, we produce our books only when they are wanted, either through print-on-demand or as platform-agnostic e-books.

This system allows a rapid publishing turnaround so relevant books can intervene quickly in issues of the day.

Most importantly, we sell direct to you, the customer, shipping promptly when a book is released and/or your order is received.

Our approach jettisons the inefficiencies of conventional publishing to better serve readers, writers and the environment.

It points to a new future for book publishing.

Monday, 22 March 2010

Adult Hardback Sales Slump 8.1% For January (AAP)

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The Association of American Publishers (AAP)has today reported on book sales for the month of January 2010. Overall sales were down 0.7% compared to January 2009, but the most alarming figure is adult hardback, dropping 8.1%. You can find the report here.

New York, NY, March 22, 2010—The Association of American Publishers (AAP) reports for the month of January 2010, book sales decreased by 0.7 percent at $814.9 million and were down by 0.7 percent for the year.

The Adult Hardcover category dipped 8.1 percent in January 2010 with sales of $55.6 million a decrease of 8.1 percent compared to January 2009. Adult Paperback sales increased by 0.8 percent for the month ($103.2 million) and were up by 0.8 percent compared to January last year. The Adult Mass Market category declined by 0.5 percent for January with sales totaling $56.0 million; sales were down by 0.5 percent year for the month. The Children’s/YA Hardcover category decreased by 41.6 percent for the month with sales of $31.7 million, a decrease for the month by 41.6 percent. The Children’s/YA Paperback category decreased by 18.1 percent in January with sales totaling $30.7 million; sales were down by 18.1 percent compared to January 2009.

Audio Book sales posted an increase of 5.0 percent in January with sales totaling $10.6 million; sales for the month increased by 5.0 percent. E-books sales soared to $31.9 million, reflecting a 261.2 percent jump for January and a 261.2 percent increase compared to January 2009. Religious Books saw a decrease of 14.6 percent for the month with sales totaling $42.2 million; sales were down by 14.6 compared to January 2009.

Sales of University Press Hardcover books reflected an 8.6 percent decrease with sales of $5.1 million; sales decreased by 8.6 percent for the month of January. University Press Paperback sales posted a decrease of 9.4 percent for the month with sales totaling $7.7 million; sales were down 9.4 percent. Sales in the Professional and Scholarly category were down by 20.4 percent in January ($51.5 million), a 20.4 percent drop compared to January 2009.

Higher Education publishing sales reached $384.3 million, a 7.9 percent increase. Finally, the K-12 El-Hi (elementary/high school) category posted a total net sales increase of 35.7 percent in January at $94.6 million; thereby, sales were up by 35.7 compared to January of last year.
The Association of American Publishers is the national trade association of the U.S. book publishing industry. AAP’s more than 300 members include most of the major commercial publishers in the United States, as well as smaller and non-profit publishers, university presses and scholarly societies. AAP members publish hardcover and paperback books in every field, educational materials for the elementary, secondary, postsecondary, and professional markets, scholarly journals, computer software, and electronic products and services. The protection of intellectual property rights in all media, the defense of the freedom to read and the freedom to publish at home and abroad, and the promotion of reading and literacy are among the Association’s highest priorities.

NOTE: All sales figures cited in this release are domestic net sales

Hachette Ireland Launch Online Presence

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Hachette Ireland, a division of Hachette UK, launched their online presence in Ireland earlier this month. While the office has just three staff, Hachette Ireland has developed a significant presence on the Irish publishing scene since it first began in 2002 as Hodder Headline Ireland.

The new website features author pages, submission guidelines, a bookshop and general news on new books by the imprint.

Hachette Ireland is open to submissions of non-fiction books, but an enquiry email is required in the first instance. Hachette Ireland only considers fiction submissions from authors via an agent.

Founded in 2002 as Hodder Headline Ireland, with a staff of three, it has quickly become a major force in Irish publishing, with a string of bestsellers and a growing staff. Destinations by Sheila O'Flanagan (2003) was the company's first book. We have since established a strong reputation for working closely with authors to establish their vision and then working tirelessly with them in helping them to achieve it.

Saturday, 20 March 2010

The Authors Guild React to eBook Proposals By HarperCollins & Random House

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The US Authors Guild has quickly responded to communications sent by publishers Random House and HarperCollins to their contracted authors about ebook royalties. The Authors Guild are advising authors that it may not be in their best interests to lock themselves into an ebook deal offering 25% royalty, particularly if the deal covers a period beyond two years. One can understand the view of the Authors Guild in what has been a developing and volatile situation between some of the largest publishers and their discussions with Amazon and Apple recently.

Here is the Authors Guild letter:

December 15, 2009. On Friday, Random House CEO Markus Dohle sent a two-page letter to many literary agents regarding e-books.  Much of the letter is devoted to Random House's efforts and investments to market traditional and electronic books.

On the second page, Mr. Dohle gets to the point.  After noting that most of Random House's backlist titles grant the publisher electronic book rights (we agree, since most backlist titles are from the past ten years, a period in which authors have generally licensed electronic rights in tandem with their print rights), he writes that "there have been some misunderstandings concerning ebook rights in older backlist titles."  He then proceeds to argue that older contracts granting rights to publish "in book form" or "in all editions" grant electronic rights to Random House.

The misunderstandings reside entirely with Random House.  Random House quite famously changed its standard contract to include e-book rights in 1994.  (We remember it well -- Random House tried to secure these rights for royalties of 5% of net proceeds, a pittance.  We called it a "Land Grab on the Electronic Frontier" in our press release headline.)  Random House felt the need to change its contract, quite plainly, because its authors did not grant those rights to it under Random House's standard contracts prior to 1994.

A fundamental principle of book contracts is that the grant of rights is limited.  Publishers acquire only the rights that they bargain for; authors retain rights they have not expressly granted to publishers.  E-book rights, under older book contracts, were retained by the authors.

There's no need to take our word for this, however.  A federal court in 2001 examined this precise matter in Random House v. Rosetta Books.  Judge Stein of the Southern District of New York was unequivocal in his 10-page decision:  authors did not grant publishers the e-book rights in the old book contracts at issue.  Judge Stein specifically dismissed notions, raised by Mr. Dohle in his letter to agents, that the non-compete clauses of these old contracts in some manner acted to grant Random House electronic rights to the works, saying that this "reasoning turns the analysis on its head."  The court pointed out that the license of rights comes solely from the contract's grant language, not from the non-compete clause, and that non-competition clauses, to be enforceable, have to be narrowly construed.  Using the non-compete clause to secure future rights is unsustainable.  An appellate court affirmed Judge Stein's decision.

We are sympathetic with the difficult position the publishing industry is in at the moment.  The recession has been tough on book publishing, as it has been on many industries.  And everyone with knowledge of the dynamics of the industry properly fears that Amazon's dominance of the online markets for traditional and especially e-books will give it a chokehold on industry profits.  Difficult times, however, do not justify this attempt at a retroactive rights grab.

It's regrettable and unhelpful that Random House has chosen to try to intimidate authors and agents over these old book contracts.  With such a weak legal hand, it would be well advised to stick to its strength -- the advantages that its marketing muscle can provide owners of e-book rights.  It should also start offering a fair royalty for those rights.  Authors and publishers have traditionally split the proceeds from book sales.  Most sublicenses, for example, provide for a 50/50 split of proceeds, and the standard trade book royalty of 15% of the hardcover retail price, back in the days that industry standard was established, represented about 50% of the net proceeds of the sale of the book.  We're confident that the current practice of paying 25% of net on e-books will not, in the long run, prevail.  Savvy agents are well aware of this.  The only reason e-book royalty rates are so low right now is that so little attention has been paid to them:  sales were simply too low to scrap over.  That's beginning to change.

If you have an old book contract in which you haven't granted e-book rights, patience is likely to pay off. The e-book industry is still young -- there's no need to jump in.  And we strongly suspect e-royalty rates are at a low-water mark.

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