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The Amazon Strategy – If We Kill It, They Will Come

Amazon's strategy for marketing the Kindle makes me think of a dictator who decides he wants all the citizens of his country to live in one city. 

People being, well, people with individual patterns and practices, likes and dislikes, it's not likely that all them will ever live in one city.  But the dictator could certainly get more of them there by showing that his city is a safe place with the best streets and parks and the most jobs.  That would attract interest.  Then he could point out that his city opens its arms to everyone and respects their differences.  I'd bet that dictator could then watch the steady influx of folks from hamlets all over the land, willing to try city life because it lets them keep big parts of the things they loved about their hamlets while letting them have more jobs, more choices,  and more possibilities. 

Or, if the dictator is maddened with power and crazed with the determination to have it all his way, he could use a different strategy.  He could simply kill all the citizens who live anywhere except in his favored city.  Guess which strategy Amazon has chosen to market the Kindle?

Amazon could have opened the Kindle to accept different formats to broaden its appeal.  In particular, Amazon owns a little company called Mobipocket.  I'm no computer person - that's my hubby's job - but I understand that the Kindle could accept books in mobi format.  Mobipocket has hosted an ebook distribution service for years, and ebook stores all over the planet generally feature mobipocket as one of the formats for their publications.  Instead of broadening the reach of the Kindle, Amazon seems to be trying to kill off the competition.

Like the insane dictator, Amazon is trying to kindle business by killing choices, including those within its own realm.  Some time ago, as noted above, Amazon bought the  little French company, Mobipocket.  Mobi's ebookbase distributed independent authors' work to etailers great and small, all around the globe.  Mind you, Mobi had its problems, including a royalty structure that had and still has the nasty little habit of not paying royalties to writers at regular intervals.  The Mobi structure also was a little too open, and allowed people to upload books within the public realm, those where the copyright period had expired.  Then those enterprising (and in my opinion, ethically challenged) uploaders - not authors- could sell the ebooks and make money from someone else's work.  These were problems that could have been addressed pretty easily. 

As to royalties, Mobi could do what Kindle does - pay them 30 days after the end of the period when they are accrued, provided they are at some very minimal threshold amount - like $10.00.  Mobi could have cleaned up the existence of hundreds of copies of public realm titles by only taking books the author wrote and owns.  Amazon and Mobi could take the public realm titles on a first come, first served basis and only from charities.  Let charities who give books to kids sell the titles to fund their programs.  That would perform a public service that would not in any way disrespect the original author of the work.   Amazon has addressed neither issue in a way that makes sense.

The great dictator has kept in place Mobi's nasty, self-serving NO royalty, royalty structure.  And it has gone in and arbitrarily cleaned up the public realm titles.  In one notably well-publicized case, Amazon wiped off the titles from Kindles of people who'd purchased them.  Mobi titles fed up to Kindle and so the Mobi failure to restrict its service to people posting their own work created a situation where people were making money, sometimes lots of it, by uploading titles from literary geniuses and keeping the profits in their own pockets.   As noted above, Amazon should have cured the multi-posting problem by saying authors post their own work and charities contact us if they want to post public realm works to fund good causes. 

Because Amazon didn't come in and wash Mobi's dirty laundry, and then it allowed E-Bay's subsidiary PayPal to proclaim Mobi too dirty to deal with, I posted earlier that Amazon was clearly up to something.  My prior post speculated that whatever it was, the writers would come out on the losing end of the battle they couldn't fight.  And so they have.

Mobi recently posted an announcement, effective September of 2009,  that no new publishing accounts could be created through Mobipocket to sell ebooks via Ebookbase or Kindle. Amazon suggests that new authors with a US address and a US bank account publish via Kindle.   However, the company claims that existing ebookbase publishers could continue to upload new work.  Why?  Because that way, Amazon can wait for business to dwindle and die on Mobi without ever paying out those royalties lining its coffers. 

The more important issue is why Amazon would take this path at all.  Why not open the Kindle to the Mobipocket format?  That would mean that ebook owners could load their old Mobi titles on their new device.  Of course, it would also mean that new Kindle owners could buy books from stores all over the globe.  Kindle owners wouldn't have to get the majority of their titles from Amazon. 

Rather than killing Mobi, Amazon could have cleaned it up and broadened its reach by making all of the Amazon entities around the world ebookbase affiliates.  That way, you could buy titles through Amazon for Kindle but you could also buy ebook titles for Mobi that you could use on your Kindle or your PC.  That would have attracted even more business to Amazon and some of them might stay as repeat customers.

Instead, the crazed dictator said - IF WE KILL IT, THEY WILL COME.

Amazon should have recalled that Lady Liberty's open arms made America a great melting pot - and the best place in the world to do business.