On this blog in September 2013 I predicted that Amazon’s CreateSpace were positioning themselves to supply the Canadian market directly. Two days ago, in an email to clients, CreateSpace made it official. Unless the CreateSpace publisher specifically opts out, the following will now apply:
Starting October 8, we began making CreateSpace titles enrolled in the Amazon.com sales channel available directly to readers in Canada on Amazon.ca. Your title may already be offered on Amazon.ca through Expanded Distribution or other channels, but now you can earn the same royalty on Amazon.ca that you would earn for a sale on Amazon.com.
You can expect to see a title enrolled in the Amazon.com sales channel on Amazon.ca in 30 days. List prices will be converted from US dollars to Canadian dollars to determine the Amazon.ca list price. Royalties from Amazon.ca sales will be calculated based on your USD list price and reported as part of your USD sales for Amazon.com.
Many indie authors use a combination of CreateSpace and Lightning Source International/Ingram Spark as our POD manufacturers, and those who select CreateSpace’s Expanded Distribution do so as well, just not directly: CreateSpace subcontract Expanded Distribution to Lightning Source. The struggle for everyone was Amazon’s decision back in 2011 to artificially lengthen the estimated delivery times posted on the Amazon sites of POD books distributed by Ingram (a practice that has continued unabated by Amazon and inexplicably unchallenged by Ingram). This manipulation of the Amazon catalogue lowered, and in some cases entirely killed off, our print book sales on Amazon sites outside of the U.S. and key European sites serviced by CreateSpace.
For those self-publishers wanting to sell in Canada, then, this move by CreateSpace seems a welcome relief: our books will now be listed as “In Stock” on the Amazon.ca site AND we will earn higher royalties than we do with LSI or Expanded Distribution.
But it’s not all roses. Firstly there is the problem of selling at a Canadian price that is converted from the USD: right now, our dollar is sitting in the mid-70 cent mark, so a $10.00 USD book would balloon to $13.00 Canadian. What needs to happen is for CreateSpace to allow publishers to set a local currency price just as we currently do for the UK and European markets. Publishers who wish to maintain a dedicated CDN price must still rely on LSI, which does allow for a dedicated CDN price (though problems with this have been an ongoing matter, at least for me, but that’s a different blog post) — yet if you do so you run back into the problem of the extended stated delivery times. So what Amazon give with one hand (expanded distribution into Canada) they take back with the other (higher book prices for Canadians).
[UPDATE 18 October 2015: I just received a phone call from CreateSpace about this issue, and they tell me that they may add the option to set a dedicated CDN price in future if consumer feedback warrants it. So if you have a CreateSpace account, I recommend you send them an email requesting this option.]
Secondly, this move hints at a darker agenda, which is for Amazon Canada to become book manufacturers, not just retailers, by force.
This was something I touched upon when I reported on how Amazon were bullying traditional publishers in the UK, trying to force them to hand over their print book files and to sign a new contract that would have allowed Amazon to print book orders if the publisher was “unable to deliver.” So why do I believe this is what may happen in Canada, too?
When I signed up with CreateSpace back in 2011, they were supplying the books ordered on the Amazon.com site; when CreateSpace expanded into Europe in July 2012, I assumed that CreateSpace had created a physical presence there. But that, I recently learned, is not actually the case. When UK publishers order copies of their CreateSpace titles, the books are printed at the company’s South Carolina plant and shipped overseas; but when a UK consumer orders a CreateSpace title, the book is printed by Amazon at their own printing facility in the UK. CreateSpace still handle the royalty payments, but a physical product does not change hands between subsidiary and parent company. It’s all on paper, no pun intended. It is the same arrangement for all Amazon sites in Europe, and has been in the United States, too, for a few years now. This same arrangement will be used in Canada, which means Amazon have now set up a printing press here too.
[UPDATE 18 October 2015: In my phone call today, CreateSpace apologized for this incorrect information supplied to me: for now, Amazon.com will be printing and fulfilling Amazon.ca orders and shipping the books north. It’s likely Amazon will be gauging demand before setting up a press here.]
So why is that a problem? Firstly, we publishers are approving a proof printed by CreateSpace but the product delivered to the consumer is printed by Amazon. Not a big issue IF the machines are identical, but if there exists any variation in the printing process between companies, there is the matter of subcontractor anomalies, also known as print on demand’s dirty little secret.
[UPDATE 18 October 2015: I asked whether or not Amazon use identical machines as CreateSpace and was informed they are not allowed to discuss this. All they could share is that they use the same paper, which at least ensures the spine thickness is identical, but that “variations in the cover may occur.”]
Secondly, this move may open the door for Amazon to bully Canadian publishers into handing over their print book files, or at least for Amazon to try to as they did in the UK. As any small press or self-publisher in Canada who bulk prints then distributes to Amazon.ca via Amazon Advantage can tell you, there is no advantage: Amazon make the process as difficult and expensive as they can, hoping you’ll give up and go POD. I personally know of some self-publishers who have done exactly that already, and that was before this latest move.
Printing POD costs considerably more per book than bulk printing, so forcing publishers to print POD eats into profits. Canadian publishers — small press, vanity press, and self-publishers — are already struggling to stay afloat; how this latest move will affect them only time will tell.