Penguin Upsets Kindle Owners

HansTWN · 06-02-2010, 06:03 AM

Hope I didn't double post. Sounds like dirty business to me. I would love to see the anti-trust action bring them to their knees!

http://seekingalpha.com/article/2080...s?source=yahoo

rogue_librarian · 06-02-2010, 06:19 AM

$12.99 and up, higher than their paperback editions. $27.99? You gotta be kidding me. And, no, I have no interest in reading them on the ipad.

HansTWN · 06-02-2010, 06:23 AM

And Apple's reputation of being a "consumer friendly" company should be taking a big hit over this. In the end they are the ones who made the agency model possible. Thank you, Apple!

GeoffC · 06-02-2010, 06:31 AM

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

sabredog · 06-02-2010, 06:37 AM

Stone the flaming crows!

Well I will seek Penguin/Ace titles elsewhere at those prices. I refuse to pay more than paperback prices for ebooks PERIOD!

Iphinome · 06-02-2010, 07:41 AM

I won't ask how is this legal but WHY is this legal? Seriously does anyone know what the justification is for allowing this? It's hard to imagine big buisness got together and lobbied to give their suppliers the right to screw them.

disney_mommy · 06-02-2010, 08:40 AM

Quote:

In any case, let's be clear. This is not a case of Penguin declaring war on ebooks. What Penguin has done is declared war on Kindle owners, and on Amazon.

This sentence says it all. I hope Kindle readers recognize this and voice their opinions by not opening their wallets for Penguin. They should be ashamed.

tompe · 06-02-2010, 09:08 AM

Quote:

Originally Posted by disney_mommy

This sentence says it all. I hope Kindle readers recognize this and voice their opinions by not opening their wallets for Penguin. They should be ashamed.

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

Terisa de morgan · 06-02-2010, 09:23 AM

Quote:

Originally Posted by tompe

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

Not all the bestsellers, books at 9.99$ are quite less than books at other price. It looks like urban legend (and bad excuse) to me .

HansTWN · 06-02-2010, 09:42 AM

Quote:

Originally Posted by tompe

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

But the difference is that Amazon's war (though for selfish means, no doubt) benefited ebook buyers, while Penguin is hurting us. Amazon drove book prices lower accross the board, other sellers followed.

Disney_mommy is right, we should all avoid Penguin, at least while this is going on.

Worldwalker · 06-02-2010, 09:43 AM

No, this war was started by SCOTUS overturning nearly a century of precedent and law saying that manufacturers can set only their own wholesale prices, not those of the retailers who buy from them.

Brick-and-mortar retailers sell products below cost all the time. They're called "loss leaders". They even do it with books. To them, it's a form of advertising: they hope that the person who comes in to buy the cheap book will buy a couple more books at the same time, and maybe a muffin in the cafe, and so on. In an online store, they have that "people who bought this book also bought...." list, which is where they're hoping to make their profit. Even auto dealers do this -- they really do sell cars "below invoice" ... and then make a profit on everything from financing to rustproofing.

This is bad for several reasons. One is the monopoly angle: while there are, true, many manufacturers for books, there is only one manufacturer for Atlas Shrugged (which is kind of the whole point of copyright). So buyers have no choice. They can't decide between a Ford and a Chevy; if they want to read Atlas Shrugged, they have to buy it from that sole source, Penguin.

Another is that -- especially with the collusion between publishers -- it gives them control over the retail market. They can destroy a retailer's ebook business at will, simply by requiring them to price books at a level where they will not sell -- especially when they permit that retailer's competitors to sell those books at a much lower price.

The biggest problem is that it works against the free market. There is only one Atlas Shrugged and one manufacturer who produces it -- and copyright laws ensure that will remain the situation essentially forever (in terms of our own lifespans, anyway). There is no competition, the force behind that "invisible hand", so the market is not free. Therefore, it is not efficient.

Comparing books to insurance is not a valid comparison. If I don't like the prices one insurance company charges, there are a dozen others competing with them. $X of car insurance is $X of car insurance, whether my card says "Geico" or "Allstate" on it. Insurance is about as fungible as you can get. So the fact that it's sold by agents does not make this artificial "agent" model (and why doesn't it apply to pbooks too?) valid for books. There is a free market in insurance because all the insurance companies are selling the exact same thing -- $X of insurance -- and competing on price and performance. Even if the company, not the agent, sets the price, there is still competition across the market. The same is not true with books, because each book has only one source. There is no competition between providers of that book, because there is only one -- Penguin, in this case. If you need or want Atlas Shrugged, there is no alternative seller.

We could go into all sorts of economic/legal issues here. My take on it is that it's a result of an imbalance: The government has granted privileges to Penguin (and the Agency 5), namely through copyright law, and through the government's willingness to act as their enforcer; it has not, however, attached corresponding responsibilities and limitations to those privileges -- or, rather, that SCOTUS decision detached them. So the market is not free, the invisible hand is manacled, and in the long run, we're the ones getting screwed. You can have either a free market or a regulated market, but half and half -- such as, in this case, regulating the behavior of the citizens (don't copy that floppy) but not the corporations (collusion to cripple online booksellers) is a Bad Thing in the long term, and something that should concern people of all political/economic stripes.

HansTWN · 06-02-2010, 09:50 AM

Where would ebooks be today, if Amazon had not taken the lead? The $9.99 pricing was a big part of making ebooks popular. And there never was any chance of Amazon becoming a monopoly.

The real problem is that the big 5 are even allowed to sit down and discuss a concerted strategy. And that Apple sits down with them to help them take out Amazon. How could that be legal?

tompe · 06-02-2010, 09:57 AM

Quote:

Originally Posted by HansTWN

But the difference is that Amazon's war (though for selfish means, no doubt) benefited ebook buyers, while Penguin is hurting us. Amazon drove book prices lower accross the board, other sellers followed.

Disney_mommy is right, we should all avoid Penguin, at least while this is going on.

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

tompe · 06-02-2010, 09:58 AM

Quote:

Originally Posted by HansTWN

Where would ebooks be today, if Amazon had not taken the lead? The $9.99 pricing was a big part of making ebooks popular. And there never was any chance of Amazon becoming a monopoly.

The real problem is that the big 5 are even allowed to sit down and discuss a concerted strategy. And that Apple sits down with them to help them take out Amazon. How could that be legal?

The ebook part is still only 3% so it is not so popular.

kjk · 06-02-2010, 10:01 AM

Quote:

Originally Posted by HansTWN

And there never was any chance of Amazon becoming a monopoly.

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)

06-02-2010, 06:03 AM	#1
HansTWN Wizard Posts: 4,538 Karma: 264065402 Join Date: Jun 2009 Location: Taiwan Device: HP Touchpad, Sony Duo 13, Lumia 920, Kobo Aura HD	Penguin Upsets Kindle Owners Hope I didn't double post. Sounds like dirty business to me. I would love to see the anti-trust action bring them to their knees! http://seekingalpha.com/article/2080...s?source=yahoo Last edited by HansTWN; 06-02-2010 at 06:21 AM.

06-02-2010, 06:37 AM	#5
sabredog Geographically Restricted Posts: 2,629 Karma: 14933353 Join Date: Dec 2008 Location: Perth, Australia Device: Sony PRS-T3, Kindle Voyage, iPad Air2, Nexus7v2	Stone the flaming crows! Well I will seek Penguin/Ace titles elsewhere at those prices. I refuse to pay more than paperback prices for ebooks PERIOD! Last edited by sabredog; 06-02-2010 at 07:43 AM. Reason: syntax errors...

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06-02-2010, 06:19 AM	#2
rogue_librarian Guru Posts: 973 Karma: 4269175 Join Date: Apr 2010 Location: Europe Device: Pocketbook Basic 613	$12.99 and up, higher than their paperback editions. $27.99? You gotta be kidding me. And, no, I have no interest in reading them on the ipad.

06-02-2010, 06:23 AM	#3
HansTWN Wizard Posts: 4,538 Karma: 264065402 Join Date: Jun 2009 Location: Taiwan Device: HP Touchpad, Sony Duo 13, Lumia 920, Kobo Aura HD	And Apple's reputation of being a "consumer friendly" company should be taking a big hit over this. In the end they are the ones who made the agency model possible. Thank you, Apple!

06-02-2010, 06:31 AM	#4
GeoffC Chocolate Grasshopper ... Posts: 27,600 Karma: 20821184 Join Date: Mar 2008 Location: Scotland Device: Muse HD , Cybook Gen3 , Pocketbook 302 (Black) , Nexus 10: wife has PW	problem could be that too many iPad newbies know nothing different and believe the iBookstore is their only source for their reading material....

06-02-2010, 07:41 AM	#6
Iphinome Paladin of Eris Posts: 3,119 Karma: 20849349 Join Date: Sep 2009 Location: USAland Device: Kindle 10	I won't ask how is this legal but WHY is this legal? Seriously does anyone know what the justification is for allowing this? It's hard to imagine big buisness got together and lobbied to give their suppliers the right to screw them.

06-02-2010, 09:43 AM	#11
Worldwalker Curmudgeon Posts: 3,085 Karma: 722357 Join Date: Feb 2010 Device: PRS-505	No, this war was started by SCOTUS overturning nearly a century of precedent and law saying that manufacturers can set only their own wholesale prices, not those of the retailers who buy from them. Brick-and-mortar retailers sell products below cost all the time. They're called "loss leaders". They even do it with books. To them, it's a form of advertising: they hope that the person who comes in to buy the cheap book will buy a couple more books at the same time, and maybe a muffin in the cafe, and so on. In an online store, they have that "people who bought this book also bought...." list, which is where they're hoping to make their profit. Even auto dealers do this -- they really do sell cars "below invoice" ... and then make a profit on everything from financing to rustproofing. This is bad for several reasons. One is the monopoly angle: while there are, true, many manufacturers for books, there is only one manufacturer for Atlas Shrugged (which is kind of the whole point of copyright). So buyers have no choice. They can't decide between a Ford and a Chevy; if they want to read Atlas Shrugged, they have to buy it from that sole source, Penguin. Another is that -- especially with the collusion between publishers -- it gives them control over the retail market. They can destroy a retailer's ebook business at will, simply by requiring them to price books at a level where they will not sell -- especially when they permit that retailer's competitors to sell those books at a much lower price. The biggest problem is that it works against the free market. There is only one Atlas Shrugged and one manufacturer who produces it -- and copyright laws ensure that will remain the situation essentially forever (in terms of our own lifespans, anyway). There is no competition, the force behind that "invisible hand", so the market is not free. Therefore, it is not efficient. Comparing books to insurance is not a valid comparison. If I don't like the prices one insurance company charges, there are a dozen others competing with them. $X of car insurance is $X of car insurance, whether my card says "Geico" or "Allstate" on it. Insurance is about as fungible as you can get. So the fact that it's sold by agents does not make this artificial "agent" model (and why doesn't it apply to pbooks too?) valid for books. There is a free market in insurance because all the insurance companies are selling the exact same thing -- $X of insurance -- and competing on price and performance. Even if the company, not the agent, sets the price, there is still competition across the market. The same is not true with books, because each book has only one source. There is no competition between providers of that book, because there is only one -- Penguin, in this case. If you need or want Atlas Shrugged, there is no alternative seller. We could go into all sorts of economic/legal issues here. My take on it is that it's a result of an imbalance: The government has granted privileges to Penguin (and the Agency 5), namely through copyright law, and through the government's willingness to act as their enforcer; it has not, however, attached corresponding responsibilities and limitations to those privileges -- or, rather, that SCOTUS decision detached them. So the market is not free, the invisible hand is manacled, and in the long run, we're the ones getting screwed. You can have either a free market or a regulated market, but half and half -- such as, in this case, regulating the behavior of the citizens (don't copy that floppy) but not the corporations (collusion to cripple online booksellers) is a Bad Thing in the long term, and something that should concern people of all political/economic stripes.

06-02-2010, 09:50 AM	#12
HansTWN Wizard Posts: 4,538 Karma: 264065402 Join Date: Jun 2009 Location: Taiwan Device: HP Touchpad, Sony Duo 13, Lumia 920, Kobo Aura HD	Where would ebooks be today, if Amazon had not taken the lead? The $9.99 pricing was a big part of making ebooks popular. And there never was any chance of Amazon becoming a monopoly. The real problem is that the big 5 are even allowed to sit down and discuss a concerted strategy. And that Apple sits down with them to help them take out Amazon. How could that be legal?

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