Apple helps shift landscape for UK publishers over e-books

<p>The world&#39;s biggest publishers will follow Macmillan US&#39; lead in demanding changes to how Amazon sells and prices e-books, after what was described by one senior UK publishing executive as a &quot;very significant week and genuinely&shy; a very good week for book publishers, authors and readers&quot;.</p><p>Hachette USA was the first to declare its hand after last week&#39;s move by Macmillan US, with <a href="../news/111678-hachette-moves-to-agency-model-in-the-us.html" target="_blank" title=" chief executive David Young writing to agents</a> on Thursday (4th February) that it was &quot;willing to accept a lower return for e-book sales&quot; in return for control over the &quot;value of its product&quot;, namely pricing. </p><p>And a well placed source in the UK indicated that others would follow, prompted by last week&#39;s launch of the iBook Store on Apple&#39;s new iPad: &quot;I think Apple&#39;s iPad is a big opportunity for the market to sell e-books at sensible prices to a growing market. And it creates some competition to the Amazon channel and the Amazon platform, and competition is healthy.&quot;</p><p>Earlier this week Amazon said it would accept Macmillan&#39;s demand for new terms for the sale of its e-books in the US, following a stand-off in which Macmillan US titles were removed from direct sale on the site. However, has still not enabled the &quot;Buy&quot; button on Macmillan titles such as <em>Wolf Hall</em>, though Macmillan chief John Sargent sent a second letter to agents this week indicating that a deal was close. </p><p>Other publishers have also hinted that they will follow Macmillan&#39;s lead, with News Corp chief Rupert Murdoch this week indicating that he wanted to renegotiate the current deal with Amazon for HarperCollins titles. Murdoch said;s $9.99 standard e-book price &quot;really de&shy;values books and it hurts all the retailers of the hardcover books&quot;.</p><p>Trade observers speculate that other iPad launch partners Simon &amp; Schuster, and Penguin are also likely to follow Macmillan, and that any changes to trading terms in the US market will inevitably later translate to the UK.</p><p>The launch of the iPad and Macmillan&#39;s dispute with Amazon come at a time when publishers are having to use different sales models when they deal with Apple and Amazon. Publishers sell to Amazon resale, with Amazon determining the price to consumers, while Apple works on an agency model, with e-books sold at the publisher&#39;s price while Apple takes a commission.</p><p>As one insider put it: &quot;Publishers have lost control over pricing with the Amazon model, as Amazon can [afford to] sell e-books at a loss. The problem is that both Amazon and Apple would want to match each other&#39;s price, and as pricing goes down the model blows up. The only solution is to move everybody onto the same model.&quot;</p><p>UK publishers are currently tight-lipped about their relations with Apple, but it is believed that they have not yet begun detailed negotiations over the launch of the iPad in the UK. Apple&#39;s website now states that the iPad will be shipping to the UK in late March, but the iBookStore will not be available in the UK from launch. </p>