Amazon vs Macmillan: what's best for the consumer?

The big news over the weekend was the battle between Amazon and Macmillan books. On Friday, users noticed that while Macmillan books were still listed on the Amazon website, they weren't being offered for sale thru Amazon (3rd party sellers still offered the titles).

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The New York Times speculated that this was conscious decision on Amazon's part (as opposed to a glitch in the system) based on some e-book pricing disputes between Amazon and Macmillan. Macmillan wants Amazon to raise the price of their e-books to $15 (up from the current price of $9.99 for bestsellers) because it feels the lower price devalues the titles. On Saturday, the situation was confirmed by Publishers Lunch, which reprinted a paid advertisement that Macmillan's John Sargent ran. The advertisement, which reads like a memo to "All Macmillan authors/illustrators and the literary agent community," starts like this:

This past Thursday I met with Amazon in Seattle. I gave them our proposal for new terms of sale for e books under the agency model which will become effective in early March. In addition, I told them they could stay with their old terms of sale, but that this would involve extensive and deep windowing of titles. By the time I arrived back in New York late yesterday afternoon they informed me that they were taking all our books off the Kindle site, and off Amazon. The books will continue to be available on Amazon.com through third parties.

Sargent goes on to say that he wants a level playing field when it comes to selling e-books; one that allows all retailers to sell books profitably. On Sunday, the "Amazon Kindle Team" responded on Amazon.com's Kindle Community. That post started with:

Macmillan, one of the "big six" publishers, has clearly communicated to us that, regardless of our viewpoint, they are committed to switching to an agency model and charging $12.99 to $14.99 for e-book versions of bestsellers and most hardcover releases.

We have expressed our strong disagreement and the seriousness of our disagreement by temporarily ceasing the sale of all Macmillan titles. We want you to know that ultimately, however, we will have to capitulate and accept Macmillan's terms because Macmillan has a monopoly over their own titles, and we will want to offer them to you even at prices we believe are needlessly high for e-books.

As of Monday morning, Macmillan books were still not available for purchase directly from Amazon.

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