Dear Hachette, you’re doing it wrong

If I were designing the next annual report for Hachette Book Group, I would use these three phrases prominently throughout, because they seem to sum up its current approach to digital publishing.

1: “The customer is the enemy.”

Last night I called Amazon and, after making sure the problem wasn’t a glitch, got a refund on a Kindle book I’d bought the week before. Why? Because Hachette, the publisher, had disabled all clipping and highlighting functionality. That’s right, everything. The best part was that this was a new development, because on I could see that other past Kindle edition owners had highlighted and shared sentences from the book.

2: “Don’t make a peep, piracy is under the bed!”

On the same day that I was discovering I’d had my fair use rights secretly stomped on by Hachette (yes, secretly: there’s no info on clipping limits on Amazon product pages), David Shelley, the head of Hachette’s publishing group Little, Brown and Company in the UK, was at the London Book Fair trying to convince authors that piracy justifies low royalty rates:

“Money spent on print and paper will be spent on specialists to fight piracy and that is a team of many people. Piracy websites are proliferating, and we are scanning the entire web, and investing in software too. The costs of this are only getting more expensive, and could spiral way out of control. There are also legal costs, when sites refuse to take down content.”

The most important part of this statement is what’s missing: Shelley provided absolutely no evidence to back up his claims. At least one author in the audience told Shelley she didn’t believe him, and Magellan Media, one of the only companies trying to seriously study ebook piracy, has pointed out that until publishers actually start to measure piracy and share the data, they’re just spreading FUD to serve their own needs.

3: “We think it’s best to be reactive, not innovative.”

The reactive company makes every decision from a position of fear, and consequently chooses rigid and conservative paths that limit future growth. The innovative company explores the edges of the market to look for new ways to create revenue.

Check out what the senior vice president for digital products at Hachette US told the Boston Globe last week:

“We were the first to engage the anti-piracy service Attributor,” Thomas told me. “They go out and find pirated copies on peer-to-peer networks, and they send automatic takedown notices to the websites. Generally, we get good compliance.”

And compare that to what a Random House exec said in the same article:

“I suppose it’s a growing problem, but it hasn’t yet made a serious impact on our business the way it did on the music business.”

Random House reported its digital sales grew 250% in 2010 (The Financial). Hachette’s digital sales grew by 138% (eBookNewser).

What would explain Hachette’s fear-based approach to ebooks? I have a feeling it has a lot to do with where Hachette’s executives are getting their news from these days. Attributor’s business model depends on selling anti-piracy services and consulting to publishers. To sign up new clients, it has to convince them that piracy is one of the four horsemen on the apocalypse. Here’s a different take from someone who tried to check out the company’s findings, and who concluded that “Attributor ebook piracy numbers don’t add up.”

I don’t earn or lose money on Hachette’s business model, so other than having to get a refund on a crippled Kindle edition, I guess I shouldn’t care too much. (The taking away of fair use functionality really irks me on a more fundamental level, however.)

Dang, I was totally going to pirate about 20 lines from this book. Foiled again!


But what I’d like to point out, one more time and just in case someone from Hachette reads this, is that every pirate isn’t a customer, and every customer isn’t a pirate.

Although sometimes, if you do everything wrong, you can make those two groups overlap a little more.

(Photo: takomabibelot)

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