As I’m sure you’ve heard by now, here was a major kerfuffle between Amazon and Macmillan over the weekend that is so hugely important it will necessitate the postponement of my planned “Last Week in Publishing” post. I KNOW. Didn’t Macmillan and Amazon realize the implications to my blog???
Stay with me, because I’m going to go into the weeds a bit to break this down. And to do that I need to provide some background info.
The Background Info
The whole issue revolves around e-book pricing: many publishers have long been extremely uncomfortable with the $9.99 price point that Amazon established for e-books, feeling it’s too low and acclimating consumers to a price that is, from a publishers’ perspective, unsustainable. In the words of Hachette CEO David Young when Hachette announced that they would delay some e-book releases: “I can’t sit back and watch years of building authors sold off at bargain-basement prices.”
Here’s the interesting thing about that, and something to keep in mind because it’s not often mentioned in the discussions surrounding Amazon: major publishers weren’t getting paid based on the $9.99 price point. According to the NYTimes, for a new release publishers have been receiving roughly the equivalent of half the hardcover retail price. For a $24.99 hardcover book available as an e-book for sale at $9.99, again, according to the NY Times, Amazon pays the publisher somewhere around $12.50 and uses it as a loss leader, presumably to sell Kindles.
Along comes the iPad and Apple’s “agency” model. Apple is allowing publishers to set the list price of their own titles, and they pay publishers a 70/30 split. E-books will cost no more than $14.99. This means that for a $14.99 iBook, publishers will receive $10.43. (note: Random House hasn’t come to an agreement with Apple and is still in discussions)
Do you see what’s interesting about this?? Take this hypothetical $25.00 new release hardcover. Publishers are willingly taking less money from Apple ($10.43 in our hypothetical example vs. $12.50 for Kindle) in exchange for setting what publishers feel is a more sustainable list price.
Assuming all these reports are right. Also my math.
The Kerfuffle
This past week, as Macmillan CEO John Sargent explained, Macmillan told Amazon they wanted to use the Apple agency model for Kindle e-books. Essentially, Macmillan was proposing that Amazon could pay them less money per title if Amazon would let them set their own e-book prices.
Amazon reacted with what Mike Shatzkin called the “nuclear option”: they took down the buy buttons for nearly all Macmillan titles. As in: they pulled down the buy buttons not only for the e-books, but for print books as well. Some customers reported that Amazon removed Macmillan titles from their wish lists and deleted Macmillan sample chapters off of Kindles. Yowza.
The dust settled somewhat Sunday afternoon as Amazon said that they would “ultimately capitulate” to Macmillan’s demands and abide by the agency model with Macmillan, though the buy buttons have not yet, as of this writing, been reactivated. And that brings us up to speed.
Say What Now?
So. Why would a publisher willingly take less money per e-book copy sold in exchange for, essentially, the ability to charge consumers more money for an e-book? And why would Amazon react so vehemently when Macmillan was proposing that they receive more per copy?
Well, you’d have to ask them yourself to get the real answer. I have a few guesses though (and everything below should be taken as such).
Amazon’s position is relatively easy to guess at: they want e-book prices to be as low as possible to entice more people to buy Kindles and to make sure they have the lowest prices period. The more people who buy Kindles, the more people who are locked into their proprietary format, who are probably likely to stay with Amazon to buy e-books in the future, and, by the way, who may be less likely to buy paper books from a bookstore, further consolidating Amazon’s position as the dominant player in the bookselling world. They want the ability to sell products to consumers at as low a cost as possible.
Presumably, publishers are (presumably) concerned about losing control over the price of their books in the marketplace, especially when they compete with higher priced editions of the same work.
And, of course, lurking behind all of this is the iPad.
The iPad Factor
I plan on delving into the book world implications of the iPad in a later post, but one of the great ironies of the iPad, as Bloomsbury publisher Peter Ginna recently noted, is that Amazon and Apple are very likely going to be competing against each other on the very same device. Apple will be selling e-books through the iBooks store, and Amazon will (I’m guessing) make books available via its Kindle app.
This set up an interesting scenario where these models could potentially compete against each other head to head: Amazon presumably selling an iPad compatible e-book for $9.99 and Apple selling an iBook for $14.95. This led Ginna to ponder whether the iPad was actually a trojan horse for Amazon, who could use their app presence on the iPad to further corner the e-book market. Or, even if Amazon decides against making an iPad app available, they could still offer the same e-books at a lower price on the Kindle in order to retain a key Kindle selling point.
And that, I would postulate, is the one of the keys to all of this. Macmillan’s books will now be the same price on the Kindle as they are in the iBooks store on the iPad (and on the Kindle App on the iPad if Amazon goes that route). Amazon made an audacious bid to retain the ability to be the lowest priced e-book vendor for Macmillan’s books. Amazon blinked.
Oh Yeah, What About the Consumer?
This ain’t over. Not by a long shot.
As we’ve seen repeatedly in digital media (hello, music industry!), consumers are the ones who are going to have the most power to determine what the coming e-book landscape is going to look like. And this is where consumer experience and expectations, DRM, proprietary e-book formats, piracy, and competition are going to come together to dictate prices. I’m not exactly going out on a limb to say that consumers have their own expectations for what an e-book “should” cost, and these might not mesh with what a publisher thinks they “should” cost.
And as a recent NY Times article points out, customers are not exactly lacking for free or cheap e-book options. On the iPad and similar devices of the future, they’re not going to be lacking for cheap or free non-book distractions either.
You didn’t hear it from me, but they might even still want their books on paper too. Which they bought at their friendly neighborhood bookstore.
When the dust clears on all of this, will publishers regret accepting a lower price per copy in exchange for the ability to set higher prices? Or was Macmillan smart to take a stand against very low discounting to help level the playing field? Have we seen Amazon’s peak as an e-book player or will they continue to dominate the coming e-book world? Will publishers follow Macmillan’s lead or work out their own arrangements? Are you on Team Amazon or Team Macmillan? Or maybe even Team Can’t We All Just Get Along?
You tell me. I’m extremely curious to know what you think about all of this.
I'll for the most part keep going to my little local bookstore, ordering or buying my books, and to the library, and watch all this from a distance…as a consumer.
As an author – I'm with Ink, I have a headache!
As a former teacher, my first thought on iPad was that Jobs was going after the textbook market – especially at the college level. An iPad is more than a reader, it's an entertainment center and that would make it more appealing to the demographic. There's a lot of money in that market and if the iPad can breach Amazon's fiction market too – so much the better. But I think, jmo, that Apple wants the kids via textbooks first b/c it will condition them.
I am going to take a wait-and-see attitude. I am the owner of a Kindle and have gotten used to the $9.99 price for books.
But I never liked the fact that I could not share the ebook I purchased with my children who do not own Kindles (and who live in different states).
So this squabble has solved the problem for me. If I believe my children will like the title I am going to buy paperbacks and pass them on. I will buy ebooks of those books I want to read for my own pleasure UNLESS the price of the ebook is the same or more than the paperback, then I will buy the paperback (from Amazon).
I'm leaning toward Macmillan on this one, though I have my reservations since they recently lowered their royalties to authors on eBooks. That could be part of the pricing strategy, though, if they're willing to take less money overall (based on a percentage of the book price rather than a flat rate per unit). They're also toying with "Special Edition" eBooks with author interviews, etc. Macmillan is at least THINKING about the future of eBooks, which is encouraging.
I don't like Amazon trying to dominate the market but I also don't like publishers jacking up the prices to match hardcovers. Ebooks don't require money to make them, house them in warehouses, or ship them so I don't see why they need to compete with hardcovers. I think if the difference in prices were explained, people would still buy hardcovers if they liked the ebook enough.
As an aspiring writer, I see where the publishing industry is coming from but as a consumer I'm torn. I set a $20 limit to buy books and hardcovers are $24.95. Guess who's going to get my money?
I don't really understand any of it. All I know is what works for me:
I use my FREE Kindle (app) on my iPhone and have bought about a book a month on it. Works great!
I still like roaming through bookstores to find something new to buy and read. If you only go to Target, you only see a few choices, and it takes too long to surf online. Loves me some bookstores. Our local indie just closed though, so I have to make a drive in order to do this. 🙁
Ken: https://nbrans.wpengine.com/2010/02/kindle-missile-crisis.html
Ken: Comspiracy theories abound….
Todd: train fares went up in chicago
Todd: probably has to do with the new iPad release
Ken:rofl
Ken: That's the best one I've heard today, and I've heard them all.
Todd: 70-30 and 80-20 and almost no overhead. that matters.
Todd: books will find thier own price level eventually, now that we arent paying for buying armies of staff or prices controlled by a monopoly.
Todd: rest of this is jsut well, entertaining
Todd: authors never had a 70-30 before. let them keep duking it out. beat hell out of each other, i'm liking the results
Ken: So am I, because now I can truly offer great deals to authors for eBook rights. That wasn't possible when Amazon was only paying 35%.
Todd: its WWF everynight in the book world
Ken: And it will be for the forseeable future.
Todd: i hope nobody ever wins
Todd: thats about the only time the author and reader win, is when nobody else does
Ken: yup
Todd: we write, they read, everyone else is a middle man profting off both of us. reality check people. lets root for nobody ever wins this fight.
Part of the "book culture" in my family going back 100+ years has been to leave books to your kids/and or grandchildren. Ebooks, of course, will change that dramatically going forward.
My plan is to buy "cheap" entertainment once-only "reads" as ebooks. For meaningful books that might want a home within the new branches of the family tree? I'll stick to paper.
What am I willing to pay for "cheap" once-only "reads" ebooks? No more than what I'd pay for a paperback — certainly not over $10. Should that cheapo ebook fool me and be marvelous, I'd go buy the paper version to add to my inheritable library.
The comparison between digital music and digital ebooks is so screwed up. I'll listen to an album several times a year over the years. I'll read an entertaining murder mystery ONCE.
jj (sharon)
Team Macmillan.
Amazon is a bully, and it's about time the publishing industry stopped taking it in the rear from these people.
Me too Ink; this makes my head hurt. Maybe you can get your book store back into business again with all the controversy over e-formats. 😉
I think I'm on the "Lets just get along" team. Also the, I buy a paper book, thanks, and not have to worry about following a bunch of rules for buying a novel or worrying about it disappearing from my e-shelf.
That was a lot of work Nathan. Thanks for the update.
……dhole
Also, this is the reason why I would never buy a Kindle from Amazon. I don't want them "removing" items without my permission or notification.
I'm on Team Amazon and Team Author. As an indie author who has published both Kindle and print editions, MacMillan stands to make A LOT more money from E-books and probably at the expense of it's authors.
I'll give you an example.
A Publisher X releases a hardcover book for $25.00. Retailers usually get a 55 percent wholesale discount, and then they subtract the cost of printing the book (let's say $5.00 per book). We are down to about $6.25 profit The author's royalty is usually set in stone, maybe $1.50 per book. So Publisher X is making about $4.75 per hardcover book sold.(I have not subtracted for marketing and promotion so that number would probably be a bit lower).
Now Publisher X releases an E-book. To publish an ebook all you need is ONE file for the infinite number sold. I used the same interior as my print book, no extra work. The cost to produce is about as close to zero extra as you can get.
So Publisher X charges $14.99 for e-book. Amazon takes its 30%, leaving 10.49. If the author has not negotiated higher royalty rates for the e-book edition, the author gets $1.50 per book. Leaving Publisher X with about $9.00 profit on the e-book. They don't have to spend any "extra" marketing the e-book over a print edition so there is no added cost there.
They'd be getting over like fat rats on the authors if the authors don't negotiate a higher royalty on the ebook edition.
Further, if the e-books sell fewer copies because of the higher price point, the fat rat Publisher is still pretty fat. But if the number of copies sold is reduced, then it will only hurt the author's royalty in the end.
That's why I'm on Team Author– and I think Amazon's model is more author friendly. Especially in this economic climate when people are very price-sensitive.
I would like to know why an electronic version should cost half as much as a paper hardcover version. Would someone please speak to the issue of actual costs saved (paper/shipping/storage) and make an argument as to why any ebook should be more than $9.99?
anon-
I don't have time to find the post, but per HarperStudio publisher Bob Miller, only about $3-$4 are saved with e-books vs. print books. That's because a lot of the costs that go into a book (author advances, editorial, marketing, overhead) exist whether it's a print book or an e-book. Printing and shipping paper books is a very small piece of the pie.
You did well with this post. Everything I've read so far has been so subjective, but you stuck to the facts.
Oh dear, oh dear, oh dear…
For the record, I'm more willing to stand behind Macmillan on this one, but I still think they're all behaving like a bunch of two year olds. Mind you, that's any business I suppose. One look at my mom's office and you'd think you were looking at a third grade classroom.
I'm with Ink and Bane. Although it's not what I'll do, I just want to pull a pillow over my head and say, "Someone please wake me when it's over."
"I like my MP3's over my vinyl records"
You, sir, speak heresy.
Team MacMillan. I want book people setting book prices, even if books end up costing more.
Interesting.
I'm fascinated and my head is spinning. Oh, the repercussions!
I'm on Team Apple. Jobs got this part of the iPad right, and hinted at such, about six months ago. He's attempting to put the Kindle out of business, and this is a logical first step.
Of course, I don't believe in the concept of an eBook, as I'd rather have an actual copy, than a virtual one….
I've seen a number of comments state, in effect, "It doesn't cost money to make an e-book."
But it DOES. E-book formats are not the same as print book formats. Someone has to put the book into the right format (especially where proprietary software is concerned). That person should get paid.
Someone has to translate cover art and interior art from a print format to a digital format that will work with various readers (or remove them if the reader can't handle pictures). That person should get paid.
And no matter what the book's final format, not only the author makes the book. There is an editor, a copy editor, a proofreader, and a typesetter, not to mention an artist or two (cover and interior design). Only THEN do we get to the actual difference of a physical paper book that must be shipped, warehoused, and shelved.
Let's not forget (where applicable) advertising/marketing.
Don't be fooled by the invisibility of the process that translates an author's manuscript into a book in your hand/your e-reader. There is a lot of work in a book and a lot of people involved who all would like to be paid for what they do. Skip all of them, and you get the average self-published/vanity press book.
We're still in the first inning of this ball game.
JA Konrath has three excellent posts on this issue. The second post shows his Kindle sales for January. He's doing very well with low pricing (1.99 for most of his books).
I think there's a great opportunity here for indie publishers.
https://jakonrath.blogspot.com/
Oops — I almost forgot. AGENTS. Agents also like to be paid.
@Sherri,
I've actually turned a print edition into a Kindle edition and NO, sorry ma'am, there isn't a lot of labor involved in changing print to ebook formats and the same cover used for my print edition is used for my Kindle edition. And to look at my book on Kindle or on the Amazon website, you cannot tell the difference between one or the other. So, as someone who has actually gone through the process…ummm…I have to disagree.
As for the agents, the author's agent gets paid from the author's earnings. They eat the author's pie, not the publisher's pie. So, at the end of the day, if author's get screwed, so do the agents.
As for marketing, publishers are marketing the print edition, they don't need to do extra for the e-book edition. For the MOST part, revenue from e-books is like bonus money UNLESS authors earn a higher revenue for ebooks, in which case it may not make a difference. I suspect that is probably NOT the case.
Just keepin' it real.
@Sherri THANK YOU!!!
@JL did you read all her stuff? The indie imprint you did did not pay for editors marketing, etc. I have also put a book on kindle and because I didn't have the $$$$ right photo program I couldn't add a cover. And how much time did you put into making it right for the format????
It takes time and money for the right programs to work with Amazon. I'm going to do my own indie imprint here soon and my own artwork. Not a problem if I want to sell low. It's all my time and effort. But here in the US, we have MINIMUM wages, and we have experts working on the books. Shouldn't they all get paid? The most intensive costs of books are the people who make them happen.
Where do you think Amazon puts their money? Probably have more tech people working to keep all the kindle apps working right.
As for the 40% off coupons etc, it costs the bookstores (I am published and I know what they pay, not mention shipping) at least that much for the book itself. The coupon is meant to get you into the store and impuls ebuy all the other things they have available. Again the prices are to reflect the cost of getting it to you and the technology and the people power it takes to do everything – like TAXES grrr. They have to pay someone to do the taxes and to figure the right amount to send into the cities and states etc. That's true for all product companies.
There is a much bigger picture here. As for Amazon, they were stupid to put up a big fight. They are always putting stuff on sale. They put my kindle on sale without asking me. I'm sure they could do the same for the books that are released.
Retail 14.99 sale 9.99 limited time, or whatever. There are ways to work around it without pulling peoples chapters, etc. They wanted the publicity and hoped the consumer would go nooooo keep it all 9.99.
@KL – How is revenue from an ebook "bonus" money for a publisher? If I buy an electronic copy of a book, that's one copy of a book I WON'T be buying in hardcover. So all the marketing, merchandising, etc. going into the print version is, in reality, also going into the electronic version. You can't separate the two – especially when you have Kindle owners going into bookstores to peruse hard copies then downloading them onto their devices right in the store.
I read an article over the weekend that said books were one of the few things people *are not* willing to give up in the recession – books trumped movies & dining out. I thought that was hopeful regardless of e-books vs. paper copies. People are never going to stop wanting to read stories . . . how those stories are purchased and read, well, we'll see . . .
I don't care who charges what as long as I can charge $4.99 on the Kindle and $4.99 on the iPad for my self published book and put more money in my pocket from one book than the bloodsucking publisher offered me for my next two books.
The Kindle and the iPad are both poised to put the power back into the hands of authors — we can take our product directly to the consumer and make more money than deadhead publishers who think that "More of the Same" is what the public wants.
I think Amazon acted like an 8-year-old bully. (I would have been slightly more understanding if they'd kept the "buy" buttons for the print books, and if they hadn't messed with people's wish lists–and they would have explained what was going on to the public. I know one author who was on the phone with Amazon on Friday for over an hour, trying to figure out why her just-released St. Martin's book had disappeared.)
But I think Macmillan is making pricing decisions based on fear.
I understand that ebooks require cover art, editing, promotion, etc. However, if you're producing a print book, those costs are already covered. The cost to reformat the book into an electronic version doesn't seem to justify the $10-plus price that Macmillan wants to charge. (I'd love to know if I'm not seeing this correctly.)
I want a book, every single time. No files. And for as long as I can afford to do so, I'll buy them locally and from an independent. When I can't afford to do that any more, I know where there's a great library.
Donna,
I'm gonna have a new store with direct hi-fi downloads to the brain. Working on the surgical implant procedure now. Any, um, volunteers? Free William Gibson books with every implant…
Thanks Nathan for all this information presented in a way I can understand.
What team am I on? Whatever makes the most sense for authors. As consumer, I will buy the books I want at any price point. I don't drive around or surf the net for deals. Discount e-books won't make me buy more, I'm just not that into them and only occasionally use my Kindle app.
But I think if anyone believes that you actually own the e-books you get from Amazon, you're nuts. The fact that they went into people's devices again and erased material is very concerning to me. Has Apple ever done anything like that with iTunes?
As far as kerfuffles go, this is one big ol' mamma jamma. One of my critique partners writes for St. Martin's Press. She has a book coming out. Great, right? Except that Amazon took the buy option off for St. Martin's. Yikes'ola.
So. Her next book is due to drop any day, she's had plenty o' fans do the "pre-order" option and now No one knows what's going on with the pre-order's or if they'll be able to buy from Amazon as they'd planned.
I'm with you, Nathan. Can't we all just get along?
This stinks. This is her second book in a proposed series. The first had the misfortune of dropping during the height of the financial crisis, as everyone held onto their breath and their checkbooks very tightly, and now this. Seriously, I have no idea how an author is supposed to plan a career around all these landmines.
Oh. And how Dare they mess with your planned blog. It's a bloody shame, I tell ya. A bloody shame.
Pulling the buy button is showing their power and it is scary.
I think that e-books are going to sell at the lowest price point.
Now, if you could get a hardcover and a backup e-book… (or maybe you can) or a color cover trailer thingamigigee, well then that might change the scales.
I am MOST worried about Amazon (and or Apple) being able to just remove stuff from an e-reader.
I also would prefer my telephone and my e-reader (of the future) to be independent of the books and visa versa.
I'm in the corner of any model that doesn't amount to a monopoly and frankly I've seen 4 things now that Amazon has done that make me very nervous. First they tried to force publishers who printed on POD to use their POD Booksurge, then they delisted LGBT books, including mine, from their site. This was followed by the time they went into their customers Kindles and removed books they had downloaded. Now they have a hissy fit befitting a 5 year old against a large publisher.
And every time they did this, it was done under cover and it always seemed to take Amazon a long time to respond with any kind of explanation and as far as I'm concerned those explanations were lame. In fact Amazon did nothing in each case until a slew of angry authors and readers demanded an answer.
If a $14.99 ebook can't be sustained then that should be up to the publisher to decide. Not a faceless, irrational juggernaut that seems to think it can do whatever it wants without consequence.
If and when I buy an ereader I can guarantee you it won't be a Kindle.
In theory Amazon's model is also unsustainable, though, right? They're taking a loss at the moment to encourage people to buy Kindles, but eventually they will *have* to raise prices themselves, correct? Interesting conundrum.
In any case, I see things like this and think, "Why on earth is anyone one company allowed to have this much power?" We have anti-trust laws for a reason, and it just strikes me that this is essentially Amazon trying to monopolize the market. Granted, it seems that in the past few years an awful lot of companies have been allowed to become much, much larger and more powerful than is really good for anyone. When you consider the number of smaller, independent bookstores that are going out of business, you basically have three or four major players in the game to begin with. That's just my own, probably biased, take on it.
What frustrates me about the entire situation is that rather than come out with a single format which can be used on any of these players, it seems like everyone is doing there own thing. I wouldn't buy a kindle (maybe a nook), but I'm sure as heck not buying anything until there is a single, set way to do it and those books can be used on whatever device I choose. The thought of even potentially having to re-buy books just because you change devices is enough to turn me away for now.
First, I think it's so cool that you and Kristin Nelson both refer to this incident as a "kerfluffle" on today's blogs. As I always say, "great minds steal from other great minds." Or, maybe you both just like words like "kerfluffle." I'll make a mental note of that for any query letters I happen to send your way.
Second, although $9.99 ebooks are a major selling point for the Kindle, we are after all talking about a segment of the reading market who are willing to pay upwards of $250 for a device on which to read books. Price may not be such a big consideration here,considering that printed books can be read without the aid of an expensive device.
The value of a thing is what a buyer is willing to pay. Speaking strictly as a consumer, I simply do not care what costs were incurred in the production of the things I buy. If I want something, and can afford it, I don't engage the vendor in an argument over what it cost him to make it or what it would cost him to make some other product that I do not choose to buy. An ebook is an ebook. A printed book is a different product. You can't buy one and put it onto your Kindle the same way that you put your cd's onto your iPod. Comparing an ebook to a printed book isn't something that is going to happen all that much among purchasers of ebooks. Price competition for ebooks (like for like) isn't going to come from the print editions; It's going to come from other providers of ebooks. The market for the books will determine in the end whether this was a good move or not.
I don't understand why people compare the iPad and Kindle. The Kindle is a true eReader, while the iPad is a glorified iPod Touch. It does have backlighting, I couldn't stand reading an entire book on that thing. Not to mention it's overpriced for the functions (no flash, no multitasking, the battery life will probably be terrible like all Apple products).
I love my iPod and my iPhone, even my MacBook Pro, but I also have a Dell notebook and a PC. The apple fanboys will buy anything at any price, sadly.
As for the eBook war, wasn't it expected? As Mr. Bransford has said, this is not over, not by a long shot, and I wouldn't be surprised if Google eventually came out with their own device (they always wait and lurk around, then come out with a terminator product. Don't underestimate Google).
Amazon and Apple will fight it off, and this is great news for us consumers. You also have to admire CEO standing up for the market, and I think Amazon's reaction to remove buy buttons from all productions was extremely childish and unprofessional. Shame on them!
All I can say is as an author and a consumer I would never pay for an ebook if I can get it cheaper in print. It's really ridiculous to charge so much for something that costs nothing to make!
My first instinct is to side with Amazon. They sell books. Macmillan should not be able to tell them what price they have to sell their books at. That's not how bookstores work, though perhaps there are precedents for this sort of thing. A book may have a suggested retail price, but the seller typically decides what the consumer will pay to buy it from them.
I also side with Amazon in that they don't want to see the cost of ebooks go over $9.99. I'd like to see ebooks take off and generate a whole new wave of interest in reading, but I'm concerned that ebook prices over $10 will be bad for the ebook industry. Bad Apple.
I also personally LIKE Amazon because they've been hooking me up with cheap books for years with an incredible unlimited 2-day shipping plan. I also personally DISLIKE Amazon for many of their recent actions, such as the infamous amazonfail.
I'm also more concerned about Apple monopolizing Everything That Is Cool than I am about Amazon being a monopoly, though I want Apple to give Amazon some good competition.
Amazon has lost the PR war here, though, and their nuclear option looks petulant and dictatorial. I'm shocked they went nucular, as they say in Crawford.
I am HOPING that the consumer will be the winner here. Competition between Amazon, B&N, and Apple should make eReaders better and cheaper over time. Maybe they'll drop some or all DRM as well. I'm guessing that the economic reality of competition will produce a better ebook market for everyone, because Amazon and Apple are both titans and neither should be able to fully dominate the other.
But who knows.
'Nathan, I don't think $3 to $4 is a VERY small piece of the pie. It's as much as the author and agent are likely to get from a hardcover, more than they get from a trade paperback, and about half the price of a mass market paperback.
The big discount to a few publishers for bestsellers was meant to lure them into not noticing that Amazon was going for a vertical monopoly that could seriously damage their businesses.
And ff Amazon were to achieve the domination they dream of, they would dictate price to everyone, Bigs, included, just as they dictate them to us small publishers now. Small publishers were getting that rotten 30%–take it or get out–while the bigs were getting their sweeteners.
The long term potential is what made it essential for the Bigs to stand up on this issue. They can afford to do it now because right now Kindle sales are a TINY piece of their action. Amazon wouldn't be so secretive about their actual sales numbers if they weren't pathetically tiny.
So Macmillan can easily sacrifice trivial earnings now in return for retaining much more control for the future, so in 5 years when e-books are selling ten times or more what they sell now they don't have to sell them at a price Amazon dictates–one unlikely to rise with inflation, either.
Yikes! This whole discussion makes my stomach hurt.
Because A) I'm one of those people who is in a lifelong love affair with books – actual paper books, that have different smells and feels.
And B) no matter what my opinion is, what's gonna happen is gonna happen and there's not a blessed thing I can do about it. Except keep buying new hardcover books – this is the only vote I get, methinks. And it's not much.
Has anybody taken their e-readers to the beach and/or otherwise found that the screen gets ruined or scratched? Then what is the "life" of these devices?
1. Is it worth noting that Apple is not entirely letting publishers set their own e-book prices? They are capping prices at $14.99 (for now), which seems to me to be raising the waterline but still establishing the waterline.
2. Amazon may be good at making money, but this episode is just another example of incredibly poor decision-making over there. Consider the automatic removal of a title they shouldn't have sold from Kindles; the way they tried to take over the POD business (turning off Buy Now buttons if authors did not agree to let Amazon's POD company print them); and now this. What's the company motto? "We're big, get over it"?
Liz Czukas said, "This whole smacks of blu-ray vs. HD-DVD (or beta vs. VHS back in the day) when the studios were taking sides. I'm waiting til the dust settles. Best place to get free books is still the library as far as I'm concerned."
Exactly right, Liz.
If they want me, they can have me but I want better flowers and candy first and I'm not going steady with anyone who isn't stable.
Sort it out yourselves, boys, and come see me when you're done.
I'll be in the stacks.
Many of the smaller e-book publishers sell their own works and set their own prices. Or they can go through Fictionwise & read on other devices like the Sony e-reader.
Not the same, but there are options out there.
anon-
I took my iPhone to the beach and read a book on it. No scratches.