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Apple Raises E-book Prices For Everyone 327

Posted by timothy
from the here-a-penny-there-a-penny dept.
Nom du Keyboard writes "I was informed by my publisher this week that they would have to raise my e-book prices because they planned to sell them through the Apple iBooks store. How could this happen? A lot of my individual stories sell in the $1 to $3 range, which is well within the impulse purchase amount for many people. In this price range a 50-cent price difference may well be the difference between a purchase and a pass. Meanwhile, Apple is touting its new 'agency model,' whereby the publishers set the prices. However, it seems that Apple requires books sold in its iBook store have prices ending in .99 — nothing else." (More below.)
"Furthermore, Apple requires that if you sell books through them that you absolutely cannot sell them for less through anyone else. To my understanding Amazon also requires this, so Apple and Amazon prices should be identical in the future, but Amazon doesn't force prices to end in .99. What this means is that an e-book that the author was quite happy to sell for $2.29 or $2.49 is now going to cost $2.99 from everybody. While that sounds like only a few extra cents, it adds up over time and can lead to resentment against authors for charging higher prices, even though they have little real control over pricing. I, for one, do not understand why Apple computers only understand numbers ending in .99, or just how Apple is making it better for the consumer this way."
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Apple Raises E-book Prices For Everyone

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  • Meh. (Score:5, Informative)

    by JesseL (107722) on Friday April 30, 2010 @07:07PM (#32051152) Homepage Journal

    Almost all my ebooks come from Baen. They may cost a little more, but they are 100% free of Apple-style dickery, including DRM.

  • Are You Sure? (Score:2, Informative)

    by hondo77 (324058) on Friday April 30, 2010 @07:18PM (#32051290) Homepage

    You're blaming Apple for your publisher raising prices even though you admit it's the publisher setting the price?

    However, it seems...To my understanding...

    It seems like maybe you're hearing things kinda third-hand and sorta don't have direct knowledge of what might be going on between Apple and your publisher, doncha think?

  • Re:Meh. (Score:5, Informative)

    by Aladrin (926209) on Friday April 30, 2010 @07:18PM (#32051292)

    I'm proud to say that all my ebooks are drm-free, too, and that's because I bought most of them at Baen as well. I went there for the free ebooks, originally. They were good enough that I started buying there as well. I haven't been disappointed. (Of course, being able to properly preview a book on their site hasn't hurt, either.)

  • Blah... (Score:3, Informative)

    by Savage-Rabbit (308260) on Friday April 30, 2010 @07:19PM (#32051312)

    I, for one, do not understand why Apple computers only understand numbers ending in .99...

    It's a math fixation... row one, column two [xkcd.com]. Mind you I don't get it either ln(2*pi) is much more challenging.

  • by bencoder (1197139) on Friday April 30, 2010 @07:36PM (#32051512)
    Disclosure: I work (in-house IT) for a publisher. We publish in physical and ebook formats.

    The vast majority of texts that authors give us are incredibly poor. Our editors have an extremely hard job of cleaning these up and rewriting them so that they are generally understandable and professional and are correctly targeted for our audience. To our established authors, we also offer them an advance on their work.

    Even if it's just ebooks, getting it into all the available distribution channels and formats for the various stores requires a high level of technical competence, this is likely more than a lone writer wants to learn.

    Of course they could pay someone independently to do this for them, just as they could pay someone independently to edit the book. It is a trade off and while some authors will prefer doing it alone, some(many) prefer the relative security of going through an established publisher who has existing links to distributors, printers, editors and the technical know-how to get it into the required formats to ensure the maximum market for the book.
  • Re:99.95 (Score:5, Informative)

    by Brandee07 (964634) on Friday April 30, 2010 @07:41PM (#32051558)

    Apparently there's some research that indicates that people are actually slightly more likely to buy a $x.99 priced product over its $x+1 identical counterpart.

    Even if it's just 0.01%, when you're looking at inventories as massive as Wal-Mart or Amazon, that can be a LOT of sales.

  • by Arkem Beta (1336177) on Friday April 30, 2010 @07:41PM (#32051560)
    Don't forget marketing, publishers will try to get a book publicity in the form of advertisements, reviews and premium space in bookstores / ebookstores.
  • by Low Ranked Craig (1327799) on Friday April 30, 2010 @07:41PM (#32051562)

    which means the developer would get $700,000 without the requirements of setting up distribution and to a large extent marketing. Clearly you've never run a business and had to pay for sales, marketing, advertising and distribution expenses.

    30% for built in exposure to 80 million potential customer and application distribution is actually pretty cheap. Plus it's a flat pay-as-you-go situation. Generally you have to pay for marketing sales and distribution channels up from and hope you make enough to cover your costs.

    Personally I don't like Apple's schizophrenic approval process, but the model is brilliant.

  • Re:Meh. (Score:4, Informative)

    by fruitbane (454488) on Friday April 30, 2010 @07:45PM (#32051596) Homepage

    The DRM-less iTunes tracks still have lots of private tracking information inserted into them. Further, Apple still maintains a relatively closed system. So while it's not DRM, per se, it is evidence that Apple prefers to have control. It's not just content providers. It's content providers and Apple, working sometimes together, sometimes at odds, to ensure content control, with the end user in very last place when it comes to personal control over content.

  • by Low Ranked Craig (1327799) on Friday April 30, 2010 @07:48PM (#32051632)

    I don't think this situation meets the definition of third-line forcing.

    Third line forcing occurs when a supplier places a condition on the supply of its goods or services that the customer must acquire goods or services of a particular type from a third person nominated by the supplier. http://www.mallesons.com/publications/2005/Nov/8201946w.htm [mallesons.com]

    Anyway Amazon and Apple will need to answer those questions.

  • Re:Meh. (Score:5, Informative)

    by TheRaven64 (641858) on Friday April 30, 2010 @07:50PM (#32051664) Journal
    My publisher is entirely happy to sell you a DRM free copy of my book as a PDF, and will if you buy from their web portal. If you buy one from Amazon or Apple then you get DRM. But it's the publishers that are to blame for the DRM?
  • Re:Meh. (Score:2, Informative)

    by lupis42 (1048492) on Friday April 30, 2010 @07:53PM (#32051696)

    Get sick and tired of people bitching about this, blaming Apple entirely. It's just not true.

    What part of

    Apple requires that if you sell books through them that you absolutely cannot sell them for less through anyone else.

    and for that matter

    Apple requires books sold in their iBook store have prices ending in .99

    did you not understand?

    Also, this is not about iTunes. It's about iBookStore.

  • by DragonWriter (970822) on Friday April 30, 2010 @07:53PM (#32051702)

    The nice thing about the iPad, as opposed to the Kindle or the Nook, is that there are many ways to buy a book.

    There are, in fact, many ways to buy a book for the Kindle and (even moreso) the Nook; both, in addition to supporting DRM-laden purchases from the device vendors own e-bookstore, support content in a variety of DRM-free formats (a slightly wider variety on the Nook) acquired outside the vendors e-bookstore.

    And plenty of publishers with their own online bookstores make ebooks available DRM-free in PDF (usable directly on the Nook, and usable, as I understand, after jumping through some hoops on the Kindle), epub (usable directly on the Nook), and/or mobi (usable directly on the Kindle) formats. (The Pragmatic Programmers [pragprog.com], for instance, do all three -- and you don't have to pay for them separately.)

    The only "advantage" the iPad has in terms of more ways to buy books is that, since it can run different vendors e-bookstore apps, you have more ways to buy DRM-laden books from competing vendors.

  • Re:Your what now? (Score:4, Informative)

    by DragonWriter (970822) on Friday April 30, 2010 @07:57PM (#32051746)

    Sounds to me like Apple and/or Amazon are your publishers.

    The role Apple and Amazon have with regard to ebooks sold through their respective roles is a combination of the role of retailer (in terms of being the person who sells directly to the customer) and distributor (in terms of being the person who buys directly from the publisher.)

    The role of the publisher continues to be played by the existing publishers.

  • Re:Meh. (Score:2, Informative)

    by pete_p (70057) on Friday April 30, 2010 @08:06PM (#32051840) Homepage

    Amazon does allow publishers to provide books without DRM, though there is no indication to the buyer of this... I've only noticed it trying to strip the DRM and discovering that there was none to strip.

    So, yes, if it's on Amazon with DRM, that's the publisher's choice.

  • by colinnwn (677715) on Friday April 30, 2010 @08:07PM (#32051858)
    In the parent post it says the author did some trials and found out $2.49 was the price where he made the most profit. At a lower price, enough new customers weren't created to offset that lower price. A higher price caused customers to chose not to buy. Profit was optimized. So selling at $1.99 means forgoing revenue, as would selling at $2.99. Now if parent didn't say they had experimented with pricing, either pricing higher or lower could end up creating more revenue.

    http://en.wikipedia.org/wiki/Price_elasticity_of_demand [wikipedia.org]
  • Doesn't understand economics well? What the heck are you talking about. This doesn't require a fancy degree in economics to understand. Apple is shoving its bs down his throat and the result is that he has to increase the price across the board to maintain the same target audience. Which is assinine.

    Smells like price fixing to me. "We refuse to allow you to sell your product at the price you want to sell it at" is price fixing. This is anticompetitive behavior at its finest. We won't carry your product if we can't be the ones selling it for the cheapest, and we refuse to sell it at the price you want.

    It's not up to you to decide whether he can profit from selling for at cheaper prices, or more expensive prices. It's his product and he clearly has a market at that price. End of story.

    Seriously though, you don't like the premise of the article? Wow, thanks for such an astute comment, if only I gave a crap whether you liked it or not. I don't think you understood the premise of the article. Amazon and Apple shouldn't be involved in driving the price anywhere, they are a market place. The people creating the products and the market dictate prices.

    Clearly you don't understand economics well. Play the stock market much? I'd love to make a market against you. Next you are going to tell me that competition between NYSE and BATS is going to drive stock prices down. Competition does one and only one thing, it drives prices to their equilibrium and it tighetens the spreads. As long as Apple enforces a $1 interval (which I didn't realize they did until reading this article) you aren't going to see any movement. Go look at tick sizes for$1-$5 equities on Nasdaq or NYSE, I'll bet the farm the tick size is not a dollar.

    Yet another way in which I've lost all respect for apple.

  • $4.99 = $4 (Score:5, Informative)

    by Anonymous Coward on Friday April 30, 2010 @08:17PM (#32051970)

    Seriously, will this .99 and .95 thing ever die? Does anybody really look at a price-tag that says $4.99 and not just think in their head "$5"?

    Quite the opposite: a lot of people think $4. That's the whole point.

    http://en.wikipedia.org/wiki/Psychological_pricing

    I've caught friends doing this on a few occasions, and when I call them on it they do a sheepish "oh, yeah". :)

  • by Qwavel (733416) on Friday April 30, 2010 @08:22PM (#32052032)

    and they hate that.

    On the iPod they had no competition when selling content so they sold inferior content for higher prices then their competitors (who sold 192Kbps for $0.79, but never got far cause they couldn't license Apple's DRM).

    They won't be able to repeat that trick for eBooks but their is a solution that allows them to avoid competing and continue selling things at Apple high prices: force the other retailers to raise their prices to Apple's levels. They can do this because of their clout and the new U.S. law that allows the publishers to enforce the recommended sales price. Actually, the publishers didn't mind and are happy to enforce the higher price now that they have a powerful ally.

    This is primarily aimed at Amazon (though smaller publishers and consumers get hurt, of course) who could have competed on the iPad. Now, with everyone selling books on the iPad at the same price users are very likely to choose Apple because of the ease and the integration.

    (If you think you detect some dislike of Apple, you are right. I have no personal interest in any of this, but I have grown increasingly disgusted by this company.)

  • by Xrikcus (207545) on Friday April 30, 2010 @09:34PM (#32052546)

    But it's not slavery. If you weren't paying the taxes you simply wouldn't have the income to not pay from. The entire system would collapse. You'd have no roads to go to work on, no police to stop what you do have being stolen, no laws to prevent the company from exploiting you, no economic stabilisation to stop inflation running out of control and making your income worthless. You simply can't look at the gross income and claim that tax is theft from it, that's ridiculously naive.

  • by BasilBrush (643681) on Friday April 30, 2010 @10:08PM (#32052780)

    I personally believe that 30% for what apple is offering is a bit much. It's about 3x more than typical systems for similar services online.

    Like who? Handango for example are one of the main resellers of mobile apps for Symbian, Android Blackberry etc. They take 40%.

  • by rolfwind (528248) on Friday April 30, 2010 @10:18PM (#32052836)

    You can have both. In Germany, the price is the price. No surcharges. No surprises.

    OTOH, at a few gas stations I've been too there, they had huge stickers near the price displaying reminding me how much money off of every liter went straight to the government. One even had a breakdown on the reciept.

    Both requests can be met.

  • by gander666 (723553) on Friday April 30, 2010 @11:03PM (#32053130) Homepage

    Don't forget the proper formatting and typesetting (even in ebooks), else they look like crap. Many of the "free" options, or very low cost books like much like badly photocopied political pamphlets.

  • by AthanasiusKircher (1333179) on Friday April 30, 2010 @11:04PM (#32053134)

    ... but I'm genuinely interested: What exactly does a publisher of e-books "publish"?

    I'm serious. You've written the book, you've put it in whatever form you decided on.

    Umm... this is the problem: "whatever form you decided on." Many if not most authors are incapable of putting a manuscript into a reasonably publishable format on their own.

    Most authors still output some sort of error-ridden prose in MS Word. At a minimum, it needs someone to read through it and correct basic spelling, grammar, etc. mistakes. Also, someone to ensure consistency in format -- for example, if the manuscript uses citations, are they all the same format? etc. A good editor/publisher may do actual editing (i.e., improving your writing so it will actually be understandable) and perhaps will employ some specialist editors in your field (if it's non-fiction) to at least make sure the content makes sense.

    And then there's design. Unless you know Quark or InDesign or are a LaTeX master, your document will still look pretty crappy compared to most published books. (No offense to the LaTeX crowd -- I use it myself for many purposes and love it -- but while the typography is easy to make great, the design of a LaTeX document can take a bit of work to make it look like a really well-designed published book.) Many people these days seem to be unaware of the principles of good book design, but there's a lot that goes into choosing a set of typefaces, setting up layouts for chapters, table of contents, additional materials, how to handle figures and images, etc. Not to mention things like artwork, which is admittedly less important for e-books. Well-designed books are easier to read -- just because e-books are displayed on a screen doesn't mean we should forget about principles of good design.

    And there are a few other random tasks -- like indexers. There are still people who are professional indexers, and if you've ever noticed the difference between a non-fiction book with a fantastic index that takes you right to what you want, versus a book with a crappy index (sometimes only names, or something like that, since those are simple to index), you know why these people are necessary. If an e-book is full-text searchable, you might think that would negate the reason for someone like that, but good indexers group concepts together in intuitive ways that can be much more useful than basic text searching.

    So yeah, you could hire people to do these things individually. Or, you could acquire the skills of an editor, a book designer, an indexer, etc. in addition to being a good writer. Or you could go through a reputable publisher.

    And this doesn't even get into the actual business end of things -- perhaps dealing with legal issues in terms of permissions, various registrations for copyright, etc., dealing with big distribution networks (like Amazon or Apple's store or whatever), etc. You can also do such things on an individual basis, but it's just something else to do.

    In sum, if you're actually a good writer, it makes sense to have someone do all the random tasks for you so you can actually focus on what you do best -- writing.

  • Re:My speculation (Score:3, Informative)

    by BasilBrush (643681) on Friday April 30, 2010 @11:19PM (#32053230)

    And 3) Because of consumer's preference for certain price points, and it's link to international markets. If the price in other markets were simply linked to the exchange rate, then it would fluctuate up and down at whatever frequency Apple chose to update the prices. And all prices would be at weird numbers. A £3.43 price for example. Rather than that, Apple set up tiers of price points.

    A = 99c or 59p etc.
    B = $1.99 or £1.19 etc.
    C = $2.99 or £1.79 etc.

  • This wasn't even some crazy coup by Steve Jobs, it's in fact actually the standard publisher price. I heard the business model on Fresh Air this week and it's quite interesting.

    Amazon has been taking a loss on almost every new ebook in their store. They did this to gain marketshare (they have about 80% of the ebook market) and hoped to make up the difference on kindles. The publishers feared that Amazon would demand lower prices from them over time since they have a huge marketshare and because Amazon wants to drive sales of kindles. Amazon is also trying to cut the publishers out by providing publishing services for books. The old publishers hate Amazon right now.

    Along comes Apple and the iPad, and Steve basically made an agreement with publishers that they like. Steve doesn't compete on price, he competes with flash and glamour, and does to very well. The publishers in fact like the fact that there's more competition now, and that Apple has agreed to, for one year, a price structure favorable to what they want. Now Amazon will lose marketshare and be in a less favorable negotiating position and publishers can increase their prices again.

    Yes Apple did agree to this, but besides the .99 thing, Steve could care less about the true price of the book. The price increases came from the publishers directly.

    It's the 4/29/10 podcast of Fresh Air on NPR, check it out.

  • by Evro (18923) * <evandhoffman@NoSpAm.gmail.com> on Saturday May 01, 2010 @06:44AM (#32055048) Homepage Journal

    I, for one, do not understand [...] just how Apple is making it better for the consumer this way."

    Well, there's your problem. Apple's goal isn't to make things better for the consumer, it's to make money.

A LISP programmer knows the value of everything, but the cost of nothing. -- Alan Perlis

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