Hachette’s CEO on front lines of Amazon fight
NEW YORK — As a young book editor at Little, Brown & Co. in 1992, Michael Pietsch paid $80,000 — $45,000 more than the next-highest bidder — for a postmodern novel by a little-known writer named David Foster Wallace.
He spent years urging Wallace to cut hundreds of pages from the sprawling manuscript and impose at least some structure on the disparate plot strands. The book, “Infinite Jest,” was finally published in 1996 and became an instant literary sensation.
Pietsch is now chief executive of Little, Brown’s parent company, Hachette Book Group, and is engaged in a very different sort of battle — not with a fragile author, but with one of the most powerful corporations in the United States: Amazon.
As the first chief executive of a major publishing house to negotiate new terms with Amazon since the Justice Department sued five publishers in 2012 for conspiring to raise e-book prices, Pietsch finds himself fighting not just for the future of Hachette, but for that of every publisher that works with Amazon.
“In a sense, Michael Pietsch is like ‘Horatius at the Bridge,’ ” said literary agent and former Amazon executive Laurence J. Kirshbaum, referring to the soldier of legend who single-handedly saved ancient Rome by fighting off an invading army. “He is carrying the rest of the industry on his back.”
Because Hachette and Amazon have signed confidentiality agreements as part of their negotiations, the particulars of their dispute have been kept secret. But in the publishing world, the consensus is that Amazon wants to offer deep discounts on Hachette’s electronic books and that the negotiations are not going well.
The proudly customer-friendly Amazon is delaying shipments and preventing preorders of certain Hachette books, suggesting to potentially frustrated shoppers that they buy them elsewhere. Pietsch, ordinarily easygoing and accessible, is refusing to talk to the news media and has told employees to do the same.
There is little question that Pietsch would not be squaring off against the country’s largest bookseller if it were not an absolute necessity for his company’s bottom line. Friends say he never wanted the negotiations to become public. But now that they have, everyone in the book industry is watching and waiting.
“We’re all Hachette now,” one small publisher joked last week at the trade fair BookExpo America in New York.
Pietsch, 56, is an unlikely figure to find himself in such a position. He is trained as an editor, not a businessman. He took over Hachette in April 2013, trading a life of poring over manuscripts for one of scrutinizing spreadsheets.
Like a player-coach, though, he has continued to acquire and edit a small number of books, most notably Donna Tartt’s Pulitzer Prize-winning novel, “The Goldfinch.” He has built an all-star stable of authors that includes highbrow, literary writers as well as mass-market giants like Michael Connelly and James Patterson.
Over the years, Pietsch had developed a reputation as both a man of letters and a shrewd deal maker. The combination could serve him well in his dispute with Amazon.
“While I don’t envy his position in this street fight, I think he’s exactly the right guy to be conducting it,” said Sloan Harris, an agent at International Creative Management.
Pietsch is married to Janet Vultee Pietsch, a children’s book editor. As Hachette’s chief executive, he oversees not just Little, Brown but all of the publisher’s imprints, which together put out about 1,000 books every year.
Hachette has been largely silent since the dispute broke out in public last month, though it did issue a statement, written by Pietsch, that underscored its view that books deserve to be treated differently from hard drives, diapers, and the countless other products Amazon sells.
“Amazon indicates that it considers books to be like any other consumer good,” the statement said. “They are not.”
Pietsch’s central role in his industry’s dispute with Amazon seems to be happenstance. As part of Hachette’s antitrust settlement, the company agreed to allow Amazon to continue to discount e-books for two years. That agreement has expired and for some reason — no one is exactly sure why — Hachette is the first publisher to find itself in the position of negotiating a new one.
Other publishers are holding their breath. It is in their interests for Pietsch to drive a hard bargain. They have their own relationships with Amazon to protect, and they do not want anything they say to be construed as antagonistic.