By Jeffrey A. Trachtenberg
Amazon.com Inc. reached a new multiyear publishing contract with
Hachette Book Group covering print and digital books, ending a
seven-month dispute that showed how the online retailer's growing
clout is roiling the book industry.
The two sides said Thursday that new e-book terms will commence
in early 2015. Under the new pact, Hachette will set the prices of
its digital books. The companies said Hachette would get better
terms when it "delivers lower prices for readers."
Amazon and Hachette, a unit of Lagardere SCA, were fighting over
how e-books should be priced and how revenue from them should be
divvied up. As the battle dragged on, Amazon took steps that were
heavily criticized by some authors, including removing preorder
buttons on Hachette titles and delaying shipment of some books.
Amazon said it has resumed treating Hachette titles as it did
before the dispute. Shares of Amazon, down 11% over the past 12
months, rose 1.5% to $316.21 in midday trading.
The development, coming only a few weeks before the kickoff of
the holiday season, is welcome news for Hachette writers, whose
ranks include James Patterson, Michael Connelly and J.K.
Rowling.
The pact comes less than a month after Amazon and CBS Corp.'s
Simon & Schuster publishing arm struck a multiyear print and
digital contract that allows Simon & Schuster to set the
consumer prices of its e-books while enabling Amazon to discount
digital titles in certain situations.
That agreement was widely seen as putting additional pressure on
Hachette as the holiday season neared because of Amazon's clout
with consumers. A June 2014 online survey by researcher Codex Group
LLC found that Amazon had 40% of the new book market, accounted for
62% of all print books sold online, and controlled 64% of the
e-book market.
Simon Lipskar, president of the literary agency Writers House,
whose clients include a number of Hachette authors, welcomed the
news.
"Our writers have been suffering terribly because their sales
have been significantly diminished as a result of this dispute."
Mr. Lipskar said. He said it was possible that there would be
long-term consequences for some authors because of diminished sales
when it comes to negotiating new contracts.
The battle between Amazon and Hachette began in early May and
quickly intensified, as both sides dug in.
Write to Jeffrey A. Trachtenberg at
jeffrey.trachtenberg@wsj.com
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