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Customer Discussions > Kindle forum

Amazon v. Macmillan, Simple Poll

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Showing 1-25 of 208 posts in this discussion
Initial post: Jan 30, 2010 4:16:36 PM PST
JD Rizen says:
Okay, here's the situation as it seems to be shaping up (this is all based on semi-sketchy reports as there has been no official word from either party so details may be off, or even completely wrong - but at this point this assessment seems to be accurate). Amazon and Macmillan had a contract. That contract expired. Macmillan offered two different contracts.

Contract 1: Amazon relinquishes control of their pricing, lets Macmillan set all retail pricing, and gives Macmillan a bigger cut (old contract was about 50% of list, Macmillan now wants 70% of list). This would most likely lead to e-book prices being raised above the current "standard" $9.99 price point for most bestsellers.

Contract 2: Amazon retains control of their pricing and keeps the 50% of list payout but Macmillan will hold all e-book versions until up to 7 months after the title has been released in hardcover. This could also eliminate the current "standard" $9.99 price point as once e-books are released over half a year after the hardcover edition, the title will no longer be on the bestseller list.

Apparently, Amazon has refused either of those options and thus was forced to remove all of Macmillan's titles from their shelves (both DTB and e-books). I'm guessing that Amazon felt that either of the two choices would hurt their customers, or at least alienate them. Which is not to say that Amazon was looking out for us. It merely means that they think we would be upset and therefore take our anger out on Amazon. This would hurt their bottom line. I hold no delusion that any of this is done by some altruistic sense of decency on the part of Amazon.

What should Amazon have done? Picked Contract 1? Picked Contract 2? Or did they make the correct choice in pulling Macmillan's product and trying to come up with some alternate contract that, in their minds, wouldn't upset their customer base?

Posted on Jan 30, 2010 4:25:55 PM PST
Knipfty says:
Amazon made the correct choice (based on what we know at this point).

Amazon is fighting for lower prices and I applaud the effort. Publishers are not serving their customers, clearly Amazon is.

I have read 40 books in the past year. Way more than in past years. That is directly related to lower prices.

In reply to an earlier post on Jan 30, 2010 4:27:23 PM PST
teacher says:
most people will not pay more than $9.99 for an ebook. Remember we are all pinching pennies in today's economy.

Posted on Jan 30, 2010 4:29:56 PM PST
I agree with Amazon's decision here. I want the Kindle to succeed but for that to happen people need to be able to buy new books when they come out, if it comes down to being able to get nothing on the Kindle other than obscure titles and self-published stuff I hate to say it but you wont be able to give a Kindle away. The 9.99 price is good for a new release but something that you aren't mentioning is that Amazon subsidizes the cost above the 9.99. This is not about people or Amazon wanting publishers to sell books cheaper (as you accused me of in anther response--something about incessant whining I think it was) it is about Amazon not allowing publishers to dictate what it can sell products to its customer for. The publishers get the same wholesale price no matter if Amazon sells it for $1 or $1000, and I personally think that is the way it should be. I would love to read "Impact" on my kindle but I cant so thats just tough for me I guess. This is about publishers being scared of customers getting used to paying 9.99 for ebooks, not about what they get to charge Amazon for them because at least up until now that figure had very little to do with Amazon's pricing to its customers. Amazon is willing to eat some of the cost in order to sell Kindles, which Im sure there is a very large margin on.

Posted on Jan 30, 2010 4:35:46 PM PST
A. Doyon says:
I'm sorry, yes this is big corporations making readers and authors suffer, but it seems an awful lot like macmillan saying: you can be our agent selling books for more than you want to sell them for, or you can be an actual bookseller, but we won't give you our product for the first six-seven months it's out. It's hard for me to fault amazon here.

Posted on Jan 30, 2010 4:35:57 PM PST
S. Dunham says:
I've worked as a hospital administrator so I know what it's like to make unpopular decisions. I think Amazon did the right thing. It's not just a business decision, this is going to help to set a precident for the future of eBook sales. Both options still give the publisher too much control over the retail market. I think retailers should be the one to decide what price to sell their items.

But Apple has to be careful too. It could put them in a very bad light. They could be seen as the bad guys here. If consumers think it's Apple's fault for making a deal with publishers for their new iPad that will increase the cost of books to the consumer, people will turn on them. Don't think Amazon will won't point that out if it will help them. I know I sure would to help people support my POV. And timing is everything. With the economy in the toilet, people out of work, with out health care benefits, and money is tight, the last thing consumers want to hear is any company pushing to raise the price on their goods.

I don't have a problem with delayed eBook releases. I think this will hurt sales because if the book wasn't all that good, and I've had months to think about my impulse purchases, I won't be so quick to buy it. The other publishers I think will sit back and see how this plays out. If this backfires on Macmillan, they don't want to be thought of as being on that same band waggon.

Posted on Jan 30, 2010 4:36:25 PM PST
Last edited by the author on Jan 30, 2010 4:37:06 PM PST
Inquiring says:
I think that Amazon made a mistake in trying to impose low prices on eBooks. They were essentially trying to follow the path that Apple had taken with music. Now Apple is trying not to make the same mistake with books. Maybe Jobs is suffering some liberal guilt.

There would many benefits if the price of eBooks were a few dollars higher. Publishers could survive. Authors of non-blockbusters could get reasonable royalties. The demise of used bookstores could be slowed down a bit because the books they sell would be enough lower than the ebook versions that people would buy them.

I would still buy books from Amazon for my Kindle if the prices went up. They have my loyalty, but I think they made a mistake when they tried to set artificially low prices.

Posted on Jan 30, 2010 4:36:34 PM PST
A. Doyon says:
btw: macmillan sent some official word to its authors, available here:

In reply to an earlier post on Jan 30, 2010 4:41:37 PM PST
G. Waddell says:
I applaud Amazon. I think that the cost of the books are directly related to the money the publisher saves NOT using paper and printing. So it should be available at a far cheaper price. There are a lot of pieces that are taken out of the equation as it relates to an e-published book (warehousing, storage, shipping etc). Those savings should be passed on to the buyer. Ten people won't read my Kindle book, but I could pass my hard copy book to ten friends, then give it to Goodwill etc. etc.

In reply to an earlier post on Jan 30, 2010 4:42:11 PM PST
The only people trying to "set" a price are these publishers. Amazon SUBSIDIZES the 9.99 price. Why do so few people seem to realize that? If they want to buy something wholesale and sell it at a loss to themselves in order to promote their flagship product, well thats how free markets work. Your argument would have a little more validity if Amazon was telling the publishers what they should sell their books for but they aren't, Amazon is just saying "you cant tell US what WE can sell it for" there is a very important distinction there that few people on these discussions seem to metion or understand.

Posted on Jan 30, 2010 4:43:53 PM PST
It's about control. Amazon wants to dominate the ebook industry, and part of what they do toward that strategy is offer some of the ebooks at a loss. MacMillan and the other publishers, quite understandably, don't want to see a single entity with that kind of clout. From what I can see, both parties are acting rationally and in their own interests.

My own interests happen to align with Amazon's; I like the sales model that Amazon has adopted and the service.

Posted on Jan 30, 2010 4:45:42 PM PST
BareThoughts says:
Since Macmillan wants to dictate the price and have Amazon simoly acting as an agent in facikitating the sale, then perhaps they should simply sign up as a thrid party seller for their products. Seems they want the benifits to them of Amazon being the seller, while also maintaning the control Amazon gets for being the seller...

In reply to an earlier post on Jan 30, 2010 4:47:40 PM PST
I agree 100%. I think both parties are acting rationally but I have to say that I think the publishers are going to end up being the losers here. I want the publishers to succeed and prosper but in this day and age they will have to adjust/modernize their business model to do it. Maybe it is time for them to switch from a high margin to a high volume (eg. Ebook-centric) model to distribute books. By no means am I even suggesting I have the answers just observing.

Posted on Jan 30, 2010 4:48:24 PM PST
Keep in mind that it isn't just ebooks, but paper as well. I think MacMillan is price gouging and desperate. Unfortunately, they own Tor, who has a lot of authors I like, but I don't like it when producers try to control prices, of anything, not just books.

In reply to an earlier post on Jan 30, 2010 4:50:24 PM PST
Knipfty says:
A Doyon,

Clearly Macmillian wants higher prices and Amazon does not. I stand with Amazon.

Posted on Jan 30, 2010 4:51:36 PM PST
Dalmane98 says:
Quote from John Sargent massage to All Macmillan authors/illustrators and the literary agent community:

"The agency model would allow Amazon to make more money selling our books, not less. We would make less money in our dealings with Amazon under the new model. Our disagreement is not about short-term profitability but rather about the long-term viability and stability of the digital book market."

I really believe that Macmillan wants to help Amazon make more money and Macmillan less...

Posted on Jan 30, 2010 4:57:25 PM PST
V. Strickler says:
For Amazon and against Macmillan

Posted on Jan 30, 2010 5:00:10 PM PST
I heard of this and had to laugh. The 9.99 price is outrageous already. Just what, exactly, is the cost to the producer to send an ebook? It's already price gouging. MacMillan's $15.00 price point is absurd.

Do you folks know that there are a TON of great books available for less than $2.00 right here on Amazon? Search for those small presses. Remember, you can get a sample to see if you might like it.

Why continue to line the pockets of big publishers and name writers already making millions? Show your opinion by buying small press/independant publishers ebooks. WAY cheaper and WAY good reading.

In reply to an earlier post on Jan 30, 2010 5:01:44 PM PST
Last edited by the author on Jan 30, 2010 5:02:20 PM PST
Dragi Raos says:
Deleted - redundant

In reply to an earlier post on Jan 30, 2010 5:03:02 PM PST
BareThoughts says:
I disagree... I do not find the prices absurb. I also have not been impressed with the vast majority of the indie books.

Posted on Jan 30, 2010 5:05:56 PM PST
Inquiring says:
@Tony. Amazon is setting long term market prices by low-balling for long periods of time. When Barnes & Noble and others close down their ebook operations because they can't compete with Amazon at low prices, Amazon will then be in a position to dictate to the publishers. The publishers understand this and don't want Amazon to be in a position of a monopoly. You could argue that Amazon as a rich company, should be allowed to compete as they like, and that makes a lot of sense.

However, some of Amazon's wealth has to do with taxation. People buy expensive items, such as TVs, computers, etc. from them in part because they don't have to pay taxes. Amazon can then use those profits to gain monopolistic powers in the eBook industry. Apple has thrown a monkey wrench into this because now publishers have an opportunity to negotiate.

Posted on Jan 30, 2010 5:11:43 PM PST
loriltx says:
I support Amazon but am not opposed to paying higher prices for new releases.

Posted on Jan 30, 2010 5:14:32 PM PST
BareThoughts says:
Something also to consider... if Macmillan manges to oull this off, forcing retailers to charge the price Macmillan wants for books, then how long will it take them to do the same thing for print books?

Posted on Jan 30, 2010 5:16:38 PM PST

No publisher who is going to participate in Apple's iBookstore has any grounds to accuse Amazon of uncompetitive behavior.

The major publishers are supporting Apple's iPad rollout because Apple has agreed to set a minimum price for ebook sales at their iBookstore.

So MacMillan not only wants to force customers to pay more for their OWN books, they want to force customers to pay more for ALL OTHER books, too. Including small press, independent, and public domain titles.

In reply to an earlier post on Jan 30, 2010 5:18:38 PM PST
Dragi Raos says:
I am with Amazon. MacMillan can exercise their "opportunity to negotiate" with Apple all they want, they will soon see the consequences of not selling through Amazon. As said several times, Amazon was *not* short changing them - they were getting 50% of their absurd list prices.

What is interesting it that only a month ago Tor (a MacMillan's imprint, IIRC) was experimenting with a very reasonable schedule and pricing model:
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Discussion in:  Kindle forum
Participants:  92
Total posts:  208
Initial post:  Jan 30, 2010
Latest post:  Feb 18, 2010

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