Amazon says 'will have to capitulate and accept Macmillan's terms'

[docjim]

Originally Posted by Lemurion

As for the publishers, I don't think DRM and price are that closely coupled for most of them. It's not so much an issue of "we'll give up DRM if you let us raise prices," as much as a desire to fight rampant discounting which has created a 40% drop in the perceived value of their most important products over the last decade or so.

Nobody buys hardcovers for list any more, and that drop in perceived value is something publishers have to deal with, especially since their costs have not dropped significantly.

But is it really the ebook market that has driven down the perceived value of a hardback edition? Seems to me that's really being driven by the downward pressure on price coming from not just Amazon, but Wall-Mart, target etc. I don't really see how ebooks play into that at all.

To my mind, the ebook really is a replacement for the mass market paperback. Most people read a paperback once, and give it away, loan it to friends or even just toss it in the trash afterwards. These are the folks who would consider buying an ebook. Someone who's considering buying a hardback book is typically someone looking for something tangible and collectible, aren't they? I know in my case, I only buy hardback books from my very favorite authors - the kind I know I want to display on the bookshelves in my office or living room long term.

[Lemurion]

Originally Posted by docjim

But is it really the ebook market that has driven down the perceived value of a hardback edition? Seems to me that's really being driven by the downward pressure on price coming from not just Amazon, but Wall-Mart, target etc. I don't really see how ebooks play into that at all.

To my mind, the ebook really is a replacement for the mass market paperback. Most people read a paperback once, and give it away, loan it to friends or even just toss it in the trash afterwards. These are the folks who would consider buying an ebook. Someone who's considering buying a hardback book is typically someone looking for something tangible and collectible, aren't they? I know in my case, I only buy hardback books from my very favorite authors - the kind I know I want to display on the bookshelves in my office or living room long term.

I use ebooks to replace paperbacks, too.

You're right in saying that most of the downward price pressure on hardcovers has been coming from discounters such as Amazon, Walmart, Target and even CostCo. At the same time, there has been a move to try and drive paperback prices up with the new taller $9.99 paperbacks.

Where ebooks throw a wrench in the works, and can force deeper downward pressure is when they are released at $9.99 simultaneously with the hardcover. People no longer have to wait for the price to drop to the level of those new funky paperbacks. That reduces the desire for hardcovers because some people buy hardcovers not for collectible value, but to read the next book right now!

Those people are much more likely to turn to ebooks, and that drives overall prices downward.

[Xenophon]

Originally Posted by DawnFalcon

Very funny, but completely unrealistic (EMI *forced* them to drop DRM on music, there was no "went after" for Apple). We already know they're using their own incompatible DRM, which speaks volumes.

Ummm... NO! On the "EMI *forced* them" part, that is. See my post here for details. Apple really, truly did fight hard for no-DRM on music from the very beginning. They lost. And delays on removing DRM on music from the non-EMI big labels were driven by the LABELS not by Apple.

As for their own incompatible DRM... I think that we only suspect that they are using their own incompatible DRM.* What we know is that an Adobe employee's blog says that Apple is not using Adobe's DRM. Not quite the same statement.

Xenophon
*And even if they are using DRM, we still don't know whether that's from their own choice, or whether it was demanded by the publishers.

[Deneb]

There is also one issue that persist no matter what between publishers and some of the consumers: they hope to force us to choose paper instead of ebook...I don't want any pbook any more. There is no fanatism on my part, I like to read on my ebook reader, I don't have the place to store pbook any more, especially those I read only once, (and it's a majority by far)...I'm not going back to paper no matter what they do. But, I'm not paying an unfair price for it. They should start to respect the ebook consumers for what they are, a new market and stop treating them as an anomaly to be ereased or a trend that will pass.

[asjogren]

I believe they can have DRM in an acceptable manner IF:
They create a mechanism where I can lend, sell, or simply change to different format ANY DRM'd book that I own and can demonstrate the ID, serial number, or keys. Perhaps an industry sponsored exchange?

I think this needs to be a free service for format shift. The alternative IS free. For lending or selling, a minor fee could be acceptable.

This would also raise the VALUE of eBooks.

[Lemurion]

Originally Posted by Deneb

There is also one issue that persist no matter what between publishers and some of the consumers: they hope to force us to choose paper instead of ebook...I don't want any pbook any more. There is no fanatism on my part, I like to read on my ebook reader, I don't have the place to store pbook any more, especially those I read only once, (and it's a majority by far)...I'm not going back to paper no matter what they do. But, I'm not paying an unfair price for it. They should start to respect the ebook consumers for what they are, a new market and stop treating them as an anomaly to be ereased or a trend that will pass.

I think you're wrong.

I don't think it's as simple as saying they want to force people to buy paper rather than electrons, but rather that they want people to buy the format they make the most profit on first.

So they want to sell hardcovers before ebooks because they are more profitable, but they would rather sell ebooks before paperbacks because ebooks are more profitable than paperbacks.

Selling cheap ebooks simultaneously with hardcovers reduces their potential profit so they don't like it. Selling cheap ebooks simultaneously with paperbacks doesn't hit their bottom line the same way.

[docjim]

Originally Posted by Lemurion

Selling cheap ebooks simultaneously with hardcovers reduces their potential profit so they don't like it. Selling cheap ebooks simultaneously with paperbacks doesn't hit their bottom line the same way.

So why do we now have Macmillan ebooks that are priced HIGHER than the mass market paperbacks that have been out for years in some cases? Look at the Robert Jordan Wheel of Time books. Before the Macmillan meltdown, these were the same price or slightly cheaper than the paperbacks. Now, the Kindle prices on Amazon have been raised to HIGHER than the paperbacks! And these are books that have been in print in paperback for >10 years. It sure seems to me this is nothing but deliberately trying to discourage ebook sales. Why else would things be priced this way? It makes no sense.

[Lemurion]

Originally Posted by docjim

So why do we now have Macmillan ebooks that are priced HIGHER than the mass market paperbacks that have been out for years in some cases? Look at the Robert Jordan Wheel of Time books. Before the Macmillan meltdown, these were the same price or slightly cheaper than the paperbacks. Now, the Kindle prices on Amazon have been raised to HIGHER than the paperbacks! And these are books that have been in print in paperback for >10 years. It sure seems to me this is nothing but deliberately trying to discourage ebook sales. Why else would things be priced this way? It makes no sense.

I just checked Amazon and while the first isn't in the Kindle store at the moment, the next three are all there and all priced at $7.99 for the Kindle edition. This is despite the ridiculous $15.00 list price that has been put on those books.

I still hold that we should wait until Macmillan's agency pricing comes into effect before complaining about prices resulting from it.

[Deneb]

Originally Posted by Lemurion

I think you're wrong.

I don't think it's as simple as saying they want to force people to buy paper rather than electrons, but rather that they want people to buy the format they make the most profit on first.

So they want to sell hardcovers before ebooks because they are more profitable, but they would rather sell ebooks before paperbacks because ebooks are more profitable than paperbacks.

Selling cheap ebooks simultaneously with hardcovers reduces their potential profit so they don't like it. Selling cheap ebooks simultaneously with paperbacks doesn't hit their bottom line the same way.

I get their way of thinking and your right in what you say. What I don't get is why they think they loose money on ebooks.

All I'm asking is to pay the price of a book minus all the cost that are not in the ebook. That mean everything untill they send the pdf to the printer. They still have the same author fee, the same editing fee, the same everything but we don't pay for a service (printing, shipping etc) that isn't there. It's not "cheap ebook" vs "expencive paperbook" it's letting people choose the format they want for the same thing.

Up to now, they have tried to convince us of "hidden fee in the making of ebooks that make them almost more expencive to make as a HC". That's what they have been trying, that's what I don't accept.

There's no decrease of value of a book in my mind just the need of a fair trade.

[Scott Nicholson]

Does anyone really expect this higher pricing to hold up for longer than six months? Authors are already signing exclusive deals with Amazon and when ebooks become a significant portion of the market share, publishers become less important. THAT's the main issue here. Authors are signing deals that basically give 85 percent of their ebook royalties to the publisher, practically for life, based on the new ebook clauses. Right now, if they make big money in paper, who cares? But when the tipping point arrives, and Amazon would pay them 70 percent directly...well, you can see where this is headed. Amazon is dumb like a fox. This battle was over long ago.

I'd suggest one way to express your opinion about pricing is to support the many indie authors who are tearing up the Kindle bestseller lists--lists that are real-time and not created by advertising and hype and product placement. Most, like me and Haunted Computer Books, are pricing at $1.99 and down, which we feel is a fair price for digital content.

In three years, this battle will seem insignificant, because ebooks are exploding and people love their mobile reads.

Scott Nicholson
The Red Church
http://tiny.cc/SMAKb

[Lemurion]

Originally Posted by Deneb

I get their way of thinking and your right in what you say. What I don't get is why they think they loose money on ebooks.

All I'm asking is to pay the price of a book minus all the cost that are not in the ebook. That mean everything untill they send the pdf to the printer. They still have the same author fee, the same editing fee, the same everything but we don't pay for a service (printing, shipping etc) that isn't there. It's not "cheap ebook" vs "expencive paperbook" it's letting people choose the format they want for the same thing.

Up to now, they have tried to convince us of "hidden fee in the making of ebooks that make them almost more expencive to make as a HC". That's what they have been trying, that's what I don't accept.

There's no decrease of value of a book in my mind just the need of a fair trade.

I agree with almost everything here, except possibly your math.

I think the appropriate price for an ebook is the cost of the currently available paper edition minus the costs the ebook does not incur that the paper version does and plus the costs the ebook does incur that the paper book does not.

I doubt very much that any of us know exactly what these costs are, but I am sure they are not zero. Nor are they likely to be identical for all books.

Part of the problem too, is that ebook sales are currently very low. This means that even though the overall costs for creating an ebook may be lower than for the paper edition, they take a much bigger chunk of a smaller projected sales volume so they may drive the cost up that way.

Lower total costs over a smaller sales volume may equal greater unit costs.

Another factor is that while publishers do pay for printing costs, they don't usually pay shipping costs, so why should they lower their prices to pass along someone else's savings to the end user? Shouldn't the person who benefits from the savings be the one to pass them along?

[Scott Nicholson]

I agree, Harry, the upper level has already been established in the public's mind at $9.99, so the Big Six position is ephemeral at best, inciting suspicion and boycotting at worst.

Neither the Big Six nor Amazon will be able to forge a monopoly on content. There are too many cracks. And look at the content in this case...it is the words of an author. This isn't a motor vehicle or a coffee maker. The author has thousands of choices for distribution. True, some pay better than others...

Scott Nicholson
The Red Church
http://tiny.cc/SMAKb

[DawnFalcon]

Originally Posted by stustaff

We don't know if it will be 'incompatible' drm yet do we?

Actually, yes, I am sure that Adobe know what they're talking about when they say that Apple have not liscenced ADE.

Scott - And of the customers lost, what proportion won't return even if (and I think you're being blindly optimisic) prices go back down in 6 months? Like music, it'll be significant.

[DawnFalcon]

Originally Posted by Xenophon

Ummm... NO! On the "EMI *forced* them" part, that is. See my post here for details.

Bluntly, I don't believe you. If they'd gone with no-DRM or ADE on their ebooks, I might have. But as things stand, I simply don't. - plus it dosn't match what I've heard out of EMI.

And unless you're suggesting that they've reverse engineered ADE...

[Xenophon]

Originally Posted by DawnFalcon

Bluntly, I don't believe you. If they'd gone with no-DRM or ADE on their ebooks, I might have. But as things stand, I simply don't. - plus it dosn't match what I've heard out of EMI.

And unless you're suggesting that they've reverse engineered ADE...

Not believing me is your prerogative. But both my sources and my memory of coverage in the press at the time support the version I referenced.

As for DRM on eBooks, my guess would be that the big 6 publishers have demanded DRM (sigh), and that we'll get an ePub and Fairplay mix. But that guess is based solely on tea-leaf reading, not on any announcements from Apple.

Xenophon