Melville House Books

A Michael Cader report at Publishers Markeplace discusses yet another aspect of the book biz that’s going to change, and change rapidly, thanks to Apple and Amazon and the already-fabled agency system of book pricing: It’s going to thin out the vast muddle of wholesales and suppliers between publishers and retailers.

As Cader details, the agency model is essential a 70/30 split of the proceeds, with retailers getting the 30%. But as Cader notes, “but publishers are indicating that the 30 percent seller’s commission under the agency model would not change when a wholesaler is involved.” That means that for a wholesaler such as, say, the giant Ingram company, “That means that Ingram and its clients need to agree on how to divide that 30 percent commission.” In other words, a retailer who normally gets its books from Ingram would have to split that 30% … or they could just get it direct from the publisher.

Now, reports Cader, Ingram Digital, for one, “has sent a letter from general manager Andrew Weinstein to approximately 65 retailers the company serves. He alerted them to ‘the very real possibility that Ingram will have to discontinue the availability of ebook titles from all publishers wishing to do business under an agency model…on or before April 1.’ He indicated that “the publishers opting to do business in an agency model have left us little choice ….”

Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House.