J Greely@326 My apologies. I did not intend to be condescending. However, I would also ask you not to put words in my mouth. Your first sentence of @326 is not an accurate assessment of my position. It presumes your definition of ebook.
Thank you.
Paolo@278: I'm not sure what I actually said in @234, but your response to it is what I actually meant. Apple treating ePub files this way would be good for everyone all around. If nothing else, as someone else mentioned, one way of increasing an ebook's worth is to remove the DRM.
(However, AAC files are not MP3. It really is a different encoding. And it does not have to have DRM. Any music you buy from the iTMS right now is AAC encoded and DRM free.)
J Greely@281: I decided that if we don't have a consensus definition of ebook, discussion would be difficult and not worth the effort. The fact remains that you can buy (your example) Twilight through the AppStore, and O'Reilly has offerings in the AppStore, (e.g. Building iPhone Apps with HTML,) The fact remains that the AppStore has a section devoted solely to books. Apples sells them, receiving a 30% cut for each sale; people buy them, then they read them. The value in that transaction is clearly placed with the text, not the mechanic by which one reads the text.
However, if you honestly believe these are not ebooks merely because they come with a bundled reader, we have no common basis for discussion. You can believe what you want. It's not my job to convince to convince you of the interchangeability of code and data. You can take a good computer science class to learn that.
Ultimately, the argument we're really having is not whether Apple is already in the ebook business; it's a tedious mapping of boundary conditions to decide what is and what isn't an ebook. I'm afraid that I have no patience for that sort of trivia.
J Greely@271: As I was previewing this entry, I saw that you have already made up your mind about "Kindle for iPad" so I deleted my response to #255 out of sheer pointlessness. I will point out that Spotify lets you download music onto your iPhone. It's not available on the US AppStore because the Spotify service is not available in the US. That has nothing to do with Apple.
Instead, I'm responding to say that there's a hole in your bet that you may want to fill. Most developers do not have iPads yet. It's safe to assume then that Amazon does not. I seriously doubt that they will submit "Kindle for iPad" without ever having tested it on a real iPad. One of the things experienced developers warn against is submitting iPhone apps one has not tested on real iPhones.
I think that it may be more than 3 months before "Kindle for iPad" to show up, not because I think Apple will do anything stupid but because good software development takes time. Unless Amazon programmers actually have iPads in their hands now, they don't know how the new UI elements work. Until they see those UI elements in action for real, it's hard to rework their existing app to take advantage of them. It's likely that they will not be able to do any useful QA until they get an iPad. (And if they do submit without testing on an iPad first, what they submit may be something that even the most dedicated Kindlephile would obviously reject from the AppStore.)
I'm not saying Apple won't also do something stupid. However, when "Kindle for iPad" hasn't come out after 3 months, Apple may not yet have had the opportunity to anything smart or stupid with it.
(BTW, if all Amazon is going to do is scale up the graphics to the new resolution, there's no point to submitting a new version. The only custom bitmapped graphics in the app are the splash screen and the cover images for each book. I think the other bitmaps come from the OS since they look like the icons in every other app. There's nothing they can do about the cover images and the splash screen barely makes an appearance.)
I expect that few apps will be optimized for iPad at the time of launch, and few of those will be optimized well for iPad. The iPhone apps that deal primarily with text may work well enough sized up. That may tide users over until developers have figured out what they're doing.
C.A. Bridges@274: In no case has Apple ever removed a program from someone's iPhone/iTouch. Even in the infamous GV Mobile case everyone points to, those who bought GV Mobile still have it. Now, since it's no longer available on the AppStore, its developers can't update it. That means GV Mobile will eventually suffer bitrot like any other piece of unmaintained software on any other platform.
IIRC, the rumor is Apple actually has the capability to do this. However, Google is also so rumored with Android and Palm with WebOS.
J Greely@98: Apple has been in the ebook business since the inception of the AppStore. There are enough ebooks in the AppStore that they merit their own category. And yet, the AppStore also has a bunch of ereader apps, including a few that directly compete against Apple for ebook purchases. It'd be highly weird for them to change this policy now.
Unfortunately, because of a bunch of highly publicized screw ups with the way they've run the AppStore, it's really easy to believe all sorts of awful things about what they will do despite the usual information vacuum about their plans.
Personally, I hope Apple treats ePub files exactly as they treat their AAC files in iTunes and within their store (but with more flexible pricing). It'll be interesting to see if the problems with the AppStore replicate themselves or will the iBook store be more like the music and video stores.
Yarrow@16: Just to put numbers on things, $X is a number between $5.99 and $14.99, inclusive depending on the book. I suspect reasonable people can differ over whether that's "considerably greater than $9.99."
J Greely@36:But I won't pay more than $10 for a typical ebook
Ultimately, this is what is most important, not what model by which Amazon (re)sells books. Whether the $10 cap is an expectation that Amazon has established or it's a ramification of us not placing much value on a bunch of bits on a hard drive, the expectation is still there. Like I said on another thread, the cost of printing and binding the book may be small relative to the cost of acquiring, editing etc. the book. However, the value of printing and binding the book is still enormous to people. Until the value of a book shifts from its existence as a physical object to its existence as information, it's hard to see why ebooks will be successful. To produce that very first copy of an ebook, it incurs all the same costs as a hardcover (up until printing), but customers have decided they simply will not pay nearly as much for it.
BTW, the agency model Macmillan espouses is the model used in Apple's AppStore, the market where developers regularly complain that the market driven retail prices are too low. I think that may be a better harbinger of things to come than Japan.
Christian@116:Actually, if you go to Amazon Marketplace, it's not hard to find stores that sell new, in print books for greater than MSRP. (I don't know who buys them.) Also, IIRC, the giant warehouse stores sell books for less than MSRP as their regular price.
Christian@101:Haven't physical retail stores always set their prices? I've certainly seen bookstores discount NYT best sellers as a matter of course.
While I'm here, Tobias Buckell wrote a terrific post with worked out examples of the compressed price range of ebooks at Amazon. The profit on the backlist subsidizes the loss on new releases. He goes on from there to make some interesting points about Amazon's strategy.
Paula@80: Isn't that already happening? You're talking about pirated ebooks.
I realize that ebooks aren't mp3 and they aren't video. However, I think there's enough track record to show that if the price is reasonable and it's easy to buy, people will buy the legit version rather than pirate it.
Of course, the big question here is what is a reasonable price. Personally, I think it's pretty low because we as a culture don't seem to place much value on a bunch of bits on a hard drive or in flash memory (as opposed to the reification of those bits in a physical object). If it's not possible to produce ebooks such that selling them at a really low price is profitable, then none of this matters because the business is not sustainable.
The incremental cost of another copy of an ebook is really low. The problem is that the money required to come out with that first copy of an ebook is akin to the money required to come out with the hardcover edition. Either publishers need to figure out how to do this much more cheaply to match our expectation of ebook prices, or we need to learn to place value on a bunch of bits stored on a hard drive or flash memory. I suppose more likely, publishers and customers will meet somewhere in the middle.
Chris@87: As I said, it's not unreasonable to guess that they think their dynamic pricing model needs a split that's more favorable than 50/50 to work profitably. To change the split would require negotiations. Now, as it happens, I don't know if a change in split is necessary for them to stay profitable if they lower their prices, but you don't know that it isn't.
If you want, read "split" as "the ratio between wholesale price and MSRP-wholesale price." However, IIRC, in publishing, it's not specified this way. I think the bookseller buys books from the publisher at a contracted discount from the suggested retail price. That's usually 50%. Given where I'm writing this, if I'm wrong, I'm sure lots of people will correct me.
If we go with that presumption, the 50% discount to booksellers is then the reason why we have the retail prices we have now. Macmillan may have crunched the numbers and decided the way to reduce retail prices, and maintain profitability, is to reduce the discount to booksellers to 30%. Like I said, the money spent to get to that first copy of the ebook is akin to the money spent to publish the hardcover edition. If that's the case and profit margins are thin, then they can't just reduce retail prices without altering the discount unless they want to lose money on each sale.
Amazon may be willing to lose money on ebooks but that doesn't mean that Macmillan ought to be willing too. For one thing, Macmillan doesn't have a ereader they want to push. (Incidentally, substitute any other publisher you'd like for Macmillan. I obviously have no inside knowledge. They're just the handy example of the moment.)
Like I said, this is one possibility. I don't know if this really is the case, but I don't think one can simply dismiss it.
Chris@77: You snipped off the bit where I suggested why they might need to go into negotiations. That's not exactly playing fair.
Chris@72: I wasn't talking about variable pricing. I was talking about delaying ebook releases. Yes, the net effect of that is variable pricing. I'm merely expressing puzzlement over why Amazon simply didn't let them do that. Call their bluff, as it were.
Or to put it another way, the mere suggestion that Macmillan might delay ebook releases caused Amazon to remove all Macmillan books from their store. I don't get the intensity of Amazon's reaction at all.
You'd suggested that ebook readers could simply wait until the paperback comes out. I was just pointing out that Macmillan had suggested something similar. However, this is unacceptable to Amazon. Or, if it were acceptable, I assume they would have simply accepted it and life would have gone on. If variable pricing is unacceptable because you don't trust that they would actually do it, this other option has been on the table from the very beginning.
I do think that Macmillan would increase readers' trust if they implemented their new scheme at Fictionwise etc. However, I suspect that would require Macmillan go to into new negotiations with them too. (Pure speculation on my part, but what if their scheme was calculated assuming 70/30 split? In that case, we'd have to wait to see how they behave within Apple's iBook store.)
Mike@74: I assumed they'd do the same with every ebook vendor. After all, the impetus here was clearly to get the same terms with Amazon that they have with Apple. Maybe I'm just being naive. Or perhaps Amazon's being naive in thinking that they'd lose sales to ebooks at hardcover prices. I mean the whole point of this discussion has been that people won't buy ebooks at hardcover prices. It seems to me that people would just wait until Macmillan made the ebooks available at Amazon (who would sell them at $9.99) and buy it then. Without Amazon selling a given ebook at $9.99, even if their competitors have the ebook for sale, they may not feel the need to match a price that Amazon isn't offering.
As threats go, it seems pretty ineffective to me. It relies on customers behaving exactly the way everyone claims customers won't behave. (Also, if Macmillan offered it to other vendors but not Amazon? Talk about incurring customer hate. If that's the case, Amazon really should just call their bluff...)
Chris@62:They could wait until the book goes into paperback to get an e-book, just as lots of people wait until paperback to get a paperback now.
This, incidentally, is the other proposal Macmillan made. Everyone is so bound up about $14.99 that the other proposal hasn't gotten much attention. Macmillan said that if they stay with the current terms of sale, they will simply delay releasing the ebook until after the hardcover release.
This seems like a perfectly workable solution to me. Amazon gets control over its retail prices. Macmillan gets the dynamic pricing that it wants. I suspect though that out of sheer impatience, ebook readers would still hate publishers. (Witness the kerfuffle when it was feared that the ebook version of The Lost Symbol might not be released at the same time as the hardcover.) To be fair, they may be worried that the book may never come out as an ebook. After all, not every book comes out in a mass-market paperback edition.
Mike@66: I think you and Xopher both agree that Amazon want to get Kindles into as many hands as possible. If Amazon has the cheapest prices on ebooks, that ought to encourage Kindle sales.
Michael@51: I don't think resuscitating out of print books from the '60s is actually zero cost or even near zero cost. As much as we might think it happens for free, getting a work into ebook form incurs a cost. Especially if we're talking about books that pre-dates the modern computer age. Actually, in the case of out of print books from the '60s, I suspect rights have reverted back to the authors, so that may be a bad example.
I agree that Baen is doing it right. It's worth pointing out then that Baen ebooks are not available at Amazon. They're selling ebooks on a model that's different from the one that Amazon wants publishers to operate on. Incidentally, the Baen model is similar to what Macmillan proposes. If you want it right now, it costs you $15. (Look at the prices for the ebook version of their ARCs.) If you're willing to wait, you will get it for cheaper.
The right answer ultimately may be for Macmillan etc. to set up their own stores rather than going through Amazon, Fictionwise or any of the other ebook stores. Of course, the analysis isn't that simple. Lots of people go to Amazon. Can Macmillan get enough to people to go their own websites?
C.A. Bridges@53: The situation I'm expecting is some sort of deadly embrace where Macmillan doesn't feel they can implement variable pricing until they know that retailers will actually honor those prices and retailers won't honor the prices Macmillan wants to set until they know that Macmillan will actually vary them. FWIW, Macmillan has long had books priced below $9.99. That's a fact that doesn't get mentioned very often. (I don't know if they've actually varied prices over time though.)
Chris@148: Why is it that no one seems to remember that Macmillan *already* prices a whole bunch of ebooks under $10? John Sargent didn't say that every Macmillan book would cost you $15. He said Macmillan wants the flexibility to price books between $6 and $15. Any argument that doesn't admit to these facts is suspect.
IreneD@144: Amazon hasn't actually re-listed any of Macmillan's books yet. (At least not any that I've tried.) At this rate, in about two more weeks, they'll be out of the book selling business. There are only 6 major publishers, right?
Kevin Riggle@219: Exactly. The way Amazon puts it kind of reads as if they were thinking, "If only that pesky copyright didn't exist, we could publish cheaper editions for you all instead." I don't think that's what they'd intended. The kerfuffle with 1984 shows, among other things, that Amazon is serious about protecting copyright.
Charlie@130: Amazon isn't offering an agency model, at least not in the sense that Macmillan means it. In addition to the conditions you mention, you also have to publish your ebook via the Kindle Digital Text Platform. As opposed to Amazon retaining a 30% commission as in the agency model, Amazon is paying out a 70% royalty less delivery costs.
In that case, Amazon isn't acting as an agent; it's acting as the publisher. The press release you linked to is primarily aimed at authors who want to "self-publish" (Amazon's word, not mine). A quick browse at the DTP website shows that DTP is aimed at people who want to self-publish, not publishers who want Amazon to just sell their ebooks.
Moreover, the terms and conditions for DTP say "We or our sub-distributors have sole and complete discretion to set the retail price at which your Digital Books are sold through the Program." i.e., while you can specify a list price, Amazon gets to decide how much they will sell your book for. (Note though that the royalties are based off of the list price.) Part of the agency model that Macmillan proposes is that they, not Amazon, get to set the retail price.
For that reason alone, I doubt Amazon likes the agency model. Having prices dictated to them is a significant change to the way they do business. Rather than being the retailer, the publisher becomes the retailer and Amazon is merely a conduit. (i.e., they turn into ebay or half.com.)
Should they just rollover and acquiesce to the change? Probably not. Should they have retaliated to the proposal by removing all of Macmillan's books from their store? Probably not. Do they have every right to retaliate this way? Absolutely.
What I don't get is why releasing the ebook after the hardcover is so horrible. Amazon must think so or else they wouldn't have gone to this trouble in the first place. People who can't afford or don't want the hardcover wait for the mass market paperback, go to the library or borrow it from a friend. I guess people just can't wait for the ebook? (The latter two aren't typically options for ebooks in any case.)
Earl@138: Some ebook readers allow you to annotate. A few even use a stylus and digitizer so that you can draw your annotations. That's one way an author could sign an ebook. However, I'd want the author to sign something more substantial than the graphical representation of a file stored in flash memory. For a whole bunch of reasons, I don't think ebooks will replace books, even if ebooks are the future.
Charles@118: That's not how I read John Sargent's letter. I think he's saying is if they stay under the current terms of sale, they will release the ebook version of a book later than the hardcover version. This doesn't involve removing anything from Amazon. It just means future ebooks will be show up at Amazon later than their hardcover counterparts. (They want to get the folks who'll pay top dollar first, then release the cheaper versions.)
It's clear that Macmillan wants a new model. Amazon wants to treat ebooks like trade books. Macmillan wants to treat ebooks like AAC at the iTunes Music Store. I don't see why ebooks should be treated like trade books, or mass-market paperbacks for that matter. (What does it mean to return or strip an ebook?) Maybe ebooks are closer to AAC than dead tree books, but I suspect that ebooks are really their own thing and require their own model.
Steve C@93: Has anyone come up with a way to sell DRMed ebooks that won't have a piracy concern? DRM doesn't actually stop piracy. Real world experience tells us this much.
Chris@94: Yes, maybe the answer is to do what Baen does, not use Amazon at all to distribute ebooks. As Gavin Grant points out at the Small Beer press blog, their authors make more money if you buy the ebook directly from the Small Beer website.
Of course, it's not that simple. They sell only a "small percentage of ebooks" at their website. 50% of a largish number may be larger than 100% of a smallish number. Apple's iBookstore will pay publishers 70% of retail rather 50% of retail. If the iBookstore becomes viable competition against Amazon, that would certainly be a better deal for publishers than Amazon.
(Still hoping that Apple will not impose DRM on ebooks, and will have some convenient way of getting ebooks on and off the iPad. And iPhone and iPod touch for that matter. Surely, the iBookstore will not be limited to iPad.)
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