Amazon-New-Detail-Page (Photo credit: kokogiak)
Will publisher's relinguish control of book supply chains to Amazon? Of course, the technology already exists (and Amazon owns it) to print books at an Amazon fulfillment facility and send them off to customers, with the same delivery times as exist today. Using an industrial strength printer and a digital book file, the task is easy.
But major publishers are not even agreeing to let Amazon have digital files of their back list books, fearing that this would be the proverbial "camel's nose under the tent" and that best sellers would be next on the list for on-demand printing. From Amazon's perspective, they would like to free up hundreds of thousands of feet of warehouse space now dedicated to books in their fulfillment centers, not to mention the labor involved in picking these books.
The principal reason? It's all about money. With best sellers going for perhaps $30 plus (and hefty profit margins), why split only $10 or so in Kindle revenue with both Amazon and the author. And Amazon already owns a print on demand provider, BookSurge (now called Create Space--clever name, huh, when you think about those books taking up warehouse space?). CreateSpace offers small publishers on-demand printing options and the results are as good as using a regular press for paperbacks.
From the publisher's point of view, they have spent the last 100 years building up complex supply chains, involving printers, warehouses, distributors and retailers to reach consumers. Often, these supply chains are now way too expensive to justify, given availability of today's on-demand technology and the huge amount of unsold books that must make their way back through reverse logistics. Publishers offer authors a wide range of money making services attached to this supply chain, including editing, printing, storage and distribution--all used to justify them keeping the lion's share of high wholesale prices. Amazon's on-demand printing threat eliminates many of the "value-add" and expensive services.
Other start ups, such as On Demand Books, offer similar services, but with only a few bookstores using the technology ($100K per machine) and only a few publishers making any part of its catalog available--generally only books out of copyright.
Many smaller publishers, especially of frequently updated technical manuals, have seen the light and begun using on-demand technology exclusively. But it will be many years before the major publishers are willing to chuck out their old-fashioned supply chains and embrace the new technology.
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