AMAZON HAS backed down in a dispute with Macmillan over e-book pricing, and has restored the publishers’ books to its online store.
The climbdown could encourage other publishers to follow Macmillan’s lead, pushing up prices for e-books.
Macmillan has been pushing Amazon to adopt a new model for selling e-books that would give publishers more flexibility in setting prices than the online retailer currently allows.
It prefers the Apple “agency” model used for selling books by Apple for its forthcoming iPad device – whereby the retailer takes a 30 per cent commission – to the “wholesale” terms for Amazon’s Kindle, the current leader in e-readers.
Amazon responded last Friday by pulling all Macmillan’s physical and digital titles – which in the US includes Hilary Mantel’s Booker-winning Wolf Hall – from its website and Kindle e-book store.
But after just two days, Amazon said it would resume selling Macmillan titles in spite of its “strong disagreement” with the publisher over its plans to charge higher prices for its e-books.
“We want you to know that ultimately, however, we will have to capitulate and accept Macmillan’s terms because Macmillan has a monopoly over their own titles,” Amazon’s Kindle team said in a post on its website, “and we will want to offer them to you even at prices we believe are needlessly high for e-books.”
Amazon said customers would “decide for themselves” whether $14.99 for a new publication (the price Macmillan is setting) or $9.99 (the price Amazon wanted to charge) was “reasonable” for a bestseller.
Five of the big six book publishers indicated ahead of the iPad launch that they plan to move all of their e-book distribution agreements to the agency model and away from the wholesale model. – (Copyright The Financial Times Limited 2010)
