5,000 Kindle titles shut down by Amazon in pricing dispute

[plib]

Sounds like Amazon want them to revert to the old "We're making a loss on each sale, but we can make it up in volume" model.

[AnemicOak]

Originally Posted by MrsJoseph

What's wrong with a company having standards? It seems that they are saying "this is what we require to do business with you" and that is their right.

Absolutely it's their right. It's also Amazon's right to try for better terms. It's what any kind of volume retailer does no matter what they sell.

[MrsJoseph]

Originally Posted by AnemicOak

Absolutely it's their right. It's also Amazon's right to try for better terms. It's what any kind of volume retailer does no matter what they sell.

Maybe so - but Amazon wants to be a loss leader. In my business loss leaders take the loss...not the vendor. Amazon seems to want their vendors to take the loss. Which is bad business for the vendor.

[CWatkinsNash]

IPG's campaign to spread awareness of their ebooks available at other retailers is off to a good start. Just got an email from Copia:

The Case of the Missing eBooks

Recently, a very big bookseller has stopped selling eBooks from the Independent Publishers Group. Why? Allegedly because the scrappy, innovative IPG refused the bookseller's "laws of the jungle" pricing demands. Copia salutes IPG for protecting their authors. Check out our sale of IPG classics and bestsellers.

I checked out the offerings, briefly - Copia's site makes me twitchy. But I might be interested in the handbook for new zombies on offer.

[osnova]

Originally Posted by MrsJoseph

What's wrong with a company having standards? It seems that they are saying "this is what we require to do business with you" and that is their right.

I am not saying anything is wrong. I even applaud them for sticking to their guns even if it hurts them. What I am saying is that it's not the case that one side is wrong and the other is right. Both are sophisticated parties negotiating a contract each in its own self-interest and using various tactics to get better terms. I think the story is "too much drama."

[Fbone]

I still don't understand what Amazon didn't like about the old terms. Since these are ebooks, did Amazon think the prices too high? So what? If they don't sell any it doesn't matter for a digital product. No shelf space.

Or are they trying to lower the 70/30 split? Other publishers would balk at that also.

Or are they talking about their print books too?

[AnemicOak]

Originally Posted by Fbone

I still don't understand what Amazon didn't like about the old terms. Since these are ebooks, did Amazon think the prices too high? So what? If they don't sell any it doesn't matter for a digital product. No shelf space.

Or are they trying to lower the 70/30 split? Other publishers would balk at that also.

Or are they talking about their print books too?

None of us know. We don't know what the current split is, nor what was offered by the publisher, nor what Amazon wanted (as far as I know anyway).

[Daithi]

Originally Posted by AnemicOak

None of us know. We don't know what the current split is, nor what was offered by the publisher, nor what Amazon wanted (as far as I know anyway).

This is true, but since Amazon is willing to let anyone sell their books and get a cut of 70% (Amazon taking 30%), then I'd find it hard to believe that this distributor was getting less than that deal.

When the Big 6 demanded 30% and the ability to set sale prices they took a major loss in the amount Amazon was paying them. So now smaller publishers and distributors are having to deal with those repercussions as well.

After all, Amazon was willing to give all publishers and distributors a good deal when Amazon was trying to capture market share. Now that the Big 6 have killed the $9.99 ebook, Amazon no longer has an incentive to continue paying small publishers and distributors the same for ebooks as they do for physical books (typically 50% of list, which is more than 70% of actual sales prices).

[Kali Yuga]

Originally Posted by MrsJoseph

Maybe so - but Amazon wants to be a loss leader. In my business loss leaders take the loss...not the vendor.

Amazon doesn't want to lose money on every single sale. They do in fact take losses when they sell specific books below wholesale.

They're trying to increase their margins on offerings from these smaller distributors. It's a perfectly normal part of business. The only reason anyone is paying any attention to this is because it's Amazon.

[Kali Yuga]

Originally Posted by Fbone

I still don't understand what Amazon didn't like about the old terms. Since these are ebooks, did Amazon think the prices too high?

The dispute isn't over ebook pricing. It's over paper book pricing.

Amazon only pulled the ebooks because that particular contract was up for renewal.

[MrsJoseph]

Interesting article at Dear Author regarding this incident.

[Sil_liS]

Originally Posted by MrsJoseph

Interesting article at Dear Author regarding this incident.

Essentially IPG wants the 10 million plus Kindle owners to stop using their Kindles just to read IPG’s books. Do we think that is likely to happen? Oh sure, there is going to be some who will peel away, but not in major numbers. And yes, Amazon might relent.

There are two problems with this statement. The first one is the fact that all IPG needs to do is use a retailer that sells mobi. It doesn't have to be Amazon. The other is the fact that it's saying that Amazon is too big at this point. It may not be technically a monopoly, but to 10 million people it is.

[HarryT]

I'm sure that IPG and Amazon will reach a compromise. Such disputes normally get settled once people stop posturing and start talking.

[Fbone]

Originally Posted by Kali Yuga

The dispute isn't over ebook pricing. It's over paper book pricing.

Amazon only pulled the ebooks because that particular contract was up for renewal.

It's both. One publisher (distributes through IPG) has commented that Amazon wanted better ebook terms also. More precisely they demand a larger share of revenue from each ebook sold. And Amazon has started requesting such new terms since late 2011 with IPG being the first to refuse to accept them. No one yet has revealed what the terms are but hopefully someone will. We can speculate 35, 40, 45%?

[TechnoCat]

What's with the antagonism towards Amazon? They have many thousands of free ebooks, and tens of thousands of commercial ones. Ten years ago there wasn't a single one of you who would go into Borders, Crown, Barnes & Noble, etc. looking for books and because you couldn't find one specific line of books, decided the store was evil. They only carry a limited number...

• What is being pushed/advertised heavily by the publisher (free promotion)
• What did they get a big buy on?
• What do they have an exclusive to?
• What is selling? Which excludes book 1 (or possibly book 3 even) of that series you're reading)

Out of a smallish selection of books, you come away with 3 or more anyhow, even if that one you always look for still isn't there.

So now IPG is not giving Amazon terms they want... but they feel entitled to be sold by Amazon? How much of that back-catalog is carried in-print at your neighboorhood bricks-and-mortar store? Or in the shlock-section of your grocery?

Amazon does not have a monopoly on paper book sales. They don't have a monopoly on ebook devices, or on ebook sales to other devices. B&N protects the Nook market as Amazon protects the Kindle market. And yet it's Amazon the ire is towards? I don't get it.