updated 07:05 pm EDT, Wed March 31, 2010
Amazon Kindle sees majors follow iBookstore model
Amazon today bowed to pressure ahead of the iPad launch by striking new Kindle book deals with HarperCollins and Simon & Schuster. Similar to the terms for Macmillan, the change will let both publishers use an agency model that gives them control over prices. Some bestseller e-books will now cost between $13 to $15; others will still cost the usual $10, but others should be priced below Amazon's average.
The two publishers were very confident of the deal and claimed it was essential to keeping e-books alive. "Our digital future is more assured today than it was two months ago," HarperCollins CEO Brian Murray said.
Combined, the hikes in text pricing for the Kindle hint at Amazon fighting a battle to keep publishers onboard before the iPad and iBookstore launch together this Saturday. Apple is believed to have much more readily accepted the agency model where Amazon has only reluctantly given up the wholesale model, in some cases trying to pressure independents and only letting major publishers switch strategies. Since Apple's rumored iBookstore terms would prevent cheaper prices at rival stores, its agreements would have had companies give up e-book sales at either Amazon or Apple.
In addition to three of the top six publishers, independents have also showed a willingness to seek out Apple's model as last-minute iBookstore deals were made with Perseus Books Group and Workman Publishing Company. Both are some of the largest coalitions of independent publishers and may have left Amazon with little choice but to either grant most smaller printing houses the same terms as with Apple or else to let them switch to Apple.