In 2001 Apple launched a product that has gone on to become one of the biggest mp3 players in the world, and revolutionised the way in which we not only consume music but purchase it as well. I am of course talking about the Apple iPod. It was by no means the first portable mp3 player on the market, even today it still is not considered the best or even the best sounding player yet Apple have managed to not only craft a brand that has fans even fiercer then rabid dogs but have managed to make the term iPod mean mp3 player.
In 2009 Apple’s Phil Schiller announced total cumulative sales of iPods had exceeded 220 million units and accounted for 73.8 percent of all mp3 players. These are some pretty impressive figures but the true success behind the iPod is the iTunes store. Opened in 2003 Apple revolutionised the sale and distribution of music forever and now with the launch of the iPad imminent they are hoping to do the same with books.
But there is already a battle in full swing being waged here, a David versus Goliath between Amazon and the Publishing world. But on closer inspection it is not immediately obvious to tell who the Goliath is and who is David.
In one corner we have the Publishers, using an age old business model that probably hasn’t changed much since the mass printing began. They have been happily continuing to do business without the trouble that music and film have had to endure with digital piracy. They have their set negotiated rates with authors and set rates with printers.
In the other corner we have Amazon, a worldwide retailer that pretty much sells anything you could want, who have their hand in DVD rentals and even digital music distribution and are currently pretty much the only distributor of ebooks or least the biggest by a country mile.
And herein lays the problem.
Recently Harpcollins, spurred by Apples promise of being able to sell books at $15, have renegotiated their deal with Amazon who has been selling their ebooks at $9.99. Happercollins, part of the News Corp Empire, objected at Amazon setting prices of their books and even threatened to pull all their titles from the site if their demands were not met. Amazon buy these books at $12.99 so are actually selling these at a loss, which not unheard of in the retail world, and regardless of the sale price Happercollins still receive their cut.
Now a lot about this situation has been written in the press but something that almost all the news sites and blogs seem to have avoided in all of this is, how can a ebook cost $9.99 let alone $15? You no longer have the overheads that exist with a physical book, the manufacturing cost of a ebook is significantly less, there are no printing costs, there are no transportation costs, no reprinting costs and the book can never be out of print or stock.
While other publishers are now moving to get the same deal for themselves the real issue here seems to be that Amazon is simply the only game in town and has a virtual monopoly of electronic book sales and unless the publishers act now they could lose control of their own product and I am sure Apple are rubbing their hands together at the prospect of not only allowing publishers to set their own prices but making bundles of cash at the same time to add to the bundles they already have sitting in the bank form iPod and iPhone sales.
I really can see a future where publishers are completely bypassed as authors sell their work directly via retailers such as Amazon who already have a self publish platform and allow the author to get a much higher royalty return then is possible with traditional publishing.
But just when you thought it was safe to jump on the ebook bandwagon there is one more contender attempting to jump into the fray, the company that everybody loves to love, Google.
Goole’s plans are so ambitious that they make Apple, Amazon and the entire publishing world seem like small potatoes. Google want to scan every book on earth and make it electronically searchable via the internet! Let me say that again in case you missed it every book on earth!
Okay that maybe a slight exaggeration on my part but that doesn’t make their plans any less ambitious. They have already run into trouble with this at the first hurdle which you can read a brief description of on the Free Software Foundations website http://www.fsf.org/news/2010-02-gbs-objection
Whichever way this goes it is going to be an exciting fight. The real question is are reading fans ready to give up low cost paperbacks to expensive ereaders, that run out of battery at the most crucial stage and on top of that contend with all the DRM that goes along with buying a ebook?
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