The Apple-Amazon Ebook War Begins: Amazon Deletes Macmillan Books

Books published by Macmillan mysteriously poofed from Amazon yesterday. The reason, according to the NYT, is that Amazon is punishing the publisher for arguing that the price of Kindle books should go up to $15. This won't end well.

It feels like a repeat of the same shit Universal Music, and later, NBC Universal pulled with iTunes, trying to counter the leverage Apple had because of iTunes' insane marketshare. Same situation here, really: Content provider wants more money/control over their content, fights with the overwhelmingly dominant, embedded service that's selling the content. Last time, everybody compromised and walked away most happy: Universal and NBC got more flexible pricing, iTunes got DRM-free music and more TV shows for its catalog to sell.

The problem publishers have with Amazon is two-fold: Amazon's overwhelming marketshare in ebooks (because that leads to more control for Amazon, and less for them) and the establishment of $9.99 as the price of a book, which publishers feel cheapens the value of books. (Hardcover bestsellers go for up to $30, after all.)

The difference in this fight is that Macmillan is one of the publishers signed to deliver books for Apple's iBooks store. They have somewhere to run. And credibly. That wasn't really the case with record labels, who tried to fuel alternatives to dilute iTunes power, and failed. (Interestingly, this little episode seems to prove Brad Stone's earlier account in the Times that publishers were looking to Apple to save them from the tyranny of Amazon, since Apple allows publishers to set their own book prices.)

The $15 pricepoint Macmillan's pushing to Amazon is a little curious, though, given two things: Steve Jobs told Walt Mossberg books in the iBooks store would cost the same as they do for Kindle, and the WSJ reported last week $15 was one of Apple's recommended pricepoints for books. Removing Kindle's price advantage would be a smooth way to launch iBooks, no? The publishers get more money, and iBooks in full, eye-straining color cost the same as Kindle books—everybody wins, except Amazon. (Update: It's known Amazon loses money offering some bestsellers at $9.99, so I wonder if selling at $15 would change that equation. Still, if its books cost the same as iBooks, and publishers start bailing, that's bad for them in a way making a few extra bucks per book doesn't make up for.)

This is just the beginning. [Bits]