The Bits Blog has an update from Motoko Rich stating that Macmillan offered Amazon one of two choices -
- An agency model like iPad will have – Publishers set eBook prices and get 70% of revenues. This would mean Publishers set prices for new books at $15 and get $10.50. The big win is the $15 price.
- A wholesale model like Kindle currently has – Amazon sticks with $9.99 and pays publishers 50% of hardcover list price (varies between $10 to $14.50). EXCEPT there would be a 7 month delay.
A 7 month delay is insanity.
The Wall Street Journal has Macmillan’s take -
Macmillan CEO John Sargent said he visited Amazon on Thursday in Seattle to discuss “new terms of sales for e-books” …
… and that by the time he returned to New York, he’d been informed that Macmillan’s e-books would only be for sale on Amazon.com “through third parties,”
Talk about choosing between a rock and a hard place
Here’s what Bits Blog has to say -
Macmillan offered Amazon the opportunity to buy Kindle editions on the same “agency” model as it will sell e-books to Apple for the iPad. Under this model, the publisher sets the consumer book price and takes 70 percent of each sale, leaving 30 percent to the retailer.
Macmillan said Amazon could continue to buy e-books under its current wholesale model, paying the publisher 50 percent of the hardcover list price while pricing the e-book at any level Amazon chooses, but that Macmillan would delay those e-book editions by seven months after hardcover release.
Amazon are in a tough position.
- $15 eBooks would stall the growth of eReaders and eBooks almost completely.
- 7 month delays would give competitors a huge advantage.
Keeping $9.99 prices intact is absolutely essential for the growth of eBooks and eReaders. If the only way to keep $9.99 is to introduce a 7 months wait then that harms eBooks and eReaders almost as much as high prices.
Who would’ve thought competition for the Kindle would lead to this?
Initially the arrival of the iPad had good results for readers (and authors) -
- Amazon upped author’s share of royalties to 70%.
- The Kindle App Store was announced.
- Amazon made the option to add books without DRM easier.
However, Publishers have managed to turn the iPad into a weapon to turn back all the progress that’s been achieved -
- eBook Prices go back up.
- Publishers get back control.
- eReader and eBook sales slow down. If you think about it – that really is the aim Publishers have.
Publishers seem intent on killing eBooks
When you consider Publishers pushing $15 prices there are two possibilities -
- Publishers are very, very detached from reality.
- They just want to kill off eBooks.
All the comments at the Bits Blog are pretty clear about how bad a move $15 is.
It makes no sense to price eBooks at $15 – Unless you want to kill eBook sales, and thereby kill eReader sales.
That would return things to the way they were – A world ruled by Publishers. That’s exactly what Publishers want.
The illusion that they are doing this to save books is a weak one. The truth is that this is just an attempt by Publishers to return to the times when they controlled everything.
Filed under: publishing Tagged: | amazon vs publishers
This is infuriating. I hope it unleashes creative outrage and action among the eBook user community. Maybe we need to enlist the National Federation of the Blind for the struggle against the publishers, in the interest of promoting accessibility. The NFB always seem to get their prey.
Well said Len. The NFB are like Rambo. We need their help.
Before getting my Kindle as a xmas gift, I had not bought a book at a book retailer in years. I just buy them used because I think they’re too expensive. Why pay $25 and up for a new hardback when I can wait a couple of months and pay $2 for it used? No brainer. When I got my Kindle, I was excited about being able to get new titles for $9.99! I bought several titles at this price and many more for less and free. I have a list of $9.99 titles to buy with next month’s check. And I’ll do that but if ebooks are priced higher than that, forget it. And if I can’t get any ebooks, I’ll go back to waiting for titles til I can get them for $2 (hardback) and $1 (paperback) at several local used book stores. I won’t pay more. And Publishers should note that they don’t get a penny from used book sales!
not sure why everyone is going crazy about this… bottom line, you cant unring the bell. the music publishers tried it, and failed. so will the book publishers. it is *inevitable*… this is nothing more than the death throes of another dinosaur.
I would suggest Amazon to introduce sharing (probably sell) of ebooks among certain number other kindle users per copy of the ebooks.
Introduce sale of used ebook or a shared purchase, for the price publishers are deciding.
Its always better for both Amazon and Publishers to go by $9.99. A low price motivates people to buy more…..
i’m curious if macmillian realizes what a great incentive they just gave pirates? i predict that soon after ibooks appear for the ipad, the drm will be cracked and the books will be easily available for free, long before they’re available from amazon.