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Upset over its ebook prices, Amazon has delayed
deliveries and cut discounts on some books published by
Hachette, the fourth-largest U.S. book publisher, owned by
France's Lagardere.
In a blog post on the Amazon site authored by the "Amazon Books
team", the ecommerce giant said e-books were very price
sensitive. (http://amzn.to/1rD27WM)
Based on a review of many titles, Amazon argued that ebook
priced at $9.99 sold 1.74 times as many copies as one sold at
$14.99, generating 16 percent more revenue.
It said keeping prices low saved money for consumers while
authors would get higher royalties and 74 percent more readers,
with publishers also getting more money.
"The total pie is bigger and there is more to share amongst the
parties," it said.
Amazon claims that pricing an e-book at $14.99 or $19.99 is too
expensive and unjustifiable in most cases.
"With an ebook, there's no printing, no over-printing, no need
to forecast, no returns, no lost sales due to out-of-stock, no
warehousing costs, no transportation costs, and there is no
secondary market — ebooks cannot be resold as used books,"
Amazon said in the blog. (http://amzn.to/1rD27WM)
Hachette was not immediately available for comment but Amazon's
actions have alienated top-selling authors James Patterson and
Malcolm Gladwell, who mocked the situation in a spoof video on
Slate.com. (http://slate.me/VTjV6m)
Lagardere has said Amazon accounts for some 60 percent of
Hachette's digital sales.
The companies have been sparring in public, with Amazon this
month proposing that authors get all the revenue from ebooks
sold on the site, an offer Hachette rejected.
(Writing by Rodney Joyce; Editing by Sriraj Kalluvila)
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