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Apple, Amazon Now Cutting Prices on Ex-Agency eBooks & B&N is Matching the Cuts

September 10th, 2012 by · 17 Comments · Amazon, ebookstore news

It’s only been 4 days since Judge Cote approved the anti-trust settlement between the 3 publishers and the Dept of Justice and it looks like Amazon has wasted no time in cutting prices.

There are reports on Twitter that HarperCollins titles are no longer showing the all important “This price was set by the publisher” note. Now there are quite a few books which instead say that is simply by HarperCollins. Jane Litte of Dear Author was the first to comment on the change, and she posted this screen shot which compared a Penguin title and an HC title:

There’s no sign yet that Amazon has signed deals with other publishers, but I can report that HC titles appear to have gotten an across the board price cut. There’s a fair number of $9.99 ebooks now selling for $8.02, and there’s also quite a few $13.99 titles now selling for $10.94. There’s also a handful of other HC titles with different discounts, so there does not seem to be a pattern. Nor does this does not include all titles, but nearly all the HC ebooks I checked in the Kindle Store have gotten a price cut. The rest might just be waiting for Amazon’s servers to get around to them.

So Amazon is cutting prices. That comes as no surprise, but what I do find interesting is that B&N appears to be matching those price cuts as soon as they happen. B&N is also dropping prices, and of the 8 HC ebooks currently in my browser, B&N has only 1 which costs more than the Amazon price. And that could change at any moment.

Update: And they’re not alone. One reader has told me that BooksonBoard has sent out an email today to announced a sale on HarperCollins titles. BoB is offering 24% off all (most?) HC titles. The sale is going to run this week.

Second Update: A reader pointed me at the iBookstore, where Harpercollins titles are now being discounted. I’ve spot checked a half dozen titles and whenever Apple discounted them Apple was the one who usually had the best price – sometimes by several dollars. For example, the Kindle edition of Men are from Mars sells for $8.89, while B&N has it for $9.99 and Apple sells it for $7.99. And it’s not the only one, either.

Final Update: It’s Tuesday morning, and the prices are now showing up at Kobo as well.

The settlement required the publishers to cancel their existing contracts and start negotiating new ones. It only took Amazon 4 days to start the discounts that will bring about the end of publishing, so I have to wonder whether they had a new contract with Harper Collins worked out in advance. That could be true, but it would not explain how B&N responded with similar speed.The settlement also blocked publishers from controlling the retail price of ebooks for the next couple years, and they also can’t sign a contract which specifies a most favored nation clause.

That last condition is potentially a good one for everyone but Amazon; it gives publishers the option of selling to different ebookstores at different prices.  They could p[ossibly set the Amazon price higher than elsewhere in order to slow down the doom they probably see coming. On the other hand, it also opens up the possibility that Amazon might get the lower price.

And we might already see the effect of the end of the MFN clause. BooksonBoard has discounted HC titles enough that some prices are below that of  Amazon. It would not surprise me to learn that they cut a special deal with HarperCollins.

P.S. I’ve just double checked and it does not appear that Hachette (test title) or S&S (test title) have signed a new deal with Amazon or B&N, but that is liable to change at any time. The only evidence I have one way or another is the price listings, and that’s subject to error.

image by Akira Ohgaki

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17 Comments so far ↓

  • George

    I know this probably terrifies the execs at Harper Collins but I have a ton of HC titles in my wishlist and on a lot of them I was just waiting for the price to come down a little, particularly on the C.S. Lewis titles. So, today I’ve bought at least 5 HC books. Which as publishing logic dictates hastens the death of publishing.

  • MikeJ

    Even Books on Board is getting in on the act. I got a promotional e-mail from them this afternoon, announcing 24% discounts on Harper Collins.

  • fjtorres

    As long as Apple and the other conspirators cling to the price fix, any discounts from all sources will serve as evidence in the trial to come.
    Since everybody except the posturing BPH apologists expected the settlement to be approved, there was ample time to negotiate “contingency” contracts. And whoever gets them in the earliest gets the extra attention and sales from the folks waiting for the shoe to drop. Harper Collins got that much right.

  • Common Sense

    I noticed this morning when I got a slew of price drop notices from ereaderiq.com. Problem is, they already lost me as a customer, because of free, low-cost backlist, library, and indie books, my price point is far lower than the new $4.99 price drops. I also have almost 9,000 ebooks in my account so have no need to purchase those books. Had the publishers never implemented the agency model, when I saw the prices of half of my wishlist go up significantly, I would have never searched out an alternative.

    I’d still be willing to replace some of my paperbacks with digital versions, but only if the price is $1.99 or less.

    Too little, too late.

    • Syn

      Wow 9000 books.

      I agree that I haven’t bought an Agency book since this whole mess started and I went to indie authors and free books. I NEVER would have thought to do this if not for Agency. When a book I wanted to buy was 9.99 and went to 16.99 over night when Agency kicked in. For me, that was it, time to look else where. I never would have found Smashwords or a lot of the other indie publishers.

      Hmm, maybe Agency did me a favor. I’m not sure it did their Authors a favor. I know they still got sales, but it lost them a lot to.

  • Peter

    It appears that Apple is in on the action as well.

    In fact, Apple appears to be making the deepest cuts.

    But I’m only two titles down the HC ebook bestseller list.

    • Nate Hoffelder

      That’s what it looks like to me too.

      • Peter

        Didn’t see that one coming.

        • willem

          I’m surprised that anybody is surprised. Apple seems to have three options:
          1) Do nothing and price themselves totally out of the market.
          2) Abandon ship, that is close iBooks.
          3) Match or exceed everybody on price.

          Other than habit – Apple does not particularly like discounting and loathes the idea of loss leaders – what would stop them from following path number three? After all iBooks is a minuscule part of their turnover and even less of their profits. Heck if they wanted to they could literally subsidize the store and hardly notice it on their spreadsheets.

          • fjtorres

            Of course, after their role in the price-fixing scam, the odds of *them* getting hit with, ahem, “predatory pricing” would be non-zero if they went all-out.
            Poisoned well and all that.

          • Peter

            They can “settle” and go back to doing exactly what they want to do in the first place!

          • Peter

            I’m not surprised they are the price leader- they have the deepest pockets and the most “locked-in” format.

            But I am surprised they didn’t try to delay by filing an appeal to the settlement. Or at a minimum, wait to cut prices until they are further out of the woods, legally speaking.

            Remember- only the publishers have settled. Apple is still defending themselves in court. Cutting prices now would seem to hurt their actual trial.

            Since the DoJ has already effectively killed agency, there’s nothing preventing the government from hitting Apple with a hefty fine if they lose.

          • willem

            Well ‘hefty’ is in the eye of the beholder. Given the amount of money Apple is sitting on I don’t think they really care about fines as such.

            Anyway this just seems a logical move to me, in fact I would have expected it from Google, but they are just all over the place these days. Amazon wants to sell hardware at close to cost and profit from the content sold through the devices. Easiest way to attack this strategy is to suck all the profit out of the content by selling it at or close to cost.

            Let the price war commence.

  • Dave Head

    >>>”It only took Amazon 4 days to start the discounts that will bring about the end of publishing”

    Way to insert bias in your article. An end to publishing? I doubt it. When blank cassettes were released in the 70s it was supposed to be an end to record companies, but it didn’t happen. They repeated the same mantra with VHS tapes and CD-Rs. But these new technologies never drove the record publishers went out of business. Likewiee the book publishers will continue onward but with smaller profit margins.

    • Nate Hoffelder

      I’m actually on the side of the self-published article, and that sentence was intended to be sarcastic. My point was that many have referred to the end of Agency as the day the industry dies, and I’m making fun of them.

      • Timothy Wilhoit

        I got your meaning. Does that mean I’m also a sarcastic person? Probably. ;) I think someone should invent a sarcasm font.

  • Elizabeth Iglesias

    I’m a book fun and I usually go to booksales just to buy used books that I haven’t read before. They usually have the interesting stuff there at booksale. This news about cutting prices on books must be great news for book lovers like me. There is nothing more alluring than a discounted bestseller.

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