Kindle, A New Way To Read

Wednesday, April 2, 2008

Amazon Explains POD Move; Ingram Raises Questions

by Jim Milliot -- Publishers Weekly, 3/31/2008 1:56:00 PM

Amazon has sent an open letter to “interested parties,” explaining “what we’re changing with print on demand and why we are doing so.” Amazon has caused a major stir in the pod field with its decision to have publishers who want to sell pod titles directly through its Web site use its BookSurge pod subsidiary. And late Monday afternoon, Ingram, parent company of BookSurge rival Lightning Source, issued a statement from John Ingram noting the concerns it has fielded from publishers about Amazon’s actions.

In the letter from the books team, the company reiterated that by using machines that are located in its own fulfillment centers, Amazon can have a title ready for shipment quicker than if it needs to wait for a book to be shipped to its facility. The extra time will permit Amazon to “marry” a title with another product that will be shipped in the same box, in most cases hitting Amazon Prime shipping times. “It isn’t logical or efficient to print a POD book in a third place, and then physically ship the book to our fulfillment centers. It makes more sense to produce the books on site, saving transportation costs and transportation fuel, and significantly speeding the shipment to our customers,” the letter states.

Amazon further notes that if publishers do not want to use BookSurge for pod, they can still sell their titles through the e-tailer as part of it Advantage Program, provided they pre-produce five copies of each title that Amazon will stock in its warehouse. Publishers can also use Amazon’s third party marketplace option to list titles. Amazon is not requiring that pod titles be printed exclusively through BookSurge.

Amazon closed the letter by stating that it will only reconsider the policy “if we can find a better way to serve customers faster.” The company noted that while some of its earlier initiatives “caused consternation at times,” it has stuck with changes that it believed are good for customers. Amazon cited its decision to provide customer reviews on the site as one that was initially criticized by many publishers, but which led to more sales. A second controversial move, which caused “significant consternation,” was Amazon’s decision to sell used books along side new editions. Despite lots of protest, Amazon notes it “stood by the decision because we were convinced it was right for customers.”

In his statement, John Ingram said that while “the questions that are being raised about and its Booksurge division don't directly relate to Ingram - either Lightning Source Inc. or Ingram Book Group - it clearly is alarming many of our publisher partners.” According to John Ingram, “publishers are telling us they feel’s actions are not appropriate.” John Ingram’s statement adds that the company has been unable to get a direct response from Amazon about its pod shift.

“We all live in a world where decisions are made about insourcing and outsourcing, and free choice is important,” the statement continues. “At Ingram Book and Lightning Source, we are going to work really hard to continue to be the compelling choice as publishers make their outsourcing decisions. Our breadth of distribution channels including the online retailers remains the same, and Ingram still provides one day turnaround in the fulfillment of orders for books including print on demand titles.”