Quote:
Originally Posted by hansl
I mostly agree with your description of market mechanics, but I don't like it for the reasons I laid out before. The laws of nature promote monopolies up to a critical size. But so what, the laws of nature will kill us anyway some day. And, thank God, Amazon is not illegal. I disagree with the game analogy because Amazon is in most cases not the publisher of the ebook content which they distribute.
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Microsoft isn't the publisher of Titanfall.
Or many others of their exclusives.
Some are merely timed exclusives like the CALL OF DUTY DLC that launches first on XBOX and only shows up on PlayStation weeks later or the Skyrim DLC that never quite showed up on PS3.
They merely secured an exclusive deal.
Ditto for a lot of their digital-only XBL ARCADE exclusives.
On the business model side there is exactly zero difference between Kindle and Gaming consoles; on both ends you have first party, second party, and third party exclusives and cross platform content. You have digital only and dual format releases. You have big publishers, small publishers, and (at least on XBOX) self-published indies.
And on both sides you have hardware sold at near cost, relying on content revenue to balance the books. The only difference is that in ebooks the platform owner is also the retailer and thus collects their cut upfront and in consoles they get their cut on the back end in the form of royalties. And on the ADEPT side, not even that difference: the platform owner is Adobe and their model is identical to the consoles, with distributors and retailers adding friction (and cost) to the transaction and their cut coming behind the scenes as royalties and licenses.
As Nintendo proved decades ago, the economics of subsidized hardware require tight content control. But they invariably beat non-subsidized systems. Which is why multi-vendor systems like MSX, CD-I, and most prominently: 3DO, lost to Nintendo.
Going with near-cost pricing on ebook readers wasn't Amazon's idea originally but they correctly understood that once one player brings subsidized hardware into the industry you either flow suit or perish as ATARI, INTELLIVISION, COLECO, BANDAI/APPLE, and PANASONIC/3DO discovered.
Like it or not (and I'm not exactly thrilled about it myself), the ebook industry has evolved into a collection of proprietary platforms at the consumer level. That is the reality everybody has to face and adapt to. For vendors, survival hinges on adapting.
For readers it isn't that critical but understanding how and why we got here will save us money and aggravation; salmon runs may be spectacular but the fish don't generally come out well.