In Cue's first meeting with a publisher, with HarperCollins, an executive floated the idea of working with
Apple under an agency model.
Not exact matches
That statement was that
Apple could not engage in book discounting
under the
agency model for at least two years, and then it could only negotiate terms of the so - called «
agency model» (in which the publishers set the prices of their books, not the retailer) with one publisher at a time spread out over a period of six months each.
«As
Apple prepared to introduce its first iPad, the late Steve Jobs, then its chief executive, suggested moving to an «
agency model,»
under which the publishers would set the price of the book and
Apple would take a 30 % cut.
While Amazon originally worked
under the wholesale
model, which afforded the retailer the opportunity to sell ebooks at less than their cost in order to push sales of their Kindle e-readers, the alleged collusion between
Apple and five of the Big Six publishers actually refers to their switch to an
agency pricing
model, which allowed publishers to set the price of the ebooks for the retailers.
Under the agency model — one of the factors that led the investigators to believe that anti-trust violations had taken place between Apple and five of the Big Six publishers, including HarperCollins — publishers get to set the price of ebooks, rather than retailers; under the previous wholesale model, retailers could purchase books directly from the publishers, then turn around and sell those titles for any amount, even taking a loss on the books in order to boost sales of other prod
Under the
agency model — one of the factors that led the investigators to believe that anti-trust violations had taken place between
Apple and five of the Big Six publishers, including HarperCollins — publishers get to set the price of ebooks, rather than retailers;
under the previous wholesale model, retailers could purchase books directly from the publishers, then turn around and sell those titles for any amount, even taking a loss on the books in order to boost sales of other prod
under the previous wholesale
model, retailers could purchase books directly from the publishers, then turn around and sell those titles for any amount, even taking a loss on the books in order to boost sales of other products.
Ebooks on
Apple's iBookstore rose to the range of $ 12.99 to $ 14.99
under Apple's
agency pricing
model, which allows book publishers to set the price of an ebook while
Apple takes a 30 percent cut.
Even if
Apple and Amazon were on the same
agency arrangement with a Publisher, and that Publisher were able to move the retail price of the e-book to the top of the
Apple price tier and sell it for $ 12.99, the Publisher would still receive less revenue
under the
agency model: $ 9.10 instead of the $ 13.00 in revenue
under the wholesale
model.
Under the
agency model (described in further detail here), publishers set the final sale price of an e-book, and the retailer (like Amazon, B&N, or
Apple) collects a cut, usually 30 %.
Because when the big publishers colluded with
Apple to raise prices
under the
Agency model, $ 12.99 and $ 14.99 were the price points for ebooks.
Filed
Under: eBooks, General Trade Publishing, New
Models, Publishing, Supply - Chain Tagged With:
Agency 5,
Apple, Ed Nawotka, Frankfurt Book Fair, Google Editions, iBookstore, Kindle, Kobo, Macmillan, Nook, Peter Wiley, Publishing Perspectives, Random House
He explained that,
under the agreements,
Apple would «go to [an]
agency model, where [publishers] set the price, and we get our 30 %, and yes, the customer pays a little more, but that's what [publishers] want anyway.»
Their role would be as a retailer / distributor who merely takes a percentage of the sales, in much the same way
Apple is doing with Penguin, HarperCollins, et al.,
under it's much discussed «
agency model.»
There was nothing illegal per se about the contracts the publishers had with Amazon or that the publishers were able to set the retail price
under those contracts (
Apple was doing business
under an
agency model for years before they got into ebooks and continues to for its app and music sales).