Apple has more than 200 million iTunes accounts. Amazon doesn’t publish its account numbers, but according to Matt Shatz, former VP of Digital for Random House, a reasonable guess is over 100 million. Here’s why that’s important:
With those 100 million billing and messaging relationships, Apple and Amazon would only need to achieve a reasonable 1 percent conversion rate to help an author sell 1 million books, a level few authors today reach.
Actually, Matt, with Apple it only takes 0.5 percent. Hey, I’m not quibbling. But the question remains: what about traditional publishers? Shatz is less optimistic that large publishers will successfully transition to the digital world in ways that rival what Amazon and Apple are doing.
Publishers have been taking steps in this direction by shifting their ad spending to online, and having staff get up to speed on Facebook and Twitter as promotional outlets. But for the most part, this effort has been limited to a few relatively junior people working on a campaign-by-campaign basis and trying small-scale experiments.
In short, I don’t think publishers will figure all this out in time, which is why retailers will dominate the customer relationships in the future.
Ok. But let’s remember that we’re still in the early days. And that Amazon and Apple are still in the experimental stages, too. Jeff Belle, VP of Amazon Publishing, has this to say in a January 30 Businessweek cover story on Amazon:
“What we’re building is more like an in-house laboratory where authors and editors and marketers can test new ideas. Success to us means working with authors who want to find new ways to connect with more readers.”
So it’s a lab project? Well, I’m with Shatz here, but Belle’s words don’t exactly ring out like the words of the revolution, do they? Maybe he’s just being cautious. After all, even Nancy Pearl is taking heat for her recent Amazon deal. Says Pearl, “I suspected people would not be happy with this. But I didn’t expect the vitriol.”
I don’t understand it either.
Photo: Bloomberg Businessweek