JetLib News

All is not well in the e-book market. Amazon and Google have each scaled back some e-book programs in the past week because business was weaker than expected. Both e-book sellers are having trouble doing business with publishers.

Amazon has pulled more than 4,000 books from its e-shelves after publishers wouldn’t budge for lower prices. Google is cutting off partners in its e-book affiliates program because sales referrals are too low to be worthwhile.

What’s going on here? E-book sales passed print in all trade categories last year, and e-book library lending is huge, but print still brings in more revenue for publishers. The problem is that consumers expect e-books to be cheaper, so publishers can’t charge as much for them as they might like. In other words, it’s a problem of business models, not of demand.

Meanwhile, Amazon’s profits are sagging, and Google Books trails far behind in terms of sales. They’re both getting tired of the middlemen, i.e. the publishers., and the squeeze they put on e-book sales.

Amazon is not shy about its efforts to get authors comfortable with self-publishing of e-books. Meanwhile, when publishing houses can’t meet its price expectations, Amazon pulls the plug on their books. Google’s affiliate program for e-books gave partners a better deal than Amazon’s affiliate links, but it’s cutting off the partners who can’t perform.

The author and the reader are hamstrung by the presence of not just one but two middlemen. Something’s got to give.

Inevitably, it will. It will be the publishers.

It’s getting amazingly easy for authors to publish their own books, and Amazon, Apple and Google are all working on ways to let authors expand the idea of the e-book itself. Amazon is poised for a big Kindle push in Brazil. There’s no question that the future of the book business is in the hands of these tech companies, not the publishers who can’t keep up.

See also: Books Continue to Evolve – Check Out E.O. Wilson’s ‘Life on Earth’ iBook

Do you read e-books? Which store(s) and device(s) do you use?

Amazon really wants to attract more independent authors to its publishing platform. It also wants to add competitive muster to its Kindle Store for e-books and the new Kindle e-book lending library. In a move designed to achieve both goals, the company today announced the launch of KDP Select, a program that gives Kindle Direct Publishing authors an incentive to participate in Amazon’s e-book lending initiative.

If indie authors are willing to sell their e-book exclusively through Amazon for 90 days, those books become available through the Kindle Owners’ Lending Library. Each time a writer’s book is loaned through the system, they get a cut of revenue on top of the royalties they get from book sales.

Amazon has launched a new $6 million annual fund to help fuel the program. That money is divvied up among all participating authors each month, depending on what percentage of the total number of books shared were written by each author. The more their e-books are borrowed, the more money they make. At the same time, the more authors that participate, the smaller each piece of the pie gets. For writers whose e-books are widely shared among readers, this could work out to thousands of dollars in extra revenue per month.

Who Needs Big Publishing Houses?

Not too long ago, the only way for an author to get significant reach and income was to get on board with a major publishing house, no small feat for any author. Today, thanks to the spread of e-books and programs like this, the barriers to entry are much lower and the financial pay-off keeps getting more attractive.

Last year, Amazon increased the revenue share it offers Kindle authors to 70%, likely in anticipation of the launch of Apple’s iBooks store.

By offering an extra stream of revenue via KDP Select, Amazon boosts those profits for writers while making its own lending library seem more attractive to them. After all, why participate in a program that doesn’t generate any revenue, especially if you’re the little guy (or gal)?

Amazon has set aside $6 million for the fund in 2012, but wasted no time getting things started. They’ve already pledged $500,000 for the month of December.

Last year, the e-commerce giant announced that e-book editions of best-sellers had outsold their printed counterparts on the site for the first time. Then, earlier this year, the company revealed that it had sold more e-books than paperback and hardcover books combined.

Its line of Kindle e-readers was already doing quite well when the company launched its full-color, Android-based media tablet the Kindle Fire. As the holidays approach, the $200 device is expected to land in the hands of many more consumers. On Black Friday alone, Amazon sold 400% more Kindles that it did on the same day last year.