This is because ebooks are
sold under the agency model where the publisher sets the price and gets 70 % of each sale, and the retailer gets the remaining 30 %.
BN.com comparable sales reflect the actual selling price for eBooks
sold under the agency model rather than solely the commission received.
I think she was asking why ebooks should be
sold under the agency model when paper books are sold in the customary way.
Not exact matches
Hachette
sells all its U.S. e-books
under the
agency pricing
model, and according to Thomas, is «very satisfied» with the
agency model, but Thomas adds, «We welcome the ability to experiment with pricing, and offer readers a variety of choices.»
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.
So all titles you
sell at BN through Smashwords that are
under $ 2.99 will earn you 60 % over 40 %, free and clear, without worry that retailers will discount (as Smashwords now operates with the
Agency pricing
model, except that we are the «agents» and set our own price).
«
Under the
agency model, [Macmillan] will
sell the digital editions of our books to consumers through our retailers.
Certain digital content is distributed
under an
agency pricing
model in which the publishers set fixed prices for eBooks and NOOK receives a fixed commission on content
sold through the eBookstore.
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.
The publishers noted that while they continue to
sell e-books
under the wholesale
model, they have «benefitted significantly» — along with authors, booksellers and consumers, — from the ability of the Big Six publishers to adopt the
agency pricing
model with Amazon, since those arrangements, «contributed dramatically to increased competition and diversification in the distribution of e-books.»
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.
If one publisher insisted on the
agency model,
selling Stephen King's books for $ 9.99, they would make more money per sale, but lose more over the long run because another publisher would offer their books
under the usual terms, letting the retailer set the price.
But with respect to the
agency discount, Amazon demands that all non-Big-Six trade publishers
sell it their ebook and physical book wares
under the old trade discount
model, which requires only that Amazon buy inventory at roughly 50 % off the publisher's suggested list price (the discounts vary by publisher and can run as high as 55 %) and is silent on pricing — allowing Amazon to discount as steeply as it wishes to win over customers.
Random House is not involved in any of the investigations and is free to continue
selling e-books
under the
agency model, as are any other publishers who adopted the
model later.
For those who are unaware, the retailer and the publisher have been locked in a dispute over contract terms; Amazon wants to remain
under the wholesale
model in which it gets to determine the price of the ebooks it
sells, even if that means taking a loss in order to pass the savings on to the customer, and Hachette wants to go to the briefly - instituted
agency model in which the publisher determines the price.
That might seem harmless because it doesn't let Amazon
sell ebooks at a loss
under the new terms of the
agency model.