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In today’s Wired.com there is an article about the resolution to a struggle between Amazon and Macmillan and Company book publishers. The point of contention was over which company would set the prices for digital copies of Macmillan books published for the Kindle, Amazon’s e-reader.

As most of you may know, Amazon’s e-reader has been the breakout hit of the digital devices allowing consumers to download and read books, magazines and newspapers. Publishers of all three types of print media have developed a love/hate relationship with the online retailing giant. The love part relates to the ease and lack of expense related to publishing and distributing over the Kindle system. My in -house publishing firm, viscerality.com, publishes over the Kindle system and it is very simple.

The hate part of this relationship involves two primary issues. The first of these issues is immediate and pressing. Amazon has always insisted on a set maximum price, $9.99, for copyright protected books, and a specified split of the resulting revenue between Amazon and the customer.

The second issue rankling the publishers is the clear ability of Amazon and other online publishing systems, smashwords.com, Apple, Sony, etc., to offer authors a means of freeing themselves from the gatekeeper role publishers have played since the inception of print media. It is this second, latent, matter hanging over publishers that is the most worrisome, if not the most pressing.

The Wired.com article analyzed Amazon’s recent capitulation to Macmillan over the pricing issue and, perhaps, though details between the companies related to revenue sharing are not public information, the percentages shared by the parties to a sale. The article declares that “content is king” in the book publishing business.

The fact is, content has always been king and, the Monkies not withstanding, in all probability, always will be. Ted Turner, the Atlanta media mogul and billionaire, demonstrated this truth many decades ago when, against all advice to the contrary, he continually purchased content ownership to give his cable channels a leg up on competition. He began with purchasing pro sports teams, the Atlanta Hawks and Braves, and “selling” his station’s exclusive broadcast rights to the games. In a huge gamble, Turner borrowed heavily at junk bond interest rates to purchase several movie studio archives and formed exclusive movie channels showing old movies contained in the acquisitions’ vaults.

This last big gamble almost broke him before it catapulted him into such a strong position of wealth he was able to invent the 24-hour news channel known as CNN. At first, this gamble was derided, called the chicken noodle network, until the international political policy wonks became addicted to it. CNN, it is said, was the only clear winner of the first Gulf War.

While Turner’s media empire is one clear example of content being king, the entire publishing industry made that point perfectly clear centuries before Ted came along. Publishers took control away from printers early in the history of print media by the two pronged approach of, first, taking some of the front-end risk away from the author who, in return, gratefully offered up some of his or her economic rights to the creative work. The second prong was the slow creation of the legal concept of “intellectual property.” Prior to Johannes Gutenberg there was no such thing as intellectual property rights. There was no need for it. Any invention or other creative act immediately entered the public domain as soon as someone figured out how to copy it. Publishers invented intellectual property, not the creative property itself, but the legal concept of it.

Publishers did this magnificent thing to protect their economic interest in investments in published works. The fact that it was a purely selfish act doesn’t take away from the fact that it was the single greatest legal invention, rivaled only by the stock company, devised by the mind of man since Hammurabi. That single selfish impulse is the very thing that has driven the explosive outburst of creativity in western civilization. It is the primary driver that has now spread that creative explosion worldwide.

How odd it is that the two parties in the Amazon/Macmillan dispute are both betting on the same thing. Both are betting that content is and always will be king. All the e-reader companies are betting the same way. All the publishers are also betting the same way.

The e-reader platforms/distributors, Amazon, Apple, etc., are all making nice to the publishers now but they all believe the day will come when publishers will fade into marketing and/or editing companies and authors will no longer need them. The e-reader platform companies believe the day will come when established media “stars,” the Dan Browns and the Stephen Kings and the J. K. Rowlings of the world, will wake up and say to themselves, “I don’t need a publisher. My audience knows my work. If I just tell them where to look they will find me.”

And it may not be limited to superstar novelists. What would a Maureen Dowd mean to the market penetration of an online journal of opinion, such as www.likethedew.com? How about a Krugman or Friedman, well not Friedman, or Rich, now that the NY Times has made them famous? These guys, and many others besides could cut their own deal with an online journal. Any one of these guys could wrangle huge percentages of ad and gimcrack revenue in return for the site visits they would generate.

Hell, in return for the exposure, writers like myself might even pay, assuming I had any money, for the opportunity to be positioned on a page with one or more of these established opinionators. How else am I going to have my stuff in front of millions of potential readers on a regular basis?

The same may become true of a Tina Fey. Why should she make payments on the mortgage for a dead weight Harvard MBA type whose last original idea died in the womb of his constricted brain? Ms. Fey has an audience. She could easily set up her own “network” sending signal directly to desktops, TVs and iPad like devices without the aid of any MBA of any linage.

Macmillan, NBC, the NY Times and all the other “publishers” are betting creative types will not leave them. Maybe they are right. It takes a good bit of creativity to plan a successful marketing plan for a creative work. In fact, it takes a good bit of creativity to develop a bad marketing plan.

It also takes up front cash to “publish” and market creative works as well as to distribute these works to traditional channels. None of these channels are going to go away immediately and, maybe, some of them not ever. Further, when the old talent dies and/or dries up, and old talent always does do one of the other or both, without “publishers,” how does the new blood get in front of an audience?

So, maybe it is a dicey bet either way right now. However, if I was primarily a publisher I would be a bit more worried than the platform/distribution guys. Recall the old “studio system” that once dominated the movie industry. Back in the day, no matter how big a star, if you didn’t tow the company line the studio system that made you could and would and, on occasion, did, break you.

Long after the technology was in place for independents to rise up and kick the old barons aside, the studio system remained in place. It wasn’t until some of the really big stars, Burt Lancaster comes to mind, in the late sixties and early fifties, had enough money, influence and moxie to take on the system and beat it on a semi regular basis. Even today, huge studio companies are still alive and remain the only entities willing and able to take on the really big money risks.

Still, for all electronic media, movies included, it yet remains early days. The entire situation is still evolving. The bet remains that content is king. The only point of confusion is who will control the king. The Googles, Amazons, Apples and other platform distribution guys of the world think, eventually, the creators will have control. The platform guys also believe these creators are a far more malleable bunch to work with than the publisher/producer hard asses. The producer/publishers of the world believe the creative types are always going to prefer creating and leaving the up-front risk and nitty-gritty of business to them.

Could be they are both right. Evolution is a bitch.

1. Frank Povah says:

   February 3, 2010 at 6:14 am

   The problem creative types will always have is that – with a few notable exceptions – they can’t market themselves. There is a ton of talent out there, much better than the commercialized pap we are force-fed, that will never profit from its gifts because of shyness, lack of business acumen or whatever. This is why agents, in the long run, fare better than talent.

   Reply
2. Mike Copeland says:

   February 3, 2010 at 11:25 am

   Being a member of the infrequently and largely ignored published population of writers, I can relate to your comment about many very worthy writers and their lack of success.

   However, every time I hear or read or, as is all too frequent an occurrence, repeat these kinds of comments I am reminded of an acquaintance of mine. This fellow, though a splendid athlete, failed to qualify for the 1972 Summer Olympic team. He may well have but he did not get to go to the Olympic trails due to a family emergency. Though the emergency did not directly involve him, it required his presence.

   When I attempted to commiserate with him he said something to the following effect: “Tens of millions of people dream of winning Olympic gold, and every Olympiad millions of these people actually get around to training for it. Of those, hundreds of thousands actually try out for their national teams. Of those a small fraction qualify and go to the games. Of those a smaller fraction actually medal and, of course, of those, only a third take home gold. Everybody in this population of dreamers, trainers, competitors, qualifiers, medalists and gold medalists have in common reasons, often personal reasons, always good and sufficient reasons, why being an Olympic champion is impossible. The only difference between the ones who win and the rest of us is our reasons defeat us and theirs do not.”

   Harsh, harsh, yes, that is true. But, even though luck and personality and God knows what all has a role to play, everybody, Tolstoy, Dan Brown, Jane Austen, Stephen King, former First Lady of Alabama, Cornelia Wallace, just everybody has reasons to be defeated by lack of success. Some on this list are as good as writers as is humanly possible. Some are just people who spin a good yarn. Some, maybe, not even that. But, they have in common that they were never defeated by all the perfectly good reasons they should have been.

   At 61, time is beginning to run out on my chances to be a successful author. However, as long as I keep writing there remains the chance that I’ll get to go to the ‘games.’ As long as the technology keeps evolving toward more and more opportunity to be published, as this very outlet proves, the chance remains I will be read and, from my keyboard to God’s eyes, admired for the effort. I take great comfort in the idea that content is king. If any of my scribblings ever attain any commercial value then maybe I’ll get to stand on that metaphorical platform and salute the flag.

   Reply
3. Frank Povah says:

   February 3, 2010 at 1:05 pm

   Mike: there is also a certain ruthless quality to the successful – especially in the music field – that drives individuals to the fore; a willingness to ignore consequences to self and others. I have no illusions that I’ll ever be more than a person with a reasonable grasp of grammar and some stories to tell and I suppose in these my declining years I’m quite content to help the youngsters whose work I guide, but sometimes, in the early mornings, I dream that if only I could’ve pushed myself, or ignored parts f my nature, I could have been a musician recognized by other than my peers n my limited sphere. Sigh…but hell, regrets are pointless. I’ve had – am still having – a wonderful life.

   Reply
4. Mike Copeland says:

   February 3, 2010 at 2:38 pm

   “I’ve had – am still having – a wonderful life.”

   Then you have won a special and very fine form of gold.

   Reply