If you think publishers in the U.S. spend a lot of time and energy thinking about Amazon's influence in the ebook market, you should talk to some UK publishers. In the UK, Amazon is even more top of mind, and for good reason: As dominant as a player as Amazon is in the U.S. ebook market, it's even stronger in the UK.
According to recent reports, Amazon controls nearly 80% of ebook sales in the UK. It's thought to have about a 67% market-share in the U.S. (Although anyone who tells you they know this for sure is ignorant, lying or both. Some thoughts on the issue.)
In almost every discussion I had with publishers while at the London Book Fair last week, Amazon came up as a dominant force. One publisher lamented the lack of good competition. Another complained about how hard it is to market books on Amazon versus traditional in-store marketing where you can "stack-'em high." (He later wrote to me retracting some of his complaints -- I assumed because he was worried that they would get back to Amazon and hurt the relationship. This kind of thing is very common in the U.S. as well as the UK.)
One person who wasn't afraid to speak his mind about Amazon in the UK book market was best-selling author Anthony Horowitz (The Diamond Brothers series and the Alex Rider series, among many others), who gave the keynote speech at the London Book Fair's Digital Minds conference. Authors are perhaps the one group in the publishing industry who seem unafraid to tell anyone what they think.
In his talk, Horowitz called Amazon "evil bastards." In the same breath, he said that Amazon is also "wonderful" and that he uses Amazon all the time. (More on Horowitz's keynote.) The audience was all nodding heads and cheering. They also hung on every word of a presentation on self-publishing and Amazon that included Amazon's head of author and publisher relations, Jon Fine, in which he discussed how he and the company see self-publishing.
Publishers in the UK as well as the U.S. have a problem when it comes to Amazon. Amazon is most every publisher's biggest trading partner -- and its toughest one. It nearly single-handedly pushed the book-publishing industry into the digital era by introducing Kindle in 2007 and building the ebook business. It continues to grow and innovate, launching new products, devices, business models and technologies at a dizzying pace, at one point almost one new announcement every day. It now is also a direct competitor of publishers, with its own publishing house, Amazon Publishing, which this year is starting to hit the ebook best-seller list with regularity and has planned a massive international expansion.
I've heard privately from most publishers I've spoken with that year after year, it becomes harder to negotiate new agreements with Amazon favorable to publishers as the retailer becomes more powerful. From what I've seen, the smart publishers have sought to partner with Amazon rather than fight the company. Even smarter publishers are finding their own ways to diversify the way they sell books.
One good example is Verso Books in the UK. Verso publishers philosophy, current events and political books and recently launched its own online direct sales channel. It has already blown through it's very aggressive goal to sell £200,000 worth of merchandise through the new channel by the end of the year. The company's managing director told me just today that Verso has already sold £250,000 ($420,025) about $250,000 worth of books through its site -- in just a few weeks. For a company that brings in between £2 million and £3 million in revenue in total annually ($3.4 million to $5 million), this is huge -- and it makes Amazon a much less important sales channel for the publisher*.
Penguin Random House, the world's largest publisher, has also taken some action in the UK to build its own direct connection to readers. It recently launched My Independent Bookshop, which is a new platform where readers can make, share and browse bookshelves of their favorite books or books on themes. They can also buy books through the platform, with credit for sales going toward their favorite local bookstore.
What can the UK book publishing industry, which has fully caught up to the U.S. when it comes to digital publishing, do about Amazon? To steal a much worn out meme born in the UK: Keep calm and carry on.
* An earlier version of this article had incorrect figures for Verso's direct sales figures. This has since been corrected.
