• Steve

    Why Kobo can not compete in this market?

  • Kobo is in the UK, but their sales pale in comparison to Amazon.

  • Holger Ehling

    Weltbild (no “e”) went into receivership in early 2014 and is just reemerging with the loss of some 200 shops and loads of staff. It was always up there with Thalia and Hugendubel in terms of sales in Germany, but never was (and probably never will be) the EU’s largest bookseller.

  • InklingBooks

    So 95% of the UK ebook market dominated by a US company with a reputation for bullying publishers both large and small? Did the British government shut down its Competition and Markets Authority?

    All the CMA would need to do is look at what Amazon is paying authors and publishers to see that severe market abuse is taking place. For ebooks priced outside a narrow $7 window ($2.99-9.99) Amazon only pays 35% royalties to Apple’s 70%.

    Nor are authors and publishers the only ones being cheated. Amazon’s price-based royalty scheme forces prices up substantially both below and above that $7 window. Notice the difference for two very common types of books:

    Inexpensive Novels. If they’re priced at $0.99, the author and publisher will only earn about 35 cents per sale. But if they triple the price to $2.99, they earn six times as much or $2.10. is that tempting? Very. Consumers pay more.

    Textbooks whose limited sales mean they almost always have to be priced over $9.99. If a publisher cannot recoup the cost of a textbook selling it at $9.99 (70% royalty less a download fee) and earning about $7, then the publisher has to raise the price to over $20 to earn even a penny more.

    To give an illustration of the latter, imagine a nursing textbook that must earn $20 per sale to cover costs. To earn that $20 at a royalty rate of only 35% the publisher must price it at almost $58 on Amazon. And at that price for each copy sold, Amazon, which has done nothing to create the book, will pocket $37.70 while the publisher and author, who did all the work, only get $20.30. That’s monopoly price-setting. Heck, that’s more like robbery.

    Contrast that with Apple, which pays a flat 70% at all retail prices. To earn that $20 breakeven point, that nursing textbook only needs to be priced at a little under $28 on Apple. In a competitive market where Amazon has to compete with Apple, nursing students would be saving $30 on this textbook and others like it.

    That, incidentally, is why Amazon’s lawyers demand that authors and publishers not sell their books more cheaply elsewhere. Otherwise, that nursing textbook publisher could sell the book for $58 on Amazon and $28 on Apple, earning much the same from each sale. Amazon is not only driving up prices on its own stores, it forces them up on other bookstores. And with that 95% marketshare, publishers must obey Amazon’s demands.

    In short, Amazon’s market dominance lets it pay authors and publishers half what Apple pays and that in turn forces those authors and publishers to price their ebooks twice as high as they otherwise would.

    Unless the CMA is so stupid that it thinks that a market dominance that roughly doubles the price of ebooks at both the low end and the high end of the market isn’t hurting consumers, then the full weight of the CMA needs to come down on Amazon like a ton of bricks.

  • I knew the figure was high – but I didn’t realise it was that high!

    Amazon has the symbiosis between readers and books which can’t be matched by electronics manufacturers. B&N were the main competition – they should really have been like Pepsi and Coke – but I think that B&N made a few tactical errors along the way.

    Maybe they just didn’t have deep enough pockets. Whatever the reason, I find it hard to see anyone edging Amazon out in the foreseeable future.

    For every person who doesn’t want to get “tied in” to Kindle books, there are probably another half a dozen (maybe more based on your market share %age figure) drooling to get access to the Amazon content eco-system.

  • EReader61 .

    Bullying publishers big and small? More expensive textbooks because of Amazon? Amazon does “nothing to create the book and just pockets..”? Who are you kidding? Will things get better when Amazon has gone? Don’t think so. They made things better. For the readers and many authors. To counter them, one will have to do even better, no way around it. Since Amazon are around, availability, customer service and price have never been better.

    Regards, JPP

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