Macmillan vs Amazon, Round One

According to Huffington Post, after the iPad launch Walter Mossberg cornered Steve Jobs to ask a pertinent question:

Mossberg asks why users would want to shell out $14.99 for an ebook on the iPad, when they can buy ebooks for Amazon’s Kindle for $9.99.

Steve Jobs’ retort: ‘Well, that won’t be the case.’ Mossberg presses him on whether that means Apple’s prices will go down, or Amazon’s will go up, to which Jobs offers a cryptic, non-committal, ‘The prices will be the same.’

On Friday, this exchange was explained. Macmillan demanded that Amazon jack up the prices of e-books to $14.99. In response, Amazon stopped selling Macmillan books. That includes all books from Tor and Forge, the science fiction and fantasy publishers.

As it happens, next month’s book at the book club I go to is published by Tor. I went to buy a copy on Friday, not knowing about the dispute. I had seen it available for Kindle before, and wondered why it was no longer available.

Then I shrugged, and bought a dirt-cheap used paperback copy instead. If Amazon had given in and upped the price to over $10, rather than refusing to sell it, I’d have done the same.

The thing is, a book is something I rarely read more than once. There are so many good books out there, I feel like it would be crazy to re-read when I could read something new to me. Hence $15 for a book is expensive entertainment, compared to $15 for a CD I’ll listen to many times, or $3 for a movie rental.

I suspect that I’m not unusual in this respect, and that Amazon have done the market research, and concluded that DRM-crippled e-books are never going to sell for more than $10–particularly not when you can pick up a paperback for $5 including shipping. Rather than devalue the Kindle and allow other publishers leverage to introduce their own disastrous price increases, Amazon is playing hardball and opting not to sell Macmillan books–which is their right in a free market, isn’t it?

Apple did the same thing with the music industry, pushing them to keep prices at 99¢ per track. Later, the big music companies were allowed to increase prices in return for dropping DRM. Everyone loved it when Apple forced prices down, but this time there are some angry voices.

John Scalzi is one of them. He’s pretty angry at Amazon. Reading between the lines, I think he’s pretty angry at his publisher too, for trying to sell his books at a price he doesn’t think most people will buy at. Meanwhile, Cory Doctorow proposes the iTunes Music Store solution: allow publishers the freedom to set prices however they like, if they drop DRM and abusive EULAs. (Sounds good to me, as it makes the problem somewhat self-correcting–if publishers jack up the prices too high for the market, copyright violation ensues.)

I can understand why Macmillan’s authors are upset by what Amazon have done, but fundamentally, I think this is a very simple problem: Macmillan has decided to set its prices higher than Amazon thinks it can sell books at, so Amazon is choosing not to sell Macmillan books. If you’re an author published by Macmillan, I think the people you really need to be directing your ire at are at your publishing company, for attempting to raise prices in the middle of a terrible recession. In the mean time, well, I guess I’ll buy your books used.