Authors of books published by Macmillan discovered early Saturday morning that all their electronic books been pulled from Amazon sales, and even wishlists, in a dispute between Amazon and their publisher over e-book pricing.
How the dispute is resolved will help determine the price of e-books in the future.
"Macmillan, like other publishers, has asked Amazon to raise the price of electronic books from $9.99 to around $15," reported the New York Times in its technology blog. "Amazon is expressing its strong disagreement by temporarily removing Macmillan books, said this person, who did not want to be quoted by name because of the sensitivity of the matter."
Part of the dispute is related to the Apple iPad, using iBooks technology, the Times reported. "Macmillan is one of the publishers signed on to offer books to Apple, as part of its new iBooks store," the blog read. Apple will allow publishers more leeway to set their own prices for e-books, the Times said in an earlier story.
In a published advertisement today, Macmillan CEO John Sargent said he had met with Amazon in Seattle on Thursday, and gave them a proposal for new terms of sale for e-books -- or, as an alternative, greatly reducing the number of titles it would sell with Amazon. "By the time I arrived back in New York late yesterday afternoon [Friday] they informed me that they were taking all our books off the Kindle site, and off Amazon," though books will continue to be available on Amazon.com through third parties, he added.
"If nothing else, this bit of asshattery on the part of Amazon has well and truly cured me of any desire to ever get a Kindle," posted John Scalzi, one of the affected authors, and one of the first to blog about it. "If Amazon is willing to play chicken with my economic well-being — and the economic well-being of many of my friends — to lock up its little corner of the ebook field, well, that’s its call to make. But, you know what, I remember people who are happy to trample my ass into the dirt as they’re rushing to grab at cash."
Four other major publishers -- Pearson's Penguin, News Corp's HarperCollins, Lagardere's Hachette Book Group and CBS Corp.'s Simon & Schuster -- which signed similar agreements with Apple, are expected to renegotiate their Amazon prices, according to an article in the Wall Street Journal. It will be interesting to see how they respond to Amazon's action.
Ironically, the lead book on Macmillan's website is Priceless: The Myth of Fair Value (and How to Take Advantage of It). "People used to download music for free, then Steve Jobs convinced them to pay. How? By charging 99 cents," the website describes. "That price has a hypnotic effect: the profit margin of the 99 Cents Only store is twice that of Wal-Mart. Why do text messages cost money, while e-mails are free? The answer is simple: prices are a collective hallucination."