At Gear Diary, we aim to serve you, our dedicated readers. So at great risk, with stealth, ninja skills, and a fair amount of hackery, we have here the rough draft of John Sargent’s open letter to Macmillan’s authors and illustrators. The version that ran in “Publishing Lunch” was punched up by the public relations department; the rough draft is FAR more interesting.

The final version is in quotes, and the rough draft is in red below it.

To: Macmillan Authors and Illustrators
cc: Literary Agents
From: John Sargent

I am sorry I have been silent since Saturday. We have been in constant discussions with Amazon since then. Things have moved far enough that hopefully this is the last time I will be writing to you on this subject.

We’ve had Jeff Bezos locked in the basement of our headquarters since Sunday morning. He’s finally starting to see the light, after we smashed a Kindle DX in front of him to prove we mean business.

Over the last few years we have been deeply concerned about the pricing of electronic books. That pricing, combined with the traditional business model we were using, was creating a market that we believe was fundamentally unbalanced. In the last three weeks, from a standing start we have moved to a new business model. We will make less money on the sale of e books, but we will have a stable and rational market. To repeat myself from last Sunday’s letter, we will now have a business model that will ensure our intellectual property will be available digitally through many channels, at a price that is both fair to the consumer and that allows those who create and publish it to be fairly compensated.

It has been deeply troubling to see consumers wanting books again. The old model worked great, because we sold all our books to suckers like Borders and Barnes & Noble, then re-sold it to them as overstock “bargain books”. It also meant consumers were willing to pay through the nose for a new book. We liked that idea.

Then they discovered this thing called the “internet”. And on the “internet” they digitize books. Now people have this totally wacky idea that somehow, a 750mb computer file costs less to generate than a 500pg book. And therefore, we can afford to sell them books for less money. We saw that happen in the record industry, and thought we’d dodged a bullet when people just stopped reading. Then Amazon came out with the Kindle, and people started buying books again, and we realized we needed to take action! How dare they want to read!

Also, we hate capitalism, and the idea that “price competition” is a good thing.

We have also started discussions with all our other partners in the digital book world. While there is still lots of work to be done, they have all agreed to move to the agency model.

(photo courtesy Instructables)

Those smashed up Kindle DX pieces helped persuade everyone how serious we are. No one wants to wake up to a shattered e-ink screen in their bed.

And now on to royalties. Three or four weeks ago, we began discussions with the Author’s Guild on their concerns about our new royalty terms. We indicated then that we would be flexible and that we were prepared to move to a higher rate for digital books. In ongoing discussions with our major agents at the beginning of this week, we began informing them of our new terms. The change to an agency model will bring about yet another round of discussion on royalties, and we look forward to solving this next step in the puzzle with you.

Mostly we didn’t want to lose any more authors to lucrative digital deals like Stephen Covey and Ian McEwan did. How dare they actually leverage their talents for profit?

In any case, we trust dangling a carrot in front of authors should be sufficient. DO NOT ANSWER ANY CALLS FROM AMAZON. We’re your friends, not them.

A word about Amazon. This has been a very difficult time. Many of you are wondering what has taken so long for Amazon and Macmillan to reach a conclusion. I want to assure you that Amazon has been working very, very hard and always in good faith to find a way forward with us. Though we do not always agree, I remain full of admiration and respect for them. Both of us look forward to being back in business as usual.

That Jeff Bezos really likes the idea of being an “independent” person. Apparently kowtowing to a dying business model was not on his agenda. And he has this crazy idea that he can set the prices in his personal store. I don’t know what they’re teaching in business school these days!

And a salute to the bricks and mortar retailers who sell your books in their stores and on their related websites. Their support for you, and us, has been remarkable over the last week. From large chains to small independents, they committed to working harder than ever to help your books find your readers.

Thank god for actual bookstores. They buy our stuff at whatever price we want to set, because they’re desperate for business. Especially Borders. Sure, they have worse credit than a foreclosed homeowner, but they need us badly, and that’s the kind of power imbalance we are happy to have with our partners.

Lastly, my deepest thanks to you, our authors and illustrators. Macmillan and Amazon as corporations had our differences that needed to be resolved. You are the ones whose books lost their buy buttons. And yet you have continued to be terrifically supportive of us and of what we are trying to accomplish. It is a great joy to be your publisher.

Please, don’t leave us. We know the lure of the internet is great, and you want to be the “cool” author everyone can read on their Kindle and nook, but you need to let us handle this for you. You can trust us, we’re clearly out for your best interests (as long as your best interests are keeping us, the publishers, in business!)

I cannot tell you when we will resume business as usual with Amazon, and needless to say I can promise nothing on the buy buttons. You can tell by the tone of this letter though that I feel the time is getting near to hand.

Jeff Bezos just screamed “Stop, you monsters!” as we tested whether a Kindle 2 will blend. I think he’s about to crack. Better grab the new pricing structure agreement now!

All best,
John

(Special thanks to Teleread for their reprint of the original letter.)