In the wake of Apple's announcement of the iPad, comes the first salvo in what is probably going to be a drawn out battle. Amazon.com has pulled books published by Macmillan, electronic or not, from its site.
Search for authors available from Macmillan, and with the exception, it seems, of library-bound or "bargain books," you won't find Amazon.com pricing for them. You'll find them at "other sellers," but not Amazon.com. You can see it in the above image for Robert Jordan's "Knife of Dreams
Why would Amazon.com do this? It would seem this is hardly in the best interest of customers, and definitely not in the best interest of the site. Well, according to the New York Times
, it's all about e-book pricing.
According to their report, Macmillan, like other publishers wants Amazon.com to raise its price for e-books from $9.99 to about $15.
Macmillan offered Amazon the opportunity to buy Kindle editions on the same “agency” model as it will sell e-books to Apple for the iPad. Under this model, the publisher sets the consumer book price and takes 70 percent of each sale, leaving 30 percent to the retailer. Macmillan said Amazon could continue to buy e-books under its current wholesale model, paying the publisher 50 percent of the hardcover list price while pricing the e-book at any level Amazon chooses, but that Macmillan would delay those e-book editions by seven months after hardcover release. Amazon’s removal of Macmillan titles on Friday appears to be a direct reaction to that.
It appears the iPad has already made waves in the e-book market, without even being released. Currently Amazon.com is the big player in e-book sellers, but it's clear that analysts as well as publishers feel that might change once the iPad arrives. This was obviously an attempt by Macmillan to leverage the iPad's and iBooks' upcoming arrivals.
Since Amazon.com currently owns the lion's share of e-books, this just feels like an iTunes-like battle, similar to when music and other content providers tried to get Apple to change its pricing as well.
It the source is correct, Macmillan and other publishers want Amazon.com to raise the price on its e-books from $9.99 to $15. With Apple's iBook store coming, Amazon.com will have some solid competition. However, $15 for an electronic version seems, to be honest, highway robbery. How much, after all, does it cost to print an e-book?
On the other hand, since Apple announced that one of the price points for iBooks would be $15, one can see how much nicer it would be for Apple if Amazon.com's price advantage vanished. Although Amazon MP3 had a price advantage for a while over iTunes, as well as DRM-free music, $5 resonates much more with consumers.
This isn't over, by a long shot.