Dealing with Amazon

As the pricing dispute between Amazon and Hachette drags on into its seventh month with no end in sight, leaving both readers and authors out in the cold, Simon & Schuster has managed to reach a long-term print and digital deal with the e-retailer without any of the disruptions to the business that have marked Hachette train wreck.

Details of the deal are sketchy, but it appears to have been hammered out in a matter of weeks, along lines largely along lines dictated by the publisher.

So what does S& S have that Hachette doesn’t to give it such leverage? A major U.S. broadcaster as a parent, in this case CBS. In short, CBS has something Amazon needs to satisfy its growing video ambitions, both in terms of content and, more importantly, content in a favorable window on terms that will allow Amazon to be competitive in the burgeoning multichannel over-the-top streaming business.  The retailer simply couldn’t afford to squeeze Simon & Schuster too hard, leaving a lot of space for S&S to structure a deal that suits it.

CBS CEO Les Moonves made it clear back in July, in fact, that he expected no trouble from Amazon as S&S renewed its deal with the retailer.

Assuming CBS’ video assets did in fact play a role in the Simon & Schuster negotiations, even if only by dampening Amazon’s enthusiast for hardball, it bodes well for HarperCollins, which is owned by News Corp., part of the same Rupert Murdoch empire as 21st Century Fox and Fox Broadcasting.

The other two members of the Big 5 publishers club, however, Macmillan and Penguin Random House, are owned by European media conglomerates with no direct U.S. broadcast interests, Verlagsgruppe Georg von Holtzbrinck and Bertelsmann, respectively, and may find a tougher customer across the table.