MobileRead Forums - View Single Post - Amazon says 'will have to capitulate and accept Macmillan's terms'

Tim32127 · 02-01-2010, 04:29 PM

You can't honestly think Amazon did this to for any reason other than to gain controll of the ebook market.
What Macmillan did was tell them they would not use their books to do that so now other company / formats will be on an even footing.

Tim

Your understanding of Amazon's business model is simply wrong. Amazon does not keep 70% of ebook sales (or any sales). That's why people were laughing at you. Amazon was paying self-publishers, and tiny publishers, 30% of the list price. Amazon then discounted this list price by 20% and sold it to the public. On average this gave self-publishers and tiny publishers a 45% cut and Amazon a 55% cut.

In the case of large publishers like Macmillan things worked differently. Amazon paid them 50% of the list price. Then Amazon sold it for $9.99 which is less than they had paid for the book. Amazon did this to help create the ebook market. What this means is that the publishers where getting 100% of the profits on ebooks based on hardcover prices. So far from "screwing" the publishers, Amazon wasn't even asking them to contribute in helping to establish the ebook market.[/QUOTE]

02-01-2010, 04:29 PM	#137
Tim32127 Member Posts: 22 Karma: 10 Join Date: Oct 2009 Device: Sony 505	You can't honestly think Amazon did this to for any reason other than to gain controll of the ebook market. What Macmillan did was tell them they would not use their books to do that so now other company / formats will be on an even footing. Tim Your understanding of Amazon's business model is simply wrong. Amazon does not keep 70% of ebook sales (or any sales). That's why people were laughing at you. Amazon was paying self-publishers, and tiny publishers, 30% of the list price. Amazon then discounted this list price by 20% and sold it to the public. On average this gave self-publishers and tiny publishers a 45% cut and Amazon a 55% cut. In the case of large publishers like Macmillan things worked differently. Amazon paid them 50% of the list price. Then Amazon sold it for $9.99 which is less than they had paid for the book. Amazon did this to help create the ebook market. What this means is that the publishers where getting 100% of the profits on ebooks based on hardcover prices. So far from "screwing" the publishers, Amazon wasn't even asking them to contribute in helping to establish the ebook market.[/QUOTE] Last edited by Tim32127; 02-01-2010 at 04:37 PM.