“Publishers joining Apple’s iBooks store [sic] are turning their back on Amazon and its vision of the flat $US9.99 ebook,” Matt Buchanan writes for Gizmodo.
MacDailyNews Note: Like iTunes, iBooks is the app. It connects to Apple’s iBookstore, just as iTunes connects to Apple’s iTunes Store.
Buchanan continues, “Apple forced the music industry to charge 99 US cents per song, so why are they helping publishers set their own prices? To screw Amazon.”
“The difference between Amazon and Apple is this: Amazon is very much in the ebook business to sell ebooks.. Apple, on the other hand, sells content in order to sell hardware,” Buchanan writes.
“At this moment, Amazon owns ebooks. The book publishers’ fears are the same as the record labels with iTunes: They’re paranoid about losing control over pricing, and their own digital destiny. They’re worried that books are being undervalued, and that once people have the mindset that the price of an ebook is $US9.99, and not a penny more, they’re doomed,” Buchanan explains. “They needed an insurgent player: Apple.”
“Apple has advantages that Amazon didn’t have with music: Scale and technology. iTunes has just moved three billion iPhone apps. Apple’s sold over 250 million iPods,” Buchanan explains. “By contrast, Amazon’s sold an estimate 2.5-3 million Kindles since it debuted two years ago. Analysts predict Apple will sell twice as many iPads this year alone.”
MacDailyNews Take: The analysts that are predicting 5-6 million iPads sold this year are going to have to up their estimates; they’re too low.
Buchanan continues, “In terms of technology, e-ink looks old and busted and slow next to the iPad’s bright, colour display… An iPad can do more than books: Beautiful digital magazines, interactive textbooks, a dynamic newspaper. Oh, and it’s a computer that does video, apps, music. Amazon’s scrambling now to make a multitouch full colour Kindle after betting on e-ink, but that kind of development takes at least a year. Even if they churn out a full colour reader that is somehow better than the iPad, it likely won’t matter: It would just be a very nice reader to iPad’s everything else, and it would be nine months too late.”
“Price would’ve been Amazon’s major advantage over Apple too – being able to undercut Apple by setting whatever price they needed to compete would’ve been its ace in the hole against the iPad’s flashy colour screen, and everything else it can do. And now that’s poofed,” Buchanan writes. “Apple will be able to sell you ebooks for the exact same price as Amazon. By turning the publishers against Amazon, they’ve effectively dicked the Kindle over.”
Full article here.
MacDailyNews Take: The Kindle wasn’t cutting it, regardless of empty hyperbole from Bezos, willing accomplices in the media, and certain analysts. The publishing industry doesn’t have two decades for Amazon to maybe hit critical mass. Plus, Kindle is amateur-hour hardware (and software). Amazon doesn’t have the core competency to do such a device (or any device of any complexity, actually). Maybe Bezos could do an Amazon clip-on book light or something, if he wants to fool around with Amazon-branded hardware. If Amazon wants to sell e-books, then they need to forget about hardware devices — leave that to a real devices (hardware+software+services) company — and concentrate on their Kindle app for iPhone OS devices: iPhone, iPod touch, and iPad.
It would be great to have Apple stand on reducing the cost of public school and college books. A cost reduction at these two points would be great on wallets and backs!
Maybe Apple is choosing where to fight. It is a hopeful thought.
I wont buy DRM-ed content anyway, so it doesn’t really matter for me.
As much as I disagree with “zmarc,” I think he’s right. (or she)
The less popular books will be discounted if they expect to sell any of them, while the publishers will get away with charging more for the hot books.
Apple’s formula sounds like the only way eBooks (or make that iBooks) can sell for more is if they also charge more for the paper books. Also, competition from Amazon isn’t going to just go away. Expect price wars.
In any case, the electronic books should cost less.
Electronic books should cost at most $2 less than hardcover books, since that is approximately the cost of printing, warehousing and distributing a harcover book.
As for DRM, so far, NOBODY ever mentioned anything about ePUB format being encumbered by DRM. Not Jobs, not Phil Shiller, not the guy from NY Times… Unlike Amazon’s proprietary, DRM-infested Kindle format, ePUB is an open standard format, supported by number of companies, and there is no specific DRM tied to it. For all we know, you should be able to do with this book anything you’re able to do with a paperback (including making a copy and giving it to someone else; much like AAC file from iTunes music store).
Where did this DRM talk come from anyway?
What would be meaningful, is that the writers could be paid for their long term job… Instead of having all gone and lost along the edition-production-sales process.
You must consider that the big house publishers are kings of bodt, books on dead trees. Apple has the ability to turn the bookstore into an app store by making individual works available through a deal directly with the author. In the digital world we don’t need no stinking publishers. Everyman is free to “publish”.
“.. but right now libraries are more crowded than ever.”
First, libraries are crowded not because people are checking out books, but because of people using the public computers. At least 50% of library usage is for computers. People are checking out books as well, but usage is not the reason libraries will continue to shrink and eventually close: their budgets are being slashed by city/county governments. Skyrocketing insurance/pension costs, fire and police departments, and the ongoing Republican Tea Bagger movement (“No government is good government!”), will insure that cultural centers like libraries will be suffocated out of existence.
“eBooks cost the publishers virtually NOTHING on their end to produce.”
Yeah, ’cause we all know that writers work for free. Sheesh!
“these eBook prices are HIGHER than going out and buying the paperback version for yourself!”
And they FORCE people to buy the eBook so they can’t get the lower price!
“And with the paperback version, you can lend it out to a friend, you can keep it on your bookshelf…”
And, if you want to read it on an electronic device, you can scan it in page by page, run OCR on it,then fix up the errors OR type it all in by hand!
“Yeah, ’cause we all know that writers work for free. Sheesh!”
Actually, most published authors do work for free, and as an average authors receive only about 10% of the purchase price of a book. The postings here are only referring to bestselling authors, who only make up a tiny fraction of the publishing market. The publishing industry (including copyright) largely exists to sustain book publishing itself, not to support authors. If you think authors are making money from the current publishing system, you need to take a closer look.
Not sure why anyone thinks that Apple is ‘doing’ anything here. The publishers have hated their terrible deals with Amazon over eBooks. Now Amazon have competition, the publishers are glad to be able to play Amazon off with Apple.
With these prices, I’ll just continue to check my books out of the library.
Sorry, but Amazon’s forced $9.99 ebook price came at the high cost of selection. What good is being able to save a couple of bucks if you can’t find the books you want? I installed the Kindle app for iPhone and tried searching for a few of my favorites and nearly none of them were available. I blame Amazon’s pricing policy. Publishers are choosing to withhold books rather than give everything away for less money than it’s worth. Likewise, new books probably rarely show up for Kindle at the same time they are released in hardcover print because publishers don’t want ebooks to severely undercut hardcover prices, so again selection suffers. Apple’s model will likely see ebooks release at the same time as new hardcovers and as someone already pointed out, when the cheaper paperback gets released, the ebook price will drop. When the paperback is being discounted, the ebook price will likely drop again. So it’s extremely unlikely that all books will always cost $12.99-$14.99. We will see plenty of books for $9.99 and less. We’ll also see plenty of free books as the iBookstore will give us acces to a huge library of out of copyright/public domain books just like Stanza and other reader apps do.
Lastly, many iBooks will have higher value to the consumer because they will be in colour and include multimedia and interactivity that just isn’t currently possible with the one price fits all black and white Kindle books.
Chill out people, the future looks bright!
I read a lot of fiction maybe two books a week. I almost never buy a book. I get them at the library. That said, consider an author that self publishes at the IBook store and sells 1 million at 99 cents. That would gross them $700,000 after the store takes its cut.Somebody like King or Grisham could sell tens of millions. And I would probably buy 40 or 50 books a year. I bought very little music prior to ITunes and now my computer is loaded with songs. Authors can do well. Publishers might be in trouble.
“But what Apple is doing with book pricing is not consumer-friendly at all. It is now more cost-effective and beneficial to just order the actual book. With music, it made SENSE to buy through iTunes. This doesn’t make much sense at all, because it’s all about benefitting the publishers’ coffers.”
Who cares about the consumer!!! If these books are overpriced, Apple’s margins will be higher!!!! We Apple fans don’t care about the consumer – just hope Apple makes lots of money!!!
BTW, the iPad is priced way to low!!! I think it should start at about $1500!!! I’m sure there’s enough of us to buy one that AAPL will go higher!!!!!!!!!!!!!!!
Woooo Hoooo Go Steve!!!!!!!!!!!!!!!!!!!!!!!
Apple is in the hardware business. iBooks will sell hardware.
Apple is merely playing the game in a way that is palatable to publishers. Charge what you like, it’s your product. The unspoken subtext is that – you’ll have to revisit your thinking if you find that no one is buying at your preferred prices. A typical novel is no different to a CD of songs. It is a piece of work. But how much work? If I liked original music from a band I would be prepared to pay a little more for it than mere cover versions of other people’s songs. Similarly, biographies, old books, text books (which rarely change in some cases), software how-to books (which have a shorter useful life because of the march of software upgrades), short story collections and other variants of books should have some kind of matched scale of charging. Short books and long books. Books with high production values, costly original photography etc. There is great diversity in book formats, book markets, content value etc.
In the end, after the publishing industry has had its practical education in the new rules of the eMarket, I think prices will slowly trend lower. And new book prices will fall as time passes. Apple knows all this and has factored the new rules into its thinking. It is the publisher who faces a rude awakening – all publishers, but especially news and magazine publishers whose content has the shortest shelf-life of all, as little as a few hours of value in this day of tv and the internet. I stopped buying newspapers and magazines about two years ago and I used to be a major magazine buyer. Now I can find out everything I need to know whenever I feel like looking for it.
The interesting thing is that there will be new kinds of multimedia books and self-publishing will gradually take off. A good thing. Apple will support authors who follow that route too.
Bad news for agents in the long term.
I have 3 kids. 6, 4, & 2. I expect the iPad, with it’s capacity for interactive reading materials, is going to be huge with my kids and their ability to learn to read. My oldest is reading the Magic Tree House books – add in some short video animations of the scenes after reading and she won’t be able to put the thing down. That’s good news for her generation – anything to get kids to read more is good news in my book. Even if the books are the same price as hard books – I think the interactive elements will be more helpful in the education arena – and for that reason – to me, at least, are worth the price.
Much of the talk here is about best sellers and their ebook price v. hard cover price. I’m guessing in a few years those arguments will be the least topical pertaining to the iPad. Interactive books may help to make actually educating our people a priority again. Hopefully.
Rules, rules, rules! There are no rules in songwriting. There are no rules in karma. And there are no rules in Apple’s approach to content pricing. Just cause and effect.
Outrage that Apple treats ‘books’ differently from music fails, as far as I can see it. The established economic structure of music sales was a relatively limited structure: 1) song, 2) album. I suppose Apple could have tried–and perhaps even did try–to revolutionize that structure. But I don’t think it would have worked. Therefore, the insistence on the 99-cent song, with eventual distinct but limited variation.
However, in my opinion the economic structure of ‘book’ content is so chaotic as to make direct comparison with music impossible. In music you just don’t have the equivalent of a 24-page children’s book on the one hand contrasted with a 600-page medical reference book on the other. These kinds of distinctions aren’t arbitrary, they’re fundamental. Periodicals are in there, too, so what will you do about single-price limits for all ‘magazines’, or all ‘newspapers’?
It’s true that the disparity in printing costs of books and other text content disappears when you go to ebooks. That’s one of the issues that drives some of the criticism about Apple’s ebook pricing position; but there are still huge disparities in scale and complexity of ‘books’.
I recently read–with great delight–a blog entry from someone criticizing Apple’s pricing decision for ebooks using a few logical fallacies along with a couple instances of actual disinformation. When called on the validity of his/her argument, the response was “I hate the way Apple…”
It was pretty clear to me that the hate came first, then the tortured logic to prop it up.
Why the hate? My bet’s on narcissistic rage http://en.wikipedia.org/wiki/Narcissistic_rage, for which the first few decades of the 21st Century will unfortunately become famous. Paradoxically, superiority is more dangerous than we can even imagine.
What’s obvious in all this discussion is that people have different interest in eBooks vs. physical vs. no books. All of this will ultimately factor into the market prices.
As for the argument that eBooks should just be slightly less hardbacks (taking out difference in manufacturing, shipping, shelving)… that makes sense on some level but it doesn’t address the difference in what they’re worth…eBooks are worth less to me… but I’m sure they’re worth more to other people for a variety of reasons.
I’m on Amazons side. Love Apple’s products but Apple should have fought for us (the consumer) to get prices down.
I will never buy a novel as an ebook for more than $3.99 and 39.99 for text books or specialized subjects.
I do agree that the publishers should set the prices as I agreed that the music industry should set there prices. But Apple did fight for us to keep the prices down also striped out the DRM and upped the quality a bit. What are we getting this time?
The real story here is that Amazon tried to break into the MP3 music downloads with DRM free @ .99. Apple is now kicking back with giving publishers what the want and killing off the Kindle business.
Just the way I see it.
“They sacrificed the 9.99 price to consumers in order to enter the market.”
Well your own statement there indicates that if they had not ‘sacrificed’ it, they could not have entered the market. I assume you’re not a shareholder.
There is a seedy underbelly to Apple’s strategy that is repeatedly ignored – it is to screw the competition. But self-enlightened fanboys can’t face the truth – so it’s coated in some sort of sugar coated humanistic blather. It is what it is. Corporate america – no matter how Apple chooses to present it.
@cb “But self-enlightened fanboys…”
Thanks for automatically disqualifying yourself from actual discussions among the grownups here, cb. Please take your peashooter and peabrain out to the yard where the other kids are playing. Although with your attitude, you’ll probably just end up getting chucked in the sandbox.
@cb
Go back to your wipe and install.
Competition is good for consumers and bad news for middlemen such as publishers and agents.
Here are a few predictions:
– Apple will run out of iPad in 7 days
– iPad will outsell Kindle in 90 days
– Apple will make more profit from Bookstore and Appstore than the iPad hardware
– iPad will have more educational and interactive books for children in 2010 ready for Xmas season (combining reading, audio, movie, and touch capabilities
– Kindle will fail trying to compete with iPad for children demographics
– iPad largest buyer demographic will be the elderly who have avoided the internet and children
There is still a a market for kindle like devices until iPad 2nd generation comes along and the 1st gen 16GB iPad start to sell for $299 and $199 for 2nd hand on eBay.