The Roundtable is a live, interactive webcast gathering some of the most outspoken industry professionals to debate the hottest publishing issues of the week, as being discussed in traditional media, the blogiverse and on Twitter. From celebrity book deals to eBook rights and pricing to [insert YOUR pet topic here] — if it’s related to books, it’s on the agenda.
Topic: Amazon vs. Apple
This episode of The Roundtable was webcast live at 1pm EDT on Thursday, March 25, 2010.
Guy LeCharles Gonzalez, Dir. of Programming & Business Development, Digital Book World
A battle looms, and it’s not about selling new gadgets—it’s about using devices to lock you into a content ecosystem. In an ironic evolution of the World Wide Web that once promised consistent access to all of the globe’s information, corporate giants are now striving to wall off sections of content and charge you for access.
Perseus Books Group, a large independent publisher that also distributes works from 330 other smaller presses including Grove Atlantic, Harvard Business School Press, Zagat and City Lights Books, signed a deal last week with Apple, following five of the six biggest publishers that have already signed agreements with Apple.
Perseus’s deal comes as Amazon.com, the largest online seller of printed books and the biggest e-book seller in the United States, has put pressure on publishers who have not yet signed deals with Apple to refrain from doing so. Amazon, which makes the Kindle e-reader, holds about 90 percent of the e-book market. With Apple’s iPad coming on the scene, Amazon is fighting to keep as much of its market lead as possible.
Amazon already sells Kindle for iPhone, which can be used as a companion to Amazon’s Kindle e-reader or as a standalone application for reading e-books in the Kindle format. The development team at Amazon has built an iPad-specific interface that leverages the larger screen of the iPad. “Our team had some fun with it,” Ian Freed, vice president for Kindle at Amazon, told NYT.
Barnes & Noble, which recently launched its own e-reader to go along with its competing e-book store, is also working furiously on an iPad-tweaked version of its iPhone app as well. Douglas Gottlieb, Barnes & Noble’s vice president of digital products, told NYT that the company has had 14 developers holed up in a windowless room since January creating an iPad application for reading e-books from its store.
Amazon’s squabbles with book publishers highlight the flawed nature of the Kindle’s current business model. Whereas game console manufacturers and wireless carriers often take losses on hardware sales to consumers, and make it up by profitably selling content and services, Amazon is trying to do the exact opposite. Last April, iSuppli estimated that the current-generation Kindle, which Amazon now sells for $259, costs only $185 to manufacture — and the tech sector being what it is, it wouldn’t surprise me if manufacturing costs have dropped by more than 20% since then.
As both von Lohman and PercentMobile have noted, Apple’s approach to apps is really no different from Amazon’s approach to eBooks, and they arguably take much more of a Big Brother approach than Amazon does based on their recent selective ban on sexual content (Playboy somehow made the cut) and “cookie-cutter” apps.
Are publishers jumping from the frying pan into the fryer by favoring Apps over eBooks, and looking to Apple as a savior?
Twitter (as RTd by @digibookworld):
33% of Perseus clients plan < 10% of list as eBooks; 43% “too soon to tell” on iPad impact: http://bit.ly/aEck25
@tinahender: 300,000 preorders for iPad not too surprising given iPhone popularity and news of lower than expected price on iPads. #dbw
@MatthewDiener: If agency model means books are priced same from all retailers, does it all come down to user interface/experience? #dbw
@babetteross: #dbw with apps (kindle, b&n) ipad owners can choose platform for each read. And base this on user experience & price.
@babetteross: #dbw Audio books are performance. Text to speech is personal, helps the disabled and does not compete with audio books.
@kellymcclymer: Audio rights issues are going to get a new look (ADA weighing in heavily, I hope). #dbw
@bakersmark: Why are iPhone apps and eBooks are often selling for $2.99, but $9.99 on amazon cause a pricing war. Why? Where is the math? #dbw
@tinahender: Math question generates silence, then laughter. On to Act Three! #dbw
@kellymcclymer: P&L hard to figure for apps. Experimenting, but what good are apps for apps sake? #dbw
@babetteross: #dbw apple vs. amazon, consensus of roundtable: apple will increase popularity but lion share of sales will be thru amazon.