Macmillan raising e-book prices, Amazon opposed

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The Independent Culture

US book publisher Macmillan is raising its e-book prices in a move that threatens to shake up the market and is being strongly opposed by Amazon, maker of the Kindle electronic book reader.

Amazon temporarily pulled Macmillan titles from its Kindle store over the weekend to protest what it called its "strong disagreement" with the pricing plan from Macmillan, one of the six major US book publishers.

Macmillan chief executive John Sargent said the publisher planned to begin charging between 12.99 dollars and 14.99 dollars for e-book versions of most hardcover new releases and bestsellers.

Amazon currently charges 9.99 dollars for new releases and bestsellers in a move aimed at driving Kindle sales and spurring demand for digital books.

Publishers have complained the 9.99-dollar price cuts into their lucrative hardcover sales.

Macmillan's challenge to Amazon's pricing model comes as the Seattle-based online retail giant faces growing competition in the e-reader market.

Apple last week unveiled a tablet computer, the "iPad," which also serves as an e-book reader and US bookstore chain Barnes & Noble last year came out with an e-reader of its own, the "Nook."

Sony also makes an e-reader and a number of other companies, including South Korea's Samsung, have announced plans to manufacture the devices.

Amazon, in a post on its Kindle discussion page, said it would eventually be forced to give in to the new pricing plan from Macmillan.

"We have expressed our strong disagreement and the seriousness of our disagreement by temporarily ceasing the sale of all Macmillan titles," Amazon said. "Ultimately, however, we will have to capitulate and accept Macmillan's terms."

Macmillan CEO Sargent said the publisher, whose units include Farrar, Straus and Giroux, Henry Holt, Scientific American, St. Martin's Press, Minotaur Books and others will begin charging the higher prices for e-books from early March.

He said that in the future Macmillan would set the prices for e-books and retailers such as Amazon would take a 30 percent commission - the same deal Apple has entered into with Macmillan and other major publishers.

"Amazon has been a valuable customer for a long time, and it is my great hope that they will continue to be in the very near future," Sargent said in a statement.

"Amazon and Macmillan both want a healthy and vibrant future for books," Sargent said. "We clearly do not agree on how to get there."

Explaining the decision to give in, Amazon said: "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.

"Amazon customers will at that point decide for themselves whether they believe it's reasonable to pay 14.99 dollars for a bestselling e-book," Amazon said.

Amazon said it did not expect other major publishers to follow Macmillan.

"We don't believe that all of the major publishers will take the same route as Macmillan," Amazon said.

"And we know for sure that many independent presses and self-published authors will see this as an opportunity to provide attractively priced e-books as an alternative."