Amazon’s spot in the news over the last few months has nothing to do with their potentially forthcoming drone delivery service, their robotic warehouse workers, or even their TV adaptation of one of my favorite Philip K. Dick books, The Man in the High Castle. It has to do with their months-long war against the publishing company Hachette, which Amazon claims is charging too much for e-books. When giant web retailer asked for concessions (while the exact terms are unknown, there’s been speculation that Amazon asked for a raise from 30 to 50% of the revenue per e-book), Hachette was unwilling to budge, so they have been holding Hachette-published books hostage, delaying their shipping times by weeks, slashing print inventory, and cutting off pre-orders, costing both authors and the company quite a bit of money (and a lot of goodwill).
Amazon argues that publishers walk away with too much cash for e-books, given that they don’t really have a production cost and given that their roles as publicists are waning in the era of social media. They claim they want writers to get higher royalties—for print books, most authors get 15%, and for e-books they average 25%. Amazon pays people who publish with them 35%, and writers who self-publish and use them for selling and promotion get even more. At the same time, they think that e-books should simply cost less. Hachette wants to charge more than Amazon’s standard $9.99 for e-books.