[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."
Amazon was losing money on every ebook sold so it could establish the Kindle format and the Kindle reader as the dominant format and reader in the ebook market.
Once that happened, it either would've forced the publishers to lower their prices by threatening to leave them out, or it would've raised prices since there would be no real competition.
I think Macmillan's win is that they can determine what the market price for a book will be, which by their own statements won't simply be more but determined by the individual book.
To add to this: Like most things, new books are priced higher. As time passes, the price decreases.
Macmillan wanted to be able to do this, and control the rate at which it happens.
(The music industry finally got this control out of Apple as well - $1.29, 0.99, 0.69.)
Amazon was losing money on every ebook sold so it could establish the Kindle format and the Kindle reader as the dominant format and reader in the ebook market.
Which is a big mistake because there is no way on god's green earth that Amazon could ever beat the Apples of the world in the hardware business. They are sacrificing what they do best (online retail) to pursue what they do worst (hardware). Amazon shareholders should be up in arms and beating down Jeff Bezos' door to tell him to stick to the knitting. Instead of betting the company on the Kindle pipe dream, he should be working to install an Amazon app on every mobile device out there.
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
Whether a book is a 100kb file or printed on paper, the real value of a book is not determined by the file size, the paper it is printed on, or how quickly you can download it. The value of a book is in the content. I can understand why book publishers and authors would want to try and maintain a price that reflects the value of the content being offered and is not determined solely by the method of distribution. People may not accept these prices but from the publishers point of view, it is not unreasonable to want to set a price that doesn't undervalue from the beginning. If they have to I am sure that they will adjust their prices accordingly or stop selling ebooks all together if people don't see the value in them and they can not make a reasonable return on their investment from selling them at lower prices.
Which is a big mistake because there is no way on god's green earth that Amazon could ever beat the Apples of the world in the hardware business. They are sacrificing what they do best (online retail) to pursue what they do worst (hardware). Amazon shareholders should be up in arms and beating down Jeff Bezos' door to tell him to stick to the knitting. Instead of betting the company on the Kindle pipe dream, he should be working to install an Amazon app on every mobile device out there.
Agree, but what if Amazon thought Apple was coming after the ebook market, since Apple had already swooped into other digital goods markets? What should Amazon have done?
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
Yes, and software, which also downloads in 10 seconds should never cost more than $0.99.
The cost of printing isn't much. The cost of production is rather high relative to everything else.
MOST of the costs are from middlemen.
Quote:
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
Except it doesn't according to authors. And prices do get down to $6 or less when the paperbacks appear.
Quote:
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
Not even Baen books with extremely inexpensive ebooks is seeing a huge uptick from ebook sales. Their e-books range from free to $15 ish for advanced reader copies (i.e. you get to read it before it even gets published).
The Amazon Kindle contract sucked. The Apple one is far more fair and I think you'll see more ebooks AND price competition. Amazon 30-70 split contracts REQUIRES that you never sell your ebook below the Kindle price and Amazon gets to set that price to whatever it wants.
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
Apple is using toys and games to teach us students a new user interface for a new computing platform. Once the pieces are in place (an abundance of software), Apple will introduce a Macbook Touch. It will have ports, a camera, be a stand alone product that backs itself up to time capsule, it will have a large hard drive... If they introduced it now, it wouldn't sell. But a big iPod will.
That is a great thought, and I hope you're right.
Apple has always been an innovator, and has never settled for so-so products. The iPad which is supposedly 'one the greatest things Steve Jobs has ever been involved in' offers ZERO innovation.
Think about this:
Since the debut of the iTunes music store in 2003, Apple has sold over 6 billion songs. Apple's cut is 30%.
[6bil x .3] / 7 years = 257 mil
*Not including movies or any extras, just $1 songs*
The App store since it's debut in 2008 has sold just over 1 billion apps. Apple's cut is again 30%.
[1bil x .3] / 2 years = 150 mil
*Many apps are more than $1 and many apps are free. For my simple point I'm averaging each app to be $1*
This means that Apple has made over $4.8 billion by simply hosting and distributing other people's content, which averages out to $685 mil per year. Now there ARE costs such as servers, programmers, bandwidth, etc., but nothing that comes to be $685 million per year. Yet, Apple claims to only break even on this?
What has happened is that Apple has gone from innovator to middleman, and the iPad is just another device to milk the profits of selling the same content. (Now including eBooks.)
Yes, it's just f__king wonderful that Apple can FORCE the prices of content higher to make their own product more attractive. That they can FORCE part of the playing field to be leveled so that the rest that was already in their favor stands out.
Such a win for consumers...
So Amazon was selling many of their ebooks at a loss to attract more Kindle users and gain market over any other competitors. And the publishers were very unhappy with this because it would eventually make Amazon the only game in town and give them no choice. And they were overjoyed that someone else was offering them sustainable terms that helped serve them and meant that other ebook stores could stand a chance at competing again.
And this is Apple FORCING the price higher? (From an already losing price.) And BAD for consumers? (Who get low prices now but face an unstoppable Amazon that can start dictating whatever they want.)
Whether a book is a 100kb file or printed on paper, the real value of a book is not determined by the file size, the paper it is printed on, or how quickly you can download it. The value of a book is in the content. I can understand why book publishers and authors would want to try and maintain a price that reflects the value of the content being offered and is not determined solely by the method of distribution. People may not accept these prices but from the publishers point of view, it is not unreasonable to want to set a price that doesn't undervalue from the beginning. If they have to I am sure that they will adjust their prices accordingly or stop selling ebooks all together if people don't see the value in them and they can not make a reasonable return on their investment from selling them at lower prices.
I wholeheartedly agree. It seems a human perception to equate value with size. Hence packaging small products in huge boxes, and "supersizing". When it becomes non-physical, some people believe it should be priced closer to "free" since it now "costs nothing to make".
But I've found that if you set the value of something low, people tend to follow your lead. Give free lessons and people don't pay attention. Give a free service and people don't credit its worth. Ask for a fee and suddenly people take it more seriously.
If there is value in the content, it should be priced to reflect that. And people can then decide for themselves if they agree with that value. Those who do pay will appreciate it. If they don't then they will return it. The market then becomes a conversation between the creator and the consumer.
Amazon seems to want to step in and dictate what the conversation is.
"things have to cost money or people won't (can't) make them."
-exactly
@pmz, @Tonyflo: I agree. The only people who want to pay nothing for content are people who've never produced any themselves.
-Don't know if I exactly agree with MacMillan's price points, as I think the public does understand some of the reduced costs.
But goddammit, every time I hear of some broke-a$$ 16-year-old Klepto-Communist talking about how he's entitled to free content, and how he's going to try to steal something that I worked on for 2 years, I feel like cutting off the li'l f'er's head with a samurai sword.
How about this, you can steal all the content you want if you work 9-5 40h/wk job making at least $50k, but return all your paychecks and agree to work for free in exchange for the privilege. The idea of stealing from someone whose work you think is good enough to steal in the first place boggles the frakking mind.
You pay the ones you love to keep them in business.
The problem with this attitude is that it takes a short term view of things. For things like music and software, having the ability to share with friends has long been how they rose in popularity. The same is true with pirated music and software. As a one-time software developer, I was never upset when people pirated the stuff because it was so popular on the whole it made money. The knee-jerk reaction to piracy is to raise prices, which is what they doing with books albeit for another reason. This only serves to get more people to pirate it, to teach them how to use piratebay instead of itunes and generally promotes illegality.
I firmly believe that what is important is to make buying the stuff simple and easy, then over the long term people will buy it. Maybe broke college kids won't, but you know what? They never did. i'd rather have them listening to my music or software than not. And when they grow up and get a 50k per year job they will buy stuff.
So i agree with you somewhat, but I think your view is too shortsighted.
Comments
[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."
Amazon was losing money on every ebook sold so it could establish the Kindle format and the Kindle reader as the dominant format and reader in the ebook market.
Once that happened, it either would've forced the publishers to lower their prices by threatening to leave them out, or it would've raised prices since there would be no real competition.
http://www.antipope.org/charlie/blog...outsiders.html
http://www.tobiasbuckell.com/2010/01...le-via-amazon/
I think Macmillan's win is that they can determine what the market price for a book will be, which by their own statements won't simply be more but determined by the individual book.
To add to this: Like most things, new books are priced higher. As time passes, the price decreases.
Macmillan wanted to be able to do this, and control the rate at which it happens.
(The music industry finally got this control out of Apple as well - $1.29, 0.99, 0.69.)
Amazon was losing money on every ebook sold so it could establish the Kindle format and the Kindle reader as the dominant format and reader in the ebook market.
Which is a big mistake because there is no way on god's green earth that Amazon could ever beat the Apples of the world in the hardware business. They are sacrificing what they do best (online retail) to pursue what they do worst (hardware). Amazon shareholders should be up in arms and beating down Jeff Bezos' door to tell him to stick to the knitting. Instead of betting the company on the Kindle pipe dream, he should be working to install an Amazon app on every mobile device out there.
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
Whether a book is a 100kb file or printed on paper, the real value of a book is not determined by the file size, the paper it is printed on, or how quickly you can download it. The value of a book is in the content. I can understand why book publishers and authors would want to try and maintain a price that reflects the value of the content being offered and is not determined solely by the method of distribution. People may not accept these prices but from the publishers point of view, it is not unreasonable to want to set a price that doesn't undervalue from the beginning. If they have to I am sure that they will adjust their prices accordingly or stop selling ebooks all together if people don't see the value in them and they can not make a reasonable return on their investment from selling them at lower prices.
Which is a big mistake because there is no way on god's green earth that Amazon could ever beat the Apples of the world in the hardware business. They are sacrificing what they do best (online retail) to pursue what they do worst (hardware). Amazon shareholders should be up in arms and beating down Jeff Bezos' door to tell him to stick to the knitting. Instead of betting the company on the Kindle pipe dream, he should be working to install an Amazon app on every mobile device out there.
Agree, but what if Amazon thought Apple was coming after the ebook market, since Apple had already swooped into other digital goods markets? What should Amazon have done?
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
Yes, and software, which also downloads in 10 seconds should never cost more than $0.99.
The cost of printing isn't much. The cost of production is rather high relative to everything else.
MOST of the costs are from middlemen.
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
Except it doesn't according to authors. And prices do get down to $6 or less when the paperbacks appear.
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
Not even Baen books with extremely inexpensive ebooks is seeing a huge uptick from ebook sales. Their e-books range from free to $15 ish for advanced reader copies (i.e. you get to read it before it even gets published).
The Amazon Kindle contract sucked. The Apple one is far more fair and I think you'll see more ebooks AND price competition. Amazon 30-70 split contracts REQUIRES that you never sell your ebook below the Kindle price and Amazon gets to set that price to whatever it wants.
Stop talking out of your ass. There's simply no way to justify that price. It's a file, it downloads in 10 seconds, and it should be priced accordingly. It's not a "real book" whatever way you try and spin it. Even eye strain alone should bring down cost. If the publishing industry ever expect books on the iPad, or any other device "to take off" the need to rethink their pricing: "DRAMATICALLY". New releases or bestsellers should be $9.99, and all other books should be $6.99.
You see, the thing they fail to see is pricing books at this sort of price point (7-10 bucks) would get people who read books buying more books, and it would get people who don't buy any books reading books. They don't have to cut down trees, they don't have to ship the books all over the planet, and they don't have to print the bloody things. Rest assured this is saving them money.
These publishers lack the vision, intelligence and foresight to see the obvious. They are sitting on money. This "instant books" industry would be "HUGE" if the price was right. I'd say even at those prices they'd make more money, possibly quite a bit more than currently. The books can't even be resold.
hey- I couldn't agree with you more. Well put.
Apple is using toys and games to teach us students a new user interface for a new computing platform. Once the pieces are in place (an abundance of software), Apple will introduce a Macbook Touch. It will have ports, a camera, be a stand alone product that backs itself up to time capsule, it will have a large hard drive... If they introduced it now, it wouldn't sell. But a big iPod will.
That is a great thought, and I hope you're right.
Apple has always been an innovator, and has never settled for so-so products. The iPad which is supposedly 'one the greatest things Steve Jobs has ever been involved in' offers ZERO innovation.
Think about this:
Since the debut of the iTunes music store in 2003, Apple has sold over 6 billion songs. Apple's cut is 30%.
[6bil x .3] / 7 years = 257 mil
*Not including movies or any extras, just $1 songs*
The App store since it's debut in 2008 has sold just over 1 billion apps. Apple's cut is again 30%.
[1bil x .3] / 2 years = 150 mil
*Many apps are more than $1 and many apps are free. For my simple point I'm averaging each app to be $1*
This means that Apple has made over $4.8 billion by simply hosting and distributing other people's content, which averages out to $685 mil per year. Now there ARE costs such as servers, programmers, bandwidth, etc., but nothing that comes to be $685 million per year. Yet, Apple claims to only break even on this?
What has happened is that Apple has gone from innovator to middleman, and the iPad is just another device to milk the profits of selling the same content. (Now including eBooks.)
Yes, it's just f__king wonderful that Apple can FORCE the prices of content higher to make their own product more attractive. That they can FORCE part of the playing field to be leveled so that the rest that was already in their favor stands out.
Such a win for consumers...
So Amazon was selling many of their ebooks at a loss to attract more Kindle users and gain market over any other competitors. And the publishers were very unhappy with this because it would eventually make Amazon the only game in town and give them no choice. And they were overjoyed that someone else was offering them sustainable terms that helped serve them and meant that other ebook stores could stand a chance at competing again.
And this is Apple FORCING the price higher? (From an already losing price.) And BAD for consumers? (Who get low prices now but face an unstoppable Amazon that can start dictating whatever they want.)
I find that lack of forethought disturbing...
Whether a book is a 100kb file or printed on paper, the real value of a book is not determined by the file size, the paper it is printed on, or how quickly you can download it. The value of a book is in the content. I can understand why book publishers and authors would want to try and maintain a price that reflects the value of the content being offered and is not determined solely by the method of distribution. People may not accept these prices but from the publishers point of view, it is not unreasonable to want to set a price that doesn't undervalue from the beginning. If they have to I am sure that they will adjust their prices accordingly or stop selling ebooks all together if people don't see the value in them and they can not make a reasonable return on their investment from selling them at lower prices.
I wholeheartedly agree. It seems a human perception to equate value with size. Hence packaging small products in huge boxes, and "supersizing". When it becomes non-physical, some people believe it should be priced closer to "free" since it now "costs nothing to make".
But I've found that if you set the value of something low, people tend to follow your lead. Give free lessons and people don't pay attention. Give a free service and people don't credit its worth. Ask for a fee and suddenly people take it more seriously.
If there is value in the content, it should be priced to reflect that. And people can then decide for themselves if they agree with that value. Those who do pay will appreciate it. If they don't then they will return it. The market then becomes a conversation between the creator and the consumer.
Amazon seems to want to step in and dictate what the conversation is.
"things have to cost money or people won't (can't) make them."
-exactly
@pmz, @Tonyflo: I agree. The only people who want to pay nothing for content are people who've never produced any themselves.
-Don't know if I exactly agree with MacMillan's price points, as I think the public does understand some of the reduced costs.
But goddammit, every time I hear of some broke-a$$ 16-year-old Klepto-Communist talking about how he's entitled to free content, and how he's going to try to steal something that I worked on for 2 years, I feel like cutting off the li'l f'er's head with a samurai sword.
How about this, you can steal all the content you want if you work 9-5 40h/wk job making at least $50k, but return all your paychecks and agree to work for free in exchange for the privilege. The idea of stealing from someone whose work you think is good enough to steal in the first place boggles the frakking mind.
You pay the ones you love to keep them in business.
The problem with this attitude is that it takes a short term view of things. For things like music and software, having the ability to share with friends has long been how they rose in popularity. The same is true with pirated music and software. As a one-time software developer, I was never upset when people pirated the stuff because it was so popular on the whole it made money. The knee-jerk reaction to piracy is to raise prices, which is what they doing with books albeit for another reason. This only serves to get more people to pirate it, to teach them how to use piratebay instead of itunes and generally promotes illegality.
I firmly believe that what is important is to make buying the stuff simple and easy, then over the long term people will buy it. Maybe broke college kids won't, but you know what? They never did. i'd rather have them listening to my music or software than not. And when they grow up and get a 50k per year job they will buy stuff.
So i agree with you somewhat, but I think your view is too shortsighted.
Are you a Stalinist? Capitalism, when it works properly, results in in low prices for consumers. That has been known since the time of Adam Smith.
Here, a duopoly situation exists, and fanbois are falling all over themselves to convince themselves that it is a Good Thing.
I say bring on the competition.
amazon and apple just closed the door for 10 yrs on real competion for E BOOK WARES
but IN 24 months apple will offer 5 dollar classics for sales and stuff like that
it will take time
apple will also have great authors sell direct to apple
and think of al the tons of paper not being used
whole forrest of trees will not be cut
apple will redefine book reading
schools can give the kids 20 texts books
on a simple metal slab \\called ipad
and info in the books can be updated very quicky
so igenie come =join the apple cult
come be one of us
stev does love you ya know
he does
peace
9