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The $9.99 Ebook Is Dead: Third Major Publisher Hachette Dumps on Amazon

Illustration for article titled The $9.99 Ebook Is Dead: Third Major Publisher Hachette Dumps on Amazon

Amazon's ebook pricing structure has crumbled. Hachette's the third major publisher to push for the agency model, following MacMillan and HarperCollins: They'll set the ebook prices (higher, natch) and the bookseller takes a cut. The $9.99 ebook? Poof.

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It looks the pricing model reportedly first proposed by Apple to publishers—from $12.99 to $14.99 as a suggested price for harcover bestsellers, though the publisher will set whatever price they want—is the way things are indeed going to shape up, so Steve Jobs wasn't idly riffing when he said the price difference between Kindle and iBooks would go away. MacMillan CEO John Sargent has specifically mentioned those same pricepoints as their baseline, so you can expect every other publisher will hew to that.

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With a majority of the major publishers now going to the agency model, it's logical that the final two, Penguin and Simon & Schuster, won't be far behind, especially since they're a part of Steve's team. (HarperCollins hasn't officially switched, but Rupert Murdoch said on their earnings call they're renegotiating to that, so I'm counting it.) Three out of five, we're calling it: Amazon's dream of a flat $9.99 for ebooks has flatlined.

Amazon's price advantage over iBooks, also evaporated. Even though Amazon won't take losses on ebooks anymore to sell them cheaply, it's a bad situation for them, because they lose that marketshare-building advantage. (That is, Amazon's happy to spend $50 subsidizing cheap books to hook you into Kindle for life. If, eventually, they're the only game in town, like iTunes was for music, then they'd have the power to push back against publishers anyway.)

Amazon has two months before the iPad launches. They better move fast. [Media Bistro via MediaMemo]

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DISCUSSION

Why do people say that digital media has "almost no overhead"? There is still a hell of a lot of work put into a book in digital format. The only thing missing is the physical production. Everything else is still there.

The sweat and tears of the author who writes it.

The work of the editor, who fights to get it into a readable form after the author submits it (and often fights tooth and nail with the author to get those changes made).

The Proofreader who go blind trying to catch each and every spelling, grammar, and punctuation error.

The Typesetter, who turns a plain text document into an illustrated manuscript, even if it's never going to hit the printed page. Think about how many different fonts and type sizes, and headers and little bits of imagery goes into a book, even the digital ones.

That's a lot of time and effort and work. And if you think that any of those things can be skimped on, go pick up a self-published novel from almost any stand-alone author, and the difference will be GLARINGLY obvious.