Three Publishers Now Reject Amazon’s $9.99 Ebooks

February 5, 2010 By Geoff Duncan

First it was Macmillan, now HarperCollins and Hachette are renegotiating with Amazon to sell ebooks for the Kindle at up to $14.99 apiece.

Apple’s iPad and iBook Store haven’t even launched yet, and already they’re having a major impact on Amazon’s Kindle Store: three publishers are now jumping ship on Amazon’s $9.99 top price for ebooks and renegotiating their deals with Amazon to sell ebooks for prices up to $14.99 apiece.

The moves started when Apple announced its iBook Store, which will debut in March with its much anticipated iPad tablet computing device: the iPad will support full-color ebooks, and they’ll be on sale for prices up to $14.99. Almost immediately, Amazon.com got into a tussle with publisher MacMillan over ebook pricing: Amazon pulled Macmillan titles from the Kindle Store, even while conceding that it will eventually have to relent to Macmillan’s demands that Amazon switch to agency pricing and charge $12.99 to $14.99 per ebook. Now, publishers Hachette and HarperCollins have announced plans to switch to an agency model whereby the publishers set the price for ebooks, and the retailer keeps 30 percent of the sales price.

The Hachette and HarperCollins moves mean three of the “big six” publishers are now rebelling against Amazon’s $9.99 pricing on ebooks. However, the publishers are keen to spin their positions as anything but a money grab. In a memo to agents, Hachette noted “the agency model [is not] a way to make more money on e-books. In fact, we make less on each e-book sale under the new model; the author will continue to be fairly compensated and our e-book agents will make money on every digital sale.”

However, News Corp.’s Rupert Murdoch—which owns HarperCollins—was less charitable, stating flat-out in an earnings call that he believes the $9.99 Amazon ebook model “devalues books” and damages hardcover book retailers.

Showing 7 comments

Five reasons why piracy will kill the ebook digital publishing industry – Jungla - Short, impartial book reviews at 12:43pm 25th October 2010 [...] 1) Books are losing value: Customers think ebooks should mean cheap – no printing, no shipping, no storing, no rent and no employees. When Amazon started selling $35 hardback editions for $9.99 as ebooks, people considered this a fair price. It didn’t matter that Amazon was losing $8 on every sale. Amazon is continuing to subsidise sales of its Kindle ebooks by selling digital bestsellers at below cost price (against publisher’s wishes). [...]
john at 6:29pm 6th February 2010 Ebooks going down in Prices , Kindle, iPad and the new Mobile devices will push that way
dougom at 9:25pm 5th February 2010 That's exactly what I'm arguing, Ian. That's exactly what happened in the record industry when the industry was trying the "crack down and punish our customers" role. When they went with iTunes and $.99/song, people bought the songs like no one's business.

People want ease of use (e.g., Amazon's "whispersync"), and reasonable prices. In my opinion, people most assuredly *don't* want to be forced to support an obsolete business model simply because the purveyors thereof are too short sighted, or lazy, or greedy, or what have you, to change their model. There's lots of ways publishers can respond in this situation; punishing customers by raising prices is not a good one.
dang at 3:29pm 5th February 2010 Personally, raising the prices is rubbish.

When CD's first came out, they were most expensive then tapes/LPs, around $20 a pop, sometimes more. But as the cd was adopted, prices came down, not up! Sounds like pure greed to me.
Ian Bell at 3:15pm 5th February 2010 Sooo how else will you read their books if you are forced to pay for them? You act like customers can control this. Or are you implying that books will be illegally traded via BitTorrent online as a result?
dougom at 3:02pm 5th February 2010 Perhaps it's uncharitable of me, but I don't give a flying frack what Rupert Murdock thinks with regard to the "value" of books and the viability of hardcover book retailers. The increase in eBook sales has shown that the current book publishing and sales model no longer works. Until the publishers get that, they are going to find themselves marching down the same path that record companies did starting in the 80s.

eBook readers have no interest in supporting the viability of the current hardcopy book publishing and sales model, and trying to charge them a third more is not going to make the situation better. The sooner that Murdock and his fellow hidebound oligarchs recognize this fact, the sooner they'll be able to move to a model that still allows them a profit. Otherwise, piracy will explode.

So get a grip, publishers, or you'll be left behind just like record companies.
JennaW at 2:23pm 5th February 2010 Amazon pulled all of MacMillan's books, virtual and physical, from its store (though not affiliate sellers), not just from the Kindle store. Which means you can't buy any of MacMillan's books or those of its imprints from Amazon though they can be found and purchased through Amazon's web site.