How Amazon Is Changing the Book Publishing Business

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July 9 (Bloomberg) -- Robin Warner, managing director at DeSilva and Phillips, discusses how Amazon is changing the business of book publishing with Trish Regan on "Street Smart." (Source: Bloomberg)

A world where publishing becomes less significant.

In other words, if i, as an author, had -- can go straight to amazon.com and offer my manuscript, my book there online, why do i need a publisher?

It will be a little bit of a sad day if he gets to the point where publishers are not needed.

There is a very strong process in terms of editors, subject matter, etc.

Couldn't amazon do that?

Amazon does do that.

Amazon has a mystery division.

They have romance books.

They have trade publishing books similar to what trade publishers do.

And they are being somewhat successful at it.

But i would just hope that the other publishers -- you know, doesn't diminish the industry as well.

Because you wind up with a monopoly where there is one player.

Is the answer that we need more online books and use?

Could publishing houses transform themselves into more amazon style businesses?

You are very astute, because that is exactly part of what is happening right now.

What is happening between amazon and hachette and, really, the publishing industry, it is almost like two parents that are in this horrible fight and they are having the children join in, the authors join in, and help them with the fight.

Harpercollins just announced yesterday that they have a website now, harpercollins.com, that will sell print books, e-books, audio books, just like amazon is doing, straight from the website.

Free shipping for print books, big discounts, etc.

The publishing industry has been stagnant in terms of what they needed to do.

I think they had a big wake up.

Amazon has been that big wake up.

They are very powerful, and the reality is, if they don't change, they run the risk of being like the buggy whip thomas up to speak.

-- the buggy whip, so to speak.

Let's talk about this particular case.

Correct me if i'm wrong.

Amazon is approaching the authors that hachette has and saying to my we will give you all the proceeds from these e-books.

It doesn't hachette have agreements in place with its authors that would place them in some kind of legal violation of an agreement?

Let's just take too little baby steps back to get the big picture of what is going on.

Amazon is trying to reach negotiate -- renegotiate with hachette.

Their contract is up and they are trying to get a bigger percentage of the sale.

Right now, it is a new -- an agency model.

The publisher gets a percentage and amazon gets a percentage of the e-books.

It takes a lot to get these e-books up and running.

Amazon is trying to break that.

They are saying they should get a bigger piece of the pie in offering the discounts to the consumer.

-- and offering discounts to the consumer.

There was a big outcry and many authors came out against amazon and said, what are you doing?

You are holding hachette and the publishers ransom.

What amazon is now doing, the gloves are off.

They're coming back and saying, until get this negotiation -- it's always about money and control of the market.

Until we get this done, why don't we just take any money that comes in on the e-books and give it directly to the authors?

That is one way to get the authors on your side, right?

Yes, it is.

Ultimately, where you think this leads?

This is material for both sides.

This will not be solved easily.

There'll have to be a solution.

While there is a solution being negotiated, what is happening is, as i said, harpercollins now has basically an amazon for its books and other publishers will follow suit.

This is very material for the industry and i think that in the end, there will be an agreement.

Amazon is too important.

But it will not go down easily.

Thank you very much for your time.

Coming up, we have your top 10

This text has been automatically generated. It may not be 100% accurate.

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