Monday, March 29, 2010

e-Book Prices Going Up

Last Thursday, in reporting on early strategies Apple was employing to convince consumers to buy an iPad, I said:
And, according to the App Advice blog, Apple is prepared to attract readers to the iBook store. That blog reports here that "... at the moment, out of the 32 eBooks featured in the New York Time’s Bestsellers section, 27, including the entire top 10 are priced at $9.99."
On Friday, that same App Advice blog reported:
For unknown reasons, following our announcement, almost all eBooks from the New York Time’s BestSeller list on Apple iBookstore have been give a major price increase. The old standard price-point of $9.99 has just been changed for most publications to $12.99.
The possible reasons App Advice gives for the rise in prices here are ludicrous. The real answer is probably much simpler.

When Steve Jobs initially announced the iPad on January 27, Kara Swisher caught a video clip of him in conversation with Walt Mossberg here.

Mossberg asked Jobs why a consumer would buy an e-book for $14.99 on the iPad when she could purchase an e-book on Amazon or B&N for $9.99.
Jobs responded: "Well, that won't be the case."

Mossberg asked: "You mean you won't be $14.99 or they won't be $9.99?

Jobs responded: "The prices will be the same."
It's no secret that publishers are pushing the agency model, which allows them to set the prices for their books. It's also no secret that they HATE the $9.99 Amazon price point.

I'm guessing App Advice got a peek at a early version of the iPad, intended to show the prices would be the same between the iPad and the Amazon Kindle.

But, on April 3 when the iPad goes live, its best-seller prices will be $12.99 and the Apple 5 will try to tell Amazon they need to match that price or not have access to the Apple 5's books.

Of course, Amazon may try to bluff its way out, claiming they already have a contract that permits them to use the $9.99 price. However, the way they folded when Macmillan pushed back suggests that the Amazon price will be $12.99.

No comments: