Amazon goes public on Hachette feud. Pricing is primary reason for publisher’s ban

A long lasting battle between Internet retailer and Ebook goliath Amazon and book publisher Hachette has recently received explanation and corporate response

A long lasting battle between Internet retailer and Ebook goliath Amazon and book publisher Hachette has recently received explanation and corporate response from the Etailing giant.

Over the past few months Hachette books have become scarce on Amazon’s available Kindle offerings. A rift on the appropriate prices of Ebooks has resulted in a negative response from the publisher, stating Amazon’s Ebook prices are too low.

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Amazon’s Ebook pricing mainly revolves around the $9.99 range, to which 30% of a sale goes to Amazon, 35% to the author and the remaining 35% to the publisher. Hachette on the other hand believes pricing should be higher, as with other Ebook platforms, to help compensate for marketing, real-world non-digital printing, and industry shrinking shelf placement.

As a company which its roots are embedded in online book sales, Amazon sees savings in electronically based books, eliminating warehouse storage space, shipping costs, and printing costs. The Big A also believes in the sell more for less to make more motto, stating that selling Ebooks at a lower price means “the pie will be bigger”.

The back and forth between Hachette and Amazon created issues with end users as well, resulting in certain authors and titles no longer being made available. Amazon reps took the Kindle Forum to give an explanation on the situation.

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“A key objective is lower e-book prices. $14.99 and $19.99 for e-book titles are unjustifiably high, E-books can be and should be less expensive,” Amazon said in a forum release.

Digging further in the Kindle post shows Amazon also pointing the finger at Hachette for not paying its authors enough to agree to a new lower pricing scheme.

“If customers would buy 100,000 copies of a particular e-book at $14.99, then customers would buy 174,000 copies of that same e-book at $9.99. Total revenue at $14.99 would be $1,499,000. Total revenue at $9.99 is $1,738,000.  So, at $9.99, the total pie is bigger,” Amazon added.

As with the majority of internet based retail and retail in general, Amazon seems to be bullying around suppliers to lower prices in order to be represented on its platform. On the other hand, Hachette seems to be “poking the bear” in regards to pricing, and has not come forward publicly in regards to the ban on the Ebook platform.

What do you think? Is Amazon trying to take control of the entire Ebook market by creating a flat low price for all new Ebooks, or is Hachette looking to gain more by challenging the firm to agree to publisher prices? Let us know in the comment section below.

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