Penguin Upsets Kindle Owners

[AnemicOak]

Originally Posted by tompe

No. The publishers think that Amazon's actions are destroying the market in a way that is very bad for the readers.

Yet the publishers have never done anything about Amazon, Wal-Mart, Target and others who will happily sell you a physical hardcover with a huge discount (sometimes down to $9.99 or less) and that market is huge compared to ebooks.

Of course maybe they're looking at how the hardcover market is screwed and are hoping to avoid the same thing with ebooks, but that seems to forward thinking based on their other actions.

[HansTWN]

Originally Posted by kjk

Sure there was. And yes, we all reaped the benefits of Amazon undercutting prices because they had the financial muscle/long-term plan to take a loss for a while...that doesn't in itself make it "right". (Not claiming the agency model is any better, but I'm not putting Amazon on a pedestal just because I could save $5 on a best seller)

If Amazon had been shooting to become a monopoly on ebooks they would have sold in all formats. Not having epub alone ensured that an Amazon monopoly was never a realistic prospect.

I definitely wasn't putting Amazon on a pedestal. Though I have always experienced them as a very customer oriented company. But I was comparing them favorably to the price collusion under the agency model we have now.

[SameOldStory]

Thanks for posting this article.

After reading the article several times and with careful thought I have come to the conclusion that they are NUTS!

"but it has also doubled and tripled its previous prices on backlist titles such Atlas Shrugged and The Fountainhead ($27.99 each)" (On Amazon, $16 elsewhere.)

Originally Posted by GeoffC

problem could be that too many iPad newbies know nothing different and believe the iBookstore is their only source for their reading material....

BINGO.

In one article that I read iPad, Kindle, and nook owners were, in effect, saying that they were happy with the selections from their respective "brand" stores. Price seemed to have nothing to do with their selection. Convenience was of more importance. DRM and format problems were unknown to them.

Originally Posted by tompe

The war was started by Amazon by introducing the $10 price for bestsellers.

That war was started a long time ago in the early dawn of economics. Lower the price and you will sell more thereby making more money. Of course too low and you go under.

Originally Posted by tompe

No. The publishers think that Amazon's actions are destroying the market in a way that is very bad for the readers.

Now that I know that their motives are altruistic I feel much better.

[kjk]

Originally Posted by HansTWN

If Amazon had been shooting to become a monopoly on ebooks they would have sold in all formats. Not having epub alone ensured that an Amazon monopoly was never a realistic prospect.

I definitely wasn't putting Amazon on a pedestal. Though I have always experienced them as a very customer oriented company. But I was comparing them favorably to the price collusion under the agency model we have now.

I disagree. If Amazon had supported multiple formats, that would prove they weren't interested in a monopoly. Trying to push a proprietary format seems more of an issue-at least that's been the argument against Apple in the past.

[GeoffC]

Of course, no one is being forced to buy/read a "best seller" (whatever that may be) - I doubt I've purchased any individual novel (electronic) for more than $6.

A higher priced book than that would be my dictionaries or other non-fiction reading.

[SameOldStory]

Originally Posted by kjk

I disagree. If Amazon had supported multiple formats, that would prove they weren't interested in a monopoly. Trying to push a proprietary format seems more of an issue-at least that's been the argument against Apple in the past.

That may have been an issue when it was mostly Sony and Kindle. But not anymore.

[HansTWN]

Originally Posted by kjk

I disagree. If Amazon had supported multiple formats, that would prove they weren't interested in a monopoly. Trying to push a proprietary format seems more of an issue-at least that's been the argument against Apple in the past.

To pull of the total monopoly on ebooks wouldn't they then also have to pull off a total monopoly on dedicated readers? Wiping out Sony, Irex, etc? A very long shot. Sure, they are on computers, phones, etc with their app. But there are many millions of other e-ink and LCD readers sold each year. An estimated 13 million e-ink readers this year. With less than half of that being Kindles.

Sure, the Kindle tried to imitate the Apple "walled garden" model. Makes sense for books, of course.

[Worldwalker]

Originally Posted by tompe

No. The publishers think that Amazon's actions are destroying the market in a way that is very bad for the readers.

The publishers don't give a fig for the readers. The publishers care about one group of people, and one only: the people who speculate on the prices of their stock (in fact, they're legally required to care only about those people). What's good for publishers' short-term stock prices is often very, very bad for the readers -- but that doesn't matter. They're not there for us. They're not there for authors. They're not even there for their own employees. They're there for stock speculators, and only for them.

As for "destroying the market" ... exactly how? Nobody says that brick-and-mortar stores are "destroying the market" when they discount books. Is it improving the market when ebooks are required to be sold at prices higher than the list price of physical books? The Agency Cartel is not, in any way whatsoever, working for the good of the market, of the readers, of the authors, or of anyone whatsoever except the people who speculate on their stock prices. Just keep that in mind.

[TallMomof2]

I just added Penguin to my boycott list.

I used to spend a lot of money on books each month for myself and my family. Not anymore. I will go to the second hand market or the library for pbooks and for ebooks, I have a huge backlog.

Convenience is very nice but it's not worth doubling and trebling the price.

My monthly book budget for the family went from $300 to less than $25.

[leebase]

Amazon is no innocent in this. There's a big difference between Walmart buying 2 million copies of Harry Potter and selling them as loss leaders -- and selling EVERY NYT best selling book as a loss leader -- all the time.

But Amazon did have a practical monopoly on ebook distribution. The arrival of the iPad changed that. However, change was coming regardless.

Amazon had a choice. Either allow the agency model pricing -- or settle for having the ebooks delayed like paper books. With Apple going with the agency model, it was not possible for Amazon to accept the delay.

That said -- I am baffled by Penguin's pricing. I've never worried about agency pricing as the market will speak and pricing will come in line. I think Penguin's about to learn that lesson.

Lee

[GeoffC]

Originally Posted by leebase

Amazon is no innocent in this. There's a big difference between Walmart buying 2 million copies of Harry Potter and selling them as loss leaders -- and selling EVERY NYT best selling book as a loss leader -- all the time.

But Amazon did have a practical monopoly on ebook distribution. The arrival of the iPad changed that. However, change was coming regardless.

Amazon had a choice. Either allow the agency model pricing -- or settle for having the ebooks delayed like paper books. With Apple going with the agency model, it was not possible for Amazon to accept the delay.

That said -- I am baffled by Penguin's pricing. I've never worried about agency pricing as the market will speak and pricing will come in line. I think Penguin's about to learn that lesson.

Lee

How did Amazon have a monopoly on ebook distribution ? Surely they were but one outlet ....

[Kali Yuga]

Originally Posted by GeoffC

problem could be that too many iPad newbies know nothing different and believe the iBookstore is their only source for their reading material....

Last I checked, the Kindle App was the #11 most downloaded free app on the iPad. I'm gonna guess that most people are aware of it.

Plus, Apple is under no obligation to do Amazon's marketing for them.

[Logseman]

People tend to overestimate the strength of loss-leader policies. Amazon was indeed building a market with a privileged share in it, but eventually they would have had to back off, since loss-leader policies can't be kept in place indefinitely as they are, by definition, unprofitable.

In the other hand, the collusion (because that's the word for it) which the publishers have been building and that Apple has allowed to trigger, would be VERY profitable in the long term if they win the war.

Far be it from me to defend 1984mazon, but from the POV of a buyer of books, I have a company which is sacrificing profits and selling me cheap books to entice me, and I have another company (because the collusion means that those Fearsome Five act as a sole company) which is trying to maximize their profit and selling me uber-expensive books. Which, by the way, are potentially subject to the same control that Amazon exercises on their books. The difference of value between AZW books and DRM'd ePubs is 0, since they're the same text, crippled in the same ways.

[SameOldStory]

Originally Posted by leebase

But Amazon did have a practical monopoly on ebook distribution. The arrival of the iPad changed that. However, change was coming regardless.

Lee

I've bought a fair amount of stuff from Amazon. But not ebooks. Maybe Kindle owners buy a lot of ebooks from Amazon. I would like to buy from them but I have bought so much at a lower price elsewhere why bother.

[leebase]

I said "practical" monopoly - not monopoly. Amazon had an 80% share of the ebook market. Amazon was threatening the hard back book revenue as ebooks were taking off.

Of course people want $9.99 books when the new release hard backs are $20 and more. They'd be even happier with $5 ebooks. And why not $1 ebooks at the same time the publishers hope to sell those $20 hard backs?

The price was so low that Amazon sold millions of kindles in large measure on the thought that you could save money just on the difference between the hard back and ebook price.

There is no way that the publishers were going to stand for this. All of us who buy paperback books instead of hard backs have had to wait the usual year before we can read our books. Reading a "new release" book was something only people willing to shell out the hard book price could do -- or wait in queue at the local library.

Penguin's pricing will come in line with market reality. The $9.99 price was never "market reality". That was Amazon willing to lose money to capture market share.

Lee