Amazon and Hachette Settle Their E-Book Pricing War—For Now

Literary battles would be so much more fun if they were settled by arm wrestling over an open flame
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THE STORY: After a lengthy and bitter public feud Hachette Book Group and Amazon announced this morning that they’ve finally settled their dispute over the price of e-books.

THE BACKSTORY: Since May of this year, the third largest publisher in the world and the retailing megasaurus have been embroiled in a spat. Amazon wanted Hachette to price its e-books at $9.99; Hachette wanted the option of charging more. Contract negotations broke down. Amazon began cutting off the flow of titles from Hachette, which has several imprints. In some cases books took weeks instead of days to ship. In some cases customers could not preorder upcoming Hachette titles (for example, the newest J.K. Rowling novel). In other cases customers couldn’t buy Hachette books from Amazon at all. Amazon even urged customers to buy these books from other vendors or from used bookstores, meaning the publisher and writer wouldn’t make any money from those purchases.

Bestselling writers such as John Green and James Patterson as well as more than 900 less prominent authors spoke out against Amazon. TV host (and Hachette author) Stephen Colbert ridiculed Amazon while giving props to California, the dystopian debut novel by local-ish writer Edan Lepucki. (You can’t buy that kind of publicity!) Other writers like Hugh Howey spoke up to defend Amazon. Combatants on both sides of the issue were hoping for a quick resolution, but the argument dragged on.

THE WAY BACKSTORY: Amazon has been embroiled in pricing wars with publishers before. Last month it reached a deal with Simon & Schuster, which will be able to set its own prices for e-books. Hachette has also been under the microscope. In 2012 it was one of five publishers sued by the U.S. Justice Department for allegedly rigging e-book prices. (A February piece in the New Yorker offers good background reading on the then-brewing conflict.)

THE BOTTOM LINE: This is probably a good thing but it’s hard to know because  the terms of the deal haven’t been made public. The new e-book terms don’t take effect until early 2015 but in an email to his authors Hachette CEO Michael Pietsch wrote: “Hachette titles will be restored as soon as possible to normal availability on Amazon, will be available for pre-order, and will be included in promotions on the site… The new agreement delivers considerable benefits. It gives us full responsibility for the consumer prices of our ebooks… Importantly, the percent of revenue on which Hachette authors’ ebook royalties are based will not decrease under this agreement.” The deal also includes “incentives” for Hachette to keep the prices of its e-books low.

Literary battles would be so much more fun if they were settled by arm wrestling over an open flame, the way God and Sylvester Stallone intended.

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