HarperCollins Might Also Push Amazon To Increase Kindle eBook Prices

harper_logo_small-1Looks like the publishers are not through making Kindle eBooks over all a much pricier place. After Hachette followed in MacMillan’s foots steps, it looks like Harper Collins might be the next publisher to re-negotiate their terms with Amazon. Rupert Murdoch has expressed his dislike of Amazon’s $9.99 policy for eBooks and he says that it hurts hardcover editions of the the same books.

Rupert Murdoch is the chief at News Corp, the company that owns, amongst multiple other media outfits, publishers HarperCollins. Hence, if he thinks Amazon is hurting Harper Collins book sales, there might be trouble for Amazon. Yet again that is.

It hasn’t been all that long since MacMillan settled their deal with Amazon to have their books priced higher on the Kindle. Murdoch has mentioned that even though Amazon pays them the usual $14 or whatever wholesale price they do charge, the ultimate low price hurts over all book sales from other outlets. According him, Amazon is willing to sit down with them and renegotiate the terms.

Even though he puts it as if they will talk things over, there is no doubt that he will really try to push Amazon into accepting a higher pricing scheme for HarperCollins eBooks. If this goes through, it might become the turning point in Amazon’s eBook pricing scheme. Once three such major publishers force their deals through Amazon, there will be little in the hands of Amazon to change the over all pricing of eBooks.

Of course, a lot of people will see opportunity in this and will offer books for cheaper than the major publishers. For light reading thus, a lot of people might choose cheaper alternatives. But for best sellers and major titles, buyers are the ones who will bear the price difference. Interestingly, Amazon will finally be gaining money on &9.99 books instead of losing it as they do now. But it will serve to lower their appeal to buyers, which is ultimately not a good thing.

Kindle May Have Newspaper Trouble in Australia

Fairfax Media, one of Australia’s large media companies, has rejected the Kindle and decided to look elsewhere for e-delivery.  Even worse for Amazon, this announcement comes on the heels of another Australian Media company’s public dissatisfaction with the Kindle.  Rupert Murdoch has voiced his concern over Amazon’s business model, and it seems that News Corporation will simply skip the Kindle with its Australian holdings.

As the eReader market grows in Australia, it looks like electronic newspaper subscriptions will follow a more traditional model where subscribes subscribe from the newspaper itself.  But since newspapers are only a fraction of the Kindle’s revenue, I can’t imagine that this news alone will stop the Kindle from breaking into the Australian market.  First and foremost, the Kindle platform is an entertainment medium designed to work off of Amazon’s existing status as a leading book retailer.  Being able to read newspapers and periodicals is a nice feature, but books remains the Kindle’s strong suit.

Even if some of the major papers bail on the Kindle, the device will have popularity with those who like to read.  If other online publishers take off in a way that could hurt the Kindle, Amazon needs to merely allow their device to read other formats.  They might not take a cut of the sales, but their are plenty of other revenue streams for Amazon.

Rupert Murdoch is Threatening to Leave the Kindle

Rupert Murdoch

Rupert Murdoch

Rupert Murdoch, as the head of the crazy huge News Corporation, has threatened to take his publications off of the Kindle.  Since News Corporation owns many major newspapers, such as the Wall Street Journal and The Times, this could have a devastating effect on the Kindle, especially as it moves into more countries.

The disagreement seems to be over revenue.  It looks like Amazon takes a higher percentage of the sales than Murdoch would like. But it also seems like Murdoch just isn’t happy with the general business model.  He’s angry that Amazon won’t release the customers’ names because “Kindle treats them as their subscribers, not as ours.”  News Corporation is also currently negotiating with Sony to put their content on the Sony Reader.

To me, this just seems as if it’s Murdoch simply trying to show some muscle.  Right now, News Corporation’s main asset on the Kindle is the Wall Street Journal: a publication that is essential to many involved in business.  Threatening to put the Wall Street Journal exclusively on the Sony Reader is the same thing as threatening to take away a large demographic with tons of disposable income.  Apparently, Murdoch wants to bully Amazon until they agree to distribute content on exactly his terms.

Amazon may be forced to bow to News Corporation on this issue.  But if they decide to create a special agreement specifically for this publisher, it could open up the floodgates.  I could see other major media conglomerates trying to negotiate their individual revenue cuts, and threatening to take away vast swaths of content if they don’t get their way.

Newspapers going digital in 20 years, textbooks – by August, 2009

Two interesting pieces of news surfaced recently:

Rupert Murdoch, the chairman and chief executive of News Corporation, gave a speech on Sunday titled “The Future of Newspapers: Moving Beyond Dead Trees.” Here are some interesting excerpts from it, courtesy of The E&P Pub:

What we call newspapers today, I call ‘news organizations,’ journalistic enterprises, if you will.  They’re the source of news. And people will reach it if it’s done well, whether they do it on a Blackberry or Kindle or a PC.

I can see the day maybe 20 years away where you don’t actually have paper and ink and printing presses. I think it will take a long time and I think it’s a generational thing that is happening. But there’s no doubt that younger people are not picking up the traditional newspapers.

Personally I could bet that newspapers will stop using XV century technology sooner than 20 years from now in most of the industrial world. It will be the same story as with film cameras being replaced by digital. The new technology is going to become much cheaper and it is already more convenient to use. Personally I always hated to unfold and page though newspaper although I suspect Murdoch was referring to “younger people” who are younger than I am… Yes, Kindle may cost $359 or $489 today but lets not forget that in 1990 0.0768 megapixel black-and-white digital camera cost $1,000.

Over in California governor Arnold Schwarzenegger announced initiative to make digital textbooks for subjects such as geometry, algebra , trigonometry, calculus, physics, chemistry, biology, life science and earth science available to high-school students by August, 2009 when new school year begins.

Currently California is in the middle of financial crisis facing 24 billion dollar budget deficit. According to the official announcement with textbooks costing $75..100, a school district with 10,000 students can save up to 2 million dollars.

Official press release can be found here.

Arnold Schwarzenegger On Digital Textbooks

Arnold Schwarzenegger On Digital Textbooks

rupert-murdoch

Rupert Murdoch