“Dear Ms Blackall

Thank you for your email inquiry of 14 November 2009 to the Australian Competition and Consumer Commission (ACCC) regarding Amazon Kindles.

The role of the ACCC is to ensure compliance with the Trade Practices Act 1974 (TPA), which is designed to encourage fair trading and discourage anti-competitive conduct through a specific set of competition and consumer protection rules.

Section 52 of the TPA is a broad provision which prohibits a corporation, in trade or commerce, engaging in conduct which is misleading or deceptive, or which is likely to mislead or deceive. Whether particular conduct is misleading or deceptive is a question of fact to be determined in the context of the evidence as to the alleged conduct and to the relevant surrounding facts and circumstances. If you think you have entered the on the basis that all Amazon books advertised would be available to Australian consumers, when in fact only 25% are available, you should first attempt to pursue a remedy with Amazon.

Section 45 of the TPA prohibits anticompetitive agreements (agreements between competitors) that have the purpose, or likely effect of substantially lessening competition in a market in which the businesses operate. The ACCC would be interested if you have any information that may suggest that there is an agreement between publishers to restrict the supply of books for any particular reason.

In assessing any complaint, staff of the ACCC would generally determine whether or not the matter falls within the jurisdiction of the TPA, whether or not there appears to have been a breach of the TPA, and if so, whether the impact of the conduct is so serious and widespread that it is appropriate that the ACCC should take some action. The ACCC generally takes enforcement action in circumstances where there are broad flow on benefits for industry and consumers alike. While there may be some instances where a breach of the TPA has occurred, it may be more appropriate for consumers to pursue these matters individually as a private matter and in many instances their local Office of Fair Trading will be able to assist with advice on how to proceed in such matters.

Often private actions are more appropriate because they are aimed at remedying a particular dispute between the parties. It must be emphasised that, ultimately, it is a matter for the Courts to determine whether the alleged conduct breaches the TPA and a private right of action is available to anyone who suffers loss or damage as a consequence of a contravention of the TPA. It may be prudent to seek independent legal advice on what further action may be appropriate.

Your matter is important to the ACCC as it assists us in determining issues with national or wider public interest implications. We closely study the patterns of complaints that we receive to ensure that our enforcement and education actions are focused on the areas of greatest concern to Australian consumers. Consequently, the details of your matter have been recorded and will be used to determine whether there is a pattern of behaviour by a particular trader or in a particular industry that raise broader concerns.

Thank you for contacting the ACCC with your concerns.”

It looks like they will not be able to do anything about this issue. It was worth a try anyway.

It has done so.

The first recommendation in its report, available at http://www.pc.gov.au/projects/study/books/report
is:

The Government should repeal Australia’s Parallel Import Restrictions (PIRs)
for books.

I strongly suggest that Michael read the report. It runs to around 240 pages, is carefully researched and details and refutes many of the logic errors in favour of PIRs made by Michael and others.

Michael and others make their comments in favour of PIRs forcefully and perhaps even sincerely, but forcefulness and sincerity in isolation are no substitute for scientific rigour, such as is found in the government report.

Michael claims authorship of over 100 scientific publications. I urge him, and any others claiming similar abilities to apply scientific method to the independent report of the Australian Government Productivity Commission and identify sufficient errors in it so as to invalidate its prime recommendation, if they are able.

So long as Michael and his supporters refuse to do so they must surely understand the difficulty some of us have when he asks us to prefer his opinions over the scientifically reached independent conclusions of the Australian Government Productivity Commission.

You’re just not being honest, Michael.

1. I’ve already argued in detail again and again how authors are IMHO protected against dumping by commercial and geographical and even ‘industry protocol’* factors far more than PIR’s. I’m not claiming that’s a lay-down slam, but what your side needed to do was show - with some far more compelling evidence than a couple of anecdotes about Peter Temple’s ‘Broken Shore’ and a stray copy of a Shane Maloney novel - that removing PIR’s would in fact have resulted in more dumping.

* As many submissions conceded, many books are in practise treated by local and international industry ‘as if’ PIR’s still apply to them even though the 30 day rule may have lapsed.

2. So how about some concrete numbers from some of the leading authors who warned of the remainders issue? You know, from Maloney, say: my novel X is still selling Y copies a year in Australia, and I know there are Z remainder US editions sitting waiting in warehouse A Chicago, for which I know Sneaky Pete’s Unbought Book Dumpa-Junction paid $1.40 per copy. If PIR’s are lifted, they will be able to ship them here and retail them at a profitable-to-all price of B per copy in retail outlets a-to-j, which will still be at least C cheaper to the endpoint customer than my local publisher can do it, enough to convince perhaps D% of my loyal local readers to choose the remaindered Yank version over the current Oz one, despite my best marketing efforts. A few authors in their submissions floated some theoretical examples - from memory, Toni Jordan, Garth Nix, the guy that does the Psycho Bum kids’ books - but they all stop short of getting into the nitty-gritty of freightage, distribution and retail costs cf. the internet warehouse option, as well as the specifics of how many local versions they’re still shifting.

None of them will do it because they know the numbers will rarely stack up. And also none of them want to highlight the basic mercantile fact underlying remainders which I have also made in the past:

3. These are books that buyers elsewhere have not wanted to buy. Unsold product. In market terms, failed product. Again as I have said before, in some cases, the authors will have been paid for them anyway, in the form of un-met advances. With technology changing everything, there are fewer excuses for producing remainders as an automatic systemic by-product of the industry’s framework every day. It’s environmentally wasteful to do so. There are multiple alternative options now. It’s a practice that needs to be not-so-slowly phased out of the business model, not sustained by the ongoing imposition of protective legislation (here and elsewhere) that hurts so many other industrial participants, as well as all consumers.

Why you think every book buyer in Australia should pay more for all books, small and medium booksellers be squeezed out by internet selling faster and more comprehensively than they might otherwise be, and the majority of Australian writers be robbed of a shot at greatly increased direct subsidy, just so that a small number of generally (relatively) more successful writers with a dud book oversupply problem on their hands can go on enjoying rules that maximize their income(s) in multiple, artificially-compartmentalised markets…still escapes me.

But what’s truly offensive in all this is the way your side has claimed the ‘moral’ high ground on this issue, as if only the stance that ‘cares’ about our writers and their incomes, our literary vibrancy and our cultural health in general, is the pro-PIR one. Some of the abuse the reformists have copped has been unnecessary and I thnk pretty revealing: philistines, haters of writers, anti-Oz cultural warriors, ‘sociopaths in suits’, cringers, or in my case: bitter, failed, resentful, jealous. And again, even the way you depart:

“Unless you or someone else who believes this nonsense, comes up with a sensible scheme that protects authors normal copyright, I am done with this particular discussion.”

…is the sort of sniffy, nobody-cares-about-writers-but-me language and debating tactic that, frankly, seems at odds with the fact that you got exactly what you want. Is it that you suspect that maybe, for most Australian writers most of the time, this will in fact prove the lousy outcome I think it is?

Michael thanks for your time, and we have to wait and see, I guess.

Thanks Meski. That’s a good constructive comment.

As might be expected of responsible public servants, they have weighed and judged each and every argument put forward by advocates of PIRs such as Michael. They have done their own research. They have unequivocally come down in favour of their removal.

The Australian Government Productivity Commission is an independent Government Dept, not some rent seekers mouthpiece such as Michael quotes. This Commission was set up by Paul Keating. Its role is to expose rent seekers operating against Australian consumers.

It has done so.

Sorry, ‘vast majority’, ‘zero’ are both a bit over-reaching, James: but put it this way, I question very, very strongly the claims made about the general ‘trickle down’ impact of PIR’s on the health and vibrancy of the wider literary community. Especially - and this is the key point - when compared with the efficiency and diversity and penetration of the dough that comes via the Literature Board (and other public sources, like school education programs, etc).

The moral argument is blindingly obvious: the right of an author to be paid for their creations under internationally agreed copyright law.

Perhaps you do not agree with that. But if you do then you need to suggest a scheme that solves that problem.

Also please re-read the earlier articles, such as the one with the table of Top Ten that proved that in the class of popular sellers (not of major interest to most of the bloggers here) there was little to support your bleating about paying higher.

It is a matter of choice whether you would support the cultural argument (local authors, editors, publishers, printers), and I suppose if you are worrying about the cost of Dan Brown and Jeffrey Archer, we can see where you stand on that issue.

Nah. The Sunday Telegraph’s Nick Leys reported it yesterday, with a pretty play-it-straight ‘we’re very proud’ PR release from Rudd, and a slightly snippy Michael Heyward (Text). S’not nline, here’s some bits:

‘…The Sunday Telegraph has learned [Rudd absenting himself from Cabinet/issue] was because Mr Rudd’s daughter is penning her debut novel, believed to be about the rise of an aspiring MP. Jessica Rudd’s first novel will be published by Text Publishing, but readers will have to wait to learn if it is a Primary Colours style book, a fictionalised account of Bill Clinton’s march to the WH, or something more esoteric. A spokeswoman for Mr Rudd said: ‘The PM is very proud of his daughter Jessica, who has decide to write a novel and has a contract with an Australian publisher.” Michael Heyward of Text confirmed Ms Rudd has a single book deal and said the book was yet to be given a publication date. “It’s a very clever, funny and compulsively readable book about a young woman who makes an unexpected career move, ” he said. “Until she has finished it, we won’t be disclosing anything more. He described Ms Rudd as ‘very talented’ with a ‘wonderful gift for words’…”’

Like I said, whatever. Good luck to her. Now I know I said I’d shut up, Crikey, but this is a mildly amusing denouement to what’s been, for me anyway, an astonishingly improbable tale of policy lunacy. So let’s sum the story up:

1. It was the banal existence of this just-revealed familial publishing deal that had PM Rudd abstaning from the Cabinet debate (and on reflection, most of the public one, too). Rudd’s made a huge deal of his economic reformist credentials since the election. Obviously he was looking for an excuse to avoid having to commit either way (Australia’s luvvies terrify a certain kind of ALP politician). Who knows for sure, but it’s strongly arguable that his participation in the debate would have seen PIR’s go, at last. Instead, he decided to ‘do the right thing’ and …abstain. Lame. And not even ‘the right thing’ at all, anyway. Because…

2. …Michael Heyward was probably THE key pro-PIR campaigner (at least among publishers). It’s not really credible that simply ‘abstaining’ here (formally so late, and for reasons undisclosed until after the decision) was sufficient. Heyward was about as partial as anyone in this debate could get, since…

3. …Text Publishing, a relative newcomer, has built a large part of its business (very quickly) on the lucrative international rights trade enabled by PIR’s. In Heyward’s own submissions, he bluntly said that without PIR’s, it’s unlikely the ‘growth’ in that trade he has enjoyed could be sustained. Rather hypocritically….

4. …Text has also - despite Heyward claiming in various articles during this campaign that his company no longer needed it - received direct subsidy money (ie from the Literature Board) anyway, in parallel with the subsidy benefits he harvests from PIR. He got, for example, $11,000 last reported FY (to travel to Frankfurt and undertake ‘international market development’). Presumably, though, any Lit Board subsidy he’s happy to take is relatively small beer compared to his PIR benefits, since…

5. …In maintaining PIR’s, while he and his pro-PIR leaders secured (and enhanced) the quasi-patronage power of the(ir) small-ish number of Houses that trade significantly in across-territory rights, Heyward & Co’s campaign simultaneously walked - on behalf of every other writer and publisher in Australia - away from a large increase in direct Lit Board money (as a ‘pool’ into which everyone has an equal chance to apply to dip). This is classic ‘special pleading’, actually: not where an entire industry conspires to gain special privileges over the wider economy, but where companies inside the same industry seek to gain privileges over competitors. (Same applies to writers: in this case, those with o/s deals have gained advantage at cost to those without, including unpublished writers, like me).

Think about that again, for a second: Publishing company X gets a specific benefit of a Cabinet decision, but only at cost of a general pooled benefit that ALL companies would have otherwise enjoyed. Don’t you think it starts to look a bit shabby that Company X just happens to publishing the PM’s daughter’s book? (Can you imagine the stink from the luvvies if it was Melanie Howard, here? Or Stan Howard, for that matter…?) Don’t underestimate the cost of this to the wider writerly/literary community pool, James. It’s only going to become apparent as future funding dies. And…

6. …Enormous numbers of Australian writers, editors and publishers depend heavily on what little bits they can get via the Lit Board. PIR-derived income for the vast majority of Australians in the literary community is….um…zero. And will continue to be…um…zero. Writers - and I mean good ones, not failed bitter ones like me, but recognised, low-selling, near-broke but culturally worthwhile writers with fine, weighty oeuvres produced over grinding decades and who’ve partially-survived on LB money in the past - will be in (the usual) real trouble.

7. Meanwhile, Australians will continue to pay 20-30% too much for books - especially those who are rural readers, older readers, or the parents of kids just starting to read, all of whom have greatly reduced capacity and time/opportunity to shop around the net, or the discounting shops, for cheap ‘spot price’ deals. I have a three-year-old…if he sees a book he wants, I can’t exactly say: ‘Let’s shop around for the cheapest version, mate.’ It doesn’t naturally work that way for most of the casual readers/buyers who probably constitute the vast bulk of industry turnover; only for the literati, the academics and other IT professionals.

Or at least did, up until now. Because…

8. …far better educated by this debate, more Australians will shop increasingly online, or in chain stores, slowly causing the extinction of exactly that kind of ‘little, vocational bookshop’ that the pro-PIR loud-mouths claimed to be championing. Maybe as many as 2,000, 3,000 retail jobs - jobs people who are into books do, helping make up the ‘literary community’ - will go.

9. The Australian ‘printing sector’ - the Maryborough plant in that marginal Victorian electorate (300 employees), basically - will continue to refuse to tool up for digital print-on-demand, hoping traditional business will hold . It won’t. Its orders will drop as Australians buy online-overseas anyway, and it will go broke anyway, probably within two or three years, as Bob Carr pointed out over the weekend.

10. Finally, quite aside from the specific Lit funding boost thoroughly snubbed, Arts Minister Peter Garret will have expended an enormous amount of general political capital inside Cabinet with the finance hard-heads, which means that arts funding in general will probably suffer in the future. It’s galling enough for a Finance Minister or Treasurer to have to ‘lose one’ to the luvvies when the arts/cultural policy needing money is a good one. When it is a laughable joke of an anti-policy that in fact hurts the very sector it’s purportedly designed to help; when it’s a fiscal ‘no-brainer’ which, if your hardheads fail to get through will make them a laughing stock among the wider finance & policy sector…you can bet your PM’s ass it’s going to come back to bite yours, next time you go looking for money in a cultural or luvvie cause.

Then again, James, on the plus side to all that: we will all soon be able to enjoy Jessica Rudd’s debut novel.

Look, James, as I said, it’s not her fault and I assume nothing sinister anyway and I wish her the best. Writers claw their way into print however they can. But I do think Rudd - and especially Michael Heyward - not coming clean on this way, way earlier was not exactly in good faith; in fact, really shabby. It does tend to make a bit of a mockery of all the endless self-important braying from pro-PIR dudes like Heyward, about how culturally noble and critical and fragile their vocation is. As I said, I wouldn’t mind knowing when this deal was struck, and how Rudd’s (J) advance stacks up against other (unquestionably worthwhile) Text writers like James Bradley. Or even, outside text, someone like Delia Falconer, an exquisitely singular, deeply Australian writer and artist who’s probably doomed to remain a low-seller, and so dependent to a degree on the Lit Board path of subsidy, for her whole career. This decision hurts that kind of Australian writer. That’s what is so dumb about this. It hurts exactly those parts of the industry in whose name PIR champions claimed their lobbying victory. It can’t be all that much fun if you’re someone like Falconer, to have put your shoulder to the PIR grindstone behind guys like Heyward; only to wave bye-bye to more direct subsidy while waving hullo to Why-hullo-Ms Jessica Rudd’s ‘compulsively readable’ - albeit (ahem) not-yet-written! - first effort. (That’s one hell of a fine-tuned literary-aesthetic sensibility you got there, Mikey!) Put it this way, James: if, as Christopher Dunne above in this thread keeps braying, this is the kind of culturally-important vocational ‘risk’ Australian publishers ‘need’ PIR’s to underpin, such that they may help our national literature and cultural autonomy flourish…well, poor blameless young Jess Rudd is gunna find herself fair under the critical microscope when she does launch it, I expect!!

You want the mournful truth, James? Or at least mine? I rather think the truth - one just, only now, dawning on Australia’s wider ‘literary community’ - is that a small, self-serving coterie of ambitious publishers and writers who directly benefit from PIR’s - houses that trade in o/s rights; writers with o/s deals; the local management of Australian arms of multinational houses who can gouge Australians on the big brand best-sellers, and post heftier margin reports back home - have just successfully pulled off the greatest literary hoax since Ern Malley.

I could be wrong, James. But sadly, I really, really doubt it. Cheers, all. Finally!

What is the moral argument for book producers getting the government to compel buyers to pay more than they otherwise would, for even airport blockbuster trash?

I know the local content argument, that Australian authors etc might starve - but all the studies clearly indicate direct grants to them would be cheaper.

What is the moral argument.

I want to feel good every time I overpay for non local stuff like the Da vinci Code, Jeffrey Archer etc. Currently I just feel like an idiot. My government having had a gun put to its head by rent seekers, who having learned from the CD industry rent seeking failures, now locate in marginal electorates and insist on fully unionised staff so as to facilitate an extortion racket, overcharging all Australians so as to benefit mainly to non-Australians and ALP politicians.

I want to believe its harder than that to shred Mr Rudd’s claim to economic credibility. I want to believe in the credibility of the ALP of the Hawke and Keating years, where the primary test was consumer benefit to the majority. Not a rerun of the Whitlam years when the ALP shamelessly rigged the system for the benefit of a minority of insiders, until it collapsed.

If a PIR is so good, why not a PIR run by my local council to lard up the cost of all publications not printed in my council area?

Who now claims that abolishing the same kind of rent seeking that used to operate with music, has harmed any one but the former rent seekers. (CDs and DVDs). Who now claims New Zealand consumers have not benefited from the abolishment of their PIR.

With both the claimed damage never occurred - overseas rent seekers suffered, the consuming majority benefited.

No first-time writer deserves anything less than warm wishes and congratulations. But it really better be rather good, is all. Worth chucking away x millions in direct subsidy for everyone else though the Arts Council, even, ntm Australian readers going on paying 20-30% for books in bookshops, which will likely kill the Indy bookshops off.

Fine, slag me off for being a bitter failure again, if you wish. But I think it would have been nice for Heyward and Rudd (K) to declare this upfront and publicly, too. (Be interesting to know when the deal was struck, and how much the advance.) I’m not claiming anything dodgy. No writer needs to have the thrill (presumably!) of their first book buggered up by petty accusations. Good luck to Jessica Rudd, and good on Text for giving her a go.

But it does make the PIR lobbying victory seem a bit…I dunno, a bit shabby.

Anyway, enough, at last. Jack Roberson

Is this a pre web 2.0 generation issue? And digital natives basically don’t give a proverbial?

What I mean to say is, anything that nourishes the bookshop sector will tend to foster more individualisation away from the generic Wal-Mart type of crap like Dymocks. Not just the specialty ones but the general ones with a quirky style and taste, such as Gleebooks. And my guess is that good business in those retail outlets will do more for Australian authors than any protection of the publishing houses could ever do.

I would venture to say that we’re extremely poorly served by the British publishers who carved up the world between themselves and the Americans years ago, in much the same way that Pope Alexander VI divided the world between the Catholic colonists. This anachronism has led to Australia being monopolised by a colonist that sends only a few safe leaders over this way. Any non-leader titles that subsequently take of in Northern hemisphere sales, get here many months later, if at all, and usually at a time when the public discussion about those books has died down. So Australia misses out on those discussions. And correct me if I’m wrong, but I’m not aware of much action by Australian publishers on that front.

But as I said, I’m not conversant in the Australian publishing industry. I’m just a consumer who sees us being treated as a barely literate colony, though the studies I’ve heard of have found we are more literate, and have more diverse reading habits, than the UK.

That’s not related directly to PIR (or is it? again I don’t know) but extrapolation from experiences in other industries tells me that the more government f***s with an industry, the more things break down.

I rely on the Productivity Commission for analysis of things like this. And I find that both governments have made a routine practice of totally ignoring that body since it was created. Just as they typically ignore all independent expert bodies which have expertise but no lobbying clout. That’s why your side won, and this debate is now in the realm of the purely academic.