Michael's Blog

Posts Tagged ‘IPad’

One day after the launch of the IPad, Macmillan – one of the major book publishers in the US – announced to Amazon that they would not agree with the Amazon pricing of their content anymore. The following weekend a showdown happened that eventually concluded with Amazon giving in and changing their pricing model. This was the first public locking of horns about ebook pricing and may be symptomatic of future discussions between publishers and digital distributors.

Amazon wanted to sell books for their Kindle ebook reader at 9.95, Macmillan said they want to determine the pricing of books themselves, not undercut their hardcover editions by that much and sell at least some of them at a higher price (14.95), just like they have always done with distributors/booksellers of paper titles. Macmillan stated that they would not allow Amazon to sell their books. This was communicated by their CEO John Sargent via a paid ad in an online newsletter on Saturday.

Amazon promptly withdrew all Macmillan titles – e- and paper books – from their online store (which had the effect that Macmillan titles shot to the top of the other online retailers, like Barns & Noble).

Eventually, Amazon gave in, allowed Macmillan to set their own pricing and re-instated all titles.

In the meantime, other publishers, like the french Hachette Group, have joined Macmillan. Harper Collins have also expressed their dissatisfaction with Amazon’s pricing.

Amazon’s Kindle Team posts a letter to their customers citing a mission for inexpensive ebooks.

So this was to a big part prompted by the introduction of the IPad by Apple, who will open an ibook store in competition to Amazon, so far the dominant ebook distributor.

The Apple IBook store will work according to the “agency model”, in which publishers determine pricing of their titles, proceeds are split 70/30 between publisher and Apple. Amazon, on the other hand, operates on a low cost model, buying books at a big wholesaler’s discount (70%) from the publishers and selling them at bargain pricing.

So the result is that ebook prices are going up. In the short term. In the long term there will be competition, and many more of these battles will be fought. No publisher will price themselves out of a competitive market, and if titles are available on a variety of platforms, from a variety of distributors, this can only be a good thing in the long run.

2010 will be an exciting year in book publishing and distribution. Old business and pricing models will have to be questioned and revised, and even traditional media producers must re-think, ideally before technological advances, market changes and consumer behaviour force them to.

Sunday morning on Bondi Beach, 27 degrees, time for a swim.

There is a promotion by IKEA for 30 years of their most popular book case, Billy. There are hundreds of books in a very long book case and if you bring an old book, you can exchange it for a new one. You can also buy books, proceeds are donated to the Australian literacy and numeracy foundation.

On the beach, print rules. Magazines and paperbacks go where LCDs are impossible to read and too cumbersome to take. It will take a while until printed media is replaced by IPads here.

This week the Apple IPad was unveiled after much anticipation and speculation. There was a lot of media hype, the most entertaining of which were probably  Jason Calacanis’ tweets before the event about features he pretended to have seen on a prototype, which were taken as truth by some journalists who re-posted them immediately, further raising expectations (and showing the dilemma of confusing tweets with a respectable news source in the process).

The official video is here and the device looks definitely cool.

It does, however, not have anything unexpected, there are no unknowns, nothing magical in the device, it is a 9.7 inch screen that you can use to play games and read news, books and magazines. It is lacking a few features that were expected. It is clearly made to consume contents, not to create.

To me – and I am working in a printing company – the IPad looks like a gaming tool and like print replacement. It has the ability to make online content accessible and trendy.  Apple has used brilliant design to make technology accesible many times before, and I am sure the IPad will accelerate the uptake of online distribution and consumption of content.

“The iPad and other tablets will continue the erosion of preference for printed goods” writes Dr Joe Webb.

I don’t know if it will kick some new life into newspapers or magazines, but it will make their online content available to more traditional readers, who so far have not spent extended time with online reading.

As for books, it really depends on whether Apple can secure the content. If you decide to read for an extended period of time, say a book, you will welcome the fact that you will be able to get the exact content you want within minutes. Whether you will be able to focus on an LCD screen, whether the updates from facebook and messaging applications will not distract you, and whether you will actually have the device ready and powered up where you want to read is another question.

At least now we don’t have to speculate on what the IPad will be and we can start thinking about whether it will bring any change, what it will change and where it will accelerate change.