Amazon is poised to revolutionize the book printing business through vertical integration. Let’s look at the numbers. Assuming that Amazon already pockets 50% of the retail price of a book, it could directly engage with authors and cut out the middlemen: the agent and the publisher. That would free up 30% to 40% of the pie, which can easily be split between Amazon and the author.
Let’s say, in the new world, Amazon becomes the retailer, marketer, publisher and agent combined and takes 65% of the revenues, offering 35% to the author--we end up with a much better, fairer world.
Monday, May 19, 2008
On Forbes.com, Sramana Mitra argues that Amazon's move into publishing (which has been criticised as heavy-handed) could help authors by cutting out the middlemen of agents and publishers.