[Andrew H.]

Originally Posted by stonetools

@ Andrew H, Worldwalker

I think the difficulty is that both of you think of the IOS platform as purely an applications platform like Windows. Its not: its also a store. Similarly, the Kindle app isn't just a computer program: it's a store, operating within the IOS store. If you don't understand that, then you won't get it. Again, Apple wants exactlty only a cut of the sales made on its platform. Apple in fact said that it wants no cut of subscriptions or sales outside the IOS platform. Sales made outside IOS go 100 per cent to the seller.

I understand that that's how Apple wants things to be. My point in the earlier post is that this is *new* and *unusual*. No one expected this, and Apple certainly did not signal this change.

I'm pretty sure they haven't said any such thing, and I bet they never will. We'll see come June 30.

Yes, we'll see in June. They will pull unless Apple caves. Do the math and explain how they can profit otherwise.

Originally Posted by david_e

The 'added value' that Apple is bringing to all of the vendors who want to sell on the iPad is the Apple customer, those of us who live in an all-aluminum-and-shiny-white-plastic world. The idea of everything being done within app, within the 'walled garden', and payed for via our Mac account is exactly what we are used to, what we expect, and what we want. That is how we buy music and audio books for our iPods, movies and TV shows for our Apple TVs, and how we will buy books and magazines for our iPads. And, if you believe all the drivel, we have more money than most and are used to overpaying.

Most companies would kill for customers like this (us ).

Kindle owners have higher incomes than iPad owners.

As for doing nothing for the money, they are providing the platform that will bring NEW customers to these merchants. Without an iPad would a Nook user buy a book from the Kindle store or vice-versa? And what about the people who did not have a dedicated reading device before but now have one that can read anything from anyone? This is a brand new customer base for ebooks and their sellers that Apple has created with the advent of the device and platform.

I don't think we will see price increases at all. The big sellers are all going to participate because none of them can afford not to participate. Do you see Barnes and Noble walking away and leaving this entire market to Amazon? They can't afford to because they would also be risking the loss of their current customer base. If I've got a Nook and an iPad but can't buy/sync Nook content but I can buy/sync Kindle content what am I going to do? If I need multiple devices and sync I'm getting rid of my Nook and replacing it with a Kindle. Amazon can't leave the market to B&N because they would basically be propping up their own biggest competitor, a competitor with financial troubles that need this new market and technology to save them from eventually going under. And both of these companies are probably more than willing to see no profit, if not a loss, on their iPad sales as long as they see their iPad presence lifting their direct website sales.

Once other similar tablet devices launch and the vendors are also selling on these platforms the Apple percentage becomes even less important. The vendors should have increased sales overall even if their profit margin is a bit less. The iPad app simply becomes like that very, very expensive corporate B&M store that may not sell enough to meet expenses but makes up for it in PR.

While you may feel their methods or motives are unethical, they are in business for one reason, to make money, to make all the money they possibly can, for themselves, for the company, and for their stockholders.

They will walk away because they can't make money on the iPad under Apple's terms. It's as simple as that.

And the iPad will lose the sales of those people for whom having an e-reader was important.

Originally Posted by stonetools

Let me try again


Apple is “adding something” a providing a smoother retail experience, better privacy and of course the vaunted Apple marketing muscle. Anti-Apple folks who constantly complain of the irresistible Apple marketing machine seem to think that it counts for nothing here. Funny that.
A number of magazines have signed up with Apple and are being pushed front and center in the App Store. I expect shortly there will be commercials ( “Want to read the latest and greatest in fashion in your Ipad? There’s an app for THAT”) If we see a surge in subscriptions, then we will see the 30 per cent model spread. If not , Apple will not extend it to ebook purchases.

Apple, of course, can sell iBooks and take 30%...the same way that that B&N and Kindle do. However, the latter two can't take their 30%, give Apple *another* 30%, and still earn their 5% margin. Unless they mark their books up 43%, of course.

That's why they will be dropping out.

And you've pointed out the benefits that Apple brings (i.e., a demographic somewhat less affluent than the Kindle demographic), you've left out what Amazon and B&N bring - 95% of the e-book market. And while there are people who read on the iPad, they seem to prefer to read on the Kindle app by a substantial margin.

So there will be a cost to Apple. And I suppose a decent advertising boost for an Android tablet which points out that Amazon and Barnes and Noble are available on Android, but not on the iPad.