Indie ebooktailers and the Agency Model: Where Are They Now?

“Even though the big five has been a small part of our bottom line, we
do want them back and I don’t want to do anything at this point to
jeopardize our relationship with any of them. I definitely don’t want to
see a market where only Amazon, Apple,  and B&N are selling those
titles.” ~ anonymous indie ebook retailer

“It’s ironic that the publishers who were going to level the playing
field amongst retailers pretty much now only have their titles available
on B&N and Amazon.”  ~ anonymous indie ebook retailer

In the fast-paced news cycle generated around publishing and technology, the Agency Model discussion may seem like old news, but for indie ebook retailers, the story is still (rather slowly) being played out.

diesel.gifJust where do the indie etailers currently stand in regard to getting Big 5 titles back into inventory, and how has not having Big 5 titles available affected them? We asked these questions and more of Diesel ebook store’s Kelley Allen. (Actually we asked a few other etailers and distributors, but only Kelley was brave enough to answer us on the record!)

ToC: When the Agency model contracts came into play, what was your plan of action?
KLA: Batten down the hatches and ride out the storm!
We immediately informed our customer base about the changes and took all
the titles down. That was all we could do in the meantime.

ToC:What were the implications for your business and for your customers, and how did you deal with it?
KLA: We posted a nice little blog called The
Agency Model – Diesel’s POV amid all the chaos and drama
that we
wrote when the whole A5 thing first went down in early April.

We were rather bummed since all the large
multi-billion dollar corporate stores got all their A5 titles up rather

As a
result, we wrote a funny little melodramatic blog called JILTED that
captured how we felt / still feel:

ToC:  Have
publisher and distributor partners been good about communicating with
you regarding where things stand/whether progress is being made?

KLA: No comment since we are
negotiating with three of the A5.

Our other distributor, Mobipocket, just
wrote a very short e-mail to all their distribution partners
to pull all their A5 titles.  We posted on our blog about Mobipocket
pulling their A5 titles

ToC:  Where do you currently stand in terms of access to Big 5 titles? 

KLA:  We are currently selling
HarperCollins and Penguin.  Penguin was the first go back up on the site
on May 10
th (Day 40)
and HarperCollins on May 13
th (Day

The new
contracts all have confidentiality clauses and thus we are not at
liberty to disclose terms. 


ToC:  Given that
the wholesale pricing and terms will be changing (and possibly will
vary according to publisher), how much work will it require to make
programming changes on your site?

KLA:  Quite a lot of programming
changes!  Matter of fact, we heard that a few of the smaller eBook
retailers decided to just drop out since it was too much for them. 

We have a blog posted here about the
implications of Sales Tax

had to install a very comprehensive tax table to our backend system.

addition, A5 allows for no discounts and thus we had to modify our
entire system to identify any A5 and prevent discounts on the site. 

ToC: How is this affecting your bottom line?
Are you losing customers? Are customers being supportive/ buying titles
that you DO have?

KLA:  Our
sales are down as a direct result.   However, we have been relatively
vocal about any updates to our customer base and thus our customers are
supportive. We also
found that sales of titles for the Indies are increasing by large

ToC: A lot of the indie online ebook
retailers, and their distributors, are reticent to talk about how the Agency
Model disruption has affected their businesses. Do you worry that being
vocal about the subject might offend your publisher and distribution

KLA:  It’s
crossed our mind.  


ToC: So why the industry-wide silence? And why are you willing to talk when
others don’t seem to be?

KLA:  Well, basically our
distributor needs to sign individual contracts for each retailer for
each A5.  That means there could potentially be hundreds of contracts as
a direct result of this.  So, you better be extra nice to your
distribution partner and their publishers!

Scott and I decided that we wanted to be
vocal about all this despite any potential repercussions (and there have

ToC: Have
you been in discussion with non A5 publishers as to whether they are
planning to go to agency model?

KLA:  Yes.  I have been talking to quite a
lot of the smaller publishers / indies.   Many seem not too anxious to
jump full-heartedly into Agency and instead are adopting a “hybrid”
approach – agency for Apple and wholesale for everyone else.  I asked
one rather large and highly respected Indie about how they could do it
legally.  They replied that there are some loopholes in the Apple
contract to get around that issue. 

ToC: Are you looking forward to Google
editions? care to share any thoughts about how
 Google Editions
may affect your biz? have you been talking with them?

KLA:  We are not at liberty to
talk any specifics but yes, we are excited about Google for a couple of
different reasons.  One, they are having a calming influence on the
eBook marketplace.  Two, they will be adding a whole different technical
slant to the eBook experience for both the retailer and consumer. 
We’ve always had a strong relationship with Google and expect that to