Wednesday, September 5, 2012

Book News: E-book Price Fixing

E-books are all the rage nowadays.  Why hold a tangible paperback or hardback book in your hands when you can feel the cold smoothness of an e-reader? An e-book can hold thousands of books taking up the same or smaller space than a tangible book.

One pro for ebooks was supposed to be price.  There are many e-books that are free or less than $2.  That's pretty awesome.  But, for many, especially the popular titles, the price difference is not there.  Either it's just a couple bucks or the same price as the tangible, hold in your hands, with actual paper book.  It costs the publishers much less to print and sell e-books so why cost readers the same?  Because they can?  Is that a valid reason?

I don't have an actual ereader, but I do have programs downloaded on my computer: Kindle and Adobe Digital.  I totally see the benefit in having these programs.  There are so many more books I have read because of this.  Being able to download a book in a few minutes is super easy, cool, nice, all that. But, when the book costs as much or more than I can pay for a paperback copy why would I download?  Because it takes up less space on my shelf?  What if I like having that space filled?

I recently came across a piece of news that I think is of interest to anyone who reads, writes, and/or publishes e-books.

US prosecutors announced Thursday that the top three US publishing houses have inked a $69 million deal to close the book on charges that they schemed to fix prices of digital titles.  Hachette Book Group, HarperCollins Publishers, and Simon & Schuster Inc. have agreed to compensate ebook buyers to resolve antitrust claims, according to a joint statement by 55 attorneys general.
Publishers ink $69 mln deal in ebook price-fixing case
What does this mean?

The settlement deal, which requires court approval, calls for Hachette, HarperCollins, and Simon & Schuster to compensate people who bought ebooks from April 2010 to May 21, 2012 priced on an "agency" model. 
The publishing houses have also agreed to terminate existing agreements with retailers such as Amazn and Barnes & Noble, freeing them to cut ebook prices.
Publishers ink $69 mln deal in ebook price-fixing case
Along with that comes this:
A case against Apple and "non-settling" publishers Penguin and Macmillan is pending in US district court in New York, according to [Connecticut Attorney General George] Jepsen.  The US lawsuit said the publishers conspired with Apple to end the longstandin "wholesale model" in which ebooks were sold to retailers, which had the power to set their own prices. 
They replaced this with a so-called "agency model" where publishers would set prices charged by retailers for the ebooks.  Under the arrangement, Apple was guaranteed a 30 percent commission on each ebook sold. 
Prior to the introduction of Apple's iPad, online retail giant Amazon sold electronic versions of many new best sellers for $9.99.  After the agency model was adopted, the prices rose to $12.99 and higher, the suit said, and price competition among retailers was "unlawfully eliminated."
Publishers ink $69 mln deal in ebook price-fixing case
I'm still trying to make sense of all this.  I'm not naive to think we're going to be seeing checks in the mail, although one link I found claims otherwise.  I know that in deals like this if the consumer sees any money it's nothing more than pennies.  It's not about that.  I don't care about that.  I want to see the price of e-books lowered.  They should most definitely cost less than a hard copy of a book.

Some people are not happy with this decision, but we'll talk about that at another time.

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