Simon & Schuster has reached deal with Amazon.

[tubemonkey]

Is this why S&S is giving away a free ebook?

[fjtorres]

Originally Posted by binaryhermit

Good news for consumers?

EDIT: from http://mashable.com/2014/10/20/amazo...m-Tw-main-link


That sounds potentially bad for consumers.

At worst, only for buyers of the non-discounted books.

Since Amazon will have discount power, which they never had under the conspiracy, it sounds like Agency lite:

http://www.bookweb.org/news/publishe...doj-settlement

Amazon never said they wanted all books at $9.99 (just a bigger cut if they were priced higher--which is how they deal with Indies) and last year the BPHs themselves were pricing books in the $8 range. There really isn't that much difference is position which is why S&S came to terms in three weeks, with three months to spare.

Let's see how the pricing breaks down come January.

[fjtorres]

Amazon’s announcement on the Kindle forum:

We are pleased to announce that Simon & Schuster and Amazon have reached a multi-year agreement for the sale in the US of both print and digital books.

We are very happy with this agreement, as it allows us to grow our business with Simon & Schuster and help their authors reach an ever-wider audience. Importantly, the agreement specifically creates a financial incentive for Simon & Schuster to deliver lower prices for readers.

Thank you,
The Amazon Books Team

[ottdmk]

Hmnn. I hope we get to hear more details about this deal. How does it work? Is it the normal Agency 70-30 split? Where does Amazon's discounting ability come from? Their percentage? S&S' percentage? Some combination of the two?

What I'm really curious is this: What's in the deal that "creates a financial incentive for Simon & Schuster to deliver lower prices for readers"?

[hardcastle]

Some reactions from the...not even sure what to call them. The anti-Authors United camp? The anti-anti-Amazon camp? Some interesting analysis anyway.

http://www.hughhowey.com/speculation...schuster-deal/

http://davidgaughran.wordpress.com/2...bad-guy-again/

[Barcey]

Originally Posted by ottdmk

Hmnn. I hope we get to hear more details about this deal. How does it work? Is it the normal Agency 70-30 split? Where does Amazon's discounting ability come from? Their percentage? S&S' percentage? Some combination of the two?

What I'm really curious is this: What's in the deal that "creates a financial incentive for Simon & Schuster to deliver lower prices for readers"?

I hope that we don't hear more details because it would allow Amazon to negotiate different terms with the other publishers and give the DoJ further proof of collusion if they demand the same terms.

[fjtorres]

Originally Posted by Barcey

I hope that we don't hear more details because it would allow Amazon to negotiate different terms with the other publishers and give the DoJ further proof of collusion if they demand the same terms.

That is what happened back in 2009: Amazon would agree on one term with oone if the BPHs in return for something and the next day the others would ask for the exact same thing without giving anything up.

Of course, this time they are months apart but sooner or later the terms of S&S will start to leak: those folks all sleep together. Often literally.

I do suspect Amazon did give S&S one free concession: "Sure. No problem, you can tell everybody you won the deal. In fact, we insist you do."



It's not no-discount agency. Which is all that matters.
Anything else is speculation.

BTW, word is S&S sent a note to their authors letting them know they had a deal.
They're still predatory publishers like the rest of the gang, but at least they're polite.

[ApK]

Originally Posted by DiapDealer

Apparently forging an equitable deal with Amazon isn't quite as challenging/impossible as Hachette wants people to believe.

In other news: the bodies of several members of the S&S executive board were found washed up on the Seattle coast....

I kid, I kid.

Originally Posted by ottdmk

What I'm really curious is this: What's in the deal that "creates a financial incentive for Simon & Schuster to deliver lower prices for readers"?

It's always been Amazon's argument that they know how to set lower prices for consumers which result in more sales and money for themselves and their vendors. It seems they are merely saying S&S will reap the benefit of this.

[fjtorres]

Originally Posted by ottdmk

What I'm really curious is this: What's in the deal that "creates a financial incentive for Simon & Schuster to deliver lower prices for readers"?

If you check out the Howey column linked above you'll see one (likely) possibility: sliding-scale terms.

As in: Amazon gets a 30% cut at $10, 33% at $12, 40% at $15, 50% at higher, with the nominal "agency price" at $10. So going to $12 gives the publisher only half the increase and going to $15 gives them only 40%. Higher than $15 and they'd be making less per unit than at $12 and losing volume unless it's a jackpot seller.

Limit Amazon to 15%-20% discounts unless they're price matching (at shared expense) and you have a deal like you had last year with S&S bestsellers generally selling for $8-$12, instead of $12-15. S&S sets their price range and Amazon keeps their power to discount. If S&S wants to protect pbooks at ebook expense, they have to give Amazon pbook-like margins (40-50%) and deal with lower revenue--set them lower and Amazon gets a lower cut but higher volume. (Tweak the numbers a notch or three either way and you get a deal both sides can live with.)

It's very similar to what Amazon gives Indies: they take a 30% cut between $2.99-$9.99 but 50% above that to make up for the (expected) drastically lower sales volume.

[BearMountainBooks]

Originally Posted by binaryhermit

Good news for consumers?

EDIT: from http://mashable.com/2014/10/20/amazo...m-Tw-main-link


That sounds potentially bad for consumers.

The various articles I read on financial sites (yahoo and the like) are guessing it will mean higher prices for consumers. That's my take as well. But I've already been pushed back into buying used books from the large publishers. I think the last book I bought new was Benedict Jacka's latest and it was discounted by about a dollar so I grabbed the pre-order for Kindle. I read a lot of indie books too so that keeps my cost down. This news just means that many of the trad books are still out of my reach when they first come out. I've waited before. I'm patient.

[carld]

Originally Posted by FizzyWater

I was never a fan of Agency, but one of the things I hated was that I could buy the same book for usually 20-25% less, as long as I was willing to buy a physical copy.

Worse, are the times I've seen an ebook for $6.99, $12.99 or even more selling for $.01 + shipping in hardback.

[FizzyWater]

Originally Posted by carld

Worse, are the times I've seen an ebook for $6.99, $12.99 or even more selling for $.01 + shipping in hardback.

I was ignoring the whole "you can't resell an ebook" part of the issue.

[avantman42]

Originally Posted by fjtorres

It's very similar to what Amazon gives Indies: they take a 30% cut between $2.99-$9.99 but 50% above that to make up for the (expected) drastically lower sales volume.

Slight correction: Amazon take a 65% cut from indies if the price is less than $2.99 or more than $9.99.

[fjtorres]

Originally Posted by avantman42

Slight correction: Amazon take a 65% cut from indies if the price is less than $2.99 or more than $9.99.

Gotcha.

[TCSimpson]

The ball has been served, I guess. Where will Hachette's counter stroke land?