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Random House to use agency pricing in shift to iBooks

updated 10:00 pm EST, Mon February 28, 2011

Random House last major signed up for iBooks

Random House on Monday said it would switch e-book business models in what's likely a sign of a deal for Apple's iBookstore. The publisher planned to switch to an agency model, where it will set the price and a given bookstore takes a flat percentage of the sale. Its switch takes effect Tuesday and will help it "forge new retail relationships" as well as expand its overall e-book sales.

The firm wouldn't name the stores it would support with the deal but was very likely making a deal with Apple in mind. Only a handful of e-book stores insist on an agency model, and one of the few that embraced the wholesale model where the store set the price, Amazon, both already offered Random House books on the Kindle and itself has largely switched to allowing an agency model. Apple is frequently credited with having pushed towards an agency model to wagewar on Amazon through more attractive prices for publishers.

A deal with Apple would put the last of the six major publishers onboard with iBooks and would go a significant distance towards closing the gap between Apple and Amazon in book catalogs. The Kindle has over 800,000 titles where Apple has mostly remained quiet on its library and is believed to have under 100,000.

Its timing would also conspicuously arrive on the eve of Apple's March 2 iPad event. The agreement would help Apple push sales of the next-generation iPad right as it launches and would give Apple's fledgling e-book store credibility at a point of maximum exposure.



By Electronista Staff
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