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February 18, 2010

Did Apple trick publishers on pricing?

The iPad (will this release a larger-screen edition called the MaxiPad?) seemed like a saviour from the Amazon-kills-publishing price of $9.99, with projected pricing of ebooks at between $12.99 and $14.99, but it appears this was only, you know, unless Apple wants to do something else. Like cut prices to corner the market. Hm. Man, this must be the first time we’ve ever learned the lesson that big media corporations are never our saviours, but always their own. Otherwise, we’d surely not be in this situation again, would we? ‘Cause we’d have learned. You’d think.

When Steven P. Jobs showed off the iPad last month, he announced agreements with five of the six largest publishers to offer their content through a new iBooks application. Those publishers — the Hachette Book Group, HarperCollins Publishers, Macmillan, the Penguin Group and Simon & Schuster — agreed to terms under which they would set e-book prices and Apple would serve as an agent to sell the books to consumers. Apple would take 30 percent of each sale, leaving 70 percent for publishers to split with authors.

Publishers indicated that e-book editions of most newly released adult general fiction and nonfiction would sell in a range from $12.99 to $14.99, under a complicated formula that pegs e-book prices to the list prices of comparable print editions. Publishers liked Apple’s deal because it resulted in a marked increase above Amazon’s $9.99 price for most new releases.

But according to at least three people with knowledge of the discussions, who spoke anonymously because of the confidentiality of the talks, Apple inserted provisions requiring publishers to discount e-book prices on best sellers — so that $12.99-to-$14.99 range was merely a ceiling; prices for some titles could be lower, even as low as Amazon’s $9.99.

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3 comments on “Did Apple trick publishers on pricing?”

  1. michael says:

    Capitalism is such a bitch.

  2. Julie says:

    Wow, that’s funny. I seem to remember this very blog being in favor of Apple when big bad Amazon was “destroying” publishing.

    Funny how things turn out, isn’t it?

  3. George says:

    In fact, I’ve never been pro Apple. I have been very pro Macmillan. You might need to take a look back, Julie. I think the iPad is a big rip off. It’s a less functional, less practical iPhone and most Mac folks are pretty embarrassed about it. So save the smug for now!

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