An Open Letter to the DOJ on Ebook Price Fixing

The ebook price fixing story had a new development this week. America’s leading literary agents’ organization – the Association of Authors’ Representatives (AAR) – penned an open letter to the Department of Justice (DOJ) opposing the terms of the settlement reached with three of the publishers named in the Apple anti-trust suit.

I won’t go into the details of how wrongheaded that letter was. It has already been systematically taken apart by Joe Konrath, Bob Mayer, and Dean Wesley Smith.

This post is from 15 May 2012. It has not been updated except to clean up broken links but the comments remain open.

Also worth reading are Joe Konrath’s subsequent dismantling of another open letter to the DOJ written by Simon Lipskar (a board member of the AAR), as well as the comments made by Passive Guy on the same topic.

If you have any doubt whose side (most) agents and the AAR are on (clue: it’s not writers’), then you need to read this guest post by Ann Voss Peterson on her exploitative Harlequin contract, the subsequent reaction to Ann’s post by romance agent Scott Eagan (read the comments following that piece) and agent Steve Laube, as well as Joe Konrath’s filleting of the latter.

I have heard privately from one agent who is opposed to the AAR’s position on ebook price fixing, but I haven’t seen any public postings to that end. If they exist, please point me to them and I will amend the above characterization (but I fear I won’t have to).

Gail Hochman, the President of the AAR, sent a copy of that open letter mentioned at the top to all members of her organization, along with an accompanying note calling on her fellow agents to both write similar letters and encourage their clients (i.e. writers) to do likewise. Their explicit aim is to influence the judge presiding over the suit.

From Gail Hochman’s letter to AAR members:

The DOJ must read and report to the judge who must ultimately approve the settlement each communication it receives commenting on the proposed settlement. For that reason, in addition to the AAR’s letter we urge all AAR members to express their views on the settlement to the DOJ and we hope you will also urge your clients to do the same.

Your note might address whether you feel the settlement will foster competition and well-being in the literary marketplace, or the opposite. There is a time limit for such communications, so your messages should be sent as promptly as possible. (The address is on the AAR’s letter.)

We believe it is tremendously important that we all be heard on this most significant issue. We believe the more letters from publishing professionals that are received, the better the chance of affecting the judge’s final decision.

While I’m not a member of the AAR, I suppose I am a “publishing professional” in one sense. I will gladly answer Gail Hochman’s call. A copy of the letter I’m sending on Thursday morning regarding the ebook price fixing case is below.

If anyone wants to add their name to it, please make a note in the comments (or email me privately) and I will include your name.

It would be great if there were other writers’ names to add, but make no mistake, this isn’t a petition. If mine is the only name at the bottom, I’m sending it anyway.

Some authors may be reticent. I can understand that. Many of you may be seeking representation or a publishing deal and may be afraid of stepping on toes. That’s fine. I don’t really care about that stuff so I’m happy to take any potential flak.

Open Letter to the DOJ on the Ebook Price Fixing Case

To: John R. Read, Chief, Litigation III Section, United States Department of Justice, 450 5th St NW, Suite 4000, Washington DC 20530

Dear Mr. Read,

I’m sure you will have already received plenty of letters regarding the terms of the proposed settlement; I would like to apologize at the outset for adding to the pile.

I felt it necessary to contact you, however, as I fear that the multiple letter-writing campaigns aimed at influencing the presiding judge may give the impression that authors and publishers (and readers) are uniformly opposed to the terms of the settlement.

As an author and publisher (and reader) I can assure you that this is not the case.

Unlike some of the publishers named in the suit, I’m not part of a major media conglomerate that owns newspapers and television stations around the globe. I’m a one-man operation who set up a publishing company to release my own books.

I’m far from unique. There are thousands and thousands of writers just like me – writers who couldn’t get their books published by the conventional route who then self-published their work and reached thousands of readers.

A few short years ago, this was not a viable path. Self-publishing was expensive, difficult, and risky. The rise of e-books enabled thousands of writers like me to bypass the middlemen – literary agents, publishers, distributors – and sell direct to retailers and readers. Without the presence of all these middlemen taking a cut, I can sell books very cheaply and still make a good profit.

This disintermediation benefits authors and readers directly. Readers have more books to choose from, and when they choose books published by independent authors, they are almost always significantly less expensive than titles from the defending publishers.

It’s similar to what has transpired in many businesses since the rise of the Internet. All kinds of middlemen – such as travel agents and insurance brokers – have gone from being indispensable to optional, and face the according challenging business conditions.

Publishers and literary agents are no different. Writers no longer need them to reach readers. Instead, they can publish their own work, sell books at cheaper prices, and make more money.

The kind of disruption caused by the Internet is often messy. Not everyone comes out a winner. As such, vocal resistance is to be expected, especially from those who do quite well under the status quo.

One such group are best-sellers like Scott Turow, the President of the Authors Guild – an organization that claims to represent the interests of writers. Another such group are literary agents like Gail Hochman, the President of the Association of Authors’ Representatives – an organization of literary agents, which also claims to represent the interests of writers.

To be clear, neither organization speaks for me. And, in my opinion, it’s fear of change, fear of competition, that drives literary agents and publishers (and best-selling authors) to support the Agency model and disingenuously claim it benefits readers.

I don’t know if the publishers named in the suit (and Apple) colluded to fix prices, however, unlike the Authors Guild and the Association of Authors’ Representatives I don’t believe that means that we should simply throw our hands in the air and move on. I believe the judge is perfectly capable of making such a determination.

If the chain of events laid out by the Department of Justice is accepted by the court (and the case seems compelling to this layman), then I also don’t believe that the terms of the proposed settlement are too onerous. Law-breaking should be punished, not swept under the carpet.

Personally, I believe that the actions the defending publishers and Apple are alleged to have undertaken, and the subsequent defense of those alleged actions by the Authors Guild and the Association of Authors Representatives (and the respective defendants) are motivated by fear.

The world is changing and they don’t like it. Amazon, as the prime mover in facilitating those changes, is the primary target of their ire. I don’t share their apparent hatred of Amazon. From where I stand, Amazon has done more to make self-publishing a viable path than any other company (something which benefits authors through increased paths to publication and readers through a greater selection and lower prices).

I don’t think Amazon has done this because they have any favorable disposition towards self-publishing per se, rather I think that this was a (happy, for me) by-product of their support of the digital revolution and their customer focus.

More than any other company, Amazon made e-reading attractive, widespread, and cheap. This has come at the expense of reading books in print – a market which was controlled by companies such as the publishers named in the suit.

What is replacing it is something very different: an open market with thousands and thousands of competitors for the defending publishers (and those competitors are able to compete largely because of Amazon’s self-publishing platform – KDP – where independent authors can set their own prices and reach readers all over the world).

This, I submit, is the real reason these publishers (seem to) hate Amazon: because Amazon is creating, for the first time, real competition in publishing by facilitating and encouraging the switch from print to digital, and giving new competitors the tools and platform to really compete with the existing players.

It seems the defending publishers sought to slow this transition by forcing higher prices on Amazon and their customers (and by extension, the customers of every other retailer). In my opinion, this shows contempt, both for the readers who purchase their books and for the authors whose sales have suffered as a result of these artificially higher prices.

I trust the DOJ will pass on this letter to the presiding judge and that the only voices heard in relation to the proposed settlement won’t be those orchestrated by the global media conglomerates, which own a controlling interest in some of the defending publishers.


David Gaughran, Author and Publisher (and Reader).

Update 1 – 25 May 2012:

The letter is in the mail with almost 200 co-signers. My sincere thanks to everyone.

Update 2 – 23 July 2012

The DOJ has quoted from our letter in its official response to the public comments on the ebook price fixing case, in court papers filed today, which you can read here. Well done, everyone.

Update 3 – 7 September 2012

Judge Cote has approved the settlement. It looks like our letter had a genuine effect, so be proud of yourselves, and thank you again. The ebook price fixing case continues against Apple.

David Gaughran

David Gaughran

Born in Ireland, he now lives in a little fishing village in Portugal, although this hasn’t increased the time spent outside. He writes novels under another name, has helped thousands of authors build a readership with his books, blogs, workshops, and courses, and has created marketing campaigns for some of the biggest self-publishers on the planet. Friend to all dogs.