Agents of change?

<p>If history books exist in the future, they will surely record that the year 2010 was the defining moment in our exodus from analogue to digital publishing.</p>
<p>Yet of all the extraordinary things to have happened thus far, the most far-reaching has also been the least-publicised. Steve Jobs may have grabbed the limelight, but it's Macmillan that has truly changed the game.</p>
<p>In case you blinked, here's the bottom line. Publishing is moving away from the traditional wholesale/retail model to the agency model. Macmillan can take credit for this <i>adroit</i> solution to its recent spat with Amazon. Briefly, it means that the digital sale is concluded directly between the publisher and the customer, for which Amazon (now demoted to a mere publisher's agent) receives a commission.</p>
<p>Just think. Publishers will be free to set their own prices: reminding grizzled insiders like me of the good old Net Book Agreement days. But unlike the NBA, the agency model is not subject to the prohibition on anti-competitive agreements that proved to be the NBA's death-knell. And there's more: publishers will become increasingly adept at marketing direct to consumers and supermarkets will no &shy;longer murderously sell our hottest &shy;products below cost price. So&mdash;good times, yes?</p>
<p>I'm no Cassandra, but some of this is giving me pause. For a start, Amazon caved too quickly for my liking&mdash;over a weekend. &ldquo;Macmillan has a monopoly over their own titles&rdquo; says Amazon, ominously. If I were a publisher's chief executive, I'd be a tad concerned by that &ldquo;M&rdquo; word.</p>
<p>More worrying is the possibility that this rather delicate arrangement might be misconstrued: that the only practical change that consumers or regulators see is a sudden absence of price competition. And what would happen then? I asked Stuart Richards, a partner in the IP department of Fasken Martineau, to explain. &ldquo;If an agreement is not regarded as a genuine agency agreement,&rdquo; he told me, &ldquo;then, depending on its terms, it may be found to infringe Article 101 of the Treaty on the Functioning Of The European Union. Such arrangements could also, if the tests are met, constitute an abuse of a dominant position.&rdquo; And that's not good.</p>
<p>Agency model or no, Apple is squeezing publishers mightily to discount e-book prices in its new iBookStore. And Amazon will not accept being less competitive. My nightmare scenario sees e-book prices even lower than they are now&mdash;with a massive European lawsuit thrown in.</p>
<p>Of course, this won't happen. Will it, chaps?</p>