News broke Thursday that the two companies had reached new sales terms--after a stalemate in their negotiations became public in May--with Hachette Book Group CEO Michael Pietsch telling authors and agents in a letter that the agreement gives the publisher "considerable benefits." Chief among those benefits, is that Hachette can sell its ebooks on Amazon using a model he called "Agency," giving the publisher "full responsibility for the consumer prices of our ebooks."
Pietsch, in a statement about the agreement, noted that Hachette's the new ebook terms won't take effect until 2015 but that, in interim, its titles will return to "normal availability" on Amazon. (During the stalled negotiations, a number of Hachette titles were unavailable for pre-order, or faced long delivery times.) Additionally, with the agreement, Hachette titles will now be featured in Amazon promotions for the holiday season, which Pietsch called "a very positive development." It could be until the middle of next week, however, for Amazon to be fully stocked on all HBG titles.
Since Thursday's news, reaction to the agreement has been coming in quickly.
Douglas Preston, who founded Authors United (a group for authors who wanted to voice their concern about Amazon's tactics), said he was “relieved” to hear about the agreement. Preston added, however, that the deal will not stop Authors United from going ahead with its plans to ask the Department of Justice to start an antitrust inquiry into Amazon.
Preston said he hopes that in future disputes between Amazon and publishers, “Amazon will never again seek to gain leverage by sanctioning books and hurting authors.”
Speaking on behalf of the Authors Guild, president Roxana Robinson called the end of the standoff “great news for Hachette authors.” Robinson said it was “heartening to see so many writers rally to the defense of their colleagues.” Robinson added that she hopes the “display of communal spirit played a part in bringing the negotiations to an end” and “will prevent authors from being dragged into corporate disputes in the future.”
At a practical level, Robinson said that while terms are said to be favorable to authors, the Guild has no way of knowing at the present time if that is the case. Robinson said that given the support HBG received from authors the time is right for the publisher “to revisit its standard e-book royalty rate of 25% of the publisher’s net profits."
Brian DeFiore, founder of the literary agency DeFiore and Company and a board member of the Association of Authors Representatives,was glad that the impasse has been resolved, but also expressed some concern about what the agreement may mean for authors in the future. DeFiore noted that while authors, HBG and Amazon "all have financial skin the the game," only Amazon and HBG were involved in the negotiations. "That's worrisome for the ones not at the table," DeFiore said, observing that e-book royalties are based on publisher receipts, so authors incomes are likely to be impacted by the deal, terms of which have not been made public.
In his letter, Pietsch stressed that "the percent of revenue on which Hachette authors' ebook royalties are based will not decrease under this agreement." Pietsch thanked its authors for sticking with them in the difficult last few months. He closed by trying to bury the hatchet with Amazon, writing that "I feel strongly that this new contract reestablishes our positive relationship with Amazon...and that thus strong relationship will benefit the writers we publish for many years to come."
This story has been updated several times since it was originally posted early Thursday afternoon.
This story features additional reporting by Clare Swanson, Rachel Deahl and Judith Rosen.