Amazon: What Do We Do Next?

Someone emailed me today and asked what publishers should do in light of Amazon throwing their weight around and others posing threats to the industry.

My response,

Indeed, I agree that publishers don’t seem to be taking the threat seriously and I really don’t understand why. I really don’t know what the answer is (I wish I were that smart) but it should be the case that any interaction with Google, Amazon and Microsoft should be guarded. In addition, the publishers should be offering some type of counter policy – whether it is alternative options to access to their content (new pricing/subscription models, distribution/retail) – so that consumers have more options. For example, publishers have hesitated historically to mess with the retail channel and I recall in the early days of the internet there was a lot of discussion about publishers creating channel conflict with existing retailers if the publisher set up their own store front. In the past 10 years the retail channel has become far more concentrated and could become even more concentrated as more content becomes electronic.

Perhaps it is time for publishers to be more aggressive in becoming retailers as well as content producers. If so, it’s not as simple as setting up a store front that looks like a mini-version of the Amazon bookstore (obviously) since no one would switch. However, publishers do have the direct relationship with the author and can use this exclusivity to build a more robust presentation of the content. On Amazon you get the Buick version but on the Publisher site you get the Cadillac. None of the added or supplemental content would be made available elsewhere. What that extra content would be I don’t know. Maybe every author is twinned with an additional writer and site designer that builds/creates websites focused on the authors work but with far more expansive material about the works, process, background details, audio, video etc., any of which could be purchased by a consumer. This becomes the new marketing and promotions approach or the way to spend money that is traditionally allocated to print advertising, book tours and launch parties.

That’s a quick thought. Trade faces challenges. Education and Information are/have morphed into new beasts but it is less clear where trade will end up.

Later on in the day, I came across this news story about musicians and acts setting up their own social networking sites. The reasoning is simple: The artist has decided they don't have to have an intermediary between themselves and their fans. Their actions don't mean they forgo any of the other outlets such as Myspace or Facebook but they are understanding that they can insert themselves into the value chain at their choosing. Reuters:

"The thing that separates Thisis50 from MySpace is we control the e-mail database," says Chris "Broadway" Romero, director for new media at G-Unit Records, which handles Thisis50. "We can e-mail members if we want to." Thisis50 isn't meant to be a fan club, but rather a platform for 50 Cent to showcase his music and music he likes, and comment on news and user profile pages. Ludacris' WeMix.com, on the other hand, is more of a hub for aspiring artists to upload their music.

Publishers can do the same kind of thing to distinguish themselves and their authors in the minds of consumers while also establishing more balance in the relationship between producer and retailer. Change is certainly on the horizon but whether publishers move fast enough is the question.