Amazon needs publishers to embrace the Kindle standard if the device’s economics (and projections) are ever to work well for Amazon. For now, publishers are fighting tooth and nail.
Simon & Schuster and Hachette will delay the release of e-book titles by upwards of four months after the hardcover release, according to the WSJ.
This is another example of publishers pushing back against Kindle’s low e-book retail prices which the publishing industry believes cannibalizes print sales and provides authors with less economic motivation to write quality books that sell well.
We discussed how some publishers were exploring such “tiered-release” schedules in our report on the Kindle on November 30.
Some important quotes from the article with our take:
“We believe some people will be disappointed. But with new [electronic] readers coming and sales booming, we need to do this now, before the installed base of e-book reading devices gets to a size where doing it would be impossible.”
Publishers realise their leverage goes away if Kindle sales reach critical mass among consumers. They realise they must try to figure out and drive the business model now before it is decided for them.
“We’re doing this to preserve our industry,” Mr. Young said. “I can’t sit back and watch years of building authors sold off at bargain-basement prices. It’s about the future of the business.”
This is central to understanding book publishers’ point of view. As we said in our report book publishers feel that declining author royalties will lead to less quality books being released (writers won’t spend the time on major books if they are not compensated well). This will lead to lower overall book sales long-term hurting the industry.
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