ebooks, monopolies, monopsonies, DRM and me
I was late last night reading. I had finished reading Evan Currie’s Valkyrie Burning (Warrior’s Wings Book Three) on Amazon. I went looking for new publications from Evan which included The Heart of Matter: Odyssey One. But there was a change in price, The Heart of the Matter is $7.99. Sure it’s not a lot of money. But I’ve previously bought 4 of Evan’s books (including the price I paid):
- Into the Black: Odyssey One - $2.99
- On Silver Wings (Warrior’s Wings Book One) - $3.99
- Valkyrie Rising (Warrior’s Wings Book Two) - $3.99
- Thermals (An Anselm Gunnar eBook) - $2.99
So from an average price of $3.49 to a new book of $7.99. A 229% price increase. I want my authors to get paid. I like them earning more and generating more and better content. But a 229% price increase, and it’s not just the popularity of authors but current events and my choice of operating system that have me paying more. So I support an author and they become “famous” or “popular”, and I’m am supposed to grin and bear it because I can. I’m all for paying for integrated services, I’m all for authors earning more, I’m all for a better experience. But seriously a 229% price increase, something doesn’t feel right.
But wait, I can get the book for $0.00 as a Prime member. I didn’t think Amazon Prime was available to me in Canada. I was on Amazon.com, but my credit card and my shipping address is Canadian. Maybe with hope that Amazon Prime was finally available in Canada. I don’t think so, Kindle Owner’ Lending Library is only available in the US. I was just being hopeful that perhaps another large company had decided to invest in the Canadian market, much like Netflix and take on the regional licensing restrictions. </sigh>
I am trying to better understand the implications of my choices, i.e, buying and consuming DRM books in a closed ecosystem (see Kindle SF). I like integrated services. I like unified experiences. But I don’t like being taken advantage of, or having freedoms taken away.
Distribution, Disintermediation, and Monopsony
I was trying to understand Amazon’s ebook strategy and what its implications mean for me as a consumer in Canada.
We’re use to monopolies, well really ogliopolies (wireless companies, banks, internet service providers, we’re good on this one) and monopsonies (Canadian Wheat Board that ended Aug 1, 2012) . But I was surprised in Charles Stross’ analysis of Amazon, was they were playing both sides of the monopoly/monopsony market equation.
“And the peculiar evil genius of Amazon is that Amazon seems to be trying to simultaneously establish a wholesale monopsony and a retail monopoly in the ebook sector.” Charles Stross
One explanation for the increase in kindle prices is predatory pricing. And it’s not like the DOJ is investigating Amazon, Apple and the big six publishers for predatory pricing of ebooks. This has disintermediated retailers and how consumers purchase and consume books. Next to disintermediate the publishers themselves, and Amazon with Kindle Direct Publishing has given authors a way to get large distribution and forego publishers. The ebook market is growing at 200 percent per year, and Amazon owns “70 to 80 percent of the [ebooks] market“.
“By foolishly insisting on DRM, and then selling to Amazon on a wholesale basis, the publishers handed Amazon a monopoly on their customers—and thereby empowered a predatory monopsony.” Charles Stross
Crap, I fell for it. Other consumers fell for it. Publishers fell for it. What to do next?
“And the only viable Plan C, for breaking Amazon’s death-grip on the consumers, is to break DRM.” Charles Stross
This means changing my behaviour to support authors and publishers that publish DRM-free content. Thank you O’Reilly, all of the technical books I’ve purchased are available without DRM. It also means that I might consider removing the DRM from my existing Kindle purchases, oh wait, I can’t do that any more. It might violate the Terms of Service for Kindle, which you, like me, probably didn’t read. It’s too bad that I have bought a “limited license to use the product, rather than actual ownership of an object” with the ebooks (yah, it surprised Bruce Willis about his iTunes collection). It is why for a long time, I purchased movies on DVD rather than iTunes. At least, I could back them up.
But the goal isn’t to put the books back on my Kindle, but to have a back up copy that is future proofed.
Bill C-11 and Changes in Canada
But I can’t do that in Canada since Bill C-11 which passed in June 2012. It includes a digital locks provision that is “one of the most restrictive digital lock approaches in the world“. It seems that my worries in Dissident, Citizen were more about the Canadian government. And it seems that my worst nightmares about copyright and content are coming true.
I am going to have to rethink all of my media consumption behaviours. Ranging from ebooks to mp3s to DVDs.
- Michael Geist
- Charles Stross What Amazon’s ebook strategy means
- Charles Stross More on DRM and ebooks
- Cory Doctorow Tor Books goes DRM free
- Cory Doctorow Doubling Down on DRM
- Cory Doctorow How DRM weakens publishers’ negotiating leverage with retailers
- Ebook Formats, DRM and You – A Guide for the Perplexed