# Warning -- Take Your Books Off Kobo Now!



## LeeGoldberg (Jun 12, 2009)

If you are using Smashwords, go there *right now* and OPT OUT of having your books distributed to Kobo, the ereader used by Borders, Chapters, etc.

Today Kobo, without my knowledge or consent, has slashed the prices on a bunch of my ebooks from $2.99 down to $1.99 and 99 cents....and Amazon has followed suit. This is going to literally cost me *thousands of dollars *this month.

I don't know how long it takes for Kobo to remove your books after you have opted-out through Smashwords, so I have contacted Mark Coker directly to see what he can do before I lose a lot of money. In the mean time, get your books off Kobo now before they do the same thing to you...if they haven't already.


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## kyrin (Dec 28, 2009)

None of my books were discounted but I opted out anyway.

I remember Kobo used to discount books in the past and Amazon would price match.

I thought they stopped doing that. Thanks.


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## Guest (Apr 12, 2011)

ehhh...maybe after dinner I'll get around to it.


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## Monique (Jul 31, 2010)

They aren't supposed to do that...

http://blog.smashwords.com/2010/11/smashwords-puts-authors-and-publishers.html


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## LeeGoldberg (Jun 12, 2009)

Monique said:


> They aren't supposed to do that...
> 
> http://blog.smashwords.com/2010/11/smashwords-puts-authors-and-publishers.html


Well, apparently they are anyway. There are still a couple of my books that Kobo has price-slashed that Amazon hasn't noticed yet...but my guess is that Amazon will catch up soon enough and I'll lose even more money. Kobo has slashed the price of THE WALK, my bestseller, from $2.99 to $1.99...and my book THREE WAYS TO DIE, my second bestseller, from $2.99 to 99 cents. To say that I am outraged is an understatement. It's like they've hacked into my checking account and made an unauthorized withdrawal.

Lee


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## JRTomlin (Jan 18, 2011)

Another one of my dumb questions: where on the dashboard do you opt out?


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## Monique (Jul 31, 2010)

Let us know when you hear back from Mark.


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## LeeGoldberg (Jun 12, 2009)

JRTomlin said:


> Another one of my dumb questions: where on the dashboard do you opt out?


Distribution Channel Manager


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## JRTomlin (Jan 18, 2011)

LeeGoldberg said:


> Distribution Channel Manager


Thanks, Lee. Found it.


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## SuzanneTyrpak (Aug 10, 2010)

Thanks for the warning. I thought this had stopped.


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## Rose Gordon (Mar 18, 2011)

I've noticed it's been going on at random for the past month or so. It lasts a couple days to various titles at a time. Very strange. 

Please let us know what Mark has to say because I know it could take a few weeks to get the titles yanked, which, by then the price may be back to normal.


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## Holly A Hook (Sep 19, 2010)

My first book is 99 cents there, so I think it'll be okay.  Thanks for the heads up, though.  I'll keep an eye on it.


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## nomesque (Apr 12, 2010)

Eep! Bad for you. BUT your advice is not good. It'll be faster to contact Mark, let him know the problem, and let him fix it with Kobo. Pulling out of the distribution to Kobo will take a while, and the whole mess will likely be sorted by then.

Anyone who's affected by this, email Mark to let him know, then why not promote the hell out of the temporary Amazon price drop?


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## JumpingShip (Jun 3, 2010)

LeeGoldberg said:


> Well, apparently they are anyway. There are still a couple of my books that Kobo has price-slashed that Amazon hasn't noticed yet...but my guess is that Amazon will catch up soon enough and I'll lose even more money. Kobo has slashed the price of THE WALK, my bestseller, from $2.99 to $1.99...and my book THREE WAYS TO DIE, my second bestseller, from $2.99 to 99 cents. To say that I am outraged is an understatement. It's like they've hacked into my checking account and made an unauthorized withdrawal.
> 
> Lee


Oh wow. That sucks. They take FOREVER to update their catalog too. I only put mine back because of the agreement Mark Coker made with them late last year.


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## Monique (Jul 31, 2010)

Jeff said:


> Hmm. Something else must be going on too. Kobo's discounted one of my books from $2.99 to $2.00 - Amazon hasn't followed them yet. However, I see that Amazon's discounted two other books (from $3.99 to $3.03 and from $2.99 to $2.50), yet those prices are not discounted on Kobo. Weird discounts, don't you think?


Jeff, the books in your siggy look neat! I think, in your case, Google Books is the culprit. http://books.google.com/books?id=sbxmbD-HKooC&dq=Lonely+is+the+Soldier&source=gbs_navlinks_s


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## Joshua Rigley (Mar 19, 2011)

Monique said:


> They aren't supposed to do that...
> 
> http://blog.smashwords.com/2010/11/smashwords-puts-authors-and-publishers.html


That was an interesting article. I liked it, except for this part:



> Every once in a while I'll see people suggest authors should only sell their ebooks direct on their own websites, as if all intermediaries between the author and the reader are to be excised. Those folks are smoking opium. Smart authors put their books at retailers who can put their books in front of customers.


This is insinuating that authors aren't capable of driving customers to their website. Um, hello? People have been selling ebooks on their websites for years, LONG before the kindle was even thought of. I believe the earliest format used was .exe, which moved to .pdf. Anyway, people are still selling ebooks on their own website, and doing quite well, even though they haven't touched the likes of kindle and smashwords.

The ironic part is that retailers like amazon and smashwords do very little to promote an authors book, outside of putting it on their website and letting their shopping cart algorithm decide if your book is worth promoting or not. The responsibility for getting customers rests mostly on the shoulders of the author.

Sure, putting your ebook on amazon _can_ make your job of publishing easier, but you could do just as well by going at it on your own website.

And sucks about kobo. I wasn't planning on using them anyway. Then again, if you did publish on your website, you wouldn't have to worry about some retailer arbitrarily lowering your book's price for no reason. Plus you'd have access to your site's analytics, and that's invaluable for marketing. I hear amazon isn't too good about letting their authors know where their customers are coming from.


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## Terrence OBrien (Oct 21, 2010)

Thanks for the heads-up.


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## JRTomlin (Jan 18, 2011)

Joshua Rigley said:


> That was an interesting article. I liked it, except for this part:
> 
> This is insinuating that authors aren't capable of driving customers to their website. Um, hello? People have been selling ebooks on their websites for years, LONG before the kindle was even thought of. I believe the earliest format used was .exe, which moved to .pdf. Anyway, people are still selling ebooks on their own website, and doing quite well, even though they haven't touched the likes of kindle and smashwords.
> 
> ...


That is like saying I could do as well by putting my print novel in one bookstore. Theoretically every reader in the world could show up.

But they won't.

The more stores I can have my books in the better. The larger stores I can have my books in the better. I took mine out of Kobo, but that's one less place someone can buy my book--so as soon as it's worked out, back it goes.


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## isaacsweeney (Jan 1, 2011)

I don't make enough money to have to worry about it, but if/when I did/do, I will certainly opt out.


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## PeggyI (Jan 9, 2011)

retweeted


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## Joshua Rigley (Mar 19, 2011)

JRTomlin said:


> That is like saying I could do as well by putting my print novel in one bookstore. Theoretically every reader in the world could show up.
> 
> But they won't.
> 
> The more stores I can have my books in the better. The larger stores I can have my books in the better. I took mine out of Kobo, but that's one less place someone can buy my book--so as soon as it's worked out, back it goes.


That analogy doesn't apply to the web. Every reader couldn't show up to a single bookstore, but they can to a single website. It depends on how well you get traffic. True, you can get more customers by publishing with book retailers, and I'm not bashing that.

But I still say you can do just as well, if not better, by publishing on your website. And I'm basing this statement on case studies on thousands of ebook authors (mostly non-fiction though) have individually made tens of thousands of dollars doing this, and some much more. Of course, these people didn't simply put their book on a website and leave it there, thinking customers would start coming in. They put in the time and effort to promote it.


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## Jenni (Feb 20, 2011)

I've been uploading our books to Kobo myself. It hasn't been a very user friendly process, but the books are at the price I set, so far and not sure what our sales are like there. Smashwords has always been a great alternative for authors to upload and let them do the distribution process. Mark is a stand-up guy and I'm sure once he's away of the situation, he'll work it out the best he can.


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## Thumper (Feb 26, 2009)

Holy carp...I checked and they're discounting mine without it saying they're discounted. Only thing covering me is that my prices with Smashwords were high enough to cover it.


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## nomesque (Apr 12, 2010)

There's no WAY I'm opting out of Kobo. When I only had a Sony, they and Smashwords were my two preferred retailers. I'm sure I'm not the only non-US person with the same preference. 



Joshua Rigley said:


> This is insinuating that authors aren't capable of driving customers to their website. Um, hello? People have been selling ebooks on their websites for years, LONG before the kindle was even thought of. I believe the earliest format used was .exe, which moved to .pdf. Anyway, people are still selling ebooks on their own website, and doing quite well, even though they haven't touched the likes of kindle and smashwords.


I have readers who will NOT sideload a book unless they're really low on money and it's free. Otherwise, they'll happily wait until it's available on Amazon or B&N so they can buy the way they're used to buying, and have the book magically turn up on their device. I think having only one sales channel is _bound_ to lose you readers.


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## LeeGoldberg (Jun 12, 2009)

Thumper said:


> Holy carp...I checked and they're discounting mine without it saying they're discounted. Only thing covering me is that my prices with Smashwords were high enough to cover it.


That won't save you on Amazon, which will lower their prices to match Kobo...which is how I am getting massively screwed.


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## Monique (Jul 31, 2010)

Fwiw, I think he's traveling and sick. Hopefully, if he's not up to it someone else can answer the bell.


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## Guest (Apr 12, 2011)

LeeGoldberg said:


> which is how I am getting massively screwed.


But what about the break it's giving your appreciative and dedicated readers. Doesn't that help make it worth it?


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## Joshua Rigley (Mar 19, 2011)

nomesque said:


> I have readers who will NOT sideload a book unless they're really low on money and it's free. Otherwise, they'll happily wait until it's available on Amazon or B&N so they can buy the way they're used to buying, and have the book magically turn up on their device. I think having only one sales channel is _bound_ to lose you readers.


That is absolutely true. But, a sales channel is only as effective as the effort you put into it. And if you have several sales channels at once, it can be a huge chore promoting them all at once, let alone effectively.

One of the first things you learn in internet marketing is to focus on one thing at a time. If you spread out your efforts, the results tend to be mediocre. That's why I'm only going to start with one channel; either my website or Amazon. I may lose some readers in the beginning, but I can always pursue other channels later. Besides, it's quite impossible to capture every reader in your niche anyway. Even Harry Potter hasn't been read by everyone who loves fantasy books.


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## Gordon Ryan (Aug 20, 2010)

Checking with Kobo, every one of my books has been discounted heavily.  Even the .99 books are on sale at .59.  I emailed Mark Coker, but also Opted Out on the Distribution page.  That will take a long time, however, and as someone said, Mark might correct it by then.

I wondered why a couple of my prices have changed at Amazon, but had not visited Kobo to ascertain the reason.  Thanks, Lee, for bringing this to our attention.

Gordon Ryan


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## daringnovelist (Apr 3, 2010)

One thing I always worry about is that each of these retailers are "kiting" discounts.  That is, they take their sweet time lowering and raising prices... and then use somebody else's delayed price as a discount so, oh golly, I get to discount my prices again.  By which the first place has finally returned the price to normal but sees the discount at the second place so they lower it again, which is proof to the second place that they were right in re-discounting again....

I have a feeling that could be part of what's going on here.

At my sales level, it doesn't matter so much (hey, I get some increased sales from the specials).

Camille


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## edwardgtalbot (Apr 28, 2010)

My books are 99 cents - I suppose I would be irritated if they lower them to 59 cents, but at my sales levels, I'm willing to give it a few days to see what Mark can do.  This crap at Kobo seems to have been happening some over the past 1-2 months but accelerated greatly just in the past week or so.

Lee - I feel for you.  I'd be ripped in your situation.


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## nomesque (Apr 12, 2010)

LeeGoldberg said:


> I haven't heard from Mark yet. I emailed him at [email protected]
> 
> Is that the correct email address?


Yes, that's the right addie, Lee. I've noticed that occasionally they wait to fix the problem before getting back to me.


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## LeeGoldberg (Jun 12, 2009)

Apparently, we have no legal leverage in this situation. I checked the Smashwords user agreement...

Although they give authors the absolute right to set prices...

_7. Author-Controlled Terms. The Site allows Author to control pricing, sampling rights and output formats. Smashwords may extend author control in the future. 
_
They also take no responsibility if other sites don't honor that agreement.

_14d. LIMITATION ON DAMAGES. IN NO CASE SHALL SMASHWORDS BE LIABLE TO AUTHOR OR END-USERS, OR ANY OTHER THIRD PARTY, FOR ANY SPECIAL, INCIDENTAL, INDIRECT, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OF ANY KIND. IN NO CASE SHALL SMASHWORDS OR ITS RETAILERS BE LIABLE FOR ERRORS OF ANY KIND THAT RESULT IN SHIPMENT OR AVAILABILITY DELAYS, MISPRICINGS, OR INACCURATE OR INCOMPLETE PRODUCT LISTINGS. It is the Author/Publisher's responsibility to monitor retailer listings and report errors to Smashwords, in which case Smashwords on a best efforts basis will strive to work with the retailer to correct the error. In the event that Smashwords is found liable for any damages, for any reason whatsoever, Author hereby expressly agrees that, in no event will Smashwords' liability to Author exceed the amounts collected by Smashwords for the Author's book in question._

I am facing genuine and significant financial losses as a result of Kobo's actions. When this is all resolved, I am going to have to look long and hard at whether it's worth the financial risk to have my books distributed by Smashwords.

Lee


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## Carol (was Dara) (Feb 19, 2011)

My novella is already $0.99 so good luck to them slashing _that_ price.


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## LeeGoldberg (Jun 12, 2009)

Gordon Ryan said:


> Checking with Kobo, every one of my books has been discounted heavily. Even the .99 books are on sale at .59.


That is an outrage! Clearly, they have decided to ignore whatever agreement they made with Smashwords...

And its the writers who are getting screwed as a result.


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## nomesque (Apr 12, 2010)

I dropped Bill (Mark's better half  ) a line to let him know what's going on. He just replied to say there's a glitch in Kobo's system and they're working it out as we type.


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## David Derrico (Nov 18, 2009)

Add me to the list -- they discounted my books from $2.99 to $0.99 over at Kobo. I don't know how long it's been going on, but luckily Amazon hasn't matched it yet.

This is pretty annoying, especially for those who might be losing hundreds or thousands of dollars (I did lose probably a couple hundred due to an earlier Amazon de-listing glitch, and it wasn't fun). And it seems like there's not a stinking thing we can do about it. I very highly doubt Kobo will say "Our bad, let us reimburse you for what you lost." (For the record, with the Amazon issue, Amazon said, "Sorry about that. Our bad. Nope, we won't reimburse you a cent.")

It really does make you wonder about Smashwords distribution, or making the effort to distribute through anyone other than Amazon and B&N. I'm a fan of maximum distribution, but glitches like this (that affect much larger Amazon royalties) can wipe out all those small channel sales and then some.


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## edwardgtalbot (Apr 28, 2010)

Well, this prompted me to take an overdue look at my books on Kobo. My two thrillers which first shipped in February (or maybe first week of March for one of them) by Smashwords to Kobo are not even listed yet.  I'm not 100% sure whether they ever were now that I think about it.  I checked Apple and Sony, but may not have checked Kobo. My other three books from last year ARE listed, including reflecting a March price change.

I will wait until Mark resolves the more urgent pricing problem before asking him about it


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## JimC1946 (Aug 6, 2009)

Good grief, I'm glad I saw this. I just noticed that Amazon has dropped my price from $2.99 to $1.95.

I just opted out of Kobo.


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## BTackitt (Dec 15, 2008)

Jeff said:


> I've said this before and was shouted down, but I still think Amazon's practice of discounting based upon competitors' pricing is predatory. Witness this thread: it essentially forces authors and small publishers to do business with only Amazon. That's clearly monopolistic by intent.


I don't think it's predatory. Every major retailer does price matching. Just this weekend I saw ads on TV from Walmart, Staples, and Best Buy, and LOTS of car dealerships saying they would meet or beat competitor's pricing. Why should Amazon be any different?


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## nomesque (Apr 12, 2010)

Jeff said:


> I've said this before and was shouted down, but I still think Amazon's practice of discounting based upon competitors' pricing is predatory. Witness this thread: it essentially forces authors and small publishers to do business with only Amazon. That's clearly monopolistic by intent.


*shrug* With my current plan of attack, Amazon price-matching my books only helps my sales. I don't mind at all if retailers discount as much as they like.

Of course, it would be nice if they'd still pay the same royalty, without the author moving back to 35% (price-matching on the 35% agreement = full royalty paid). Part of the price you pay for a higher royalty, eh?


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## edwardgtalbot (Apr 28, 2010)

BTackitt said:


> I don't think it's predatory. Every major retailer does price matching. Just this weekend I saw ads on TV from Walmart, Staples, and Best Buy, and LOTS of car dealerships saying they would meet or beat competitor's pricing. Why should Amazon be any different?


HUGE difference is that Amazon pays the content provider less when they do this. If Sony sells best buy a product at $49 wholesale, Best buy can sell it for whatever they want and Sony still gets $49. (Yes there are various arrangements and restrictions between retailers and manufacturers, but by and large, Sony knows it will get $49 per unit)

This is the problem with agency pricing, and the reason why it was always going to be a bad thing for indie authors. And I think Amazon has figured out how to make it work even better for them than the prior model, despite their initial resistance.


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## JenniferBecton (Oct 21, 2010)

Thanks for the heads up. Please let us know if you hear from Mark.


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## Will Write for Gruel (Oct 16, 2010)

foreverjuly said:


> But what about the break it's giving your appreciative and dedicated readers. Doesn't that help make it worth it?


You dropping all your prices to $0.99 to give your readers a break?


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## BrianKittrell (Jan 8, 2011)

Jeff said:


> I've said this before and was shouted down, but I still think Amazon's practice of discounting based upon competitors' pricing is predatory. Witness this thread: it essentially forces authors and small publishers to do business with only Amazon. That's clearly monopolistic by intent.


Perhaps, but it's allowed. Just like any other retailer, they're allowed to match the prices of any competitor out there. Yes, their price-matching is predatory, but the price drops are being caused by the other retailer, not Amazon. The #1 status that they hold wouldn't last for very long if people could go somewhere else and get the books cheaper; they stay at #1 because they offer just about the lowest price in 99% of cases.

I removed my books from Smashwords for now because I wasn't making any sales there, and I heard that this exact sort of thing was possible (and, on a long enough timeline, probable). I've even heard they'll go under $0.99 to the $0.70 - $0.80 range. If they would go to free, I wouldn't mind so much on my first book to boost sales, but there's little incentive to buy a $0.70 book instead of a $0.99 book. A $0.29 discount isn't going to just up and cause a downpour of sales.


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## BrianKittrell (Jan 8, 2011)

foreverjuly said:


> But what about the break it's giving your appreciative and dedicated readers. Doesn't that help make it worth it?


So says the man with $2.99 price tags. hehe


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## Rex Jameson (Mar 8, 2011)

This is rather disturbing. I might have to forgo this distribution channel. Sorry to hear about the financial ramifications of these glitchy channels.


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## Herc- The Reluctant Geek (Feb 10, 2010)

How smart are Amazon's bots? Is it worth uploading books with slightly different titles on Amazon to get around the probs with third party websites discounting? I don't want to opt out of any retailer, especially after Feb/March results where the Smash distribution system matched Amazon almost to the dollar. 

I love being in at the inception of things  I can see us all in 5 yrs time telling the newbie indie authors about how lucky they are, and how it was sooo much more difficult in the old days


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## swolf (Jun 21, 2010)

Dara England said:


> My novella is already $0.99 so good luck to them slashing _that_ price.


They lowered one of my $0.99 books to zero.


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## HelenHanson (Sep 13, 2010)

File under Irony:  I was at the Kobo site when I popped over here to ask a question.  

My problem with the discounting:  The seller determines the price the author receives.  When Safeway discounts milk, Borden's still gets the contracted amount.  Safeway wants to discount. Safeway takes the hit.


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## daringnovelist (Apr 3, 2010)

Here's the thing: 

This is the risk that we opted into (knowingly and overtly) when Amazon offered the 70 percent option.  It's what agency pricing is too, and although we all knew the risks here, we didn't know the power of automated systems.  Things can cascade out of control fast.  This is the sort of thing that can force a big change in royalty offerings and terms.

I do have a question for everybody with this problem (since I haven't experienced it yet): these discount prices which are showing up -- have you ever offered these books at those prices?  Could this be resonance with in the system on old data?  Or does it seem to be random or from some other cause?

(I myself tend use full price or free, and Amazon doesn't match free much, so I don't mind if it trickles through the system all it wants.)

Oh, and Helen: with agency pricing, the seller is NOT supposed to set the price at all except to match a price of a competitor -- which keeps us honest in not signing up for the 70 percent option and then underselling the vendor.  Yes, they all give themselves little exit clauses, but in this case, Kobo is clearly breaking their agreement with Smashwords.

Camille


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## swolf (Jun 21, 2010)

Herc- The Reluctant Geek said:


> How smart are Amazon's bots?


There's also a link on your Amazon book page named "tell us about a lower price?" that customers can click on.


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## HeidiHall (Sep 5, 2010)

I thought the Google Books question was interesting... how many of you who have had your price lowered are with Google Books? Just wondering if that's why mine haven't been discounted (I'm not on GB).


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## Will Write for Gruel (Oct 16, 2010)

Amazon's pricing policy isn't predatory, it's self-preserving. They allow publishers to set their price and in return publishers allow Amazon to price match if Amazon finds the price lower elsewhere. Why should Amazon go to the trouble to sell a book if the publisher will go and undercut that price elsewhere? 

Kobo is the problem, not Amazon. Unfortunately for Smashwords, it makes them that less attractive.


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## HelenHanson (Sep 13, 2010)

daringnovelist said:


> Oh, and Helen: with agency pricing, the seller is NOT supposed to set the price at all except to match a price of a competitor -- which keeps us honest in not signing up for the 70 percent option and then underselling the vendor. Yes, they all give themselves little exit clauses, but in this case, Kobo is clearly breaking their agreement with Smashwords.


Thanks, Camille (I have always loved that name)

I've heard about this problem for some time, thus my reluctance in signing up with SW. To restate the point for clarity (and my density) -- no one is allowed to discount my work without my permission unless I have it listed elsewhere at a lower price. Is that correct?

Thanks.


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## MeiLinMiranda (Feb 17, 2011)

Sony took forever to update a raised price of mine, Amazon caught it, and I got dinged. I contacted Mark and he got Sony to fix it within a few days. Good, since Sony hadn't updated (and STILL hasn't updated) the description changed 6 months ago.


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## nomesque (Apr 12, 2010)

Jeff said:


> No. Everyone can discount your book. If Amazon does it for price matching, they reduce your royalty accordingly. If Amazon, or any other retailer, reduces the price for their own marketing reasons they (the retailer that makes the sale) pays you royalties based upon the wholesale price that you set.


Part of Smashwords' agreement with retailers is *no seller discounting*, except to price-match.


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## Terrence OBrien (Oct 21, 2010)

Typically predatory pricing is an attack by one firm on another. Price is cut in an attempt to drive the other firm out of business. In international trade it's called "dumping," where a firm sells below average cost, but above marginal cost.

Amazon is not engaged in predatory pricing since they are not making the first move, and they do not go below the competitor's price. They match it. If a competitor sets a price, it is very hard to contend that price will force them out of the market.

We might want to use the term "price matching" here so we have "predatory pricing" available if it actually does occur.


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## BTackitt (Dec 15, 2008)

Ok, sometimes it takes me a while to think things through. Re: pricematching, I don't think Amazon is out to stick it to the authors, that is an unfortunate byproduct (?) 
Amazon wants to keep customers happy, happy customers buy more. Amazon price matches for CUSTOMERS.. It's like reviews, they are not for the author, they are for the buyer... Pricematching not for/against the author, FOR the buyer.


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## LeeGoldberg (Jun 12, 2009)

I heard from Mark Coker...he says it's a technical glitch at Kobo and that he's getting into it with them. He hopes to have it resolved by Thursday morning. I appreciate him escalating the issues, but even if they resolve it by weeks end, who knows how long it will take Amazon to readjust their prices? And I still will have lost a lot of money in the interim. I will have to seriously consider whether listing my books on Kobo again is worth the financial risk of them accidentally or unintentionally slashing my prices again...my guess is that, for the time being, it is not.

Lee


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## MosesSiregarIII (Jul 15, 2010)

Those bastards. They've discounted my free book to _negative_ one dollar! Now you can get my ebook and make a buck at the same time!

But seriously folks, that sucks, Lee. However, this might end up making you more money than it costs you over the long term. I wouldn't sweat it.


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## nomesque (Apr 12, 2010)

Jeff said:


> Please take a look at the title of this thread.


An anomaly is NOT a generality, and should not be stated as such.


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## daringnovelist (Apr 3, 2010)

T.L. Haddix said:


> For everyone who has said "I'm not big enough that it's going to hurt me," let me ask this - what happens if tomorrow, someone in the right place at the right time discovers your book, and you end up getting a thousand sales in the next few days? Is it going to hurt you then?


Honestly, I'd have to assume that it's the price drop.

I'm not saying people who have a good income should not be complaining about or that it doesn't matter. I'm just saying that right now I'm TRYING to get Amazon to offer my books free so in my personal situation, I don't have a problem. A year from now? Sure, that would be a problem. And by then either Kobo will have its act together or I won't be distributing through them. (Or perhaps it would be better to say they will have their act together or they may be out of business.



Jeff said:


> Please take a look at the title of this thread.


I think you may have misunderstood what Terrence was saying. I'm not sure. It sounded to me like you were refuting his argument that Amazon was engaging in predatory pricing because Kobo will suffer from this. Terrence didn't say Kobo won't suffer. What he said was that KOBO IS THE ONE DRIVING THIS. They're the "predator" except that they aren't doing a good job of it. Amazon is simply reacting to their move.

Part of the problem is that both companies are using automated systems, and once something goes wrong it REALLY goes wrong.

Does anybody know if any of the major publishers are also being hit? That could get it cleared up fast....

Camille


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## Gordon Ryan (Aug 20, 2010)

Whoever is driving the discounting, it is beyond reason to expect that an author who already offers his/her book for .99, should see it discounted to .59.  That was done without any contact between retailer and author and, probably, without contact between retailer and Smashwords.

Gordon Ryan


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## MarkCoker (Feb 15, 2009)

Hi Everyone,

Amazon is having a wet dream over this.

Kobo is very aware of this problem. I urge everyone here NOT to opt out of Kobo unless you want to compromise your long term potential as a author. Kobo has been growing quickly, as have our other retail partners, and it would simply be dumb for anyone to abandon them over such a glitch.

I understand this is causing some authors some serious short term pain, so I don't blame Lee or anyone else for being angry. Kobo has already responded to this problem.

We first notified them of it yesterday and by today they confirmed and identified the problem and escalated it. Some of the authors affected have already had their prices adjusted to normal. I can assure everyone this was an honest error Kobo made with the noblest of intentions. Ironically, the error was introduced while they were updating their software to improve the reliability of their pricing systems. As anyone who's ever worked with software can appreciate, one change in one line of the code in one place and it can have unintended consequences elsewhere.

Someone on the thread made a comment about Amazon's predatory price matching practices. I would agree. Amazon knows that these titles are distributed by Smashwords, and they know what the true correct price is because they're spidering the Smashwords.com web site where the author-set price is always displayed.

This means Amazon has the data to realize that the price change at Kobo was not the author's fault.

Yet Amazon punishes the author.

Last year, I even offered to share our price list with Amazon so they could use it to satisfy their price parity needs, as opposed to punishing authors for glitches that can occur between us and the retailer.

Amazon knows that each time they give their best-selling authors a firm spanking, that author is reminded how important Amazon is to their daily bread, and it makes that author leery to explore other opportunities. On this thread alone, there are multiple authors who are afraid to work with Smashwords or Kobo over such concerns, and some might find this new incident with Kobo as validation for their caution. Such a conclusion would be erroneous and self-limiting, because this event will be over within a couple days and the pricing systems at Kobo will be all the stronger for it.

No Smashwords retailers are allowed to discount. We negotiated agency agreements will all our retailers last year, and by December 1 all our retailers agreed to give our authors the power to set their own price. Kobo was actually the first to agree to this. They moved us to agency in November.

If Amazon had compassion for authors, they would do you the courtesy of shooting you an automated warning email, and give you a 24 - 48 hour grace period to correct the problem. They could do that with one day of coding (I know they have the talent to do it because last year they hired the former Smashwords CTO who coded the original Smashwords platform three years ago. He's a smart guy!). If our retail partners had 24 hours notice, they could all make such price corrections. Amazon has the ability to do the right thing and give you fair warning. Will they?

Instead, to date at least, Amazon sits behind their rules, and reminds authors that the authors agreed to these rules in exchange for 70%. And Amazon's right. They have every right to do this. Yet it doesn't mean what they're doing is right. I wouldn't treat my authors this way. I encourage our authors to maintain price parity, but I don't mandate it and would never punish them for it.

Amazon understand that each time you opt out of another retailer, or each time you decide not to expand your distribution opportunities, it makes you more dependent upon Amazon and it harms the other retailer. It's a double win for Amazon.

It pains me every time I see an author hurt themselves by opting out of a great retailer like Kobo. Amazon's market share is dropping thanks to the great progress of Kobo, B&N, Apple, Sony and others. We specialize in serving these non-Amazon retailers. We hope to one day serve Amazon too.

I would encourage all authors here to make a commitment to make themselves less dependent on Amazon. It's in every author's best interest to support and encourage a thriving and competitive ecosystem of ebook retailers. Indie authors have this power to make a difference today, starting with your marketing. If you're promoting your books here on Kindleboards, or on your website, blog or social networks, add links to all your retail outlets, not just Amazon. Give your customers a choice.

Last year, people were talking about Amazon's 75+% market share. More recent accounts show that market share declining closer to 50%, and dropping. According to the Crains NY story, it was a possible reason Amanda Hocking refused to sell out to Amazon (http://www.crainsnewyork.com/article/20110401/FREE/110409990, because Amazon wanted an ebook exclusive and Hocking and her agent probably realized Amazon's not the only game in town any more.

This isn't the last time you'll see a Smashwords retailer (or Smashwords for that matter) make a mistake. Remember these are only bumps to a higher road. I know all our retailers have made improvements over the last 18 months to improve the speed and accuracy of their ingestions from Smashwords. Overall, things have been working great for a long time now, and they'll only get better in the future.

Thanks, all.
mark


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## Gordon Ryan (Aug 20, 2010)

Mark, that is what we needed to know: was it an error or policy.  No one wants to Opt Out of Kobo (although I did for several hours) but until we knew it was a glitch and not intentional, it was a good choice.  Thanks for continuing to jump on these issues and explain the situation.

Gordon Ryan


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## NotActive (Jan 24, 2011)

content


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## CraigInOregon (Aug 6, 2010)

LeeGoldberg said:


> If you are using Smashwords, go there *right now* and OPT OUT of having your books distributed to Kobo, the ereader used by Borders, Chapters, etc.
> 
> Today Kobo, without my knowledge or consent, has slashed the prices on a bunch of my ebooks from $2.99 down to $1.99 and 99 cents....and Amazon has followed suit. This is going to literally cost me *thousands of dollars *this month.
> 
> I don't know how long it takes for Kobo to remove your books after you have opted-out through Smashwords, so I have contacted Mark Coker directly to see what he can do before I lose a lot of money. In the mean time, get your books off Kobo now before they do the same thing to you...if they haven't already.


Wouldn't be surprised if this is related somehow to the bankruptcy of Borders...


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## LeeGoldberg (Jun 12, 2009)

Mark,

I appreciate your efforts, your good intentions, and your fast response...

That said, I won't be opting in with Kobo until I am convinced that they are worth the financial risk. And right now, they aren't. Even if they resolve their problems by Thursday, there's no telling how long it will take Amazon to restore my original pricing. I will have lost a week of sales at my 70% royalty.

You're right, I make most of my ebook income from Amazon....far, far more than I am earning from all the other ebook platforms combined (from Amazon alone, I am on track to earn $80,000 this year on just my out-of-print backlist). That gives Amazon incredible influence over my ebook publishing decisions. So when Kobo makes a big mistake like this, it does more than shake my confidence in them...it costs me financially. In fact, it wouldn't surprise me if I have already lost more in Amazon sales in three days than I've earned from Kobo to date.

This experience also forced me to look at Kobo for the first time...and I was shocked by how far behind they are in terms of updating my listings. They are still using cover art and titles that I changed on Smashwords _over a year ago_. So either there is a glitch at Kobo or at Smashwords...or in the communications between the two of you. Either way, it doesn't instill a lot of confidence in Kobo in me...or in Smashwords, to be honest. Right now, there is no upside for me in doing business with Kobo...and a costly downside. I'll be back when, and if, they get their act together.

I am all for exploring other platforms for my ebooks....but until those other platforms can prove their reliability, and demonstrate the potential to earn me the money that Amazon does, I'll be favoring Amazon over all the others.

Lee

PS - On Smashwords, in your alert to authors about this problem, you say the glitch is affecting about 20 books. No offense, but that can't be right. Five of my books alone are affected...and from what I have read here, on twitter, and directly from other authors, the count has to be much higher.


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## Rex Jameson (Mar 8, 2011)

Thanks, Mark. That's all I needed to know.


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## Gordon Ryan (Aug 20, 2010)

LeeGoldberg said:


> PS - On Smashwords, in your alert to authors about this problem, you say the glitch is affecting about 20 books. No offense, but that can't be right. Five of my books alone are affected...and from what I have read here, on twitter, and directly from other authors, the count has to be much higher.


Lee, it affected all eleven of mine, so I agree that the overall number must have been considerably higher. Perhaps Kobo is giving Mark the wrong information to minimize the problem. In any event, Mark is, as usual, on top of trying to rectify the situation.

Gordon Ryan


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## Courtney Milan (Feb 27, 2011)

Hi Mark,

I really appreciate your response, and I especially appreciate this line:



> It's in every author's best interest to support and encourage a thriving and competitive ecosystem of ebook retailers. Indie authors have this power to make a difference today, starting with your marketing. If you're promoting your books here on Kindleboards, or on your website, blog or social networks, add links to all your retail outlets, not just Amazon. Give your customers a choice.


I'm a firm believer in an ecosystem of links, because in the long term, a healthy competition among retailers is the best thing for both authors and readers. That's why I wrote a script a year or so ago that automatically creates buy links (for print books) to all the major retailers.

But the ecosystem argument cuts both ways. See, ecosystems are not all fuzzy daisies and brightly colored parrots. Evolution is about survival of the fittest, and that implies a very grim part as well: those who are not fit don't survive. That's harsh and not-fuzzy. The question I think you have to answer is this: if kobo costs an author as much money as it cost Lee here, why should authors continue to support it? We want a healthy, vibrant ecosystem--but a part of that ecosystem that can literally slash a week's worth of income for a writer isn't healthy or vibrant. It's diseased, and the proper response of the marketplace should be to cut it off.

I have been a coder in one of my many past lives (note above script, which is not a stellar example of clean code, but whatever), and I get that a small mistake can have a huge consequence. But how is it supposed to instill confidence in kobo as a vendor to be told kobo is making mission-critical code live without thoroughly testing it in a contained environment first?


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## MarkCoker (Feb 15, 2009)

modwitch said:


> Thanks for replying Mark. I will say that as an outside observer, it's hard to believe this was entirely accidental on Kobo's part (I understand coding issues, but I also know they get blamed more often than they need to be - they're convenient).


Yet it was an error. Kobo was the first major retailer (other than Apple) to let indie authors benefit from agency rates. They did it because they realized (because I communicated this to them) that Amazon was punishing authors for Kobo's (then contractually allowable) discounting. Kobo is not in the business of screwing over authors. They've always been indie-friendly, from their very first days a Shortcovers.



modwitch said:


> However, I don't see price matching by amazon as "out to get us". We're business people. We enter into agreements with our various distributors, and all of them claim the right to price match. If we can't keep pricing in some of our channels under control, why is that amazon's problem? They price match so they don't lose customers.


I have nothing against price matching. Our retailers are allowed to pricematch. They rarely do. Amazon metes out instant punishment to authors for errors that are not of the author's making. It's the equivalent of ticketing the front seat passenger of a car if the car exceeds the speed limit by 1 mile per hour or one second. The reality of the matter is that if you put your book anywhere but Amazon, there's a risk that the retailer or the distributor makes a mistake, and although the retailer or distributor stands ready to correct that mistake within minutes or hours, you bear that risk. Amazon does a good job of reminding you of that risk.



modwitch said:


> So since it is *my* job to keep pricing in my various channels under control, how can smashwords assist authors in monitoring prices? It seems like this isn't the first time Kobo has done this, accidentally or otherwise. Can you code a scraper (or go via APIs) and grab pricing from your major retail partners? That would set off a red alert for pricing changes in violation of your agency agreements.


We're always thinking of how we can help our retail partners improve the speed and maintain the accuracy of their listings. There are many things we do already to proactively correct things. It's an ongoing iterative process, and some of our retail partners are further along the path than others.


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## Mel Comley (Oct 13, 2010)

Amazon lowered my price on the UK site to 49p two weeks ago and I didn't know why. When I looked on Kobo my book was being offered for FREE. 

I contacted Mark and he got it changed straight away. I think we should all check our prices on the other sites offered through Smashwords regularly, the quicker we can spot things like this the better.


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## MarkCoker (Feb 15, 2009)

LeeGoldberg said:


> PS - On Smashwords, in your alert to authors about this problem, you say the glitch is affecting about 20 books. No offense, but that can't be right. Five of my books alone are affected...and from what I have read here, on twitter, and directly from other authors, the count has to be much higher.


At the Smashwords Site Update post at http://www.smashwords.com/about/beta I wrote, "We don't know how many are affected yet, but I've personally confirmed about 20 books affected in the last two days." That was conservative on the high end at the time I wrote it based on the number of people who had contacted us. I wasn't counting folks who only reported their pricing problems here or on Twitter but hadn't told us yet.


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## nomesque (Apr 12, 2010)

If you have a 99c book with Amazon, though, where's the problem if they pricematch below 99c? You're on the 35% royalty already, you get 35% of your list price no matter what.


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## kyrin (Dec 28, 2009)

nomesque said:


> If you have a 99c book with Amazon, though, where's the problem if they pricematch below 99c? You're on the 35% royalty already, you get 35% of your list price no matter what.


I think they changed this when they updated the royalty agreement.

Not all books on the 35% royalty plan are 99 cents. There are some books (graphic intensive ones) that use the 35% rate because of their file size and associated delivery charges.


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## nomesque (Apr 12, 2010)

> i. The Royalty for the Digital Book will be 35% of the applicable List Price for the Digital Book.
> 
> ii. If you select the 35% Royalty Option for your Digital Book, you must set and adjust from time-to-time as necessary the Digital Book's List Price so that the List Price, plus 15% (the statutory Luxembourg VAT rate) for sales to UK customers, is no higher than any of the following:
> 
> ...


Nope, still 35% of the List Price (ie, the price the author sets in the KDP). The only difference is that price-matching to FREE no longer gets the author 35% of the List Price.

Know your contracts, folks.


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## CraigInOregon (Aug 6, 2010)

I wonder what the future of Kobo is, with Borders going south. Mark?


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## nomesque (Apr 12, 2010)

CraigInTwinCities said:


> I wonder what the future of Kobo is, with Borders going south. Mark?


Eh? Why does the loss of a distributor - or three, possibly, with the RedGroup in Australia doing the same - mean much for Kobo? They've never been hugely US-focused, have they? And I thought their emphasis was primarily on their direct retail, for ebooks?

*ponder* Then again, if RedGroup go belly-up, I guess they lose their physical Kobos-in-hands advantage over Amazon in Australia...


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## MarkCoker (Feb 15, 2009)

CraigInTwinCities said:


> I wonder what the future of Kobo is, with Borders going south. Mark?


I believe Kobo gets only a small percentage of their sales from Borders. Most sales are from the Kobo-branded retail operation. I'd say if Borders goes on to survive and thrive, it's icing on the Kobo cake. The cake itself is Kobo.


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## CraigInOregon (Aug 6, 2010)

nomesque said:


> Eh? Why does the loss of a distributor - or three, possibly, with the RedGroup in Australia doing the same - mean much for Kobo? They've never been hugely US-focused, have they? And I thought their emphasis was primarily on their direct retail, for ebooks?
> 
> *ponder* Then again, if RedGroup go belly-up, I guess they lose their physical Kobos-in-hands advantage over Amazon in Australia...


Border's was Kobo's main retailer in the US, to my understanding.


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## kyrin (Dec 28, 2009)

nomesque said:


> Nope, still 35% of the List Price (ie, the price the author sets in the KDP). The only difference is that price-matching to FREE no longer gets the author 35% of the List Price.
> 
> Know your contracts, folks.


Not to be picky, but that was the change / difference I was talking about. If Kobo or another retailer dropped your book to FREE (which is a possibility though not all that probable) then you would get nothing instead of 35% of the list price.



nomesque said:


> If you have a 99c book with Amazon, though, where's the problem if they pricematch below 99c? You're on the 35% royalty already, you get 35% of your list price no matter what.


You're the one who said "no matter what" and free is below 99 cents.

EDIT: Had to remove a comment that didn't fit. It's late and there's no need for me to bite someone's head off who's trying to point something out.


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## nobody_important (Jul 9, 2010)

Jeff said:


> The fact that Amazon has that much power doesn't make it right. I'd have no objection to their price matching if they reduced the price based upon a price that I set. For example, if I set the price for a title at Smashwords lower than at Amazon. But we have no control over Kobo. In fact we're not even self-published on Kobo - the publisher is listed as Smashwords. The fact that the title of this thread urges us to remove our books from an Amazon competitor should say something.


But it's not Amazon's fault that Kobo screwed up. Why should Amazon not price-match?

The problem lies in the author-SW-Kobo chain, not author-Amazon.


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## nobody_important (Jul 9, 2010)

MarkCoker said:


> If Amazon had compassion for authors, they would do you the courtesy of shooting you an automated warning email, and give you a 24 - 48 hour grace period to correct the problem. They could do that with one day of coding (I know they have the talent to do it because last year they hired the former Smashwords CTO who coded the original Smashwords platform three years ago. He's a smart guy!). If our retail partners had 24 hours notice, they could all make such price corrections. Amazon has the ability to do the right thing and give you fair warning. Will they?
> 
> Instead, to date at least, Amazon sits behind their rules, and reminds authors that the authors agreed to these rules in exchange for 70%. And Amazon's right. They have every right to do this. Yet it doesn't mean what they're doing is right. I wouldn't treat my authors this way. I encourage our authors to maintain price parity, but I don't mandate it and would never punish them for it.


Instead of blaming Amazon for not giving authors a notice for price change, how about holding Kobo responsible for not sending authors and/or Smashwords a notice for changing the price on their own? That's fairer than blaming Amazon for reacting to Kobo's errors.



MarkCoker said:


> This means Amazon has the data to realize that the price change at Kobo was not the author's fault.
> 
> Yet Amazon punishes the author.


You are right that the price change at Kobo was not the author's fault. But the price-match isn't Amazon's fault either. It's Kobo's fault. So is Kobo going to "un-punish" the author by compensating the author for the lost income? Because I've never seen that being mentioned so far.


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## Philip Chen (Aug 8, 2010)

This has been quite an education in the dynamics of pricing among the book retailers and the effect on all of us.  I appreciate knowing this and have another question to ask.  Each retailer has a different amount of time it takes to adjust their pricing.  Some do it in one day, others take much longer.  If each retailer is price matching, doesn't the disparity in the time it takes each to adjust prices put the author into a merry-go-round that is hard to get off?


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## Rex Jameson (Mar 8, 2011)

Amazon is held accountable by their customers, which ultimately drive their business. If a book is available for cheaper elsewhere, price matching makes sense for a customer-driven business. Even if they are potentially reaping benefits from giving their competitors a black eye, they are also operating well within the boundaries of standard price matching.

I can understand Mark fighting for independent authors, but in this particular case, Kobo is the one responsible for the hiccups in the pricing system. There is no way that "software updates" should go live without a very thorough testing process (especially on something this basic).


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## nomesque (Apr 12, 2010)

kyrin said:


> Not to be picky, but that was the change / difference I was talking about. If Kobo or another retailer dropped your book to FREE (which is a possibility though not all that probable) then you would get nothing instead of 35% of the list price.
> 
> You're the one who said "no matter what" and free is below 99 cents.


Oh, gotcha. OK, lemme re-state that: if they price-match between 1c and your book's price, on the 35% agreement, where's the problem?


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## David Derrico (Nov 18, 2009)

Mark, thanks for coming by and reassuring us that you're on top of the situation. We appreciate it.

Unfortunately, people are losing money -- some are losing significant money (actually, it's significant as a percentage to all of us, even to those of us without huge sales). I'm sure it's not your fault or Smashwords' fault, I'm sure it's a glitch that will be fixed, but the bottom line is people are losing money. I don't think it's reasonable to expect authors making high 5 figures from Amazon to be too interested in "diversifying" away from them. The bottom line is that they will end up opting out of Kobo and/or Smashwords.

I know you switched to agency to try to avoid this exact problem (and thank you for that), but it's obviously still a problem. And I know this was Kobo's fault, not Smashwords', but it's affecting you and your authors. Retailers need to understand how their authors' hands are tied on this one, and how working with retailers can end up being a net negative due to price matching. I doubt retailers will agree to reimburse authors for losses the retailers cause, so then they need to be pretty iron-clad on getting the pricing right. Bottom line: if Kobo wants authors to distribute through them, they have to guarantee they won't mess up our prices or cost us Amazon royalties.



rexjameson said:


> Amazon is held accountable by their customers, which ultimately drive their business. If a book is available for cheaper elsewhere, price matching makes sense for a customer-driven business.


You're right, Amazon calls itself "The world's most customer-centric company," not the most author-centric or publisher-centric or third-party-retailer-centric or anything else. Sure, their methods are Draconian and annoy me from time to time, but it is what it is and we have to adapt to their rules.


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## BrianKittrell (Jan 8, 2011)

Mark, you've always had my respect. I think Smashwords is a great enterprise. I've even included it in a book I'm writing on self-publishing as "One of the Major Three" eBook services.

That said, I am disappointed at Kobo. I write code, too. (KindleProcessor, which will soon become ePub-compliant, and etc.) I don't deal with huge sums of money, so I don't always test out every possibility before going live.

If I did operate an eBook retailer website, I would probably make a copy of my website to test my changes out before going live. I'd take a look at everything, make sure the pricing stayed correct, that the customer databases were intact and correct, and so forth. I know it's easier to push an update than it is to test it, but, when dealing with peoples' careers, it really is a necessary process.

If they pushed an update that changed prices, they should have gone into maintenance mode immediately, corrected the problem, and then gone live again. The "we didn't know it would happen" excuse doesn't apply here. If it had been properly tested, they would have noticed it. FREE is easy to spot when it used to say $0.99, and so forth.

It's not Mark's fault that it's happened, but he's here trying to explain things to us. I don't see Kobo's representatives coming down to our little corner of the net to check on us and see how we're doing. I'll return to Smashwords when I can. I just wish it didn't require that blooming M$ .doc format. (Any word on allowing ePub directly instead?)


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## LeeGoldberg (Jun 12, 2009)

It has apparently been three days since this problem began...though we only caught on to it yesterday. And yet it's _still_ not resolved. This is as troubling as the initial "technical error," one that is costing me and lots of other authors serious money. Clearly, Kobo is not reliable or competent. Once this error is corrected, I have no intention of making my books available on their platform again until they have established a reputation for dependability and integrity. They clearly have a_ long_ way to go.

If Kobo hasn't resolved the problem by Friday, I hope Mark Coker will do the right thing and immediately yank from Kobo all of the books by Smashwords authors who have already chosen to "opt out."

Lee


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## RM Prioleau (Mar 18, 2011)

So what if your book is already 99 cents? Will Kobo make the price even lower? Or make it free??


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## Jason G. Anderson (Sep 29, 2010)

RM Prioleau said:


> So what if your book is already 99 cents? Will Kobo make the price even lower? Or make it free??


Some authors have been reporting lower prices (ie: below 99 cents). Not sure they'd drop it to free though.


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## Gordon Ryan (Aug 20, 2010)

RM Prioleau said:


> So what if your book is already 99 cents? Will Kobo make the price even lower? Or make it free??


RM, each of my .99 books (Amazon) are at .59 on Kobo, and they still are, despite Kobo knowing about the glitch. Giving it a couple more days before I go back and Opt Out again. I Opted In after Mark explained that it was an error, not policy, but they are taking their sweet time to correct it. I am not losing heaps of money like Lee, so no real damage, but it should not even be occurring.

Gordon Ryan


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## daringnovelist (Apr 3, 2010)

Since it was reported that only a few authors were affected, I hope that everyone who is having the problem has reported it.

(Also, just because there is a known problem with Kobo, that doesn't rule out that a few people won't have an odd problem here and there with another source.  If I remember right, there were some problems with Sony a little while ago -- although they were simply being VERY slow to update prices.)

Camille


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## MarkCoker (Feb 15, 2009)

BrianKittrell said:


> If I did operate an eBook retailer website, I would probably make a copy of my website to test my changes out before going live. I'd take a look at everything, make sure the pricing stayed correct, that the customer databases were intact and correct, and so forth. I know it's easier to push an update than it is to test it, but, when dealing with peoples' careers, it really is a necessary process.


Hi Brian, it would be unfair to characterize this as a sign of sloppiness or haste, and it's because they understand the gravity of this that they're being extra careful with the fix. We shipped them a complete refresh of our metadata today. Once we get over this initial bump, we and Kobo will explore how Smashwords might reengineer our delivery systems to them so our shipments can arrive faster and more accurately, and so the listings can more accurately reflect the desires of the publisher. This conversation was already in the works before this blew up.


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## CraigInOregon (Aug 6, 2010)

Mark,

Just wanted to note that you are an excellent apologist and spokesperson; not only for Smashwords, but for your business partners as well.

It's not easy to enter into a forum where people are upset and tell them the truth of a matter - especially when some of those things might not be what they want to hear, or what they are prepared to believe.

You do it as well as anyone I've seen. Well done.


Craig


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## Gordon Ryan (Aug 20, 2010)

CraigInTwinCities said:


> Mark,
> 
> It's not easy to enter into a forum where people are upset and tell them the truth of a matter - especially when some of those things might not be what they want to hear, or what they are prepared to believe.
> 
> Craig


Mark, as Craig says, I second his remarks. However, if history tells us anything, that particular trait completely removes you from my list of potential presidents of the United States. I prefer the lying scumbag who tells me what I want to hear.

Gordon Ryan


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## edwardgtalbot (Apr 28, 2010)

I'll certainly concur that I appreciate Mark's level of communication and degree of candor.  It's not common to get from KDP and it's non-existent from B&N.  This is one of several reasons why I have my books at Smashwords and have a high degree of opting in to things.

Earlier I stated bluntly that Kobo screwed up.  Regardless of the reasons or how hard they are trying to fix it, it is having a massive and immediate impact on some people's livelihoods. The influence of the 1000-pound Amazon gorilla certainly affects the dynamics, but few people in a room with a gorilla and someone who accidentally flicked a rubber band at him are going to blame the gorilla when he gets mad at the action and starts tearing off everyone's arms. The anger at the situation is both justified and understandable, as is making the decision to opt out and accept the risk posed by Amazon's dominance over the risk of losing so much immediate income.

That said, as a web developer by profession (I know it's shocking that my book sales don't support me , I wouldn't second-guess Kobo technically. Mistakes happen. Just in the past month, we could point to technical security breaches at multiple companies with much larger resources than Kobo who know that such breaches could literally put them out of business. Sure, my first instinct is like Brian's, to imagine that if I were doing things, I wouldn't have allowed it to happen because I would have done x,y, and z. But I've put out releases that went through rigorous documentation, peer review, and QA on identical environments to production that nevertheless had problems. 

There isn't a single company out there that doesn't have IT process weaknesses that would be vulnerable to problems if the wrong combination of conceivable events occurred.  What you do is try to minimize them and constantly re-evaluate them. And when something like this happens, you hope you survive it, you make sure you at least protect against this type of problem in the future, and you hope to also learn about other vulnerabilities that you can fix before they create a problem.  This does not excuse Kobo in the sense that customers and partners would be right to trust them less moving forward. They need to be judged on end results, which at this point are bad. But let's not go too far in castigating them for specifics about which we know essentially zero pertinent details.


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## Guest (Apr 14, 2011)

Joshua Rigley said:


> That is absolutely true. But, a sales channel is only as effective as the effort you put into it. And if you have several sales channels at once, it can be a huge chore promoting them all at once, let alone effectively.


That is why I don't promote sales channels. I promote BOOKS. It is not my job to drive customers to Amazon or BN or Kobo. It is my job to convince people to buy my books, and then they can buy them whereever the heck they want to.

And just to touch on the "sell them yourself point," this may not actually be a good idea depending on where you live. For example, if I was involved in direct sales to readers, I would have to collect NJ sales tax. Whatever money I save not paying a fee to Amazon or Smashwords gets shifted to an accounting cost having to keep additional records for the state tax collection office. I went around the block with my county clerk because I obviously run my publishing business from my home. Because I don't actually sell directly out of my home, I don't need any special licenses or exceptions to the "residental only" designation of my neighborhood. But if I was actually involved in direct sales to end users (I sell both print and ebooks), that would require me to get special exceptions to operate a business in a residental district. And while some folks may feel their sales volume is low enough to not bother or that they assume there is no way for the township to know, I personally prefer to stay above board on such matters. Between property taxes, school taxes, and the assortment of fees the township loves to assess, I really don't feel like giving them an excuse to charge me more money.


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## David Derrico (Nov 18, 2009)

Just a heads-up: it looks like my books are re-priced correctly at Kobo now.


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## LeeGoldberg (Jun 12, 2009)

My books are still there, still price-slashed, still costing me money. At this point, I don't want the prices restored. _I want my books removed from Kobo_. They aren't reliable and the financial risk to me of keeping my books on their site is too high right now.

Lee


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## SD Livingston (Mar 13, 2011)

An interesting question struck me after Lee's last post that his books are still listed at Kobo (and this could be pertinent with regard to other retailers).

I can still view Lee's covers and prices on the Kobo site, but when I click through, an error message says the content has been removed.

This makes me wonder: when a retailer such as Amazon is checking prices, does it matter if the content isn't actually for sale? Or is residual data (prices and covers) lingering on Kobo's site enough to trigger Amazon to price match? If a retailer (in this case Kobo) complies and removes a book from their site, shouldn't the cover and price automatically disappear from their catalogue?

Apologies if I'm missing something obvious here.

Sandra


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## LeeGoldberg (Jun 12, 2009)

SD Livingston said:


> An interesting question struck me after Lee's last post that his books are still listed at Kobo (and this could be pertinent with regard to other retailers).
> 
> I can still view Lee's covers and prices on the Kobo site, but when I click through, an error message says the content has been removed.
> 
> ...


You aren't missing anything. It's Kobo that is. Removing my books for sale, but keeping the price-slashed listings, _does me no good at all_. I am losing money every day that my books remain listed on Kobo with discounted prices. This kind of sloppiness and disregard for authors is another reason why I am opting out of Kobo until they can prove they are reliable, trustworthy and competent. And that day appears to be a ways off.

As you can probably tell, I am very angry about this. I am losing money every day that this screw-up drags on.

Lee


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## Will Write for Gruel (Oct 16, 2010)

Mistakes happen, but I have trouble understanding how you can change the code that affects pricing and not test it enough to see this behavior during the testing phase. I wonder if it is deliberate on Kobo's part in an attempt to drive sales? 

Anyway, the smokescreen of trying to deflect criticism onto Amazon is a bit annoying too. Sure, Amazon should send out emails and wait 48 hours for a reply before changing prices and hire staff to answer all the emails and engage in a back and forth dialog with each indie publisher, while during all this time they are being undersold by Kobo -- in a fantasy world that might happen.


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## Will Write for Gruel (Oct 16, 2010)

modwitch said:


> Been there, seen it happen. I understand how it could have rolled out. It's a lot less acceptable that it's taking this long to fix. I know how that happens too - this was probably part of a larger code release, and they can't just roll back one part. But I can only imagine this is immensely frustrating.


Even if they rolled back the code that wouldn't necessarily change the prices back. They're not going to do a restore and lose a day's worth of data.

I used to work in software development so I know how easy it is to release code with nasty bugs -- we released something once that caused the program to hang when the daylight savings time rollover happened. That was fun, going into customer site after site to do a quick fix to keep their data collection process from dying.

But when you're releasing code that you know affects customer pricing, I'd hope you would test it over and over again. Maybe they instituted some kind of emergency fix and didn't have time for thorough testing, though.

I'd expect Kobo to release a statement at some point to explain what happened.


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## LeeGoldberg (Jun 12, 2009)

It looks like my Smashwords books are off of Kobo...now I just have to get Amazon to quickly jack my prices back up to where they were before.

I appreciate Kobo and Smashwords resolving this issue for me.  

Lee


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## BlakeCrouch (Apr 18, 2010)

I hear what Mark's saying about not putting all your eggs in one basket with Amazon, but I don't think that Amazon's behavior toward Indie author's can be called predatory. Many of us are having an amazing year simply BECAUSE of Amazon who stepped in and bumped a royalty rate to 70% last June. Amazon has always been about having the lowest price. That is their model beyond anything else. Like many others, I opted into Kobo on the assurance that there would be no discounting. If it was an accident, I believe that, but most of my sales still come from Amazon and to be honest, Kobo has yet to show me ANYTHING. I have titles, namely RUN, which I uploaded several months ago that Kobo hasn't gotten around to listing, which are doing gangbusters elsewhere. It's time for Kobo to demonstrate why I should upload my next work, because I'm not really feeling it at the moment.


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## Will Write for Gruel (Oct 16, 2010)

Has anyone had their price raised instead of lowered by Kobo and their software glitch? 

It's hard for me to understand a coding error that arbitrarily lowers pricing. I assume Kobo has their own web crawlers and will price match and that somehow this is behind the problem, but I still can't grok how if those crawlers don't actually see a different price they activate a price change. 

Kobo really needs to issue a statement after this mess is cleared up. Mark Coker is not their spokesperson.


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## LeeGoldberg (Jun 12, 2009)

T.L -- That's _exactly_ why I have taken my books off of Kobo. The financial risk is way too high to keep them there. And by the way, the financial scenario you just posed is probably not far from how much money guys like Joe Konrath and some of Smashword's other big sellers have lost this week because of this snafu.

But you don't have to be at their level to feel the pain in your wallet.

Let's take a far more modest example that more folks here can relate to. Let's say you're selling 500 books a week at $2.99 on Amazon. At the 70% royalty, you'll earn $1030. If a Kobo glitch knocks you down to 99 cents (and a 35% royalty), you'll earn $175 on the same number of sales. But let's be generous, let say your sales double as a result of the discount, you'll earn $350. So you'll lose $680 because of their error.

Being on Kobo right now just isn't worth the risk.

Lee


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## Gordon Ryan (Aug 20, 2010)

Day three and each of my books is still at .99 / .59 and the equivalent for the 2.99 / 1.59. Again, this is not hurting me financially because my sales are not that high, but the problem continues to exist. See the prices for yourself and then check your own books.

http://www.kobobooks.com/search/search.html?q=gordon%20ryan&

Gordon Ryan


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## daringnovelist (Apr 3, 2010)

Asher MacDonald said:


> Kobo really needs to issue a statement after this mess is cleared up. Mark Coker is not their spokesperson.


Frankly, I think Kobo needs to do more than fix their own listings. They need to step up and take responsibility for lobbying Amazon to correct the prices on Amazon.

At the same time, I really agree with Mark that we should be looking at the Big Picture. It isn't like this kind of problem is unprecedented, or that we don't know that we don't have direct control of prices, etc. This is only an outrage if you believe you have full control, and aren't carrying any risk.

indie publishing means you take the risks.  It's how business is. Sometimes you take a loss for overall gain. It's nice when you have control over that loss... but frankly, that's just not how the world works. There are floods, there are fires. There is road construction right in front of your restaurant. Gas leaks and train derailments. Sometimes a person with your name commits a horrible crime and becomes famous, and people turn away from your stuff because of it. (Imagine, for instance, being actor Mark Lindsey Chapman, who was just perfect to play John Lennon in a bio pic, but because of his name, he lost the job.)

Sometimes those things are somebody's fault. Sometimes you can take action. But just because it is someone's fault doesn't mean you should get more upset and be less prepared than you are for the things that are nobody's fault.

IMHO, we should always be emotionally and financially prepared that our books may go on involuntary sale once in a while. Hey, at least to the consumer it's a benefit. That is way better than losing income because Amazon's site went down.

This is not to criticize those who got upset. Yeah, bad stuff happened. This is just a reminder that bad stuff DOES happen. All the time. That's why insurance was invented. (And, btw, that's also a very good argument in support of what Mark Coker said. By supporting other vendors along with Amazon -- even if it costs us something once in a while -- it is like the origins of mutual insurance. It really does lower our risk of losing EVERYTHING, rather than just the annoyance of losing something, if we have more options out there.)

Camille


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## HelenHanson (Sep 13, 2010)

Mark Coker is a brave, diplomatic man wedged between the rock and the hard place.  As a smart business owner, he would view Kobo as both a customer and a supplier.  He's earned my respect for trying to plug the dike.

I'm in the middle of publishing on SW, but I will be opting out of Kobo.  I've manged multiple web software launches, and it's important to have a known, good roll-back position in case the thing blows.  This is part of best practices or basic survival.   When you still have teeth marks in your posterior from the last blow-up, you make triple-dog certain that you at least tick-off new people next time.  Anything less is either lame or intentional.


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## R. Barri Flowers (Apr 12, 2011)

I have yet to join Smashwords, but plan to do so soon and will certainly take note of issues with Kobo as I navigate the eBook waters. -- Barri


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## Kobo Ashleigh (Apr 14, 2011)

Thank you for your comments and patience with us as we worked to correct an issue that caused discrepancies with some of your prices. As of today this issue has been corrected, and you will see appropriate prices reflected on the site.

Earlier this week, Lee Goldberg and others noticed that their titles were listed at the wrong price on Kobo. After investigating on our end, it was discovered that an older pricing file was used in an update that attached incorrect pricing to some Smashwords titles. These titles weren't being discounted from the original prices - but out of date pricing was applied to these titles. (The older file lowered some prices and raised some others.) This was not a deliberate action to discount and beat Amazon's list prices; we are fully aware of the issues that this can cause to authors and work hard to avoid it. Instead it was an honest technical mistake, one that we've taken very seriously to correct and ensure doesn't happen again.

Correct pricing is something very important to us at Kobo, and I would like to assure that this problem was an issue at the highest levels of our team until it was corrected. I'd love to be able to promise that we'll never have another error, but unfortunately that isn't realistic for any website. Issues with code can and do happen at all websites, regardless of how extensive the QA and deployment process is. What I can promise is that we will continue to work to correct any errors as quickly as possible.

We understand that in addition to hurting your trust with Kobo, some of you have expressed disappointment with Smashwords. I can assure you that Mark and Bill take every request seriously - and are quick to respond and escalate any issues direct to Kobo. Once Mark was notified he immediately began working with us to correct the issue. Now that the issue is corrected, we're looking at how we can improve our processes even further to give you more control of your distribution and pricing.

We'd hate to see any of you opt out of distribution through Smashwords. Today, Kobo has over 3 million users, and customers in over 100 countries worldwide. In addition to our global store, we offer locally merchandised stores in US, Canada, UK, Australia, New Zealand, and Hong Kong - with an announcement this week to launch local stores in Germany and Spain this May. We're dedicated to providing authors and publishers greater distribution in more places and on more devices than ever before. We'd love your books to be part of that. We're excited to have you with us as we grow, and we truly apologize for any issues caused to our authors with their other retail partners.

If anyone has any questions or concerns, I'd love to talk further at [email protected]

Ashleigh Gardner
Kobo | Content Manager


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## Kobo Ashleigh (Apr 14, 2011)

T.L. Haddix said:


> May I snark, just for a line or two or six? Lee *Greenberg*, whoever you are, please come to KB and tell us how you feel! Oh, and are you related to Lee *Goldberg*, by chance? You know, the guy who lost a significant chunk o' change this week thanks to outdated pricing being applied?
> 
> Out of date pricing? Uhm. Okay. Just how out of date are we talking, because Agency pricing has been in effect for months now...
> 
> ...


Ugh. Totally mortified. Can we chalk this up to a mistake made at the end of a long few days? I'm deeply apologetic, Lee.

As for the out of date pricing - agency has been in effect with smashwords for months - the issue in this case wasn't discounting - we were offering these titles at the (unfortunately, old) list price. The recent issue was caused when an old pricing file delivered to us from smashwords was added into the system as a new update - reverting prices back.

We've diagnosed why this issue happened, corrected with a full update provided by Bill and Mark, and made system improvements to ensure this error doesn't happen again.


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## Kobo Ashleigh (Apr 14, 2011)

Gordon Ryan said:


> Day three and each of my books is still at .99 / .59 and the equivalent for the 2.99 / 1.59. Again, this is not hurting me financially because my sales are not that high, but the problem continues to exist. See the prices for yourself and then check your own books.
> 
> http://www.kobobooks.com/search/search.html?q=gordon%20ryan&
> 
> Gordon Ryan


Hi Gordon,

Your titles are correctly priced in territories where Smashwords is Agency. This contract does not yet extend to AU/NZ, but we're definitely working towards this.


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## Edward C. Patterson (Mar 28, 2009)

Mine are back to normal. Thanks, Mark.

Edward C. Patterson


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## Terrence OBrien (Oct 21, 2010)

_"Your titles are correctly priced in territories where Smashwords is Agency. This contract does not yet extend to AU/NZ, but we're definitely working towards this."_

Will a lower price in AU/NZ trigger an Amazon price match?


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## Emma Midnight (Feb 19, 2011)

Kobo Ashleigh said:


> Ugh. Totally mortified. Can we chalk this up to a mistake made at the end of a long few days? I'm deeply apologetic, Lee.
> 
> As for the out of date pricing - agency has been in effect with smashwords for months - the issue in this case wasn't discounting - we were offering these titles at the (unfortunately, old) list price. *The recent issue was caused when an old pricing file delivered to us from smashwords was added into the system as a new update - reverting prices back.*
> 
> We've diagnosed why this issue happened, corrected with a full update provided by Bill and Mark, and made system improvements to ensure this error doesn't happen again.


Curiouser and curiouser. So Amazon's "wet dream," as Mark Coker so diplomatically stated, was the result of Smashwords delivering an obsolete file to Kobo? I'm sure Amazon is glad to know who to finally thank!


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## mscottwriter (Nov 5, 2010)

Until this thread popped up, I'd never heard of Kobo.  So I checked it out, and neither of my Smashwords books are on there.  Does Smashwords automatically link titles to Kobo, or is that something an author has to do for herself?  (Although, after reading through the thread, I'm not sure that would be a good thing...)


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## LeeGoldberg (Jun 12, 2009)

Kobo Ashleigh said:


> As for the out of date pricing - agency has been in effect with smashwords for months - the issue in this case wasn't discounting - we were offering these titles at the (unfortunately, old) list price. The recent issue was caused when an old pricing file delivered to us from smashwords was added into the system as a new update - reverting prices back.


So, if I am reading you correctly, this wasn't just a Kobo problem. This was a Smashwords problem as well.

Lee


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## LeeGoldberg (Jun 12, 2009)

T.L. Haddix said:


> May I snark, just for a line or two or six? Lee *Greenberg*, whoever you are, please come to KB and tell us how you feel!


I'd cut her a break on that score, T.L. God knows, I make plenty of typos and errors in my emails...especially after a long day dealing with one crisis after another. I can assure you that no offense was taken on my part.

Lee


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## Linda Acaster (May 31, 2010)

_*...was the result of Smashwords delivering an obsolete file to Kobo?...*_

Really? Well, my _Beneath The Shining Mountains_ has always been the equivalent of $2.99 yet it sits on Kobo as I type at UK Sterling £1.79 discounted 21% from the "retail price" of £2.27. I have no idea what USA users can see on their screens, as that is all that comes up on mine reading from England. And the same goes for _Hostage of the Heart_ (which Amazon has not noticed and price-matched - yet).

It is interesting to note that neither of the others, uploaded to Smashwords in December, are showing up on Kobo. Perhaps I should be thankful.


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## Emma Midnight (Feb 19, 2011)

mscott9985 said:


> Until this thread popped up, I'd never heard of Kobo. So I checked it out, and neither of my Smashwords books are on there. Does Smashwords automatically link titles to Kobo, or is that something an author has to do for herself? (Although, after reading through the thread, I'm not sure that would be a good thing...)


If you opt for premium distribution from Smashwords they will try to publish your book on Kobo, iBooks, Diesel, and B&N unless you opt out of any of those markets.


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## LeeGoldberg (Jun 12, 2009)

THE WALK was $1.99 before Amazon started offering the 70% royalty at $2.99....but I don't think THREE WAYS TO DIE was ever 99 cents. I could be wrong, though. 

Lee


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## 13893 (Apr 29, 2010)

Kobo has Space Junque up for the right price, but has the wrong cover on it. I just opted out.


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## sgroyle (Aug 21, 2010)

Kobo Ashleigh said:


> After investigating on our end, it was discovered that an older pricing file was used in an update that attached incorrect pricing to some Smashwords titles. These titles weren't being discounted from the original prices - but out of date pricing was applied to these titles. (The older file lowered some prices and raised some others.) This was not a deliberate action to discount and beat Amazon's list prices; we are fully aware of the issues that this can cause to authors and work hard to avoid it.
> 
> Instead it was an honest technical mistake, one that we've taken very seriously to correct and ensure doesn't happen again.


Now this is a lie. Flat out. My book is still listed on your site at USD2.39. I have never dropped the price of my book from 2.99 (excluding coupon during Indie Books week). Likewise I never opted into Kobo until you agreed Agency pricing; so my book has never been on some old price list at 2.39. It clearly states on your website that as of today, right now, you are discounting my book 60 cents.

I think Mark's attitude to Amazon is wrong. Blaming them for the loss of income, when that has been caused by Kobo is backward to say the least. I have nothing against Smashwords or Mark, I think Smashwords does an OK job, but Kobo?... Unprofessional and now dishonest.


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## daringnovelist (Apr 3, 2010)

Folks! Before you jump all over Smashwords, read what was said carefully:

She did NOT say that Smashwords delivered an old file. They said that they USED an old file from Smashwords -- like, you know, one they had in their system (which what I've been saying they probably did) -- and they had Smashwords deliver a fresh file to correct the system with, because obviously they had their files mixed up and wanted to be sure of using the right one now.

(The other issues, yes, worthy of complaint -- they clearly haven't tracked down where they're getting their prices from.)

Camille


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## Kobo Ashleigh (Apr 14, 2011)

Emma Midnight said:


> Curiouser and curiouser. So Amazon's "wet dream," as Mark Coker so diplomatically stated, was the result of Smashwords delivering an obsolete file to Kobo? I'm sure Amazon is glad to know who to finally thank!


To clarify the issue - I did not mean to imply that the old file was delivered to us from Smashwords recently. The old file was delivered to us from Smashwords some time ago, but mistakenly reprocessed on our end as new. The error was of no fault of Mark and Bill at Smashwords.


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## Kobo Ashleigh (Apr 14, 2011)

sgroyle said:


> Now this is a lie. Flat out. My book is still listed on your site at USD2.39. I have never dropped the price of my book from 2.99 (excluding coupon during Indie Books week). Likewise I never opted into Kobo until you agreed Agency pricing; so my book has never been on some old price list at 2.39. It clearly states on your website that as of today, right now, you are discounting my book 60 cents.
> 
> I think Mark's attitude to Amazon is wrong. Blaming them for the loss of income, when that has been caused by Kobo is backward to say the least. I have nothing against Smashwords or Mark, I think Smashwords does an OK job, but Kobo?... Unprofessional and now dishonest.


Hi Simon - In the US and Canada - your title is listed at 2.99 without discounting.

Am I right in assuming you're viewing the site from Thailand? In Thailand your title is listed at 2.99 as your list price, but with a discount applied as the contract is wholesale in Thailand at the moment. Agency agreements are not yet approved worldwide, and hasn't come to every territory yet. There was no attempt to deceive on our part.


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## sgroyle (Aug 21, 2010)

Kobo Ashleigh said:


> Hi Simon - In the US and Canada - your title is listed at 2.99 without discounting.
> 
> Am I right in assuming you're viewing the site from Thailand? In Thailand your title is listed at 2.99 as your list price, but with a discount applied as the contract is wholesale in Thailand at the moment. Agency agreements are not yet approved worldwide, and hasn't come to every territory yet. There was no attempt to deceive on our part.


Yes, Ashleigh, I am in Thailand. No statement was made by either Kobo or Mark that Agency only applied to US and Canada... from Smashwords site: "Effective December 1, 2010, all Smashwords retailers switched to agency pricing, which means you set the retail price. Retailers don't discount unless they are price-matching a lower price elsewhere. It also means in most instances Smashwords has significantly increased our royalty rates..."

Anyway, I do not believe in Geographic specific pricing, nor did I understand (since it wasn't really made public) that my books would be discounted by you outside of the US or Canada. So just as soon as I have finished typing this reply I will be opting out of using your service, and I will be letting other authors know that Kobo is most likely discounting their books outside of US and Canada.


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## Emma Midnight (Feb 19, 2011)

sgroyle said:


> Now this is a lie. Flat out. My book is still listed on your site at USD2.39. I have never dropped the price of my book from 2.99 (excluding coupon during Indie Books week). Likewise I never opted into Kobo until you agreed Agency pricing; so my book has never been on some old price list at 2.39. It clearly states on your website that as of today, right now, you are discounting my book 60 cents.
> 
> I think Mark's attitude to Amazon is wrong. Blaming them for the loss of income, when that has been caused by Kobo is backward to say the least. I have nothing against Smashwords or Mark, I think Smashwords does an OK job, but Kobo?... Unprofessional and now dishonest.


If you ever had your book at $2.39 on Smashwords, even long before you were ever on Kobo, it's possible Kobo picked up that price. The Kobo rep said an old Smashwords file was at issue.


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## edwardgtalbot (Apr 28, 2010)

I personally don't sense an intent to deceive here. But it does sound like this can't be quite as simple as applying an old file, if books are being lowered to prices they never were at. 

This is not to slam Kobo.  I have not opted out (my sales don't really warrant it) at this point. I respect the fact that Ashleigh has come here to try to explain. And the whole concept of agency pricing combined with price matching inevitably leads to this kind of situation - as new vendors come on board, they WILL make mistakes. Nevertheless, the explanation from Kobo doesn't quite match the data authors are providing here (granted, I am taking authors at their word). And the main concern about that is not deception, it's a worry about whether the problem has fully been identified and resolved.


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## nomesque (Apr 12, 2010)

sgroyle said:


> Yes, Ashleigh, I am in Thailand. No statement was made by either Kobo or Mark that Agency only applied to US and Canada... from Smashwords site: "Effective December 1, 2010, all Smashwords retailers switched to agency pricing, which means you set the retail price. Retailers don't discount unless they are price-matching a lower price elsewhere. It also means in most instances Smashwords has significantly increased our royalty rates..."


From https://www.smashwords.com/dashboard/salesReport



> Effective December 1, 2010, no Smashwords retailers are allowed to discount your books, unless they're price matching a lower-priced competitor (Best practice: keep your prices consistent). Kobo may still discount titles for sales transacted outside the US and Canada for currencies other than US or Canadian dollars.


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## Shayne Parkinson (Mar 19, 2010)

Kobo Ashleigh said:


> Hi Gordon,
> 
> Your titles are correctly priced in territories where Smashwords is Agency. This contract does not yet extend to AU/NZ, but we're definitely working towards this.


That explains my prices, too, as I'm also in New Zealand (and I did know that agency pricing didn't necessarily apply outside the US and Canada). Mine are showing on Kobo as "List price: $1.29 Our price: $1.09", but Mark said they were showing as the correct $1.99 for him. I'm still a bit puzzled, though, as my list price has never been $1.29 (it's always been $1.99).


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## sgroyle (Aug 21, 2010)

nomesque said:


> From https://www.smashwords.com/dashboard/salesReport


Yes - and this is what it says on that page...
"Effective December 1, 2010, no Smashwords retailers are allowed to discount your books, unless they're price matching a lower-priced competitor (Best practice: keep your prices consistent). Kobo may still discount titles for sales transacted outside the US and Canada for currencies other than US or Canadian dollars."

All the prices are in USD... anyway Kobo is not a big portion of sales and their potential for screwing up remains fairly high. Sure, Kudos to Ashleigh for her proactive measures to appease, however I've already opted out.


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## nomesque (Apr 12, 2010)

sgroyle said:


> All the prices are in USD... anyway Kobo is not a big portion of sales and their potential for screwing up remains fairly high. Sure, Kudos to Ashleigh for her proactive measures to appease, however I've already opted out.


Ahhh, so in Thailand, Kobo is displaying prices in US$? Huh. Fair enough, then. Looks like clarification is required.


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## D.A. Boulter (Jun 11, 2010)

I'm in Canada and I've never priced Pelgraff at anything other than $2.99 or $3.99. Kobo has it for $2.87. That's definitely not a price they got from Smashwords. I've only ever priced my books with a 99c ending: $0.99; $1.99; $2.99: $3.99. So, I don't know where they got the 87c ending.


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## Linda Acaster (May 31, 2010)

Well I'm viewing from the UK so my prices are £sterling.

It's breakfast time here and overnight I received an email from Mark Coker (thanks, Mark) confirming that my prices on Kobo are not/no longer discounted - presumably on Kobo USA which I cannot get into (reading above Kobo seems to automatically default to your viewing region no matter what URL is used).

Yet the ebooks remain discounted to me in £sterling - by 21%. And it is THIS that Amazon looks like it's price-matching. It may only be price-matching on the Amazon UK site - it is very difficult to tell when trying to view Amazon US pages which have pricing hidden [can Shayne Parkinson in New Zealand & Simon Royle in Thailand confirm theirs?] So any copies I sell in Amazon UK will have its royalty slaughtered. I'm not selling many. But are YOU?

If you are in the USA presumably you have difficulty making out your UK pricing. To just pick two, Simon Royle's "TAG" and LK Rigel's "Space Junque" are both showing up on Amazon UK at £2.14 with no discounting, but on Kobo they are discounted by 21% to £1.79.

So what to do? If Amazon UK is price-matching Kobo UK's discounting, then I'll have to kick Kobo into touch. I'm not selling many on Amazon UK, despite the fact that I live here, but that is hardly the point. The UK is a very young market, and will grow. Kobo can be reconsidered when it gets its act together.


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## Debi F (Nov 10, 2010)

I have to admit that I'm very confused about how/why/whatever is behind the pricing at Kobo. 

My book, Summoning, has been listed at Smashwords at $2.99 since last October. When I check out Kobo now, my book has been "discounted" to $2.01 from a list price of $2.49. The book has never been $2.49, and that discount . . . where does that come from? 

Seriously considering opting out.


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## Shayne Parkinson (Mar 19, 2010)

Linda Acaster said:


> Well I'm viewing from the UK so my prices are £sterling.
> 
> It's breakfast time here and overnight I received an email from Mark Coker (thanks, Mark) confirming that my prices on Kobo are not/no longer discounted - presumably on Kobo USA which I cannot get into (reading above Kobo seems to automatically default to your viewing region no matter what URL is used).
> 
> ...


Linda, I'm not (yet) in the Kindle store, so I don't have any to check. But I took a look at yours, and they're showing as $2.99 (apart from one at $0.99), so I hope that means your Amazon US prices are okay.


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## Gordon Ryan (Aug 20, 2010)

Kobo Ashleigh said:


> Hi Gordon,
> 
> Your titles are correctly priced in territories where Smashwords is Agency. This contract does not yet extend to AU/NZ, but we're definitely working towards this.


Ashleigh, thank you for your response and I do in fact understand that my PC address triggers overseas responses, however, on no platform in any of my listings have I ever chosen .59 as the price of my books, any of them. I fail to see how an old file from SW, with whom I have never listed below .99 (other than an occasional Free book) would have triggered this event.

Are you advising that within the US system (or where Agency applies) my work is listed at the same price as SW?

Thank you.

Gordon Ryan


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## Gordon Ryan (Aug 20, 2010)

Would one of my colleagues within the US borders, check this page and see if my prices are at the .99 or 2.99 range? I see them at .59 and varied up the ladder.

http://www.kobobooks.com/search/search.html?q=gordon%20ryan&

Thanks to whomever can have a look for me. Phil Chen, you awake yet?

Gordon Ryan


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## Carl246 (Apr 10, 2011)

Gordon Ryan said:


> Would one of my colleagues within the US borders, check this page and see if my prices are at the .99 or 2.99 range? I see them at .59 and varied up the ladder.
> 
> http://www.kobobooks.com/search/search.html?q=gordon%20ryan&
> 
> ...


Yes they are all either $0.99 or above.

Carl


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## JoeMitchell (Jun 6, 2010)

Gordon Ryan said:


> Would one of my colleagues within the US borders, check this page and see if my prices are at the .99 or 2.99 range? I see them at .59 and varied up the ladder.
> 
> http://www.kobobooks.com/search/search.html?q=gordon%20ryan&
> 
> ...


Gordon, I see a couple for .99 and most for $2.99.


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## Gordon Ryan (Aug 20, 2010)

Carl and Joe, thank you both for your assistance.  That solves the US pricing issue, but I have a remaining question for Kobo, ala Ashleigh.  Is Kobo discounting outside the US since Agency does not apply?

Gordon Ryan


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## Linda Acaster (May 31, 2010)

Shayne Parkinson said:


> Linda, I'm not (yet) in the Kindle store, so I don't have any to check. But I took a look at yours, and they're showing as $2.99 (apart from one at $0.99), so I hope that means your Amazon US prices are okay.


Thanks, Shayne. That puts my mind at rest for Amazon USA. So it's just Amazon UK that is being price-matched to Kobo £sterling page. Hmmpf!

And I think that's the answer to your question, Gordon. In fact... trust you to have loadsa books up... On the first page of 10, State of Rebellion, Spirit of Union - Destiny and Threads of Honor are showing on Kobo in the UK as 71p with no discounting (equivalent to 99c) but the others -all of which may or may not be yours looking at the covers but show up under a Gordon Ryan search - are list-price £2.27, discounted 21% to £1.79, like mine are. Callahan's Trilogy is listed as £3.71 discounted 23% to £2.87. None of these seem to be price-matched on Amazon UK, they are all selling at the listed price. Hope that helps you.

Linda


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## Kobo Ashleigh (Apr 14, 2011)

D.A. Boulter said:


> I'm in Canada and I've never priced Pelgraff at anything other than $2.99 or $3.99. Kobo has it for $2.87. That's definitely not a price they got from Smashwords. I've only ever priced my books with a 99c ending: $0.99; $1.99; $2.99: $3.99. So, I don't know where they got the 87c ending.


Hi D.A.

We currently only get one price from Smashwords - USD. For our Canadian customers, we get our list price by converting this price to the local currency. What you're seeing is the calculation against our recently strong Canadian dollar.

I've spoken to Bill and Mark about expanding the pricing files we get - and we'll be doing this shortly to provide you with more control over the pricing in multiple currencies.


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## HelenHanson (Sep 13, 2010)

Linda Acaster said:


> I have no idea what USA users can see on their screens, as that is all that comes up on mine reading from England. And the same goes for _Hostage of the Heart_ (which Amazon has not noticed and price-matched - yet).


2.99 at Amazon and Smashwords, for the record.


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## Linda Acaster (May 31, 2010)

Thanks, Helen.


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## Guest (Apr 15, 2011)

sgroyle said:


> I think Mark's attitude to Amazon is wrong. Blaming them for the loss of income, when that has been caused by Kobo is backward to say the least. I have nothing against Smashwords or Mark, I think Smashwords does an OK job, but Kobo?... Unprofessional and now dishonest.


Actually, Mark is correct. Ultimately the problem is Amazon making the producer pay for a sale ran by a competitor. It is one thing if I, as the publisher, offer my book on Amazon at one price and on Kobo at another. It is something quite different if I set my price the same on BOTH SITES and one site decides to discount it. Effectively, Amazon changes the wholesale amount of your product in order to lower the price.

For example: let's say I am selling a widget (we love to talk about widgets). I list the retail price of that widget as $2.00. Vendors pay 50 cents for the widget, and then can sell it for $2 to make $1.50 profit. Now ABC Discount decides to sell the widget for $1.25, even though I offered the identical retail price to all vendors. They decide to sell for below retail to increase volume. Amazon decides to match the price of the widget. Would it be acceptable for Amazon to come back to me and say "We're only going to pay you .25 for the widget, because ABC placed the widget on sale." Amazon effectively forces an unfair competitive advantage for themselves, because while ABC has to eat the discount they decide to offer, Amazon can match the deal at MY EXPENSE.

So yes, Kobo screwed up. But it is a screw up NOBODY would care about were it not for the fact that Amazon unfairly makes us pay for it.


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## Guest (Apr 15, 2011)

Bards and Sages hit on one of the problems we need to solve.

As I understand it, Microsoft charges a fee for computer makers to install its operating system. If Dell, HP, or whoever, discounts their computers, it doesn't hurt Microsoft because its fee is unchanged. The computer maker can give its product away, but Microsoft still has its fee.

Here's a similar proposal for us independents. It might sound out of left field unless you keep the Microsoft example in mind.

If we price our book at 2.99, then Amazon, and other sellers owe us 70%. If Amazon wants to discount it, regardless of the reason, it still owes us 70% of 2.99

One of the major reasons that traditional publishers are failing is that they allowed the distributors and retailers set the rules. Barnes and Noble was created when a young fellow realized that the publishers allowed their books to go out on consignment. Thus the super bookstore was born. Its whole book stock came to the store free.

If a hot book sold out, B&N reordered, even if it had not yet paid for its first shipment. This started the spiral of larger press runs. Then months down the road, B&N would return overstocks to the publisher for refund.

Now the advent of e-books allows us to wear the publisher's hat. We can control our destiny.

But can we?

We now are now putting our money up front to pay decent book covers, and in some cases professsional editing and formating.

But this bumps us up against the other rule that could destroy us just as it is destroying trad publishers.

in this age of compterized bookkeeping, the distributors and retails still insist on holding onto our royalties for 60 to 90 days after the month of sale.

If we pay $150 or more for professional book covers, etc., how long can we last with a royalty on a 99-cent product behing held up this long?

As individuals we are powerless. But we need to figure out a way to resolve these, and other issues.

Can we as an association or guild insist on pre-payments (pay us upfront royalties for the first 100 sales, etc.) or at least insist on payment the day after the return period expires (B&N has a 14-day return policy).


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## daringnovelist (Apr 3, 2010)

Bards and Sages (Julie) said:


> Actually, Mark is correct. Ultimately the problem is Amazon making the producer pay for a sale ran by a competitor. It is one thing if I, as the publisher, offer my book on Amazon at one price and on Kobo at another. It is something quite different if I set my price the same on BOTH SITES and one site decides to discount it. Effectively, Amazon changes the wholesale amount of your product in order to lower the price.
> 
> For example: let's say I am selling a widget (we love to talk about widgets). I list the retail price of that widget as $2.00. Vendors pay 50 cents for the widget, and then can sell it for $2 to make $1.50 profit. Now ABC Discount decides to sell the widget for $1.25, even though I offered the identical retail price to all vendors. They decide to sell for below retail to increase volume. Amazon decides to match the price of the widget. Would it be acceptable for Amazon to come back to me and say "We're only going to pay you .25 for the widget, because ABC placed the widget on sale." Amazon effectively forces an unfair competitive advantage for themselves, because while ABC has to eat the discount they decide to offer, Amazon can match the deal at MY EXPENSE.
> 
> So yes, Kobo screwed up. But it is a screw up NOBODY would care about were it not for the fact that Amazon unfairly makes us pay for it.


Well, yes, but it's a problem we explicitly signed up for with the 70% option. We get the higher royalty to take that risk.

The issue, imho, isn't that Amazon does this, but that they make it so hard to correct. As Mark said, there should be warnings. They used to suspend books, now they only match the price. A match price plus warning with an efficient trouble-shooting process would make a world of difference.

Camille


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## Terrence OBrien (Oct 21, 2010)

_"Would it be acceptable for Amazon to come back to me and say "We're only going to pay you .25 for the widget, because ABC placed the widget on sale." _

Yes, if you signed a contract with Amazon containing those terms.

No, if you signed a contract with Amazon with different terms.


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## Emma Midnight (Feb 19, 2011)

daringnovelist said:


> Well, yes, but it's a problem we explicitly signed up for with the 70% option. We get the higher royalty to take that risk.
> 
> The issue, imho, isn't that Amazon does this, but that they make it so hard to correct. As Mark said, there should be warnings. They used to suspend books, now they only match the price. A match price plus warning with an efficient trouble-shooting process would make a world of difference.
> 
> Camille


It would be nice if there was an automated email sent when Amazon changed pricing. I'm not sure what else Amazon would do. They don't really want to deal with a thousand email replies from small publishers. If they have to start staffing for that kind of interaction, they'll pass the cost back to us.


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## Gordon Ryan (Aug 20, 2010)

Linda Acaster said:


> Thanks, Shayne. That puts my mind at rest for Amazon USA. So it's just Amazon UK that is being price-matched to Kobo £sterling page. Hmmpf!
> 
> And I think that's the answer to your question, Gordon. In fact... trust you to have loadsa books up... On the first page of 10, State of Rebellion, Spirit of Union - Destiny and Threads of Honor are showing on Kobo in the UK as 71p with no discounting (equivalent to 99c) but the others -all of which may or may not be yours looking at the covers but show up under a Gordon Ryan search - are list-price £2.27, discounted 21% to £1.79, like mine are. Callahan's Trilogy is listed as £3.71 discounted 23% to £2.87. None of these seem to be price-matched on Amazon UK, they are all selling at the listed price. Hope that helps you.
> 
> Linda


Linda, thanks for your detailed check and info regarding the UK site. It would seem that Kobo policy varies internationally. We have surfaced a problem issue with which most of us were unaware. Time for consideration.

And as to "lotsa" books, I should only have about 12 or 13, depending on the day. More coming soon.

Gordon Ryan


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## sgroyle (Aug 21, 2010)

Bards and Sages (Julie) said:


> Actually, Mark is correct. Ultimately the problem is Amazon making the producer pay for a sale ran by a competitor. It is one thing if I, as the publisher, offer my book on Amazon at one price and on Kobo at another. It is something quite different if I set my price the same on BOTH SITES and one site decides to discount it. Effectively, Amazon changes the wholesale amount of your product in order to lower the price.
> 
> So yes, Kobo screwed up. But it is a screw up NOBODY would care about were it not for the fact that Amazon unfairly makes us pay for it.


I disagree. Amazon clearly states in their contract with me that they will price match. I know this going in when I sign up to get the 70% I get from them. I am aware that if I decided to price my book at .99 on Smashwords, then they will match that price, and my "commission" will drop to 30%. They state this very clearly - so not a surprise and therefore, because I signed up for it, not unfair. Every time I buy a book I have the opportunity to tell Amazon about a lower price, if I have seen one somewhere else.

Whereas, the following, is what was presented on Smashwords... note the comments about _"for currencies other than US or Canadian dollars"_; the only currency I see on Kobo's site is USD (I know what they mean, but the wording is less than perfect and ends with misunderstanding).

"Kobo sales earn you 60% retail price for books priced under $12.99 for sales transacted in US or Canadian dollars. *All other Kobo sales earn 38% of your list price*. Effective December 1, 2010, *no Smashwords retailers are allowed to discount your books, unless they're price matching a lower-priced competitor* (Best practice: keep your prices consistent). Kobo may still discount titles for sales transacted outside the US and Canada for currencies other than US or Canadian dollars."

So yes Kobo screwed up and it wouldn't affect me if I am not listed at Kobo - simple.


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## William Campbell (Feb 11, 2010)

Kobo hasn't discounted any of my Smashwords distributed titles. Neither has anyone else, distributed by Smashwords or directly from me -- except Amazon. They've discounted Apotheosis at $2.51 down from $2.99.

?

Just a whim, I suppose.

Not that it matters. It would take 3 months (if not more) to get out of Kobo anyway. I'm not changing my distribution settings at Smashwords.


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## edwardgtalbot (Apr 28, 2010)

I certainly understand authors pulling their books from Kobo.  But the argument over whose fault it is I think misses the point. Yes, Kobo is the one who made the mistake.  Yes, it wouldn't be a problem if Amazon wasn't so aggressive about price matching (but B&N,Apple, etc price match too in theory)

If we are going to blame anyone, blame the big publishers and Apple.  They're the ones responsible for agency pricing.  Combine agency pricing with price matching, which is a perfectly reasonable retail practice, and the commission adjustment if price matching gets you below $2.99, which is necessary in an agency pricing environment if Amazon wants their commission tiers to mean anything.  The result is that this is inevitable and will happen MORE going forward, not less.

Imagine for a second that B&N and Apple and Amazon all have systems that can instantly scout the other sites for pricing.  If you EVER put your book on sale, you theoretically risk never having it raised back up without removing your book from all but one of those sites. Say you raise your price on both sites.  But Amazon won't raise it until it sees it raised on B&N and B&N won't raise it until it sees it raises on Amazon. This isn't quite what is happening now, but it will. If it doesn't, then price matching fails for the retailers.

Agency pricing plus price matching is an impossible combination to work correctly unless the retailers doing price matching are willing to allow authors a grace period for price changes.  None of the major ones do currently. There are other variations that might work too.  But I'm not aware of any of the agency retailers that have something in place to address this logistical catch-22.  Amazon just happens to be the most aggressive price-matcher and the largest retailer, so they're the most obvious when things go wrong.


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## BTackitt (Dec 15, 2008)

William Campbell said:


> Kobo hasn't discounted any of my Smashwords distributed titles. Neither has anyone else, distributed by Smashwords or directly from me -- except Amazon. They've discounted Apotheosis at $2.51 down from $2.99.


William, your culprit isn't smashwords/kobo.... it's Googlebooks. I just checked.. it is listed at $2.51 there.


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## daringnovelist (Apr 3, 2010)

edwardgtalbot said:


> I certainly understand authors pulling their books from Kobo. But the argument over whose fault it is I think misses the point. Yes, Kobo is the one who made the mistake. Yes, it wouldn't be a problem if Amazon wasn't so aggressive about price matching (but B&N,Apple, etc price match too in theory)


Which raises the question: would it be a problem if Amazon didn't make us so much money? When anyone else does what Amazon does, people don't complain. They don't mind.

Let's face it, it isn't even that Amazon is so powerful and can get away with aggressive behavior. When other retailers do the exact same thing, we don't really care -- we hardly even notice. So _all_ the retailers get away with the same behavior.

This isn't actually a case of "losing" money, but not getting as much from a vendor which gets us a whole lot more than anyone else. So we complain about them doing things we wouldn't even blink at with other vendors.

Camille


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## William Campbell (Feb 11, 2010)

BTackitt said:


> William, your culprit isn't smashwords/kobo.... it's Googlebooks. I just checked.. it is listed at $2.51 there.


Ah ha! The one I didn't check. And probably the one wildcard in all this. Google seems to play by their own rules. I didn't even think Amazon was paying attention to Googlebooks, but now we know, they are. Interesting...


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## Guest (Apr 16, 2011)

to T.L. Haddix
____________

What accounting nighmare are you talking about?

Years ago I worked at a B. Dalton bookstore. At the end of the day, I hit a key on the cash register and it computed the number of books sold by ISBN number and title.
That info was then automatically sent to the B. Dalton national headquarters. B. Dalton received the sales figures, by ISBN and title, from its hundreds of stores across the country.
I never heard anyone from the B. Dalton headquarters talk about an accounting nightmare.

Now we're dealing with newer, faster computers, and payment systems like PayPal.

If Barnes and Noble has a 14-day return policy on physical books, then it knows by day 15 that there will be no more returns on my book and no need to hold a reserve longer than that 14-day period, then I would not be unreasonable in expecting payment on the 15th day.

There is no accounting nighmare. B&N knows exactly what books were sold yesterday, or 14 days ago.

This is the computer age.

They insist on holding our money for 60 to 90 days to earn interest on the float.

This is one of the major things killing the trad publishers. If we take on extra expenses, like book covers, editing, etc., then we are going to get bitten, too.

And these would not be ordinary business expenses for us if we stay in the trad publishing fold.


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## William Campbell (Feb 11, 2010)

Okey Dokey said:


> in this age of compterized bookkeeping, the distributors and retails still insist on holding onto our royalties for 60 to 90 days after the month of sale.


Better than being trade published and waiting six or more months (in an ideal world).

Besides, it's part of doing business, and as an independent author/publisher, we are now business-people, not employees. In business, everything to do with finances has delay between one link in the chain to the next. In my business (printing), though invoices say due in 30 days, 90 is far more common, to be realistic, given labor that can't be floated, and material that we put off paying because we haven't been paid yet... round and round the circle goes. It's a fact of life for business owners that the employed (paycheck every two weeks like clockwork) often overlook.


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## CraigInOregon (Aug 6, 2010)

I think this is interesting: Amazon gets the heat over their policies. Why? Because Amazon results in more sales than any other outlet.

Now, I know the apologists and arguments.... Last year, Kindle had 70 percent of the market... now they have 55 percent and falling.

Yeah, that'd worry me... in a stable or shrinking market. But that's not where eBooks are right now. At all.

The eBook market is exploding; it's huge, and it's only getting bigger, at the moment. So having 55 percent of a much bigger pie is better than having 70 percent of a much smaller one.

The key to seeing through the anti-Kindle/anti-Amazon rhetoric is this: are there significantly fewer Kindle owners today than there were a year ago, or significantly more?

My point is, Amazon's not hurting in real numbers; the fact that there are more devices and competitors out there is a good thing.

If one could invest in either eBook futures or trade paperback futures, I know where my money would be placed.

And that's why the missteps by a much smaller outlet hurts; Amazon is still the source of the bulk of eBook sales. If Kobo were really competitive with Amazon, no one would care as much, because they'd be earning just as much from other sources.

Sure, I get the other side of the argument; Amazon price-matching Kobo is kind of like Coca-Cola stands price-matching a 10-year-old's lemonade stand. The presupposition is that "Amazon's so big, they shouldn't care about this lemonade stand's pricing for icy-cold beverages."

Trouble is, what if they did ignore Kobo? Pretty soon, Kobo'd get pretty big for its britches, start advertising "Our prices are ALWAYS lower than Amazon," and pretty soon they'd have a chance to get a foothold and become a real threat.

So yeah, I understand what both sides are thinking.


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## nobody_important (Jul 9, 2010)

Bards and Sages (Julie) said:


> Actually, Mark is correct. Ultimately the problem is Amazon making the producer pay for a sale ran by a competitor. It is one thing if I, as the publisher, offer my book on Amazon at one price and on Kobo at another. It is something quite different if I set my price the same on BOTH SITES and one site decides to discount it. Effectively, Amazon changes the wholesale amount of your product in order to lower the price.
> 
> For example: let's say I am selling a widget (we love to talk about widgets). I list the retail price of that widget as $2.00. Vendors pay 50 cents for the widget, and then can sell it for $2 to make $1.50 profit. Now ABC Discount decides to sell the widget for $1.25, even though I offered the identical retail price to all vendors. They decide to sell for below retail to increase volume. Amazon decides to match the price of the widget. Would it be acceptable for Amazon to come back to me and say "We're only going to pay you .25 for the widget, because ABC placed the widget on sale." Amazon effectively forces an unfair competitive advantage for themselves, because while ABC has to eat the discount they decide to offer, Amazon can match the deal at MY EXPENSE.
> 
> So yes, Kobo screwed up. But it is a screw up NOBODY would care about were it not for the fact that Amazon unfairly makes us pay for it.


Amazon has no way of knowing whether or not the sale was Kobo's decision or your decision. Amazon is not privy to the contract / agreement that you have with another vendor.

That's the danger of signing an agency pricing agreement with Amazon, which is what their KDP program is. If you don't like it, you can sign another contract with them as a publisher. There are publishers that do not participate in KDP or agency. Or you can simply choose not to distribute through Amazon.


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## daringnovelist (Apr 3, 2010)

NadiaLee said:


> That's the danger of signing an agency pricing agreement with Amazon, which is what their KDP program is. If you don't like it, you can sign another contract with them as a publisher. There are publishers that do not participate in KDP or agency. Or you can simply choose not to distribute through Amazon.


Or, actually, you can sign up for the 35 percent option with Amazon,

Camille


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## David Derrico (Nov 18, 2009)

Amazon wants to offer the lowest prices. If we're going to undercut them elsewhere, they'll just remove our books and make do with the other 915,999 Kindle titles. They'd rather do that than get a reputation for being undercut.

Back in the retail model, if Amazon paid us $X per book and could sell it at any price they wanted -- and if we charged that same price to every other vendor -- it would be an even playing field and Amazon would have no problem matching other discounts and still giving us our $X.

The problem here is that there is no standard price -- not every vendor pays 70%, although it's getting closer. Until recently, Kobo and Sony paid 40 or 50%. B&N still pays 65%. On top of that, royalty rates are different in different countries (Amazon now pays 70% in the UK, and Kobo pays 38%).

And, in general, we don't care -- we still publish on B&N even though they only offer 65%. And Amazon, understandably, doesn't want us giving a better deal to competitors, because then Amazon can't necessarily offer the best price or even match the price. Back in the print world, they had clauses in contracts with publishers preventing this, or they'd pick up the phone and talk to Random House and get Random House to match the deal they were offering B&N. But Amazon's not gonna bother with that for 100,000 indies. So they handle it on their end with much less fuss by automatically matching the discount.

Don't get me wrong, I'm not in love with the practice, and Amazon's bugs in the early days of the system mistakenly de-listed my books and cost me money, but I understood what I was signing up for with Amazon's 70% program, and it's still worth doing.


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## David Derrico (Nov 18, 2009)

One other note: it's interesting that some people might be blaming Kobo for Google's discounting. Google is now the only publisher who will intentionally discount, AND they discount to truly bizarre and ineffective prices like $3.03. Also, I have not seen one solitary sale from Google ever, and I don't have high hopes for them as an e-book retailer. They have no device and their store is a disaster. So if you're looking for somewhere to opt out of, I'd drop Google instead of Kobo in a heartbeat. At least Kobo creates some sales, and they've been helpful when I've had dealings with them.

Mark (if you're still hanging around), maybe you could distribute to Google and get them to agree to agency / no discounting? Then I'd remove my books from Google directly and go through Smashwords for Google in a second.


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## Shayne Parkinson (Mar 19, 2010)

David Derrico said:


> Mark (if you're still hanging around), maybe you could distribute to Google and get them to agree to agency / no discounting? Then I'd remove my books from Google directly and go through Smashwords for Google in a second.


David, see Mark's comments of Feb 5 2011 here: http://www.smashwords.com/about/beta. It's not for want of trying.


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## Guest (Apr 17, 2011)

sgroyle said:


> I disagree. Amazon clearly states in their contract with me that they will price match. I know this going in when I sign up to get the 70% I get from them. I am aware that if I decided to price my book at .99 on Smashwords, then they will match that price, and my "commission" will drop to 30%. They state this very clearly - so not a surprise and therefore, because I signed up for it, not unfair. Every time I buy a book I have the opportunity to tell Amazon about a lower price, if I have seen one somewhere else.


Agreeing to unfair terms do not make the terms less unfair. If someone is desperate enough for work, they may agree to work for below minimum wage. That agreement would still be wrong, however. Just because you agreed to poor terms does not make it someone else's fault with Amazon invokes those terms.

My books originally ported to Amazon from Mobipocket. Nothing in my Mobipocket contract allowed Amazon to reduce my royalty if a third party lowered the price. If I listed a book for a lower price elsewhere, then yes, I ate the difference. But so long as I did my part and had consistent list prices, it did not impact my royalties elsewhere. When they decided to port all Mobipocket publishers to KDP, I made a stink that they were effectively trying to force me to change my contract, and that there was no reason for me to have to eat the difference if someone else put my book on sale. Surprise, I haven't eaten a sales discount yet.

This is what I mean about fighting the RIGHT fights. There are things that CAN be fought, assuming you have a logical request that is within the boundries of normal business. I didn't ask Amazon to do something outside the norm. I asked them to honor our original deal and not play with my royalty so long as I was consistent with my list pricing. I certain agree with Amazon: authors should offer the same price to all vendors. That is not in dispute. But what IS in dispute is that I should not have to eat the difference because Amazon is too lazy to differentiate between a list price and a sale price.

Of course, all of this goes back to the Principle of Least Interest. The person with the least interest in a relationship has the most power. If you are not in a position to walk away, you have the least power. This is why it is important to have multiple sales outlets and not be dependent on one vendor. Too many indies have marketing plans that depend on Amazon sales rank. They don't know how to sell books without Amazon. THAT is a bigger problem than whether or not Kobo discounts.


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## Guest (Apr 17, 2011)

To T. L. Haddix
To William Campbell
______________________

We're on a merry-go-round here.

Campbell mentions that a 30-day invoice "but you pay in 90 days" is a standard practice.

Well, if I use a credit card to pay for cover design, format, etc., then I can expect that Visa or Master Card or American Express will happily send me a monthly bill and wait for 90-day payment. They won't send any bad notices to the credit bureau because I'm really following the standard practice.

Hmm, interesting point.

T. L. Haddix talks about an "accounting nightmare" that would take Amazon days to figure out our royalties.

I've repeated this several times. Amazon knows at the beginning of each day what books sold yesterday.

That's because Amazon using the new technology of computers.

If Amazon has a no-return or short-return policy on ebooks, and Amazon knows today what sold yesterday, it is time to change the standard business practice.

This "standard business" was created in a long-ago time when their were no computers. When clerks did accounting using pencil and paper.

The "standard business practice" is a major reason that trad publishers are on thin ice. They are putting out a lot of front expenses and waiting 60 to 90 days for payment.

"Please don't complain because you don't like the business model and standard."

Excuse me, but I don't think I'm the only one howling in the woods about "the business model and standard."

J. A. Konrath, Bob Mayer, Barry Eisler, and Rambo have also indicated they "don't like the business model and standard."

I am not implying here, that they agree with my thoughts on 60 - 90 day payments.

We are moving into a new platform of publishing. Why should we be content with an antiquated system of payments set up long before computers? Why should we accept, without complaint, a payment system that has practically wrecked the trad publishers?

Please don't tell me that things can't be changed.

Amazon knows, right now, which books were sold yesterday. But we're apparently happy with letting them use the "float" to earn interest on our funds.


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## Terrence OBrien (Oct 21, 2010)

_"Amazon knows, right now, which books were sold yesterday. But we're apparently happy with letting them use the "float" to earn interest on our funds."_

They are Amazon's funds. They become ours when Amazon pays us. After sale and prior to payment they are Amazon's liability.


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## Guest (Apr 17, 2011)

To Terrence O'Brien who said:
"They are Amazon's funds. They become ours when Amazon pays us.
_________________________

Of course. And the money I owe to Visa is my money until I pay them.

But, we can just carry our up-front expenses, just like the trad publishers do, for 60 to 90 days, and hope we don't get into financial trouble down the road.

Peace. Enough repeating my thoughts. Things can't be changed.


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## David Derrico (Nov 18, 2009)

Shayne Parkinson said:


> David, see Mark's comments of Feb 5 2011 here: http://www.smashwords.com/about/beta. It's not for want of trying.


Thanks for the link -- I do read all those Smashwords updates, but had forgotten that one about Google.

Honestly, Google is just a non-entity in the e-book world, IMO. So I don't waste much time worrying about them.


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## Terrence OBrien (Oct 21, 2010)

_"But, we can just carry our up-front expenses, just like the trad publishers do, for 60 to 90 days, and hope we don't get into financial trouble down the road."_

Sure we can. That's the nature of an entrepreneurial venture. I don't look at things like cover, editing, etc as expenses. They are capital investments designed to earn a return over a period of years. We may get in financial trouble down the road. That is the inherent risk of such ventures. The upside is a payout many times the initial capital investment.


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## William Campbell (Feb 11, 2010)

Self-Publishing is a business. It's not a consumer affair, and conducting business requires capital to endure the inherent delays in return on investment. If you choose to fund your business with credit cards that expect payment in 30 days, that's your choice. But don't complain if that stretches funds.

About Amazon being unfair, that's baloney. You have a choice -- 35% or 70% plan. Last year, there was only one choice: 35%. Then Amazon offered 70%, but that's with conditions, one being that discounts are absorbed by both parties. There is nothing unfair about that. 70% most of the time is unfair? Sorry, I call that whining. If you don't like reduced royalties when a title is sold at discount, set all your titles back to the 35% plan. It's your option to choose at any time.

I agree that it's unfortunate to lose revenue because one retailer chooses to discount a title. I would rather that not happen, and for most part, it doesn't and it won't in the future since Kobo and others have agreed to stop discounting.

However, as I've learned firsthand, there's Google in the mix, discounting one of my titles. Yeah, I agree, their setup is clumsy and listing my titles there has not resulted in a single sale.


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## Will Write for Gruel (Oct 16, 2010)

HelenHanson said:


> Mark Coker is a brave, diplomatic man wedged between the rock and the hard place. As a smart business owner, he would view Kobo as both a customer and a supplier. He's earned my respect for trying to plug the dike.
> 
> I'm in the middle of publishing on SW, but I will be opting out of Kobo. I've manged multiple web software launches, and it's important to have a known, good roll-back position in case the thing blows. This is part of best practices or basic survival. When you still have teeth marks in your posterior from the last blow-up, you make triple-dog certain that you at least tick-off new people next time. Anything less is either lame or intentional.


One thing to note about putting a book up on Smashwords and opting into or out of Kobo is that it's not going to hurt you much if you are planning on pricing at $0.99. Maybe they will lower your price, but you're not going to get dropped from 70% down to 35% by a price match on Amazon. Likewise if you price at $3.99 you have some price drop cushion.


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## HelenHanson (Sep 13, 2010)

HelenHanson said:


> I'm in the middle of publishing on SW, but I will be opting out of Kobo.


Not that anyone else would give a rat's patoot . . . .

But in the interest of honest disclosure, I've decided to distribute my novel through Kobo. Since I made the earlier comment, I have decided that they have likely learned a lesson over this fiasco. Whatever the precise nature of the problem, the fact is, I need them more than they need me. In the remote chance anyone read this and then saw my book over there, I wanted make as public a declaration about changing my mind as I did about opting out, lest you think it mere hypocrisy.

So without further ado, I'm off to see the wizard.


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## Kobo Ashleigh (Apr 14, 2011)

HelenHanson said:


> Not that anyone else would give a rat's patoot . . . .
> 
> But in the interest of honest disclosure, I've decided to distribute my novel through Kobo. Since I made the earlier comment, I have decided that they have likely learned a lesson over this fiasco. Whatever the precise nature of the problem, the fact is, I need them more than they need me. In the remote chance anyone read this and then saw my book over there, I wanted make as public a declaration about changing my mind as I did about opting out, lest you think it mere hypocrisy.
> 
> So without further ado, I'm off to see the wizard.


Thanks for reconsidering, Helen. 
We're looking forward to listing (and selling!) your novel


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## Linda Acaster (May 31, 2010)

Kobo Ashleigh said:


> Thanks for reconsidering, Helen.
> We're looking forward to listing (and selling!) your novel


But unfortunately, Ashleigh, I won't be. Kobo discounts my novels - and a lot of others - across on its UK site, and Amazon is price-matching on its UK site. When Kobo no longer discounts on the UK site I'll reconsider.

Now I just have to wait for Kobo to delist my books, and Amazon to realise the discounts are off the shelf, and perhaps I'll get back to a full royalty. But I have no idea how long this will take. Once burned.


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## Guest (Apr 18, 2011)

". . . you're either willing to shell out the dough and be a professional . . ."

I believe that's what the trad publishers have been doing for years.

That is what I and indie authors are doing.

And when folks pay over $1,000 a gallon for printer ink (which we can only afford to buy 1 or 2 ounces at a time, then get off printed book price as what has got the trads in trouble.

Their stumbling block has been the 60 to 90 day payment system with products they manufacture "on consignment." It was the consigment system, with a drawn out payment period, that allowed the super bookstores to come into existence. In other words, they could open a large store with little or no up-front money for row and rows of merchandise.

The payment system was created when store clerks did the accounting books by hand, long before computers.

If Amazon, and B&N know THIS MINUTE what books sold yesterday, and those books are digital with a very short or no refund policy, then the payment process should be shortened. 

A good business 101 course will teach you that your profits are not your profits until they are in your grubby hands. There are some top literary agents who insist that publishing contracts include a clause that the author's royalties are held in escrow and not co-mingled in the publishers operating funds. That is to offer some protection if the company holding the royalties goes into bankruptcy. The sooner you get your royalties, the less time they are at risk.

We are at the beginning of a new publishing era. Let's be careful about what antiquated business practices we drag into it.


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## Theresa M Moore (Nov 19, 2010)

I bypassed Kobo years ago ,when their service contract stated that they can and will discount your books to $0 if they choose. Before Kobo took over another Canadian service, I was able to post samples of my books for free there to draw readers to my books, which I sell directly from my own site, but I never got a response. After that, the samples were subsumed by big 6 publishers' whole books showing up for sale. I could not sell my whole ebooks on that site or on Kobo. There did not appear to be a way for an indie like me to do it. I used Smashwords for a while but guess what? the only ebook which sold well was one nonfiction title, and the sales were from Barnes & Noble. I do fine with Kindle and Nook on my own without Smashwords or Kobo, and I also have my ebooks up on other sites for sale. The idea of relying on a 3rd party for distribution may not work for some of us. I'd rather get my hands dirty and work directly with retailers, because then I can control what happens to my book prices. Authors wanting to get distribution through a 3rd party should really do their homework before they opt-in for distribution through a 4th channel. My 2 cents. 

Many of these so called "publishers" are only in it to look big without actually considering what it takes to drive sales. Though Amazon is the biggest retailer on the planet it does nothing to promote the books or ebooks anymore, and the pressure to lower prices makes many of the retailers engage in price wars without consideration to the authors. I have lowered my ebook prices three times since I first uploaded to KDP, but as I do I am taking a huge cut in royalties. But the funny thing about that nonfiction title? I just sold one copy over the weekend at a dollar MORE than after the last cut. Amazon raised the price. Go figure.


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## Terrence OBrien (Oct 21, 2010)

Question for Kobo Ashleigh:

If I put my book on Kobo without using SmashWords, will you discount it at your discretion? If I set $2.99 as price, will you cut that price if you choose?


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## Kobo Ashleigh (Apr 14, 2011)

Terrence OBrien said:


> Question for Kobo Ashleigh:
> 
> If I put my book on Kobo without using SmashWords, will you discount it at your discretion? If I set $2.99 as price, will you cut that price if you choose?


Hi Terrence,

We have several different contract types, and it's up to you to choose what works best for your business. If you contact us at [email protected], you can review the options open to you. Our Independent Publisher program is recommended if you require set prices.


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## nobody_important (Jul 9, 2010)

Okey Dokey said:


> ". . . you're either willing to shell out the dough and be a professional . . ."
> 
> I believe that's what the trad publishers have been doing for years.
> 
> ...


In the old era, you got paid TWICE a year, not every month.

If you hate the way Amazon and BN pay you that much, you don't have to sell your stuff there. It's really that simple.


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## daringnovelist (Apr 3, 2010)

NadiaLee said:


> In the old era, you got paid TWICE a year, not every month.
> 
> If you hate the way Amazon and BN pay you that much, you don't have to sell your stuff there. It's really that simple.


I know, we've somehow reset our expectations so high, not based on anything except our own assumptions.

Yes, I agree reporting can and should get faster and more accurate, however, payment schedules are based on something very different than the technology that's undergoing a revolution. It has to do with accounting schedules, normally run on quarterly or 30-day units. Some also have a "payroll" type schedule for every other week, but I've never seen any such system with more than a thousand payees do well on less than two-weeks.

The other issue is a really basic business one -- if you're dealing with a company which has publicly traded stock -- one measure of a business for fundamentals traders is to look at the amount of time in collections and payments. If a company can collect quickly and delay paying out, they're considered strong. A company that can't make their creditors wait a bit is considered weak. That is a part of the valuation of stock prices, and the accounting departments are very much aware of it.

Camille


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## Linda Acaster (May 31, 2010)

Thanks for your input, Theresa. I use Smashwords primarily because hailing from the UK it is easier to deal with one distributor and the IRS implications.


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## Carl246 (Apr 10, 2011)

Have you all heard the latest about Kobo over at Smashwords. Here's a link: http://blog.smashwords.com/2011/04/kobo-lands-53-million-in-funding-to.html

Bigger and better things it would seem.

Carl


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## David Derrico (Nov 18, 2009)

Selena_Kitt said:


> It won't always be so. B&N was a nonentity too for a while, until the Nook Color came out.
> 
> We were the very first publisher on Smashwords. They were a nonentity back then too.
> 
> ...


Sure, I'm not saying there's no chance they'll ever become popular in the e-book world. And my books are on Google, just in case, so I agree with you on the "eggs in many baskets" idea. But, Google has been the worst reward : effort ratio of any retailer so far (with a reward of precisely 0, and lots of bugs in the process that made it a pain), and I bet that's true for pretty much everyone (if anyone has sold lots of books on Google, I'd love to hear about it). And you can always join up if and when they do take off.

Also, it's not that Google is new at the e-book game but shows some promise, it's that they are inept, can't even decide on a name for themselves (Google E-Books? Editions? Partner Program?), don't market it at all, don't have an e-reader, and expect people to read on their computer screens in the "cloud." I would be surprised if it takes off.

As for B&N, they were the #2 e-book seller well before the Nook Color came around. They certainly were for me. I still don't buy that significant percentages of people are reading e-books on LCD devices. I believe the surge in e-reading has come from e-Ink screens.


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## hunterone (Feb 6, 2013)

I wouldn't contact MARK, I would contact KOBO direct

Also why did you go through smashwords for kobo when you could have gone direct?


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## Bec (Aug 24, 2012)

hunterone said:


> I wouldn't contact MARK, I would contact KOBO direct
> 
> Also why did you go through smashwords for kobo when you could have gone direct?


Hunter, this thread is over two years old


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## Amanda Brice (Feb 16, 2011)

This is an extremely old thread, originally begun by Lee Goldberg in April 2011. While it was true at the time, the matter has long been resolved and now Kobo does not discount.


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## swolf (Jun 21, 2010)




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## Victorine (Apr 23, 2010)

Life sure was crazy back then.


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## swolf (Jun 21, 2010)

Speaking of Lee, I see he's co-written a book with Janet Evanovich.

Very cool.


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## unkownwriter (Jun 22, 2011)

Yep, old thread, old news. My, how times are a changin'!


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## 41413 (Apr 4, 2011)




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