08-14-2011, 11:17 PM | #1 | ||
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The Opportunity Apple Just Created For Publishers
Blogger Eon Purcell notes that Apple may have created a big opportunity for publishers to sell directly to consumers, rather than through retailers:
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Well, what do you think? Is this the wave of the future? Mike Shatzkin thinks maybe: Quote:
The book publishers could even do it in partnership with the Ibookstore, the way that magazine publishers are doing it in partnership with Apple's forthcoming Newsstand app. Come to think of it, its not totally crazy to think that Apple might not have had something like this in mind when they announced their much maligned policy change! |
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08-15-2011, 03:41 AM | #2 |
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Selling directly works well for houses that have a clearly-defined genre (e.g. Baen) or for authors or small groups of authors (e.g. Closed Circle), as the customers know clearly where to go.
If the big publishers sold directly you would need to know which house sold the book you were looking for, or you would need the catalogue exposed to good search tools, or the big publishers would need to set up an aggregate site - effectively to act as their own agents. Exposing the catalogue to a general search would make sense, but wouldn't this be easier using the web rather than specific apps? Regarding iBookstore, aren't they selling through that already? Or do you mean that Apple could licence the iBookstore app to produce cloned versions for the big publishers? Graham |
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08-15-2011, 06:08 AM | #3 |
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I don't get it.
Old model - company would sell Amazon (or whoever) an ebook license at fixed price, which they would then turn around and sell to the customer at whatever price the seller wanted. Amazon would sell e-books below cost, generally $9.99 as a way to get people to buy kindles. So they would sell the e-book license to Amazon for $12.99, Amazon would sell it for $9.99, and Amazon would lose $3. Agency Model - Amazon, Apple, B&N, whoever, just works as a sales agent, taking a 30% cut of the purchase. Book prices hitting $12.99 and up and up and up. Sure, there is an opportunity to gouge customers more, but isn't the cut to iBooks (the official e-book store, who would be the sales agent there) pretty much the same as it would for their own apps? 30%? For $12.99 book, the sales agent gets ~$4, the publisher gets $9. If they did it in the app, the publisher would get the $9, plus the $4 for being their own sales agent, but they'd have to turn around and give apple the $4 for the in app purchase. |
08-15-2011, 06:08 AM | #4 |
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Publishers should do this. That way, they can have complete control over their books and raise prices as an added bonus.
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08-15-2011, 06:24 AM | #5 |
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Frankly I'm not sure how an IBook partnership would work, as yet. I do know that there are comic publisher apps already. Baen could do an app, if it wanted to . The Big Six guys could roll out very specific lines of books , I guess (Macmillan Mysteries, Harper & Collins Paranormal Romance ). There could be an Oprah Book Club or Zondervan Press App.
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08-15-2011, 06:28 AM | #6 | |
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Last edited by stonetools; 08-15-2011 at 06:32 AM. |
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08-15-2011, 06:30 AM | #7 |
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08-15-2011, 07:43 AM | #8 |
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Correct me where I'm wrong because I'm not a publisher. Now, when I buy a book from Amazon that is less of a novel than it is a "guess this word" game, I get a refund from Amazon. If I wrote the publisher I get an email telling me why it's not their fault. Now under this new model it would be up to the publisher to give me a refund, or not, right? So, at best I would be dealing directly with the herd of publishers and at worst I could just blow off the bad book.
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08-15-2011, 09:20 AM | #9 | |
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The only real way to sell direct to your customers is via a website, no middlemen and you keep 100% of the profit. (Usual exceptions for web hosting, payment processing etc) Then they could have an app that sync's content like the kindle app does to avoid the 30% fee. |
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08-15-2011, 09:31 AM | #10 | |
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i.e. that they currently get to keep 70% selling through Amazon, for example? Unless I've got this wrong, the publishers wouldn't get any more selling through the iBookstore than through any other retailer. The way they could potentially get more is by bypassing in app purchases and selling directly with a web app, but they'd have to have their own payment handling and download servers in place and deal with customer queries and refunds, which would eat into that 30% considerably. What's more, they'd do this in addition to using the other retailers. Unless they wanted to go no-DRM they'd still want to be on the Kindle as well as in ePub, for example. Graham Last edited by Graham; 08-15-2011 at 09:34 AM. |
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08-15-2011, 09:55 AM | #11 | |
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Does Shatzkin seriously think publishers want to get involved in producing reader hardware? Does he think they want to deal with all the customer-support issues currently handled by Amazon, B&N and Kobo? Shatzkin sometimes makes sense, but not here. No, there's no 'big new opportunity' here for publishers, at least not one that doesn't come with precisely the sort of overheads that they seek to avoid by giving retailers a cut of the consumer's dollar. |
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08-15-2011, 10:14 PM | #12 | |||
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08-16-2011, 03:57 AM | #13 |
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OK, it appears from those quotes that all Shatzkin is suggesting is that publishers could add additional entry points to their content with custom apps that would then make the sale with an in-app purchase or by transferring to iBooks. It's interesting that he also sees this as being diced up with apps for "authors or genres or series" rather than as a single app per publisher.
Effectively he's suggesting that publishers could capture some extra business by having their catalogue show up in app store searches rather than relying on sales within apps. Fair enough, particularly if the same basic app could be cloned for each new piece of content to spread the development and maintenance costs. (On a sidenote, regarding the transfer to a sale through iBooks, is that possible? Can one app call another in that way?) Graham |
08-16-2011, 07:00 AM | #14 |
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The publishers have had 10 years to setup an ebook marketplace portal on their own and haven't done so. They've had more time to prepare for what was coming then any other industry and did nothing but bury their head in the sand and hope it would go away. I don't know why Eon thinks they suddenly have an opportunity.
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08-16-2011, 10:13 AM | #15 | |
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*sigh* Isn't agency pricing a form of price fixing? I've always wondered, is that even legal? |
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