The Spanish Book Price War

Man with Kindle in Bookstore
Illustration by MAX

The Spanish Book Price War
Spanish publishers forced to rethink strategies after Amazon burst into the market over Christmas and sold reams of titles for less than three euros apiece
El País: Guerra abierta por el precio del libro
Antonio Fraguas reporting from Madrid January 8, 2012

Will it dynamite or dynamize the publishing ecosystem? After the December irruption of Kindle, Amazon’s electronic reader, accompanied by an avalanche of 28,000 titles in Castilian (Spanish), some of them at prices lower than two or three euros and some even less than that, the Spanish book market will never be the same. New online publishing houses and bookstores have started a price war that challenges everything that was known before, from the way we read to what we understand to be a book. Above all, there is confusion between the container (the reading mechanism) and the content (text in electronic form). The machine manufacturers are doing battle over the former, the publishing companies the latter. Amazon is fighting on both fronts.

The novelist Juan Gómez-Jurado is very close to the cannonfire and has fired a volley himself. The Kindle edition of El emblema del traidor (The Traitor’s Emblem) has been the top seller on Amazon.es for more than a month. “For contractual reasons, I can’t say how many I’ve sold, but it’s in the thousands,” he says. He fixed the price (which has risen from €1.49 to €2.68 in a week). “I expect to make a dollar from each sale; the rest goes to Amazon,” he says.

But The Traitor’s Emblem is a peculiar novel for another reason: its electronic editions are being sold at two different prices: €2.68 on Amazon and €7.99 on Casadellibro.com (Book House). In principle, this violates Spanish law (the same edition of a book cannot have two different prices inside national territory). Gómez-Jurado explains that “in one case, the author is selling the book directly; in the other, he is selling through a publishing company.”

One brand that is well-known for aggressive pricing is B for Books, launched by Ediciones B in November: “we decided to offer the lowest prices on the market against paper books (€1.99-9.99). We wanted to make digital and paper prices as distant as possible,” Director Ernest Folch affirmed. The brand sells titles on Amazon and other online stores like Leqtor.com and Fnac.es. Folch only gave ballpark sales figures, such as “we sold three times more e-books in December than we did in previous months.”

Paula Canal of Anagrama dampened this dose of euphoria: “You can set those kinds of prices for bestsellers because they sell millions of units, but what happens if no more than 1000 copies of a title are sold?” she asked. “These prices are unsustainable in a healthy publishing environment that includes small publishing runs for difficult titles.” She is suspicious of the new arrival, Amazon: “For the moment we won’t stop selling our titles in Latin America and the United States, where there are not fixed prices, so as not to compete with other online stores with which we’ve signed contracts.”

Diego Moreno of Nórdica Libros (Nordic Books) has decided to enter the arena: “This year we’re starting a digital line (€4.99 apiece) and another with Pirandello stories, which we’re selling for pocket change, €0.99. The logic of the electronic book is that the price is much lower than paper’s. It’s a new way of conceiving the book and the reader. They’re bite-sized products that can’t cost as much as paper editions.”

Writer Rosa Montero has self-published three works on Kindle: compilations and discontinued books. “We’ve lost precious time to navigate against new technology…this slowness has favored the pirates, and now it seems like the only people providing something for free are we the creators, if no one plans to pay for the reading apparatus.” Montero also put forward an old demand of the sector, that the VAT for e-books fall from the current 18% to the same super-reduced rate of 4% that paper books enjoy.

80% of digital books sold in Spain go through Libranda. It was created in 2010 by, among others, Random House Mondadori, Planeta, Santillana, and Roca Editorial, and up to 30 publishers that sell digital works on Amazon negotiate over their offerings with this distributor. Its director, Arantza Larrauri, values the arrival of the Kindle: “if the electronic book is talked up in the press and on television, it will help the culture of digital reading.” He also recognizes that the sector is moving: “new publishers, medium and small ones, are being incorporated, and they’re beginning to make strides.”

There is room for everyone, thinks Pilar Gallego, treasurer of the Spanish Confederation of Booksellers’ Associations, which includes 1600 stores: “Paper books are still being sold, most of all children’s and youth literature, as those works are very eye-catching.” Gallego believes that “the Amazon phenomenon” is overstated: “it’s more about the publicity about the devices than the reality of the sales.” Literary works in digital format, according to Libranda’s forecast, will produce 1% of the revenue of paper book sales in 2012, still five times more than 2011.

For the director of the Spanish Federation of Publishers’ Assocations, Antonio María Dávila, Amazon’s focus is not the works themselves: “it could be a crazy entrepreneurial strategy for selling Kindles – which in my view are fairly poor in quality, like all cheap things – because their business is not about content.”

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