Is the new 'agency' system going to change your buying habits?

[Lemurion]

Originally Posted by Skydog

Not just Macmillan - Simon & Schuster is withholding releases as well.

The last I heard, S&S was not one of the three publishers pushing for the agency model, so you can't blame their delays on agency. In fact, if John Sargent is to be believed, their delays are probably because they aren't moving to the agency model.

[abookreader]

I won't be purchasing any MacMillan books simply because they won't allow the ebooks in libraries.

That is a very good point -- and yet John Sargent has no problem at all "devaluing" his audiobooks by allowing them to be placed on the very same Overdrive system that he claims will destroy MacMillan print titles.

Really to me, the guy doesn't make a whole lot of sense and he seems to work an extra 10 hours a week trying to think of new and glorious ways to anger his customers.

[Elfwreck]

Originally Posted by TallMomof2

I won't be purchasing any MacMillan books simply because they won't allow the ebooks in libraries.

I'm waiting for libraries to find a way around this. It's not like Macmillan has any legal right to say, "you may not loan our ebooks out." They can say, "you can't make extra copies to loan out," but maybe libraries can find a way to loan "the original."

As computers in libraries become more common, I expect for one or more resourceful libraries to register half a dozen machines with various ebook stores, and have ebooks on those computers, available for reading ADE books or Kindlebooks. Not that a whole lot of people want to go to libraries to read books on a screen--but it'd be a way for libraries to stock a lot more titles than they have shelf space for. A library in a small town, or school libraries, might look into this. (For that matter, libraries might look into chop/scan/convert methods before destroying books they no longer want to keep on the shelves--instead of selling it at a used book sale, convert to ebook, and destroy the physical copy; keep the ebook on a read-only-at-library computer.)

Potentially, libraries could have a set of ebook devices they check out (with a deposit, or credit card on file), loaded with dozens of ebooks. Not sure if end users could crack the DRM if they've got the device but not account access info.

ADE, Kindle & Nook ebooks aren't designed for loanability, but that doesn't mean it's not possible.

[Kali Yuga]

Originally Posted by Barcey

Yes, I won't be buying books from the publishers that move to the "agency model".

So if there is an ebook that piques your interest and costs $10, you're going to email the retailer and ask them what pricing model they use?

Originally Posted by Barcey

The "agency model" is price fixing and against free market principals. It was allowed for a valid business model but what Macmillan is using it for has nothing to do with an "agency model".

Again, this is not price fixing. "Price fixing," despite the name, is ultimately not about a company setting a specific price; it's about entities that collude in anti-competitive behavior in order to control a market. The publishers are not secretly meeting in a smoke-filled room and collaborating on prices, or saying "Random House will get sci-fi, Macmillan will get the education market" etc. Publishers are not in a cartel who artificially restrict supply in order to boost price (e.g. De Beers and diamonds). McDonald's is not price fixing when it sets national prices for all of its franchises. Nor has the DoJ announced any sort of investigation of Apple, Amazon or the publishers.

And if Macmillan said "we're switching to the agency model and new ebooks will be $10," the term "price fixing" would never have come up.

There is nothing illegal or immoral about the agency model.

Originally Posted by Barcey

One additional side effect is that I've switch 180 degrees on "piracy". I'm still not going to file share myself but I'm no longer going to criticize people who do. Go nuts! I understand.

So, let me get this straight.

A new ebook comes out, concurrent with the hardcover. The hardcover officially costs $30, gets discounted to say $15 + $3 shipping and handling. The ebook starts at $15 (no shipping, handling or tax). 1 year later, the trade paper comes out at $12 + $2 s&h, the ebook drops to $10.

This is such terrible behavior that it licenses people to skip out from paying all the people who produced the book, including the author?

The reality is that this is a far more efficient method than the hardcover/paperback method of dynamic pricing. As demand for a book falls, the publisher can adjust the price faster, rather than wait months for a physical object to be produced and distributed.

And have you really not noticed that in a free market society, prices are determined by both supply and demand? If someone is willing to pay $15 for a new ebook, and you are not, then you get priced out of the market until demand (and therefore price) falls. C'est la guerre.

By the way, how does pirating a title because you think the price is too high fit into "market principles" that you were lauding in your post?

[vaughnmr]

So let ME get this straight.

We needed the agency model, cause the Amazon $9.99 price for bestsellers was too low, and would bankrupt the publishing world. Now everyone will have to charge a higher price, and won't be able to discount.

Except Apple, who was able to negotiate a clause that lets them discount bestsellers to... $9.99.

What's wrong with this picture?

[leebase]

Kali -- the McDonald's analogy makes sense to me. I think you are right that this isn't price fixing.

I also think that the pricing controversy will blow over. I seriously doubt people will be buying books based on the policies between the publisher and their book sellers other than a REAL tiny minority.

I never bought hard backs for $25. Ok, maybe for the latest Tom Clancy I would. I would have for the latest Harry Potter but Wal-Mart and the like made that unecessary.

Amazon got people to think that an ebook was only worth $9.99 even when Amazon was selling the Hard back for $18 or more and no paperback version was out. So they are upset that the ebook will be $15 when the DTB is $18.

I think that anybody who would have paid $18 will pay $15. Those who won't pay more than $10 were never the publisher's hard back customers to begin with. They'll buy the ebook for $8 when the paperback is $10.

Lee

[Barcey]

Originally Posted by Kali Yuga

Again, this is not price fixing. "Price fixing," despite the name, is ultimately not about a company setting a specific price; it's about entities that collude in anti-competitive behavior in order to control a market. The publishers are not secretly meeting in a smoke-filled room and collaborating on prices, or saying "Random House will get sci-fi, Macmillan will get the education market" etc. Publishers are not in a cartel who artificially restrict supply in order to boost price (e.g. De Beers and diamonds). McDonald's is not price fixing when it sets national prices for all of its franchises. Nor has the DoJ announced any sort of investigation of Apple, Amazon or the publishers.

I wouldn't have a problem if Macmillan sold directly or through franchises and set the price. They aren't. They are selling through 3rd party retailers and pretending that they are "agents" . Other companies have done this, but they've done it discretely. Macmillan is the first company I'm aware of that has been stupid enough to come out and say, we need higher prices so we're going to fix the price.

btw John Sargent seems to disagree with you and believes it is price fixing. To quote from his latest blog entry...

2) Will retailers have flexibility to price books at a discount? No, the sale price will be fixed by Macmillan. Retailers will promote and market books, but we will control the price for the book.

As a consumer do you want a market place where all the goods you buy have the price set by the manufacturer? If you want to buy a new Ford Mustang it doesn't matter what dealer you go to it costs the same price?

The copyright laws give the author and publisher a temporary monopoly on selling a specific book. Now the publishers are using the monopoly to fix the price of that specific book. I've decided not to buy books from those publishers.

[riemann42]

I think most people are looking at the headline "$9.99 ebook on best sellers will be stopped by Agency model" and miss the big picture.

I see a few things happening as Publishers start taking responsibility for pricing:

1) E-books overall will be more available and less expensive. This is because trade paperbacks will be priced in the ebook world based on demand and price of physical book. The publishers want to make money, and the best way to make money on eBooks is to sell more of them (30 eBooks at $5.99 or better than selling 20 at $9.99).

2) Bestsellers will be a few dollars more.

3) eBooks will only rarely be more expensive than physical books, at least based on MSRP.

4) Amazon will lose out. No more selling best sellers at a loss. Other retailers will breath a sigh of relief and compete on service and reward plans. Non-Kindle devices will finally be able to compete, and the eBook device industry will move forward faster.

5) More reward plans and bundles. As pricing can't compete, giving rewards will be a way for bookstores to distinguish themselves.

This will be a good thing overall. My bet is that if I total the cost on my wish list at Fictionwise now, and compare it to next month (assuming I add no books...), it will be less, possibly significantly less, next month.


-Edward

[GA Russell]

I wonder how many eBook reader users are like me. The agency model will not change my buying habits because I have yet to buy an eBook.

It's going to take me a very long time (at least two years) to read most of the books I have already downloaded for free. And someone (usually Patricia or Harry) uploads a book I want to read here almost once a week.

When the time comes that a book comes out that I am willing to pay for, I will be concerned about the price, but not how that price was determined.

[fjtorres]

As long as the price fixing scheme is in place I'm not buying *any* books, print or e-, except from Baen. It helps I have a bookcase full of unread treeware and two years worth of webscriptions queued up but I'm not giving those idiots one red cent as long as I can help it.

No discount?
No sale.

[HorridRedDog]

Originally Posted by riemann42

I think most people are looking at the headline "$9.99 ebook on best sellers will be stopped by Agency model" and miss the big picture.

I see a few things happening as Publishers start taking responsibility for pricing:

1) E-books overall will be more available and less expensive. This is because trade paperbacks will be priced in the ebook world based on demand and price of physical book. The publishers want to make money, and the best way to make money on eBooks is to sell more of them (30 eBooks at $5.99 or better than selling 20 at $9.99).

2) Bestsellers will be a few dollars more.

3) eBooks will only rarely be more expensive than physical books, at least based on MSRP.

4) Amazon will lose out. No more selling best sellers at a loss. Other retailers will breath a sigh of relief and compete on service and reward plans. Non-Kindle devices will finally be able to compete, and the eBook device industry will move forward faster.

5) More reward plans and bundles. As pricing can't compete, giving rewards will be a way for bookstores to distinguish themselves.

This will be a good thing overall. My bet is that if I total the cost on my wish list at Fictionwise now, and compare it to next month (assuming I add no books...), it will be less, possibly significantly less, next month.


-Edward

There must be something wrong with you. We both agree.

Originally Posted by Barcey

....

The copyright laws give the author and publisher a temporary monopoly on selling a specific book. Now the publishers are using the monopoly to fix the price of that specific book. I've decided not to buy books from those publishers.

Lets see now. "A temporary monopoly" that will last longer than my lifetime, even if I were born today.

Something's wrong here.

[riemann42]

Originally Posted by fjtorres

As long as the price fixing scheme is in place I'm not buying *any* books, print or e-, except from Baen. It helps I have a bookcase full of unread treeware and two years worth of webscriptions queued up but I'm not giving those idiots one red cent as long as I can help it.

No discount?
No sale.

Ok. So say that today an ebook at the cheapest sight (Amazon) goes for $6. The wholesale cost, which amazon pays at the same time the sell to you is $5.50. Now, Agency model goes in place. Book is priced at $6. Amazon pays $4.80. Amazon makes more money, you pay same price. Who loses?

I think the decision now and and the future when buying a book should be:

1) Am I willing to pay a premium for a new release?

2) What price point am I willing to pay, as the book will likely cost that much eventually (if you want it free, just wait a couple hundred years).

To say, I won't buy a book from publisher X because they have entered into a contractual arrangement that I don't understand with the book seller, is ridiculous. Buy based on your demand. The prices will reflect this. This is how this system makes the publishers more money.

I still think that most books will cost the same or less as a result of this change. If we see a huge increase in price, then we can vote with our wallets for lower prices.

-Edward

[leebase]

Originally Posted by fjtorres

As long as the price fixing scheme is in place I'm not buying *any* books, print or e-, except from Baen..

I love Baen. I love the Baen Free Library, and webscriptions (bought 2 so far) -- and I love their general attitude with ebooks.

However, that would all be meaningless if I didn't like the Baen authors: Eric Flint and David Weber to name just two. Thanks to their free ebook promos, I have about 170 free ebooks q'd up. Even so, I still have bought ebooks from Baen because I wanted the latest Honor Harrington and 1632 series books.

David Weber also writes for Tor. Tor does NOT have the attitude toward ebooks that Baen has. But I'm still going to read the Safehold books by David Weber. The latest is coming out next month. I could go for years reading the free ebooks I have stored up, but I WANT to read the next Safehold book.

I sincerely doubt that very many folks with not buy a book by an author they want to read JUST because it's published by McMillan. Just like I have always hated to read hard back books at any price. They are just too big and bulky. I preferred paper backs. And yet, for my favorite authors I bought the hard back because I didn't want to wait.

Now Baen will get more of my business because their enlightened attitude has allowed me to become a fan of authors I'd never have read. I had never read Eric Flint nor David Weber until I came across the Baen Free Library. Now I'm hooked and am reading their entire set of books.

But Tom Clancy? I don't even know who is publisher is, and I don't care. Same with Alex Cross books by James Patterson. I'm a fan. I'll buy their books.

Lee

[Lemurion]

"Fixing the price," as John Sargent used it is not the same thing as "Price-fixing." He was using it as synonymous with "setting the price." Moving to the agency model is a completely separate issue from any accusations of price-fixing in the industry.

As far as I know, Fictionwise has normally operated primarily on the agency model anyway. That's why they have relied on micropay rewards rather than straight discounts for secure books.

[Kali Yuga]

Originally Posted by vaughnmr

So let ME get this straight. We needed the agency model, cause the Amazon $9.99 price for bestsellers was too low, and would bankrupt the publishing world. Now everyone will have to charge a higher price, and won't be able to discount.

Except Apple, who was able to negotiate a clause that lets them discount bestsellers to... $9.99.

What's wrong with this picture?

Probably your numbers.

Yes, the $10 price point would have seriously impacted publisher's margins, assuming the retailers were able to eventually hammer the publishers to drop the wholesale price. So they would go from collecting say $12 per copy to $8 per copy. I suspect you wouldn't enjoy it if your boss slashed your wages by 30% and demanded the same amount of work.

Apple did not negotiate for $10 ebooks. The prices for Apple will be the same as Amazon and any other retailer that uses the agency model -- $15 for new ebooks, $12-13 for ebooks on the best-seller list, and lower prices ($6-12) for older ebooks.