EBooks Online Monopoly

By Denise Turney

Monopolizing ebooks online may be becoming more the norm than not. It seems that just as book authors are leaping over stigmas attached to self-publishing their written works, another challenge rears its head. This new challenge surfaced in April 2012. It came in the form of a Department of Justice lawsuit made against seven book publishers, namely Apple, Simon & Schuster, Harper Collins, Pearson, Penguin, Macmillan and Hachette.

Goliath as an Ebooks Online Retailer

As reported in ARS Technica’sJuly 18, 2012 “Senator Says Apple E-Book Suit ‘Could Wipe Out the Publishing Industry’” article, the lawsuit charges the aforementioned seven companies with fixing ebook prices. If the DOJ prevails in its arguments, Amazon.com could be left holding the reins to more than half of the ebook market.

Oddly, Amazon.com gained a stronghold on the ebooks online market using the same strategy that worked for WalMart when it opened its first stores in the 1960s – sell products at a lower price than competitors. Today some Amazon.com self-published authors even offer their books for free, at times landing on Amazon.com’s bestseller list. So far no one in the book industry is questioning the validity of a bestseller list that includes books that are given away for free.

But that’s another matter.

When it comes to ebook pricing several publishers and non-book publishing companies (e.g. Apple) selling digital books use the agency model to set their prices. With the agency model publishers set the price on digital books sold to resellers (e.g. Amazon.com, Barnes & Noble). Resellers then set the price consumers must pay to purchase the books from them. To increase book sales it’s not uncommon for resellers to sell books below the cost set by book publishers.

Appealing to EBooks Online Readers thru Pricing

If a reseller lowers their prices to such a degree that ebook readers shift their buying habits, opting to buy solely from lower priced resellers than book publishers . . . well, you can see what a financial challenge that would present to ebook publishers. At this point we can only go with assumptions as to why some ebooks online publishers raised the prices on their digital books, assuming perhaps that they did so to gain more profit on the ebooks they sold direct to consumers.

What may not be under assumption (or need be) is the thought that monopolizing the ebook industry is good business. As Senator Charles Schumer said, “As our economy transitions to digital platforms, we should be celebrating and supporting industries that find ways to adapt and grow. By developing a pricing model that made e-book sales work for them, publishers did just that.”

Thank you for reading my blog. To learn what happens to Raymond, Brenda and the other characters in Love Pour Over Me, hop over to Amazon.com, B&N.com, Ebookit.com and get your copy of Love Pour Over Me today. And again I say – Thank You! 


http://arstechnica.com/apple/2012/07/senator-says-apple-e-books-suit-could-wipe-out-the-publishing-industry (ARS Technica: Senator Says Apple E-Book Suit “Could Wipe Out the Publishing Industry”)