Gerry Conway has weighed in on the recent changes close in the wake of the acquisition of ComiXology by Amazon. His vision of the result of these changes isn’t at all pretty. When someone as distinguished and demonstrably caring about the comics industry as Mr. Conway speaks, it behooves me to listen. Having done so, however, I’m unconvinced that this change is the unmitigated disaster he seems to believe has occurred.
Amazon/ComiXology has basically rolled back to the same sort of deal Amazon has for their Kindle Store on the iOS platform. Is it ideal, no. Has it crippled Amazon Kindle Store sales on the iOS platform. Hell, no!
Amazon makes damn sure they put the weight of their full marketing machine behind being sure I see anything I might be remotely interested in buying from the Kindle Store in every way possible.Direct email newsletters, targeted ads that appear especially for me everywhere I go on the web, Twitter-fed reminders — they want my money and are damn sure going to get all of it they can. I fully expect them to put the same marketing might behind ComiXology sales. If so, impulse sales will only take a small hit in comparison with Amazon’s demonstrated ability to pull people to things they want to buy.
There is no percentage for Amazon in “crippling” the iOS platform for ComiXology to make the Kindle platform more attractive, nor has Amazon ever been foolish enough to try and do so with the other digital stuff they sell. Yes, they want the Kindle to be attractive because it is the ultimate captive platform. If you have a Kindle, you have every reason to buy from Amazon and little incentive (or ability) to buy anywhere else. Selling Kindles, however, is not and never has been Amazon’s interest, except to those people who need them to buy from Amazon.
If you own an iOS device, an Android device, etc. Amazon is thrilled to sell stuff to you whether you own a Kindle or not. Amazon’s margin on the Kindle devices is thin to non-existent. The money is to be made by selling you digital stuff, not a platform to play it on. They must produce the KIndle to maintain a minimum cost platform that still makes using their digital products attractive. The Kindle went to color and high resolution screens not to make the Kindle compete with the iPad, but because people who didn’t want to buy an iPad would only buy their high-res color movies and books if they could do so with a device at a lesser price.
Amazon wants everyone to be a potential customer, even if they have to lose a little money on creating, maintaining and marketing a platform device themselves. As entry-level cost of full-function tablet devices con tinues to drop the Kindle itself will become less critical to Amazon’s marketing strategy. But it will never go away or become a second-class comnsumption device again. It is vital that Amazon not give the appearance of being wholly dependent on the good will of other platform providers to sell their goods. The existence of a quality Kindle device at less than the cost of a full function tablet is their insurance policy against an Apple/Google freezeout. Apple and Google would love to cripple the Kindle Store even more if they dared — but they don’t dare. Their users would never stand for it.
I’m by no means trying to paint Apple or Google as bad guys here — certainly not in the way Mr. Conway is trying to paint Amazon. Apple’s primary business is hardware. Google — well, Google remains confused about what the real business purpose of Android is, and until they figure that out they are something of a wild card. But both have the right to pursue their business interests, just as Amazon must pursue their own.
Finally, let’s deal with the 30% cut taken by Amazon and Apple. Certainly Amazon would want to eliminate that cut going to Apple, but here is no reason to believe Amazon would double dip one of their own divisions, charging off both the Amazon cut and the existing Comixology cut! The smarter play for them would be to use the opportunity to make their prices more attractive and to promote more sales and specials — something they can do now without really cutting into their income much. That would be consisent with what ComiXology says is one of the major reasons for the merger and the change in purchasing procedure. I’m willing to give them the benefit of that doubt — ComiXology has earned that much trust from me. I’ll give them time to make a transition to new revenue practices that will be beneficial to the creators, publishers and consumers. It would be smart business, and no one has ever claimed Amazon isn’t smart.
I find Mr. Conway’s observation that “there is no ComiXology any more”, as if the company has been turned over to rapacious ghouls, to be really over the top. I’m sure he speaks with a sincere concern for the industy, but I think such a judgement is way premature.
The ComiXology crew has time and again demonstrated their integrity, their vision for the future and their sincere desire to build a business that grows because it serves the audience in the best way it can. Certainly, they want to make money, and certainly there will be a payday involved for them. Good for them — they have earned it. The idea that they somehow turned their hard-won business leadership over to Amazon in ignorance of what Amazon planned to do, or that they believed that Amazon was going to sacrifice ComiXology’s broad-reaching market platform just to sell more Kindles and didn’t care as long as they got their payoff — well, if I were ComiXology co-founder and CEO David Steinberger, I’d be insulted on behalf of myself and my co-founders and colleagues. I don’t think Mr. Conway really believes that. If I’m wrong and he does, he’s doing those people a disservice that they haven’t earned.
The acquisition has all sorts of possibilities for improving, not crippling, the buying experience overall, and reaching more new readers than ever before — assuming Amazon is smart enough to make the best use of what they bought. Why keep on the entire ComiXology employee base from top to bottom if you are going to dump out of the way they do business altogether and ignore what made their approach work? I credit Jeff Bezos with more sense than that.
Yes, there will be changes and yes, some of them will require some short-term retrenching and regrouping. But I think we have reason to believe the final result will benefit both Amazon and the consumer. If it doesn’t, consumers will abandon them over the long haul and new customers won’t come to the platform. That would be a damn shame — but I think the smart money bets the other way. I think a full-fledged bloody panic fit is the wrong thing to do now. Instead, please do hold Amazon’s feet to the fire if they don’t use their position to build the platform over the long haul.