It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
Wrong and wrong. Amazon earns more money per ebook sale under the Agency model than they did under the Wholesale model. Secondly, Publisher's set the price under the Agency model which accounts for the higher prices (Because they do not allow Amazon, or others, to discount the "set" price.).
Wrong and wrong. Amazon earns more money per ebook sale under the Agency model than they did under the Wholesale model. Secondly, Publisher's set the price under the Agency model which accounts for the higher prices (Because they do not allow Amazon, or others, to discount the "set" price.).
The entire argument is silly.
Amazon fixed prices. Apple allows publishers to set their own prices and takes a fixed percentage.
And the iBooks 2 for texts apparently still lets the publisher set the prices. But since hardcover texts are often over $100 and the e-texts are $15 or less, I'm having trouble understanding the damages to the consumer. Since prices for the new e-texts are lower than the prices for hardcover, does that mean the damages are negative and the petitioners will have to pay Apple?
It seems to me that Amazon's original scheme of selling books at a loss was anticompetitive behavior and clearly not a business model they intended to continue once they developed and monopolized that market. Amazon is a business and they are in it to make money. There was a day when the overseas producers were selling semiconductors in the US under cost and it was called dumping and there were trade sanctions imposed to prevent it. The theory was that they would put US producers out of business and then raise the prices.
I don't exactly see how Apple's "agency model" that allows the content owners to set their own prices could be called "price fixing." Furthermore, they were not compelled to sign up with Apple.
Any honestly, the lawyers are alleging "deep antagonism?!!" How lame is that? I charge them with deep antagonism toward Apple.
Berman went on to assert that publishers took drastic and illegal action to protect their profits as their traditional business models were threatened.
Sounds like the RIAA and MPAA... and Congress, with this SOPA and PIPA nonsense.
Talking about iPad 3, has anyone considered that iPad 3 might be the same as current iPad 2 prices and that Apple might release the iPad 2 (The iPad E) at a much lower price only to educational institutions? This would hugely increase the uptake as many schools are strapped for cash, and would accelerate the Apple ebook model.
Talking about iPad 3, has anyone considered that iPad 3 might be the same as current iPad 2 prices and that Apple might release the iPad 2 (The iPad E) at a much lower price only to educational institutions?
I think that's everyone's belief at this point.
iPad 2 16GB: $399
iPad 3 16GB: $499
iPad 3 32GB: $599
iPad 3 64GB: $699
There's no need to give it a silly name or make it any cheaper.
Funny how Amazon wasn't worried about this when the record companies came to them because they worried about iTunes having too much power and having set pricing for songs.
There's no need to give it a silly name or make it any cheaper.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
"Deep antagonism" equates to price-fixing? I'd like to be present if this plays out in court. It'll be hilarious to watch the judge kick the Hagens Berman attorney's ass up around his ears for even trying to make such a tortured argument.
My thinking is a lot less that that, perhaps in the $250 range or even less.
That would be seen as "legitimizing the Kindle as a competitor", which Apple doesn't need to do. If people are buying more iPads than Kindles at $499 vs. $199, they'll just be buying even MORE at $399 vs. $199.
MAYBE Apple would do BULK discount pricing for educational institutions, but I don't see them ever letting the public know of a price lower than $399.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
I think a camera-less iPad 2 (or front camera only) would be a great educational iPad - and I think $250 is very doable for an education only iPad.
That would be seen as "legitimizing the Kindle as a competitor"
Meh - I think this perception crap is way overrated. Pricing aside, the user experience of the iPad vs Kindle Fire is night and day. I think Apple loves the Fire. It's the greatest gateway drug out there. It's cheap enough to get people who would never consider a tablet to get one, then once hooked on the concept leave desiring "the real thing". I've seen it twice in my family already - two Fires have been returned and replaced by iPads.
I do admit I liked the 7" form factor more than I thought, but if I had to pick one I would still go with the 10", and that's the rub for Apple. A 7" would sell, but would it sell enough to justify the extra tooling, retail space and software/platform issues? Variation introduces complexity and expense. Something Jobs has amply demonstrated from when he devised the original quad/four square Mac strategy with the first iMac and turned Apple back to profitability. Something I didnt think was possible at the time...
Quote:
MAYBE Apple would do BULK discount pricing for educational institutions, but I don't see them ever letting the public know of a price lower than $399.
Again Meh - in the eMac days anyone could log into the education version if Apples web store and see it and the sinificantly cheaper pricing and it didn't upset the iMac market
I expect Apple to agressvly go after the education market with the iPad. It's the perfect device, and generation three is about when (like with the eMac) they typically make their move. I think a sub $300 price is guaranteed.
It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
Nope. There was no split before Apple did it. Amaon bought the books wholesale just like paper books but with a caveat they could set the price. Publishers were not happy with Amazon using the books as a loss leader for the Kindle hardware and the Amazon website
Maybe I missed something, but who are the plaintiffs in this lawsuit? Are they filling the class action on behalf of everyone who has ever bought an ebook?
Maybe I missed something, but who are the plaintiffs in this lawsuit? Are they filling the class action on behalf of everyone who has ever bought an ebook?
You missed something.
The second line if the article to be exact.
Law firm Hagens Berman filed the original lawsuit last August on behalf of a group of consumers who allege Apple and most of the publishing industry colluded to introduce an agency e-book pricing model for the iBookstore to disrupt Amazon's wholesale model.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
That's the cost of the B&N Nook Color, a simple tablet-esque device with half the display real estate as the iPad. I think $399 would be the absolute lowest. It's not like the iPad isn't selling or losing favour.
Vendors at CES were even less focused this year than last on tablets. Apple is near winning here with a quality product that people love. There is no reason to hurt their profit or weaken their brand here.
For comparison the 8GB ? only 8GB! ? iPod Touch is $199 and the 32GB iPod Touch is $299. It's 1/8th the display real estate as the iPad and it hasn't even been updated since the year the original iPad was releaed.
It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
LOL. I usually ignore obvious fanboy comments. I love Apple but live in reality. But this comment was such over the top fiction that it was too much to ignore. Do you just make this stuff up?
Amazon NEVER got a 70-30 split in its favor. Prior to the pricing arrangement between Apple and the major publishers Apple that forced every retailer to conform to Apple?s pricing, Amazon had a wholesale e-book pricing model that was based on print books. So if the book was in hardcover and Amazon typically paid the publisher $15 for the book, they paid the publisher $13 for every e-book of that title sold as well. The publisher made the exact same take it did on print titles, and the authors got precisely the same commission as on print titles. Amazon was then free to set its own retail pricing just as they do for print, where the courts have already ruled that it is illegal for publishers to enforce fixed retail pricing. In many cases Amazon then took a loss on the sale of the e-book, selling a title that cost them $13 for $9.99 because they were more interested in marketshare at the time and every other retailer was free to set whatever pricing they wanted. Profit and loss was the decision of the retailer and the publishers and authors profited no matter what. Amazon usually made a profit on softcover-equivalent titles and a loss on new hardcovers.
Apple?s deal changed that. By requiring any publisher who wanted their distribution sales platform to contractually agree that no other retailer could have better pricing than Apple, by definition it required publishers to set retail pricing, a practice illegal in print books (but there was no case law for e-books yet). That Apple deal gave publishers 70% of the sales price and the retailer (Apple and others) 30%. In most cases this results in a smaller commission to authors than they were getting through Amazon?s deal. And, ironically, Amazon?s profit margin on a per-sales basis improves substantially, though their share is compromised by Apple (though since the market is growing so rapidally the net result is still growth for everyone).
The result was prices shot up substantially on major publisher e-books everywhere and there is now zero price competition in the marketplace ? prices are the same everywhere for major publisher e-books. Books that had been selling for $9.99 on Amazon before the Apple agreement went up to $14.99 and even $19.99. Before the Apple agreement it was extremely rare for the e-book not to be less expensive than the print book. After Apple?s agreement, it was commonplace for new mass market hardcover books.
So basically everything you wrote was the opposite of the facts. Nice work.
Whatever the outcome of the case, it is based on solid legal grounds and precedent. Apple?s deals with publishers has removed retail pricing competition from the marketplace. That?s the definition of marketplace collusion. Sure publishers don?t need to make a deal with Apple but when a company with a meaningful share of the marketplace refuses access to the marketplace unless you agree to deals that exclude other companies in the marketplace from fair market competition, there is much case law that says that?s not okay. Similarly, there is already clear legal precedent that its not legal for publishers to enforce fixed retail pricing for books. If nothing else this case will answer the open question as to whether a different and lesser standard will apply to e-books or a similar standard. If the courts believe that e-books should have consumer protection of retail pricing competition then they will rule against Apple and the publishers. If they believe the conditions of the marketplace are unique and different and that retail pricing protection is not necessary or appropriate, they will rule in their favor. If they rule against Apple and the publishers, Apple will be required to re-negotiate deals to not enforce best pricing guarantees and publishers will have to re-negotiate deals with other retailers like Amazon to only enforce wholesale pricing and not retail pricing. Amazon, BN and others will all be able to set their own pricing again, profiting or losing as they see fit for their individual business models.
Amazon then took a loss on the sale of the e-book, selling a title that cost them $13 for $9.99 because they were more interested in marketshare at the time
It's a bit naive to think they did it solely for market share.
Comments
189K sold devices in a year is good?
Ipad1 sold more in the first hour.
DaHarder bought 9 of them, 3 each for himself, his wife, and their dog.
It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
Wrong and wrong. Amazon earns more money per ebook sale under the Agency model than they did under the Wholesale model. Secondly, Publisher's set the price under the Agency model which accounts for the higher prices (Because they do not allow Amazon, or others, to discount the "set" price.).
Wrong and wrong. Amazon earns more money per ebook sale under the Agency model than they did under the Wholesale model. Secondly, Publisher's set the price under the Agency model which accounts for the higher prices (Because they do not allow Amazon, or others, to discount the "set" price.).
The entire argument is silly.
Amazon fixed prices. Apple allows publishers to set their own prices and takes a fixed percentage.
And the iBooks 2 for texts apparently still lets the publisher set the prices. But since hardcover texts are often over $100 and the e-texts are $15 or less, I'm having trouble understanding the damages to the consumer. Since prices for the new e-texts are lower than the prices for hardcover, does that mean the damages are negative and the petitioners will have to pay Apple?
So how is Apple guilty of price fixing?
I don't exactly see how Apple's "agency model" that allows the content owners to set their own prices could be called "price fixing." Furthermore, they were not compelled to sign up with Apple.
Any honestly, the lawyers are alleging "deep antagonism?!!" How lame is that? I charge them with deep antagonism toward Apple.
Berman went on to assert that publishers took drastic and illegal action to protect their profits as their traditional business models were threatened.
Sounds like the RIAA and MPAA... and Congress, with this SOPA and PIPA nonsense.
Hey! Look! I guess it is physically possible for Amazon to release their sales numbers!
Wonder why they don't do it anymore… maybe it has something to do with how terrible they are…
Talking about iPad 3, has anyone considered that iPad 3 might be the same as current iPad 2 prices and that Apple might release the iPad 2 (The iPad E) at a much lower price only to educational institutions?
I think that's everyone's belief at this point.
iPad 2 16GB: $399
iPad 3 16GB: $499
iPad 3 32GB: $599
iPad 3 64GB: $699
There's no need to give it a silly name or make it any cheaper.
I think that's everyone's belief at this point.
iPad 2 16GB: $399
iPad 3 16GB: $499
iPad 3 32GB: $599
iPad 3 64GB: $699
There's no need to give it a silly name or make it any cheaper.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
My thinking is a lot less that that, perhaps in the $250 range or even less.
That would be seen as "legitimizing the Kindle as a competitor", which Apple doesn't need to do. If people are buying more iPads than Kindles at $499 vs. $199, they'll just be buying even MORE at $399 vs. $199.
MAYBE Apple would do BULK discount pricing for educational institutions, but I don't see them ever letting the public know of a price lower than $399.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
I think a camera-less iPad 2 (or front camera only) would be a great educational iPad - and I think $250 is very doable for an education only iPad.
That would be seen as "legitimizing the Kindle as a competitor"
Meh - I think this perception crap is way overrated. Pricing aside, the user experience of the iPad vs Kindle Fire is night and day. I think Apple loves the Fire. It's the greatest gateway drug out there. It's cheap enough to get people who would never consider a tablet to get one, then once hooked on the concept leave desiring "the real thing". I've seen it twice in my family already - two Fires have been returned and replaced by iPads.
I do admit I liked the 7" form factor more than I thought, but if I had to pick one I would still go with the 10", and that's the rub for Apple. A 7" would sell, but would it sell enough to justify the extra tooling, retail space and software/platform issues? Variation introduces complexity and expense. Something Jobs has amply demonstrated from when he devised the original quad/four square Mac strategy with the first iMac and turned Apple back to profitability. Something I didnt think was possible at the time...
MAYBE Apple would do BULK discount pricing for educational institutions, but I don't see them ever letting the public know of a price lower than $399.
Again Meh - in the eMac days anyone could log into the education version if Apples web store and see it and the sinificantly cheaper pricing and it didn't upset the iMac market
I expect Apple to agressvly go after the education market with the iPad. It's the perfect device, and generation three is about when (like with the eMac) they typically make their move. I think a sub $300 price is guaranteed.
It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
Nope. There was no split before Apple did it. Amaon bought the books wholesale just like paper books but with a caveat they could set the price. Publishers were not happy with Amazon using the books as a loss leader for the Kindle hardware and the Amazon website
Maybe I missed something, but who are the plaintiffs in this lawsuit? Are they filling the class action on behalf of everyone who has ever bought an ebook?
You missed something.
The second line if the article to be exact.
Law firm Hagens Berman filed the original lawsuit last August on behalf of a group of consumers who allege Apple and most of the publishing industry colluded to introduce an agency e-book pricing model for the iBookstore to disrupt Amazon's wholesale model.
My thinking is a lot less that that, perhaps in the $250 range or even less. Not necessarily a silly name, it is not without precedent in the iMac range and does make tracking product easier.
That's the cost of the B&N Nook Color, a simple tablet-esque device with half the display real estate as the iPad. I think $399 would be the absolute lowest. It's not like the iPad isn't selling or losing favour.
Vendors at CES were even less focused this year than last on tablets. Apple is near winning here with a quality product that people love. There is no reason to hurt their profit or weaken their brand here.
For comparison the 8GB ? only 8GB! ? iPod Touch is $199 and the 32GB iPod Touch is $299. It's 1/8th the display real estate as the iPad and it hasn't even been updated since the year the original iPad was releaed.
It wasn't the low prices on Amazon ebooks that drove publishers mad. It was the cracy 70-30 split of revenue. Amazon 70% and publishers 30%. This is the reason why many ebooks are more expensive then retail books.
LOL. I usually ignore obvious fanboy comments. I love Apple but live in reality. But this comment was such over the top fiction that it was too much to ignore. Do you just make this stuff up?
Amazon NEVER got a 70-30 split in its favor. Prior to the pricing arrangement between Apple and the major publishers Apple that forced every retailer to conform to Apple?s pricing, Amazon had a wholesale e-book pricing model that was based on print books. So if the book was in hardcover and Amazon typically paid the publisher $15 for the book, they paid the publisher $13 for every e-book of that title sold as well. The publisher made the exact same take it did on print titles, and the authors got precisely the same commission as on print titles. Amazon was then free to set its own retail pricing just as they do for print, where the courts have already ruled that it is illegal for publishers to enforce fixed retail pricing. In many cases Amazon then took a loss on the sale of the e-book, selling a title that cost them $13 for $9.99 because they were more interested in marketshare at the time and every other retailer was free to set whatever pricing they wanted. Profit and loss was the decision of the retailer and the publishers and authors profited no matter what. Amazon usually made a profit on softcover-equivalent titles and a loss on new hardcovers.
Apple?s deal changed that. By requiring any publisher who wanted their distribution sales platform to contractually agree that no other retailer could have better pricing than Apple, by definition it required publishers to set retail pricing, a practice illegal in print books (but there was no case law for e-books yet). That Apple deal gave publishers 70% of the sales price and the retailer (Apple and others) 30%. In most cases this results in a smaller commission to authors than they were getting through Amazon?s deal. And, ironically, Amazon?s profit margin on a per-sales basis improves substantially, though their share is compromised by Apple (though since the market is growing so rapidally the net result is still growth for everyone).
The result was prices shot up substantially on major publisher e-books everywhere and there is now zero price competition in the marketplace ? prices are the same everywhere for major publisher e-books. Books that had been selling for $9.99 on Amazon before the Apple agreement went up to $14.99 and even $19.99. Before the Apple agreement it was extremely rare for the e-book not to be less expensive than the print book. After Apple?s agreement, it was commonplace for new mass market hardcover books.
So basically everything you wrote was the opposite of the facts. Nice work.
Whatever the outcome of the case, it is based on solid legal grounds and precedent. Apple?s deals with publishers has removed retail pricing competition from the marketplace. That?s the definition of marketplace collusion. Sure publishers don?t need to make a deal with Apple but when a company with a meaningful share of the marketplace refuses access to the marketplace unless you agree to deals that exclude other companies in the marketplace from fair market competition, there is much case law that says that?s not okay. Similarly, there is already clear legal precedent that its not legal for publishers to enforce fixed retail pricing for books. If nothing else this case will answer the open question as to whether a different and lesser standard will apply to e-books or a similar standard. If the courts believe that e-books should have consumer protection of retail pricing competition then they will rule against Apple and the publishers. If they believe the conditions of the marketplace are unique and different and that retail pricing protection is not necessary or appropriate, they will rule in their favor. If they rule against Apple and the publishers, Apple will be required to re-negotiate deals to not enforce best pricing guarantees and publishers will have to re-negotiate deals with other retailers like Amazon to only enforce wholesale pricing and not retail pricing. Amazon, BN and others will all be able to set their own pricing again, profiting or losing as they see fit for their individual business models.
Amazon then took a loss on the sale of the e-book, selling a title that cost them $13 for $9.99 because they were more interested in marketshare at the time
It's a bit naive to think they did it solely for market share.
Confessions of a Publisher: ?We?re in Amazon?s Sights