Hachette's Pietsch responds to Amazon

The dispute between Amazon and Hachette Book Group (HBG) has escalated further after the online retailer set up a website called Readers United, imploring readers to email HBG chief executive Michael Pietsch asking him to keep e-book prices low.

HGB has responded by accusing Amazon of seeking "a lot more profit at the expense of authors, bricks and mortar stores and ourselves".

Amazon made its Readers United website live on Friday (8th August) with the only content on the site a letter addressed to readers from the Amazon books team asking people to email Pietsch.

HBG responded yesterday (10th August) by releasing a letter from Pietsch, which is being sent to readers who email him following Amazon’s request.

In its letter, Amazon compares its aim of lowering e-book prices to the introduction of the paperback, which it called a “radical invention that shook the foundations of book publishing”, and misquoted George Orwell as saying publishers should collude against paperbacks.

“The fact is many established incumbents in the industry have taken the position that lower e-book prices will 'devalue books' and hurt 'Arts and Letters',” Amazon wrote. “They're wrong. Just as paperbacks did not destroy book culture despite being ten times cheaper, neither will e-books. On the contrary, paperbacks ended up rejuvenating the book industry and making it stronger. The same will happen with e-books.”

It also said that “Hachette spent three months stonewalling and only grudgingly began to even acknowledge our concerns when we took action to reduce sales of their titles in our store”.

Amazon, which last month laid out its desire for lower e-book prices, suggested readers should tell Pietsch they noted HBG’s “illegal collusion”, and tell him that “lowering e-book prices will help — not hurt — the reading culture, just like paperbacks did”.

The retailer also said readers should ask HBG to “stop using your authors as leverage and accept one of Amazon’s offers to take them out of the middle”, referring to offers made by Amazon to pay authors 100% of e-book royalties, restock all HBG books and donate the proceeds of sales to charity or to set up a fund for writers during the dispute.

In his letter, Pietsch responded: “This dispute started because Amazon is seeking a lot more profit and even more market share, at the expense of authors, bricks and mortar bookstores, and ourselves.”

Responding to Amazon’s accusations on collusion, Pietsch said HBG “set prices for our books entirely on our own, not in collusion with anyone”.

“Unlike retailers, publishers invest heavily in individual books, often for years, before we see any revenue,” he wrote.  “We invest in advances against royalties, editing, design, production, marketing, warehousing, shipping, piracy protection, and more. We recoup these costs from sales of all the versions of the book that we publish—hardcover, paperback, large print, audio, and e-book.

“While e-books do not have the $2-$3 costs of manufacturing, warehousing, and shipping that print books have, their selling price carries a share of all our investments in the book.

“Both Hachette and Amazon are big businesses and neither should claim a monopoly on enlightenment, but we do believe in a book industry where talent is respected and choice continues to be offered to the reading public.”

He concluded: “Once again, we call on Amazon to withdraw the sanctions against Hachette’s authors that they have unilaterally imposed, and restore their books to normal levels of availability. We are negotiating in good faith. These punitive actions are not necessary, nor what we would expect from a trusted business partner.”

It was also reported at the weekend that Amazon has halted pre-orders of some films from Disney, as part of a dispute with the company.