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Amazon ups Kindle book payouts to fend off Apple

updated 08:05 am EST, Wed January 20, 2010

Kindle publishers get larger cut ahead of iSlate

Amazon today took a preemptive move against Apple's rumored tablet by giving some publishers of Kindle e-books a larger cut of their sales. The deal lets authors jump their take to 70 percent of a book's price and charges 15 cents per megabyte for the costs of delivering over 3G. A publisher selling a $9 book could earn $6.25, or almost double what was earned before.

Most of the limits on the payout increase center on the price on the book. To qualify, a text must be priced between $3 and $10, cost at least 20 percent below the cheapest physical book, and carry a price no higher than at other e-book stores. Amazon has also fired back against Authors' Guild complaints about audiobook rights by asking that these books support text-to-speech and other Kindle-specific features as they become available.

The new payment option will complement, not replace the existing business models and should take effect on June 30th.

The company didn't directly explain the reasons behind the change, but it comes not just as competitors like the Nook put pressure on the Kindle but as Apple is rumored to be offering a 70/30 e-book deal for publishers looking to author for its tablet, whose supposed size (potentially 10 inches) would be ideally suited to text. Conde Nast, HarperCollins, the New York Times and others are rumored to have talked to Apple about content deals that would force Amazon to provide an equivalent deal.

Amazon has previously tried to claim half or more of the price of a non-exclusive book but has met criticism from authors and publishers that it unfairly locks them into one store or cuts out too much of the revenue compared to a paper version.



By Electronista Staff
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Comments

  1. Feathers

    Grizzled Veteran

    Joined: Oct 1999

    +5

    Influence

    So now Apple have the power to "change a game" without actually having to release a product but merely allow others to spread rumours about such things. That's influence!

    More than ever, I hope Apple don't announce what the market's expecting. Apple could wag the dog on this for months!

  1. JeffHarris

    Fresh-Faced Recruit

    Joined: Oct 1999

    +2

    How about...

    ONE e-book format that ANY e-book reader can read.

    Y'know, sorta like... a BOOK!

    Maybe Amazon should cut a deal with Apple.

  1. joecab

    Fresh-Faced Recruit

    Joined: Apr 2004

    +2

    not exactly flying blind

    I'm certain Apple's already got deals with some of publishers and there's no way that info isn't going to get back to Amazon.

    I'm more curious to see Kindle on the tablet. I'm sure for them it's like the iTunes Store in reverse: Apple wants to sell apps and media cheap to push hardware sales, but Amazon's game is book sales and the Kindle is the means. (If the hardware sales really were a big deal they would have let us know how many Kindles have been sold.)

  1. danviento

    Fresh-Faced Recruit

    Joined: Dec 2005

    +1

    Told-ya-so

    As I've said before, the pricing of eBooks before now was ridiculously high. There wasn't anywhere near the overheard when selling books in eBook format, so all that difference was going straight to the publishers or media distribution outlet.

    I don't care which market force is pushing the price down, but I'm glad it's finally being done. However, I fail to see how this is preemptive, as I'm sure Apple has already negotiated content contracts with publishers, so I fail to see how this is truly preemtive or effective. Perhaps Amazon is worried about certain publishers jumping ship...

  1. midtoad

    Fresh-Faced Recruit

    Joined: Jul 2007

    +4

    rapacious

    15 cents a MB for book delivery? That equates to $150/GB. Even Rogers in Canada isn't that rapacious. They have offered data plans with up to 6GB for $30, i.e. $5/GB.

    It seems like even if Amazon gave the publishers 100% of the book's price, and took no margin there, they'd still be making a killing on their delivery charges.

  1. Inkling

    Dedicated MacNNer

    Joined: Jul 2006

    +2

    Amazon & Anti-trust

    If this news story is accurate, then either Amazon's execs don't listen to their lawyers, or their lawyers are clueless about anti-trust law. I refer to this remark.

    "Most of the limits on the payout increase center on the price on the book. To qualify, a text must be priced between $3 and $10, cost at least 20 percent below the cheapest physical book, and carry a price no higher than at other e-book stores."

    You don't have to be an anti-trust lawyer to see that that's classic monopolist behavior. Amazon is attempting to use its dominant market share to dictate what price a publisher and author can set for print and digital versions sold in other markets. "Do as we say or we won't pay."





  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: Told ya so

    As I've said before, the pricing of eBooks before now was ridiculously high. There wasn't anywhere near the overheard when selling books in eBook format, so all that difference was going straight to the publishers or media distribution outlet.

    I don't care which market force is pushing the price down,


    They're not pushing the price down, they're increasing the payouts to the publishers.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: Amazon & Anti-trust

    You don't have to be an anti-trust lawyer to see that that's classic monopolist behavior. Amazon is attempting to use its dominant market share to dictate what price a publisher and author can set for print and digital versions sold in other markets. "Do as we say or we won't pay."

    And how is this different than Apple over and over saying "We want fixed pricing on our music!". At the time, all the lawyers here tell us its OK, because you can get the music elsewhere...

  1. bvz

    Fresh-Faced Recruit

    Joined: Oct 2001

    +2

    I doubt Amazon is just reacting to a rumor

    It would be foolish of them to make such a massive change to their pricing structure based on the mere rumor of a tablet. If anything, they could have simply put together the plan and held on to it till Wednesday and presented it then. No tablet? No price change.

    More likely, publishers are using their knowledge of their deal with Apple as leverage against Amazon. They don't even have to use Apple by name, just insinuate that they have a massive new partner in the ebook field who is allegedly going to give them a better deal - and that they are about to jump ship from Kindle.

    I suspect this is one of the more concrete examples of the existence of the tablet (or, at the very least, an ebook store from Apple)

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