“Translated into more practical terms, this means Hachette will demand that Amazon and other retailers–but really, this is aimed at Amazon–raise the prices on their e-books from the $9.99 standard they’ve adopted. Instead, the publisher will want them to use the $12.99-$14.99 standard for new books, which Apple introduced last week along with its iPad,” Kafka reports.
“Hachette is one of five publishers that participated in Apple’s iPad launch event last week. Macmillan, one of the other five, has spent the past week engaged in a public battle with Amazon over the pricing model. On Sunday, Amazon said it would capitulate to Macmillan’s demands,” Kafka reports. “Meanwhile, look for the other three publishers that have allied with Apple–Pearson’s Penguin Group, News Corp.’s (NWS) HarperCollins and CBS’s (CBS) Simon & Schuster–to fall in line. On Tuesday, News Corp. CEO Rupert Murdoch said he expected to renegotiate his publisher’s deal with Amazon soon.”
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MacDailyNews Note: Author Charles Stross blogs, “Just before Apple announced the iPad and the agency deal for ebooks, Amazon pre-empted by announcing an option for publishing ebooks in which they would graciously reduce their cut from 70% to 30%, ‘same as Apple.’ From a distance this looks competitive, but the devil is in the small print; to get the 30% rate, you have to agree that Amazon is a publisher, license your rights to Amazon to publish through the Kindle platform, guarantee that you will not allow other ebook editions to sell for less than the Kindle price, and let Amazon set that price, with a ceiling of $9.99. In other words, Amazon choose how much to pay you, while using your books to undercut any possible rivals (including the paper editions you still sell). It shouldn’t surprise anyone that the major publishers don’t think very highly of this offer.”
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