Three months after Publishers Lunch first broke the story that independent distributor IPG and Amazon had not renewed their contract for the sale of ebooks and IPG-client titles were removed from sale on the leading ebookstore platform, we can report exclusively again that the contractual standoff is over.
IPG president Mark Suchomel confirms to PL “we have come to terms” and IPG-distributed ebooks have been restored to the Kindle store on Friday, May 25. Any titles that are not restored today should be available “in the next day or two.”
Suchomel declined to discuss what broke the stalemate, and said “we’ve been talking with clients throughout” the negotiations and “I think overall people are happy that their titles are up there again.” Suchomel told us the impact of the lost three months of Kindle sales was felt differently across IPG’s client base, in part dependent on the nature of the individual lists, even with some focused support from other etailers. In a letter to clients he notes, “I only regret that we weren’t able to make up for all of the lost revenue when your Kindle titles were not available. We will continue to work hard for every last sale so that all of our publishers stay healthy moving forward.” To that end, IPG is waiving its distribution fee on the next three months of Kindle sales.
In February, Suchomel indicated their position was a considered one “that we need to hold firm with the terms we now offer.” In speaking to the press, he said, “We’re not going to go back to them and say we changed our mind.” Since the original standoff, however, a number of other major distributors and large publishers like have agreed to revised terms with Amazon for ebooks, with at least some conceding an allocation of approximately 3 to 4 percent coop on ebooks, as previously reported in PL. At the time, Suchomel had wondered, “The big question is going to be, ‘are we the only, or are we the first?'”
IPG ceo Curt Matthews has written about the issues a number of times on the company’s blog. In April, for example, he wrote about how coop has “evolved into something entirely different : ‘Give us 4% of your last-year sales with us for co-op and we will do wonderful but unspecified marketing things for you. Otherwise we will take down all of your eBooks.'”
He’s also blogged about how difficult terms negotiations have become: “Now the agreements that certain eBook retailers insist on are draconian, multi-year, intricate; they have to be negotiated from scratch one by one; and all the parties to these agreements are rendered mute by non-disclosure or confidentiality provisions.” To illustrate the difficulty of such negotiations, he wrote in March: “Try this thought experiment. Your company has signed an agreement with an eBook reseller that specifies particular discounts and maybe also gives up some points for more discounts by another name, such as a co-op or an advertising allowance. You have committed to a non-disclosure or confidentially provision. You also have agreed to not give any competitor a better deal. Now you want to sign on with an additional reseller. This new customer wants to know the terms of your other deal, but you are contractually prevented from saying what these terms are.:
Suchomel said of the negotiation process, “I think it has made us better distributors, and better partners for our pubishers.” He wrote to clients, “I feel that the experience has clarified some things for us and our clients, and that now we are all even better equipped to navigate through this rapidly changing industry.”
Here are our main previous stories of note:
Amazon Removes Kindle Versions of IPG Books After Distributor Declines to Change Selling Terms
A Little More On IPG and Amazon
Two Distributors Do Sign with Kindle–And Pay eBook Coop