A New York Times piece posted yesterday takes a look at Apple's approach to e-book pricing.
While it's widely been presumed that the big publishing houses are flocking to Apple's "agency" model because it allows them to set prices and sell best sellers for as much as $15 a pop - 50 percent more than Amazon's $9.99 top price for a Kindle edition - the reality may be something less.
According to NYT sources:
...Apple inserted provisions requiring publishers to discount e-book prices on best sellers — so that $12.99-to-$14.99 range was merely a ceiling; prices for some titles could be lower, even as low as Amazon’s $9.99. Essentially, Apple wants the flexibility to offer lower prices for the hottest books, those on one of the New York Times best-seller lists, which are heavily discounted in bookstores and on rival retail sites. So, for example, a book that started at $14.99 would drop to $12.99 or less once it hit the best-seller lists.
Are publishers really going to get better margins selling their books on the iBook Store than they are on Amazon? Or is the publisher/author cut actually going to be lower on best selling titles after Apple deducts its 30 percent commission? Since the negotiations are all secret, no one knows for sure, but it's going to be interesting to see how this new distribution channel for books plays out.
Will you purchase a book from the iBook Store for $15? What's your price threshold for e-books?