By Amanda DeMarco
The fixed price system is good for physical bookstores, and therefore also for publishers whose books are stocked in those stores. But what about publishers with other profiles? Utz Verlag mostly publishes scientific works — doctoral theses, papers, things that never make it into a typical bookstore. Publisher Herbert Utz says that fixed prices hurt his business — and that he’s even considering moving part of his business abroad to avoid the system.
To fully understand Utz’s critique, you’ll also need to know about the Verzeichnis lieferbarer Bücher (VLB, the Directory of Available Books), which aims to be a complete list of books in print in Germany. In late June of this year, the Industry Assembly (Branchenparlament) of the German Publishers and Booksellers Association (Börsenverein) recommended the VLB as the official reference for book prices — before publishers had to expressly say that the prices listed there were ultimately valid — which is important because in Germany you can get into legal trouble for not selling a book at the official price. So while registering books with the VLB isn’t required, its authority has been significantly consolidated.
Utz has long been a critic of the fixed-price model and the VLB. (Until 2002, when participation became mandatory, Utz Verlag didn’t opt in for fixed pricing). Utz Verlag has a large backlist of scholarly titles, which, though in print, sell few copies. Registering a book with the VLB costs a fee and Utz says those who want them can find them online — and he can post them to Google Book Search for free.
That’s why, when registration prices increased in 2007, he began removing books from the VLB and says he “didn’t see any correlation” in sales. Today he keeps only his biggest sellers on the list. It’s clear why this would be worrisome for people interested in promoting the VLB as a universal price reference. Utz himself is concerned that there may be an attempt to make VLB registration mandatory. The situation is complicated by the fact that VLB is a money-maker for the Börsenverein, and that VLB fees are used to support Libreka!, the digital book platform.
Keep in mind, this is all to maintain a system that Utz sees as detrimental to his business. Take libraries, for example. Before fixed prices became mandatory Utz Verlag used to offer significant discounts to libraries, who in turn would buy directly from Utz instead of a retailer. Now libraries aren’t motivated to do that extra work, and Utz says he ends up passing on savings to retailers, sees less profit himself, and taxpayers pay more for the books anyway.
In Germany, fixed prices also apply to e-books (though an e-book may be a different price than a bound edition of the same book). Since fixed pricing is intended to protect (publishers by protecting) retailers, Utz is frustrated that the system is being applied to digital books: “What do retailers have to do with e-books? Nothing.” This is not quite accurate — a small number of booksellers do offer e-books through their websites, and the rule could be important for preventing a few big players from monopolizing the market — but it’s true that the fixed price system has different, and in many senses diminished, implications in an online context.
That’s why Utz Verlag is considering moving a branch abroad in order to publish e-books outside of the fixed-price system. They’re awaiting the results of a referendum on fixed pricing in Switzerland, one potential location. The US is a second option. Utz, previously an aerospace engineer, says his willingness to challenge the system stems from the fact that he wasn’t formed by it: “I’m not thinking in books, I’m thinking in solutions.”