Amazon concedes, grants $13-$15 e-book prices to Macmillan

Posted:
in Current Mac Hardware edited January 2014
Days after Apple CEO Steve Jobs introduced the iPad and implied e-book prices would go up, Amazon gave in to a standoff with book publisher Macmillan, raising prices to between $12.99 and $14.99.



This weekend, Amazon had temporarily ceased selling titles from Macmillan as a pricing dispute between the two companies found no resolution. But Sunday, Amazon conceded and posted an announcement on its Kindle Community forums.



Calling Macmillan one of the "big six" publishers, Amazon said the company "clearly communicated" that they want to charge between $12.99 and $14.99 for e-book versions of bestsellers and most hardcover releases. Though Amazon strongly disagrees with Macmillan's stance, they raised the white flag.



"We want you to know that ultimately, however, we will have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books," the announcement said. "Amazon customers will at that point decide for themselves whether they believe it's reasonable to pay $14.99 for a bestselling e-book.



"We don't believe that all of the major publishers will take the same route as Macmillan. And we know for sure that many independent presses and self-published authors will see this as an opportunity to provide attractively priced e-books as an alternative."



Just before the iPad launch, some book publishers told The Wall Street Journal they had talks with Apple over e-book pricing on the iPad. Those negotiations would allegedly price new hardcover bestsellers at $12.99 and $14.99.



Immediately after Wednesday's iPad announcement, Jobs spoke with journalist Walt Mossberg about e-book pricing. He said the iPad and Amazon Kindle would offer "the same" prices on e-books, but did not elaborate. Prior to Amazon's dispute with Macmillan, new e-books cost $9.99 on the Kindle.



"Publishers are actually withholding their books from Amazon, because they're not happy with it," Jobs said to Mossberg.



On Sunday, when Amazon pulled Macmillan books from its online store, titles from the company could only be purchased through third-party retailers. The dispute could foreshadow the pricing structure to come in Apple's new iBookstore for the iPad.
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Comments

  • Reply 1 of 73
    zindakozindako Posts: 468member
    Apple shaking things up again eh!!!
  • Reply 2 of 73
    igeniusigenius Posts: 1,240member
    Quote:
    Originally Posted by AppleInsider View Post


    Days after Apple CEO Steve Jobs introduced the iPad and implied e-book prices would go up, Amazon gave in to a standoff with book publisher Macmillan, raising prices to between $12.99 and $14.99.



    {fanboi}I'm GLAD the price of ebooks is going up, so that the authors will bring us more and more ebooks! Way to go Macmillan! {/fanboi}
  • Reply 3 of 73
    ivan.rnn01ivan.rnn01 Posts: 1,822member
    Noisy not-anyone. About 1/4 of HarperCollins in sales.

    P.S. Well, the regular capitalism knows how to deal with problems like that; philanthropic one does not.
  • Reply 4 of 73
    igeniusigenius Posts: 1,240member
    Quote:
    Originally Posted by AppleInsider View Post


    Days after Apple CEO Steve Jobs introduced the iPad and implied e-book prices would go up, Amazon gave in to a standoff with book publisher Macmillan, raising prices to between $12.99 and $14.99.






    But seriously folks, the 30% to 50% increase in price for a nascent category does not bode well for mass acceptance. Time will tell.
  • Reply 5 of 73
    That sure was quick.
  • Reply 6 of 73
    Quote:
    Originally Posted by zindako View Post


    Apple shaking things up again eh!!!





    Yeah, it's all I wanted, for a company to force another company to raise their prices. Just fucking great! Wasn't capitalism supposed to work the other way around?



    (don't try to lecture me on capitalism, that was just rhetorical rant)
  • Reply 7 of 73
    successsuccess Posts: 1,039member
    Quote:
    Originally Posted by luisdias View Post


    yeah, it's all i wanted, for a company to force another company to raise their prices. Just fucking great! Wasn't capitalism supposed to work the other way around?



    I own U
  • Reply 8 of 73
    clemynxclemynx Posts: 1,504member
    Quote:
    Originally Posted by LuisDias View Post


    Yeah, it's all I wanted, for a company to force another company to raise their prices. Just fucking great! Wasn't capitalism supposed to work the other way around?



    (don't try to lecture me on capitalism, that was just rhetorical rant)



    totally agree with your comment.



    I don't see why we should rejoice, shame on apple!
  • Reply 9 of 73
    notrsnotrs Posts: 40member
    WAR IS PEACE

    FREEDOM IS SLAVERY

    IGNORANCE IS STRENGTH.



    I love Apple, but this iPad is a scam..



    It's obvious that to answer people's whining over an "Apple Tablet" Jobs and Co. decided to throw a large screen iPod Touch at them. All the while creating a new stream of income in which to sell content... basically the SAME content. Now, because of this "pacifier" prices are being raised!



    The iPad could have been so much more



    Although, the deal with AT&T IS a great thing... why couldn't it have been done with the iPhone from the start? (Like I've always said)



    Prepaid option - $30 for unlimited data and tiered pricing for minutes. *No Contracts*
  • Reply 10 of 73
    successsuccess Posts: 1,039member
    Hey can anyone create a book and sell it using the same GUI as the Apple store uses on the book shelf thingy? Or is that reserved for these big wig publishers?
  • Reply 11 of 73
    quadra 610quadra 610 Posts: 6,741member
    LOL Amazon is run from Cupertino.



    Win.
  • Reply 12 of 73
    Here's the article about it in the NYTimes.



    What I can't understand is that under the new arrangement, Amazon will get 30% of the proceeds from ebooks, whereas previously they had been purchasing rights wholesale from the publisher for half list price, and selling the ebooks at a loss. Now Amazon will be making more and Macmillan less, according to the Times' math. So how is this a loss for Amazon?



    "Book publishers, meanwhile, are volunteering to limit their digital profits. In the model that Amazon prefers, publishers typically collect $12.50 to $17.50 for new e-books. Under the new agency model, publishers will typically make $9 to $10.50 on new digital editions."
  • Reply 13 of 73
    addisonaddison Posts: 1,185member
    Competition works two ways. If there is only one shop they have a lot of power, Amazon could have been over charging and Macmillian could do little about it. Now with the iPad Amazon has competition and Macmillian has the upper-hand because the tail cannot wag the dog but...



    When Apple dominates as with the ITMS, Macmillian will find it harder.
  • Reply 14 of 73
    zandroszandros Posts: 537member
    I know that the costs for printing and shipping books is not a huge part of the selling price, but the benefits of a book as opposed to an electronic document (I'm going to insist that books are bound, physical objects) are more than worth the small price premium they ask for it.



    On the other hand, I see benefit in the Kindle and other e-readers in using them for documentation and manuals.
  • Reply 15 of 73
    pmzpmz Posts: 3,433member
    Quote:
    Originally Posted by LuisDias View Post


    Yeah, it's all I wanted, for a company to force another company to raise their prices. Just fucking great! Wasn't capitalism supposed to work the other way around?



    (don't try to lecture me on capitalism, that was just rhetorical rant)



    What if (and this isn't a what-if, it's a repeating of the reality behind the article for those skip it straight to Apple bashing/worship).....



    Macmillan was not happy with e-book sales on Amazon? They felt prices were too low. People opting for ebooks instead of physical books brings overall revenue down, and Amazon's previous idea of sharing revenue, was impacting the publisher's and author's income. (Yeah I know, Boo hoo big greedy authors and publishers, how dare they demand compensation for their creativity...)



    Sounds like Amazon went uber-anti competitive (which is all Amazon has ever done, ask any merchant with an account on Amazon who has had their sales stolen by Amazon cloning their inventory and dropping the prices by a 1/3), and rejected Macmillan, thinking, "Where else are they going to go? We're IT buddy."



    Not anymore you're not. iBooks hasn't even hit the public and already Amazon has backtracked its terrible mistake. For a hardcover book, I think 50% of its physical companion is a great model for everyone. There is still money to be made, and people get the convenience of the a library of books inside a 1.5 lb device. All of it half the price it used to cost.



    This is what you call a win/win situation.



    Amazon is what you call the worst successful retail company in the world. They are the digital Walmart. Scum of the earth.
  • Reply 16 of 73
    Quote:
    Originally Posted by zindako View Post


    Apple shaking things up again eh!!!



    Quote:
    Originally Posted by Addison View Post


    Competition works two ways.



    There he goes explaining how capitalism works....



    They are pricing the books at the same price as physical books, as if they had the same issues. This is just wrong. And these guys wonder why piracy is big in music and video?!? Now they are about to repeat the same mistake on books! Congrats, you losers, you're just about to create the next big p2p piracy market: e-books!



    Do these guys never learn? Don't they know that a collection of a thousand good books is 50/100MB? Don't they know they are digging their own grave?



    Ahh shit.
  • Reply 17 of 73
    pmzpmz Posts: 3,433member
    Quote:
    Originally Posted by andyapple View Post


    Here's the article about it in the NYTimes.



    What I can't understand is that under the new arrangement, Amazon will get 30% of the proceeds from ebooks, whereas previously they had been purchasing rights wholesale from the publisher for half list price, and selling the ebooks at a loss. Now Amazon will be making more and Macmillan less, according to the Times' math. So how is this a loss for Amazon?



    "Book publishers, meanwhile, are volunteering to limit their digital profits. In the model that Amazon prefers, publishers typically collect $12.50 to $17.50 for new e-books. Under the new agency model, publishers will typically make $9 to $10.50 on new digital editions."



    I'll be happy to explain. Amazon was never interested in making money off the ebooks they sell. They were interested in:



    1. Being the cheapest and most convenient medium.

    2. Selling you an insanely over priced Kindle.

    3. Selling you a hundred dollars worth of crap you didn't come to Amazon to buy, because your subconscious is sucking in the 500 products on each page that Amazon somehow knows you really want.
  • Reply 18 of 73
    Quote:
    Originally Posted by NotRs View Post


    I love Apple, but this iPad is a scam..



    It's obvious that to answer people's whining over an "Apple Tablet" Jobs and Co. decided to throw a large screen iPod Touch at them. All the while creating a new stream of income in which to sell content... basically the SAME content. Now, because of this "pacifier" prices are being raised!



    The iPad could have been so much more

    *



    I could not agree with you more. I think you nailed it. This iPad thing has got me feeling like Apple is becoming (or at least revealing) that they are really no different than any other major corporation - price fixing, profit margins, & control. Don't get me wrong, there are a lot of great things Apple has done, but really folks... can SJ really say this has been the best work of his life???? Really?



    It is just a glorified iPod Touch. And now this whole price thing. I was hesitant about buying one before, but now I am turning. It is all a game and we are just pawns. I'm getting off at the next bus stop.
  • Reply 19 of 73
    Quote:
    Originally Posted by pmz View Post


    Not anymore you're not. iBooks hasn't even hit the public and already Amazon has backtracked its terrible mistake. For a hardcover book, I think 50% of its physical companion is a great model for everyone. There is still money to be made, and people get the convenience of the a library of books inside a 1.5 lb device. All of it half the price it used to cost.



    This is what you call a win/win situation.



    YEah, win win. Because all I wanted for a product that takes practically zero effort to sell (download 100kb, frontcovers included?!?) is for it to rise to 15 bucks a piece. Really. Win win??!? Ahh come on. This is just begging for piracy.



    Quote:

    Amazon is what you call the worst successful retail company in the world. They are the digital Walmart. Scum of the earth.



    Yeah, scum bastards, trying to bring prices down for us consumers, how dare they!
  • Reply 20 of 73
    Quote:
    Originally Posted by pmz View Post


    I'll be happy to explain. Amazon was never interested in making money off the ebooks they sell. They were interested in:



    1. Being the cheapest and most convenient medium.

    2. Selling you an insanely over priced Kindle.

    3. Selling you a hundred dollars worth of crap you didn't come to Amazon to buy, because your subconscious is sucking in the 500 products on each page that Amazon somehow knows you really want.



    I'll buy that.



    Funny though, Apple's strategy is sorta similar: they claim to be only breaking about even from iTunes and apps, they make their killing from large margins on hardware. Though I do think the iPad represents much greater value over the Kindle!



    As to Macmillan's strategy, I think they are really cutting their nose etc... The ebook market represents a case in which profits rise astronomically with volume, as there is virtually no overhead for each additional unit sold.



    Then again, I can see there being an issue with a company such as, say, McGraw Hill, because textbooks typically sell at pretty steep prices. There is no way they are going to sell even as ebooks at $9.99, given the high cost of creation.
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