As someone who works between the publisher, author and reader, articles like this bode poorly for my industry. The article discusses how Amazon is directly snapping up authors instead of sourcing their books from the publishers, and how this might affect the publishing industry.

It has set up a flagship line run by a publishing veteran, Laurence Kirshbaum, to bring out brand-name fiction and nonfiction. It signed its first deal with the self-help author Tim Ferriss. Last week it announced a memoir by the actress and director Penny Marshall, for which it paid $800,000, a person with direct knowledge of the deal said.

Publishers say Amazon is aggressively wooing some of their top authors. And the company is gnawing away at the services that publishers, critics and agents used to provide.

So what does this mean for booksellers? For authors? For publishers? It means a hundred things, but the most important thing is that the book industry is going to fundamentally change, and soon. Once upon a time, eBooks and eReaders were slated to be the biggest white elephants in technology. Now their sales are booming (Kindle sales are estimated at 3 million units) and last year it was estimated that Americans alone spent $440 million dollars on eBooks. This sounds like great news for publishers and authors, and it is. People are reading more than ever before and across more genres. Once upon a time fantasy and science fiction were the red-headed stepchildren of the publishing industry, and now we’re seeing massive interest thanks to shows like Game of Thrones, miniseries like Colour of Magic and movies like I, Robot. Young adults are reading like crackmonkeys and the word in the industry is that there’s money to be made in writing for them. Readers enjoy instant and sexy novels and there’s always online shopping for those who don’t want or have an eReader.

Rosy thus far, but the last year has seen the closure of entire book chains, such as the 400 Borders stores that closed this year. 22 independent books stores are on sale in the UK, including the famous store in the Notting Hill movie. And as many of my friends delight in telling me, why wait for a book when they can get it immediately on a Kindle? There’s always the complaint that new books are expensive, but if one considers that the price of printing books has doubled, that the books have to be shipped here, the publishers paid and the rent of the store settled, its no surprise that bookstores are feeling the weight of import duties and exchange rates. We buy books in dollars and pounds, and you can imagine how hard it is on the booksellers when the Rand is down. With theft being endemic and many stores losing money through endless shoplifting and book piracy, it is a damned hard industry to stay afloat. I think one of the saving graces for us is that people over 30 tend to buy proper hardcopies. I know I prefer a real, delicious book but I know not everyone doesn’t.

And now with Amazon taking on authors directly, there are two things that I think will happen. Publishers, in an effort to recoup losses caused by defecting authors, are going to increase the price of books. This will directly affect the booksellers and make it even harder to sell books. So more people will turn to Amazon, who can buy in absolutely ridiculous bulk and command the best prices.

I do believe that Amazon has a phenomenal business model, and one has to admire them for it. They see a hole in the market and they fill it with melted Kindle goodness. And for authors, this may be the best news in the world. With publishers too scared to take on any title that may be a little controversial or too highbrow to do well, Amazon might be the best bet for a fledgling author. If they don’t require agent representation, then that’s another foot in the door. Sure, they’ll probably have slush pile ten feet high, but at least they have the kind of money to hire a fleet of editors and agents. Publishers don’t have that option anymore.

I can’t pretend to know what will happen in a year or five’s time, but I do have this awful feeling that Amazon is chewing up and spitting out all of its competitors in the Western world. With South Africa being a little behind in terms of bandwidth and wireless availability, the bookstores have managed to keep ahead. But with incomes shrinking there will definitely be less money for shiny new books. And if there’s a massive company that will send a cheaper eBook to you immediately, then why go to a bookstore?

The future might lie in bespoke bookstores, or in appealing to the idea of personal interaction with books and booksellers. But for now, all we can do is watch, and like the executives say at Amazon, to not be so hyped on demise.

Amazon executives, interviewed at the company’s headquarters here, declined to say how many editors the company employed, or how many books it had under contract. But they played down Amazon’s power and said publishers were in love with their own demise.

“It’s always the end of the world,” said Russell Grandinetti, one of Amazon’s top executives. “You could set your watch on it arriving.

EDIT: Today The Daily Maverick released this fascinating article that further explores the price structure Amazon is offering authors and more specifically where they will beat out publishers.  In essence, I think Kevin Bloom has nailed the potential upshots and downfalls of this situation quite nicely:

The contract was cancelled and Davenport was forced to pay back the $20,000 advance. She took it philosophically, stating that Cannibal Nights was some of her best writing, and that she had Amazon to thank for finally presenting it to the world. “Sleeping with the enemy?” she wondered. “Perhaps. But now I know who the enemy is.” It was a line read by thousands, as evidenced by the 159 comments under the blog, many from writers railing against the well-known bully tactics of the Big Six.

Which is where the upside to the current turmoil can possibly be found. If Amazon can act as a ballast to the dominant publishers without putting them out of business, if it can break the oligopoly and force better terms for writers as an industry standard, the good guys win.

If, on the other hand, Amazon guts traditional publishing until it’s the last player standing, only Jeff Bezos wins.

For further reading, please visit The Publisher’s Weekly article All Eyes on Amazon Publishing and the Davenport Dialogue blogpost directly dealing with her experience with Penguin.