What were they thinking? Or maybe the question should be what were they smoking?
In the beginning, Macmillan looked equally clueless. Their CEO John Sargent with, presumably, an ebook deal with Apple in his pocket, concluded a round of negotiations with Amazon by delivering a flat ultimatum: accept an "agency model" for ebook pricing, in which Macmillan would set the ebook price (at about $13 to $15) and Amazon would sell at that price and take a percentage; failing Amazon's acceptance of that, Macmillan would "window" all their ebooks— delay ebook release for several months after the hardback release, thus shrinking Amazon's thriving Kindle book sales. The agency model is a variation of a concept called "retail price maintenance," which had in the past been illegal since its effect was to squash price competition.
But at least Sargent knew enough to release a letter to all Macmillan authors about what was going on.
I can see the folks at Amazon saying, "OK, we have a problem. We've been handed an ultimatum and we need to react." And what did they do? Did they think back and say, "When have we earned scorn and derision from the public? When we acted in stealth, with no chance for argument and rebuttal. Let's do something different this time." No! They looked at the hand they had been dealt, decided their trump card was that they also sold print books (Apple doesn't), and so they simply pulled all the "Buy Now" links from all Macmillan titles in any form. Where those books were available, it was strictly through Amazon affiliates, usually as used books.
Which meant, as Macmillan knew right away and Amazon seemed not to care, that every single Macmillan author immediately began losing the chance to make any money on Amazon. For some authors, that was 10 to 20% of their sales income but for others it was a heck of a lot more. Blog posts, tweets, FaceBook updates all blossomed, proclaiming the injustice. If you think about it, pissing off people who make their living expressing themselves with words is not a good PR move.
All day Saturday and not a word from Amazon. And when they did finally issue a statement it was weird. Posted on a Kindle users forum, it said, basically, "We tried to save you from higher priced ebooks, but Macmillan won't let us." It even said Amazon would eventually have to "capitulate." Wow! A layer of stupid slathered over a healthy serving of idiocy.
First, if they planned to fold so quickly, they should never have taken the links down. They would have gotten more mileage and less ill will from simply announcing an intention to take the links down and then let themselves be talked out of it, once it was made clear individual authors would suffer more than either titan.
Second, once they took the links down, they had already lost what good will they could glean as any kind of consumer champion; whimpering like a toddler whose big brother took his candy away just made them look weak as well. They would have been better served by a show of magnanimity. "Now that we see the hardship this is causing, we're going to be nice again." At least then people who were publically backing them would not have been so dismayed at their wimping out.
Assuming the links do come back up soon (supposedly Sargent is talking to Amazon today), the aftereffects of this kerfuffle are still going to linger. Several things worry me. First, I am an ebook advocate. I truly believe they are the future of reading, and I don't think Macmillan wants to make money off of them. I think they want to kill them or at least hold them back as much as possible. One thing I noticed on a lot of eReader forums were complaints that Macmillan often priced the ebook higher than the paperback, even when the paperback had been out for a while. Even Cory Doctrow called Macmillan's $15 ebook prices "farcical" (not many authors will willing to agree).
Second, I think a lot of this has soured ebook readers (not spec fic fans but mainstream readers) on publishers. The perception is that publishers are greedy bastards; I don't think they're greedy, but I do think they're desperate to maintain a status quo that's not maintainable.
Also of note, I checked the trending topics on Twitter throughout the day Saturday and Sunday. Amazon and Macmillan were all over my writer/agent/publisher-heavy list of tweets, but those names never once hit the trending topics list, not even when I changed the geography to just look at New York City. The iPad was often there, but our book-lovers spat was not. The world paid little attention.
This leads to my final worry, which is that publishers will throw themselves at Apple and find out the hard way that the main difference between Apple and Amazon is that Steve Jobs has a better design team. Just ask the music industry if they think Apple saved them.
At least it was one weekend that the web gave TV a run for its money.
p.s. Just found this post on Dear Author that dissects the possible aftereffects.