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Amazon plays hardball on Kindle ebook sales
Online retail giant Amazon is reportedly threatening to cease selling some publishers' titles unless they agree to a detailed list of 
concessions related to Kindle ebook sales and pricing. Citing two industry sources with direct knowledge of the negotiations, The New York Times reports Amazon has agreed in principle to allow publishers to set their own prices on ebooks for sale through its Kindle storefront, similar to deals Apple has inked with publishers marketing their titles through its forthcoming iBookstore; however, Amazon is also demanding that publishers sign three-year contracts guaranteeing that no competitor will get lower prices or more favorable terms. The NYT adds that publishers are balking at the Amazon contract, declining to lock themselves into three-year deals given the rapid evolution of the ebook segment. An Amazon spokesperson declined to comment on the talks.
According to The New York Times, Amazon's Kindle platform currently controls 90 percent of the U.S. ebook market, in part because it sells bestsellers and new releases at a standard price of $9.99. Some publishers have stated that Amazon's ebook price structure poses a threat to their profit margins. Earlier this year, Amazon briefly removed the ‘buy' button for thousands of printed titles from Macmillan, one of the six largest U.S. publishers, following an ebook pricing dispute.
For more on the ebook pricing negotiations:
- read this New York Times article
Related articles:
Amazon to release SDK for Kindle content
Amazon Kindle goes international, gets price cut
Forecast: Kindle to represent 10 percent of Amazon sales within five years
Amazon promises Kindle content across more devices
Comments
Posted by Barry Dennis | March 18, 2010 - 1:16pm
Why have none of the e-reader manufactures or sellers like Amazon, Sony B&N and all the new ones coming made a definitive deal with McGraw Hill, and other Textbook publishers to publish textbook material through their devices?
Answer? Because the economic logic behind such a deal is overwhelming, and Publisher resistance is based on preserving margins and market share.
If free access and competition were driving the marketplace we would see such a deal-soon.
I venture that within a year, some one will announce that they have developed a textbook publishing system that will lower costs substantially for students, who now pay upwards of $100.00 for a textbook designed and driven by a monopolistically-based marketplace wherein publishers design Content that is approved by College and School board administrations, and competition is much less, even non-existent, in many markets.
So, Amazon, will you be the one? Design a textbook that is competitive with others and offer it for a lot less that what McGraw and others now charge for printed copies?
Will you add-in and include features that make Textbook reading a "virtual" experience? Links accessed through text clicks, Video and audio links that are accessed the same way? Turn Learning into a real experience by re-defining "textbooks?" How about collaborating with Wikipedia- one of the largest Collaboration Aggregators- for a series?
Microsoft, Google, are you there?
Class? Can we hear a faint moaning building into howls of anguish in the Monopoly marketplace? I can.
E-readers are a "disruptive technology" that is and will become part of the Convergence marketplace. College textbooks should be at the top of the list of things that E-readers can develop as a force for good in controlling college costs.
Oh, and updating and reprinting is just a click away(2012 Psychology Updates-$10.00-$20.00- Click Here).
When common sense and economic logic don't prevail, there is interference in the free marketplace.
It will be interesting to see if the FTC gets involved in the textbook monopoly marketplace, but even if not, there is ample room for smart entrepreneurs to make a free-market Textbook delivery concept work.
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