Macmillan CEO John Sargent on the agency model, availability and price

[bgalbrecht]

Originally Posted by charleski

http://www.amazon.com/Born-Wild-Othe...7623013&sr=8-1
paperback: $7.99
ebook: $7.99
BULLSHIT on you.

MacMillan apparently believes the ebook price should be $14, and the prices at other ebook retailers runs from $6.58 to $10.

[AnemicOak]

Originally Posted by charleski

http://www.amazon.com/Born-Wild-Othe...7623013&sr=8-1
paperback: $7.99
ebook: $7.99
BULLSHIT on you.

It's great that Amazon took it upon themselves to lower the price to $7.99, but it doesn't change the fact that the list price from MacMillan is $14, just like it is for many books that have a $8 paperback list. Like the Wheel of Time books. The first book came out around 20 years ago. You can get a PB new for $8 or used pretty much anywhere for $1-$4 but the ebook is $14 list. Hopefully that'll go down when the new "model" starts, but we'll see.

[dmaul1114]

Very true about MSRP.

Personally, I don't worry much about what MSRP is if the stores are marking it down to prices I feel are reasonable.

I mean it's that way physical books too--how often do people pay MSRP for a hard cover? As long as the end prices we're getting are reasonable, I'm ok with it. The problem is eventually stores like amazon will have to quick marking e-books down so drastically, so MSRP could drive up prices eventually. But I'll worry about that when it happens.

[Seli]

Originally Posted by AnemicOak

It's great that Amazon took it upon themselves to lower the price to $7.99, but it doesn't change the fact that the list price from MacMillan is $14, just like it is for many books that have a $8 paperback list. Like the Wheel of Time books. The first book came out around 20 years ago. You can get a PB new for $8 or used pretty much anywhere for $1-$4 but the ebook is $14 list. Hopefully that'll go down when the new "model" starts, but we'll see.

Keep in mind this is still 'old-style' ebook pricing, not the agency model just yet.

I am guessing, and I could be completely wrong, that this is an artefact of older ebook sales contracts being based on contracts for paper books. ie the publisher sets a cover price sells them to a wholesaler (or big chain) for a discount (rumour has it around 50% for the big ones) and the reseller pays its costs and gets its profits from the difference.

If the publishers try to keep the sales price of ebook and paper book at approximately the same level they have to keep in account the lower costs for the sales of ebooks and the corresponding higher discount the reseller can offer its customers. People are complaining that the costs of selling ebooks should be low and this Amazon pricing seems to confirm that.

There are additional complications if there is any difference on how the reseller pays the publisher, ie when do they pay for paper books supplies and how long do they keep the money of the customer before making the payment to the publisher.

[Terisa de morgan]

Originally Posted by Joykins

I know, don't you hate it when you buy at $6.99 and the next day it is $2.62? OUCH.

Yes, I do

[Ben Thornton]

I thought that the good thing about what he said was that they would make all new titles available. My biggest gripe with ebooks is availability (1st at all, and 2nd where I live). Making all new books available with the pbook is the first step. Next I'd like to see a commitment on back catalogue, but I'm not holding my breath.

The market will sort the pricing out.

[HansTWN]

Originally Posted by DawnFalcon

...In America. Outside, the premium they add (usually over a higher price anyway) means...

You can buy under an American account. And if you bought pbooks at Amazon in the US and had them shipped to you it would costs you much more than if you bought ebooks with a UK account.

[DawnFalcon]

Originally Posted by HansTWN

You can buy under an American account. And if you bought pbooks at Amazon in the US and had them shipped to you it would costs you much more than if you bought ebooks with a UK account.

Until they send you a notice you have to verify your US location or your account will be going pop, yes.

And what does shipping costs for pbooks for print books have to do with ebooks? Even Amazon dosn't try to claim that one, it's a contingency fee for wireless access, even if you don't have a Kindle...

[JSWolf]

Originally Posted by charleski

http://www.amazon.com/Born-Wild-Othe...7623013&sr=8-1
paperback: $7.99
ebook: $7.99
BULLSHIT on you.

Actually, it's cheaper at Fictionwise even if you are not a club member.

Non-club - $7.73
Club - $6.58

http://www.fictionwise.com/ebooks/b1...e-Warren/?si=0

[JSWolf]

Originally Posted by CyGuy

The paper back price is listed as $2.90 plus $3.99 for shipping. The ebook has no shipping so the Kindle price should be $2.90 at the most. They have it listed at $24.95! That is $22.05 over the correct price. I sure hope no one falls for that!

That $2.90 price is from the marketplace which in terms of this discussion does not count. But the eBook price for all I could find are too high with Amazon being the worst of all.

[JSWolf]

Originally Posted by tompe

I would happily buy $1 extra for a DRM free ebook since it is more useful to me.

But what we have here is $2 more and then there is DRM on top of it. I won't pay more for no DRM as I can strip the DRM.

[JSWolf]

Originally Posted by Joykins

I know, don't you hate it when you buy at $6.99 and the next day it is $2.62? OUCH.

I'd call B&N and ask for a refund of the difference in price and if they say no, call the credit card company or bank and tell them what's going on.

[JSWolf]

Originally Posted by AnemicOak

It's great that Amazon took it upon themselves to lower the price to $7.99, but it doesn't change the fact that the list price from MacMillan is $14, just like it is for many books that have a $8 paperback list. Like the Wheel of Time books. The first book came out around 20 years ago. You can get a PB new for $8 or used pretty much anywhere for $1-$4 but the ebook is $14 list. Hopefully that'll go down when the new "model" starts, but we'll see.

How much is it for a used eBook copy?

[charleski]

Originally Posted by AnemicOak

It's great that Amazon took it upon themselves to lower the price to $7.99, but it doesn't change the fact that the list price from MacMillan is $14, just like it is for many books that have a $8 paperback list.

The fact is that it costs $7.99 from Amazon, and less from Fictionwise. Either this is being sold on the agency scheme, in which the price is directly dictated by the publisher, or it's still on the old wholesale system, in which case it's hard to see how Amazon would have an incentive to give deeper discounts to macmillan books.

The 'list' price has always had only a notional relationship to the actual consumer price.

Read the reply Sargeant made right at the top of the comments to his post:

Jane 2 March 2010 at 7:55 am #

Currently Macmillan is pricing digital equivalent of mass market paperbacks at 14.99, nearly twice the cost of the paper version. In your above statement you reference paperback editions and pricing between 9.99 and 6.99. Does paperback refer to trade books or mass market books?

Will you continue to price digital versions at a higher level than their equivalent print versions under your new dynamic pricing/agency model scheme? Or will the digital versions be lower than or equal to the lowest priced print version?
Reply

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John Sargent 2 March 2010 at 2:51 pm #

Hi Jane. The high mass market pricing is a legacy of the old model. Under the agency model trade paperbacks will be $9.99 and lower. Mass markets will probably be at the price of the physical book or lower. We may do some experimenting on price here since digtal will be paperback format agnostic. Some books exsist in both formats…

[jxh11215]

If any attorneys are lurking, what is the possibility of a class-action lawsuit? DTBs don't seem to fall under this agency model, the bookstores, whether b&m or online buy them, then sell at sometimes drastically discounted pricing, but this agency model means that ebook consumers are forced to deal with a fixed price.
Anything.