What can you tell us of Amazon’s new direct POD service, CreateSpace.com?

What can you tell us of Amazon’s new direct POD service? Many years ago I remember walking into Book Expo America in Chicago and seeing Amazon banners hanging from every girder. What was an Amazon? Within a few years, Amazon was a household word. To consumers it was an online e bookstore. To investors it was a giant black hole where tens of millions of dollars were dumped with no return on investment.

Amazon has always intrigued me. To this day, I believe that the whole company consists of Jeff Bezos sitting behind a big desk smoking a cigar, in a room with a giant computer. I’m just kidding but that is how it seems. Have you ever talked to anyone on the phone from Amazon? Didn’t think so. Any contact I have ever had with Amazon, over the years, consisted of me writing a detailed email and then receiving canned responses several days later that rarely answered the question. I think, in the end, the key to Amazon’s success so far, even in the absence of customer support lies in the question “How hard can it be?”. Customer A buys product B and supplier C stuffs it in a package and drops it in the mail. The website is a giant virtual showroom and sophisticated cash register. If you use your imagination a little, you really can picture that man behind the desk and the giant computer hitting the refresh button every once in a while and checking the bank balance at the end of the day It’s pure genius. Of course, I am sure there is more than one employee but you get the picture.

This “let the computer do it” customer service model is great for selling widgets off the shelf. Thanks to a printer named Lightning Source, it can sell books that don’t even exist prior to the cash being put in the cash register. For those of you who don’t already know, the way this works is simple. The consumer visits Amazon, the virtual bookstore and selects a book and checks out through the virtual cash register. A signal is then sent to Lightning Source to print the book from a digital file on hand on a server in Tennessee. The single book is printed and placed in an envelope with an Amazon return address and dropped in the mail. This is all done within 24 hours. Pretty neat, huh? This is POD (Print on Demand) at its best. Not all books are available POD because it’s too expensive for the publisher but if you’re the guy smoking the cigar watching the computer, it sure makes sense to have this as a goal, especially for all books where they need you more than you need them.

Now picture yourself behind that desk for a moment and ask yourself the same question you asked earlier, “How hard can it be?” You get wondering why you are paying Lightning Source to print your books when your sales are more than sufficient to warrant buying your own printing equipment. Only problem with this is how are you going to do this and stick with your “Let the computer do it” customer service policy? A few years back, Amazon took it’s first shot at this by buying a POD printer/publisher Book Surge. To this day, I don’t see the logic in that decision. Not the logic of buying a printer/publisher but buying that particular one. Several years later, Book Surge remains a non-entity in the whole POD publishing arena. I gave up trying to interview anyone for either an article or PodCast some time ago. I see their name pop up ever once in a while in the various Internet message boards usually concerning some customer service (or lack of) issue. Amazon can’t be happy with that purchase but in light of their “black hole” money pit history, there was no reason to think that they wouldn’t try it again. The market was just too large.

Sometime after the Book Surge purchase, a little Internet company called Lulu came online and showed the world how to help thousands of authors print one or two books at a time. During this time, Lulu grew from a one million to a thirty million dollar company. I don’t know if they are making any money but their system sure seems to work. Lulu has the exact same customer service policy as Amazon…. Let the computer do it, although I have a good friend who works at Lulu and picks up his phone if he’s in. The last I heard the number was somewhere around 6000 titles per week and 1.8 copies printed per title. Pretty amazing.

Enter this week’s press release that Amazon has gotten back into the POD business under the name Create Space. What is Create Space? The definition right from their website is, “is a self-service, do-it-yourself online tool that allows you to upload your ready-for-printing PDF book files and make your trade paperback book(s) available for sale online.” Sound familiar? If you visit the website, you have the feeling that you are at a “private labeled” Lulu site. The site is so similar, I decided to do a test and publish a book. My first thought was to just do a dummy book to test the system but decided, instead, to publish a real book. I have been writing this column since 2003 so I went back and compiled a collections of my articles on self-publishing and combined them into a book titled, Ask Ron – The Plain Truth About Self-Publishing. I bought one of my own Hybrid Covers, which included a word template to lay out my text and a choice of covers. I even paid the $149 for the service, which is actually the book design buy of the century.

By the end of the day, I had a press ready PDF file for my new book and was ready to “Publish”. I first went to my Thor Program (Lightning) and entered my title set-up information and uploaded my text and cover file. Based on my previous experience, my new title will be ready for printing and distribution within a couple weeks. Ready for distribution basically means that all the computers, including Amazon’s, are talking to each other and the book can be purchased through one of the participating outlets. As with all of my customers, the Thor setup was free and I only needed to pay $19.95 for the file storage for a year compared to the normal Lightning setup of $100 or so plus the cost of a proof. I sit back now and wait for the dollars to roll in.(Unfortunately almost 4 months after a sale is made but…. that’s the system)

My next step was off to Lulu. COM. I opened up a new account and entered my title information and uploaded my text and cover files. I went on to order 1 book, so I would have an idea what the final product looked like. When I went back and checked the next day, my title was displayed on their website and my order was being “Fulfilled”, whatever that means. If I hear anything more before this article is published, I’ll let you know. In total, my Lulu set-up cost me nothing and my 176 page book cost $8.03 plus a couple dollars shipping. $8.03 is a pretty high unit cost until you take into consideration I only bought one book. Two copies would have been under $20. Sure beats Kinko’s. Lulu has lots of visitors to their website so my title is out there “exposed” to the Lulu masses. I won’t buy any more at $8.00ea but maybe I’ll snag a few sales.

Now the part you are all waiting for….. my trip to Create Space. As I said earlier, on first glance it looks like Lulu. I created an account, which was easy enough. Then I went to “publish” my book. I filled in a long form and hit the send button and.,… a message that said,

We’re sorry, an internal error occurred while processing your request.
A system administrator has been notified and we will resolve this issue as soon as possible.

Please click the back button on your browser or below to return to the previous page and try again.
If you would like to report this, please e-mail webmaster@createspace.com
and make sure to refer to
Problem ID: 9UFK01.

Thank you for your patience.

I don’t handle defeat very well so I went right back and filled in all the information a second time and got the same thing. I emailed customer service (what an original email address… webmaster@createspace.com) but being I am a properly trained Amazon customer, I do not expect any response. I went back 24 hours later and tried again and had the same result. At this point, who knows. This newsletter doesn’t go out for another week because my son, who does the layout, is on vacation so I’ll let you know if repeated attempts are successful.

From what I can figure out, my same 176 page book will cost me around $6.65 per book plus whatever they charge for shipping so, on the surface, they are a little less expensive than Lulu.

An author can use their own ISBN or create space will assign them one of theirs. This ISBN is not transferable.

The biggest difference, which will effect the small publisher the most, is there is, if I am reading the agreement correctly, no such thing as “non-returnable” The paragraph reads:

Returns
Customers have two weeks from when they receive a unit to return it under the terms outlined in the Shopper’s Policies section of this page. For legitimate returns, we will deduct the sales credit from your account but not charge you extra fees. If we accept returns due to misrepresentation of the content of your title*, in addition to deducting sales credits from your account, we will also charge you a fee of $10 per return, plus put the title on hold and possibly take other actions including terminating your account. Please see Section 4 of the Member Agreement for additional details.

Could misrepresentation mean that you claimed your book was well written and the returner disagreed? This is one scary policy but one that all small publishers are going to probably face at Amazon in the future. The whole POD “gimmick” to this point is that sales are non-returnable. If someone returns one of your non-returnable books to Amazon, Amazon currently eats the loss. Those days appear to be coming to an end.

How is this all going to turn out? It’s hard to say. One thing for sure, Amazon is going to keep throwing money at it until it works, even if they have to buy ten more companies. Who is this going to effect? This first phase will not affect anyone other than the authors who sign up for the service. Once Amazon gets the bugs out of the system, who will it effect? My guess is that Amazon will change their current policy and start to only accept titles from small publishers that are produced through their service. Since the majority of all POD sales are to Amazon, unless Lightning Source is Amazon’s printer, they will be hit the hardest and be back where they were before Ingram changed their policy towards small publishers. (When Ingram forced small publishers to use their printer, Lightning, if they wanted access to Ingram). All of the POD Publishers will be seriously affected. Most of the sales by POD publishers which are not directly to the author or their family are to Amazon…. And Amazon non-returnable at that.

The very few POD Publishers who offer a genuine service will be OK, although they may need to expand their services even more. The venture capital driven cash machines, of which there are many, will probably end up going the way of the Edsel, and be missed by none. In the end, this will act as a sobriety checkpoint for the entire industry that services the self-publisher.

I’ll keep you posted as more information becomes available.

Thanks,

Ron Pramschufer

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