On Amazon versus Macmillan

The problem with much analysis of theold-versus-new media wars (including some of my own, I confess) is that we always assume that there’s a moral struggle going on, that the real battle is between fairness and injustice, and that, in the best Hollywood tradition, good will eventually triumph over evil.

Take, for example, last weekend’s battle between Macmillan and Amazon over e-book pricing. The real story is amorally simple: Macmillan, one of the world’s big six publishing multinationals (and, full disclosure, the publisher of my next book), wanted Amazon.com Inc. (Nasdaq: AMZN) to conform to Macmillan’s so-called “agency model” arrangement for selling electronic books, which involves Macmillan determining e-book prices (from $5.99 to $14.99) and giving Amazon a 30 percent commission on each sale.

Amazon, which currently sells all e-books at $9.99 and pays a 50 percent of the list hardcover price commission on each sale, refused. So Macmillan threatened to pull its e-books out of the store, which, in turn, resulted in Amazon pulling all Macmillan’s physical books from Amazon’s entire book store. After some obligatory huffing and puffing over the weekend, Amazon eventually backed down and put Macmillan’s physical books back into its e-commerce store......