23 December 2003

Storm Warning

Border's, the most-influential brick-and-mortar (that is, "real" as opposed to "online") bookstore chain, has asserted variously that publishers don't know what their books are worth and that publishers harm the market by printing prices on books (one of the few non-subscription sources to reprint the critical paragraph). Leaving aside the ridiculous claim that books are the "only" class of goods so marked—been to a toystore lately?—Border's position creates both logical and legal difficulties that I suspect nobody is really paying any attention to.

  • Logic problem: This supposed problem assumes—without any proof, and in fact counterintuitively—that books are widgets and thus fungible. Even within one author's oeuvre, one cannot determine the "value" in advance—and certainly cannot do so on a national or even regional basis. The possibilities for arbitrage alone should discourage this kind of nonsense—all the "liberals" in university districts will no longer shop there, but instead at the more "conservative" bookstores in their areas, and vice versa, because greater "demand" for "liberal" books in university districts will (supposedly) drive up the price of those books there. In the long run, this will lead only to equilibrium, and thus to the demise of even more bookstores that try to be "different." Wait a minute… maybe this is what is intended…
  • Logic problem: This supposed problem also assumes that the cost of gathering and analyzing the data will be enough less than the potential additional profit to the bookstore that it will work across the complete field of trade books. (What this would do with academic titles is anybody's guess, because supply and demand is extremely artificial and not driven by consumer preference.) Perhaps it might work with heavy-selling titles; but then there will be two classes of goods within the same field—classes which are not fungible—creating more management problems and potentials for outright fraud than I can shake a stick at.
  • Logic problem: This also assumes that the current insane system of returns and consignment sales (sorry, guys, but any passing of title to the books to the bookstore is at best illusory because it is reversible at the bookstore's discretion) will continue. If nothing else, the continued pressures in opposite directions exerted by both discount stores and online bookselling make this an uncomfortably speculative assumption.
  • Legal problem: The vast majority of royalty-paying contracts at this time set the author's compensation as a percentage of the publisher's list price for the work. So, then, what happens when the publisher is no longer setting a list price for the work? Seems like a breach of contract to me—or perhaps an invitation to go to so-called "net receipts" royalties. (In practice, the percentages are pretty much the same, meaning that the author gets less.) I don't even want to think about the potentials for fraud that this raises, not to mention abusive "mandatory" renegotiation of contracts to account for "changing business practices."

As usual, the [offensive expletive deleted] marketing dorks are using their [another offensive expletive deleted] tunnel vision and inordinate influence in the more-corporate aspects of publishing to try to commoditize publishing. Given that the point of publishing is to meet the individual needs of consumers with developed tastes that are seldom completely congruent, the self-defeating nature of the proposed changes (which, in the end, would result in potential demand-based adjustments to the selling price of less than 5% of the titles released each year) is a nice little lump of coal for their stockings.

Oops. They don't wear stockings? Well, I can think of somewhere else to put their lumps of coal…