With Apple’s announcement that the iPad will become an snazzy eReader, that is will have the apps to read digital books, the case is being made that Apple has already blown it. By attracting the attention of publishers with higher price sales, is Steve Jobs simply sitting on rocks while singing the sirens song of more profits?
Amazon’s recent power play with Macmillan books showed the world that the $9.99 model for all ebooks is dead. Amazon attempted to hold the line and simply remove the publishers books from their catalog but quickly gave in, giving more power to Macmillan to increase the price of their ebooks. Macmillan had already worked a deal with Apple, which is offering to sell it’s books through a version of iTunes at higher prices.
Peter Kafka, over at All things D, provides a cautionary tale based on music labels messing about with pricing. By changing pricing from $.99 to $1.29, Warner Music saw sales slow. The conclusion drawn is that raising prices above a magic number such as $.99 or $9.99, customers become disinterested. The thinking follows that iPad will fall short in growing the ebook market, instead, it has killed it.
I believe this is short-sighted. Digital music is on the backside of the boon. The market is saturated (witness flat iPod sales) and as a luxury item, music is going to trend downward in tough economic times. Ebooks, however, still have yet to see that boon. Apple hopes to bring consumers to that boon with the iPad and that is why publishers are moving to reset the price point that consumer will get attached to.
Is there a magic price for eBooks? Are folks used to paying $30 for newly printed hardcovers going to scoff at $15? If they do will Apple grab the market by the throat and drive prices back down to Amazon’s level? I can’t wait to find out.
Apple eBook Pricing Myth
http://obamapacman.com/2010/02/apple-ipad-ibookstore-ebook-prices-high-price-myth/