The stated goal was to mandate retail prices for Kindle books, and all other ebooks
under the agency model publishers» control, at levels that would be 30 to 50 percent higher than the $ 9.99 price that Amazon had previously set for Kindle Store new releases.
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.
Three, if you take the time to shop around to the smaller sites or if you keep an eye on which
publishers aren't operating
under the
agency model, you can find better prices.
«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.
Industry insiders and general interested parties proclaimed that
under the new
Agency model being adapted by major
publishers in determining global eBook prices, violates anti-trust and anti-competitive laws.
The
Agency model is also
under fire right now, especially in Europe where the EU is launching a major investigating in
Publisher Price Cartels where price fixing is illegal.
Add into the mix the fact that
publishers have admitted they make less money per title
under the
agency model than they did before and you have the answer to who is harmed.
Because retailer discounting is prohibited by the
agency agreements, retailers have been prevented from introducing innovative sales
models or promotions with respect to
Publisher Defendants» e-books, such as offering e-books
under an «all - you - can - read» subscription
model where consumers would pay a flat monthly fee.
I agree the 10 % would remain the same but it's 10 % of the
publisher's revenue, not the retailer's sale price, and
under the new
agency model the
publisher's revenue (as Macmillan has explicitly stated) would be less, hence the author's revenue would also be less.
Under the terms of the Hachette's settlement of the Department of Justice lawsuit, the existing contracts which allowed for the
agency pricing
model had to be scrapped and rewritten, a job which simply takes a lot of time and effort from parties for both the
publisher and the retailers.
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 %.
Under the so - called
agency pricing
model,
publishers keep roughly 70 % of the revenue from each individual sale, with Amazon receiving an estimated 30 % as their fee.
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, a
publisher sets a retail price for a specific book, which establishes a level playing field for all resellers.
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.
This settlement will allow retailers to set the price of ebooks again, meaning the
publishers will have to negotiate all new contracts with their retailers and agree to abandon the «
agency model» that was established
under the supposed anti-trust violations.
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.
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.»
For NON
agency publishers the removal of the DRM requirement would let the retailer drop their price and still make the same margin after costs
under the wholesale
model.
But, in January 2010, each of the
Publisher Defendants did an about - face and suddenly advised Google that they were switching to an
agency model and would no longer be offering books
under wholesale terms,» Cote wrote.
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 %.
Between lower prices for indie and non-Big 5
publishers and Kindle Unlimited, I am reading a lot more than if I bought only Big 5 e-books priced
under their modified
agency pricing
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.
In Cue's first meeting with a
publisher, with HarperCollins, an executive floated the idea of working with Apple
under an
agency model.
Under the
agency model, when the
publisher mandated a retail price of $ 12.99 to $ 14.99 for an ebook, it stood to receive 70 % from Amazon or another retailer — or somewhere between $ 9 and $ 10.50.
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.
Now, of course, the
publishers stand to lose even more
under the
agency model.
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.»
One other note on March's decrease from February's sales: just like sales dipped to their lowest point of the year last April, the first month that 5 of the «Big 6»
publishers raised e-book prices
under «
agency model» pricing, March 1 marked the date when Random House joined ranks and embraced the
agency model as well.
Both these deals are
under the
Agency Model — 70 % cut for
Publishers and the freedom to set their own prices.
Under the
agency model, book
publishers set their own e-book prices and the retailer (agent) receives a commission.
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.
Under the traditional wholesale
model, which is used for print books and was used for e-books as well until
publishers adopted the
agency model in 2010,
publishers set a book's suggested retail price and retailers can discount the books to any price that they want.
Under the traditional wholesale
model, which is used for print books and was used for e-books as well until
publishers adopted the
agency model in 2010,
publishers set a bookâ $ ™ s retail price and retailers can discount the books to any price that they want.»
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.
Under the
agency model,
Publisher A sets price B and Retailer C receives some fraction of B.
Under the wholesale
model, however, Retailer C is free to set the retail price as high as that same said B set by the
Publisher.
Under the
agency model, the
publisher is the only party that can discount e-books, and an e-book's price must be the same across all retailers (i.e., an e-book can't go on sale at just one retailer).
At the heart of the flurry of lawsuits is a challenge to «
agency pricing,» the e-book pricing
model under which book
publishers set their own prices for e-books, paying the e-tailer («agent») a commission.
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).
It might be fortunate for Amazon that the Big 5 aren't in KU as the trad
publishers have reverted to high pricing
under the
agency model and the cash strain of paying out, for example, $ 7 per borrow on a best - seller could be crippling even for a giant company such as Amazon.