Amazon fired the opening salvo in the latest skirmish over eBooks with mega-publisher Macmillan. Macmillan, one of the largest publishers in the world is at odds with Amazon over the pricing of Kindle books, so Amazon deleted all of the “Buy Now” buttons from all Macmillan published titles! I’m sure Amazon can predict the impact this move will have on Macmillan’s sales and think it will hurt enough to bring the publisher back ‘in line’. We’ll see.
Amazon has always artificially deflated the price of Kindle books, to get people to buy Kindles and to read Kindle books on their phones. Until the iPad, publishers had few choices as to other major hubs of online distribution. But I’m sure Macmillan feels they have a place to run. And Amazon has called their bluff.
The average cost per title on the Kindle is $9.99 and the publisher has little say in this. While Apple says publishers will be able to “adjust their own pricing” on the new iPad and upcoming iBooks store. Prices there are expected to be in the $12-$15 range.
For those still reading this, I would like to restate one point that many don’t realize: Amazon is artificially deflating eBook prices. So, even though they sell the Kindle book for $9.99, they are still paying the publisher royalties on the $12-$15 price the publisher wants. So, at this point, the publisher is still able to keep the lights on and pay its people. Macmillan’s complaint is that Amazon is ‘purposefully devaluing the product’. The fear is Amazon will so ingrain the $9.99 price in consumers’ minds that they can then quit subsidizing the pricing, forcing publishers to sell their products at loss at $9.99. So this isn’t a price “set by competition and market conditions” it’s a price set by a huge retailer with huge leverage to control the market and competition. I’m not calling sides here, but this is a very important point.
All I know is that no one wins when retailers pull books off the shelves, for any reason. And should sound as a warning to ALL publishers that they need to open themselves up to sell directly to consumers, at a minimum to offset crazy deals like this one.
Wow. Just wow! The Guardian has a feature on the world’s largest book, which is part of a map & atlas exhibit at The British Museum. It takes 6 people to move the 350-year-old Klencke Atlas which contains maps and such dating from the time of Charles II. Pretty cool. I can’t find any measurements for the Atlas, but will share once I do. Apparently, this exhibit will be the first time the world’s largest book will be publicly displayed, with its pages open for viewing.
The Alabama Book Festival launched a new website last weekend. This year will be the 5th year for the state-wide literary festival. It scheduled to run 10 a.m. through 4 p.m. Saturday, April 17th, in the Old Alabama Town section of Montgomery. The full line up of speakers and authors is listed here and includes notables names Rick Bragg, Ace Atkins, Carolyn Haines and a gazillion more. The book festival also has a blog and Facebook page.
Are you going?
It’s less than a week before Steve Jobs takes the stage atop a unicorn showing the world the fabled Apple Tablet (iSlate). And it appears that Amazon thinks there is going to be a real battle for books. In the past two years, Amazon has used its size to bulldoze its way through publishing. But all that is changing, fast.
1. New 70% royalty rate. Amazon has been artificially keeping Kindle book prices at $9.99, to entice readers. Fancy math aside, this just means that Amazon has to pay royalties based on the cover price, not the lower $9.99 price. So the profit is non-existent there. This week Amazon announced, that starting in June, they will increase their payouts to 70%. This should balance out a lot of the math so that publishers can keep the doors open and Amazon can keep the prices low.
2. Kindle to support apps. Amazon is making the Kindle SDK available for download and will open up the devices as app platforms. So, if all things stay constant, third-party folks could make software that readers could install and run, in their Kindle. This is the same model used on the iPhone and other smart phones.
3. Amazon invites other printers back to the party. It’s no secret people can print their own books these days. The secret is finding a great way to sell and distribute those books. For years Amazon let people print their own books and then sell them on Amazon as each being their own publisher. In 2009, Amazon stopped playing nice and told writers that if you want to print your own writings to sell on our site, you have to use our printers… at our prices… everyone else, hit the road. This was a BIG deal and lots of people left the Amazon ecosystem. But now they have backed down and opened the doors to everyone again.
And all of this because the latest twist on the rumor of the hearsay of the tablet is that Apple has been talking to publishers to build enhanced editions of their eBooks to run on the pixi-dust powered Apple Tablet. I just want to know how “enhanced” an eBook has to be to warrant a $1,000 device, multi-functional or not? We’ll see.
What I do know is that consumers win again as competition forces big businesses to be more open and agile.