Amazon UK switches to Agency Model with 3 publishers

andrys.jpgAs mentioned here on Oct. 15, Amazon told its UK customers about its battles to avoid the ‘Agency Plan’ created by Apple with the larger publishers and that the latter would ‘require’ online booksellers to accept the plan to fix prices to be the same at all online stores (notably higher in most cases). See the recent story

for details of what Amazon said to its customers in a posting on the Kindle forums. The short version is:

Recently, you may have heard that a small group of UK publishers will require booksellers to adopt an “agency model” for selling e-books. Under this model, publishers set the consumer price for each e-book and require any bookseller to sell at that price. This is unlike the traditional wholesale model that’s been in place for decades, where booksellers set consumer prices.

It is indeed correct that this group of publishers will require Amazon and other UK booksellers to accept an agency model for e-books. We believe they will raise prices on e-books for consumers almost across the board. For a number of reasons, we think this is a damaging approach for readers, authors, booksellers and publishers alike. …

But Bookseller.com reports it’s come to pass in the U.K. now, also, with “publishers Hachette, HarperCollins and Penguin now setting their own e-book prices. Customers buying an e-book from the Kindle store from any of the three publishers are told: “This price was set by the publisher.” A Penguin spokesperson said: “I can confirm we are now on the agency model with Amazon as of today.”

Hachette, the leader of the 3 (or the one who required this first) switched to agency pricing in September. Bookseller says that Amazon is the first online e-bookseller to make the switch and that no Penguin or Hachette e-books are yet available for sale on either Waterstones.com or W H Smith’s website.

It seems they just withhold the e-books if the retailer refuses to go on the Agency plan. With Amazon, the customers tend to blame Amazon, as they did in the U.S., if the e-books are not in the store and many posted on forums they’d rather have a choice and pay more than not have access to the books at all or have to find them elsewhere. Most posted though that they didn’t intend to pay the publishers’ new higher prices, since they were often 50% higher.

The reaction in the UK’s forums is more angry than even what we saw in the U.S. forums. One book, Just After Sunset bought at under £5 the other day, was seen to be £17.99 today, a price shown as ‘set by the publisher’ as they decided to do in the U.S. (where some customers ignore it and still blame Amazon for the pricing). However, I just looked and they’re removed the price for the Kindle edition and haven’t replaced it yet. Also, Bookseller.com adds:

‘A small number of HarperCollins’ e-books are available at Waterstones.com and W H Smith, with a note from Waterstones.com indicating that loyalty card points do not now apply to e-book purchases.

It is believed that an issue over loyalty card payments was behind the removal of Hachette titles from sale at Waterstones.com when the publishers switched to agency in September, suggesting that the wrinkes [sic] in the transition may soon be ironed out across all booksellers who agree to the new terms. One retailer said: “It’s still a bit fluid. Everything is still being resolved.”

The only publishers who have signed up to the agency model but have yet to implement its pricing are Canongate, Macmillan and Simon & Schuster. ‘

Via Andrys Basten’s A Kindle World blog

2 Comments on Amazon UK switches to Agency Model with 3 publishers

  1. The UK must have some customer watchdog. I don’t know if the British Ombusmand is only allowed to defend the public against the administration, but in Spain the same title is allowed to defend the public against any abuses, whether public or private. Whoever does it, I sincerely hope these publishers get sued and forced to submit to the UK act that makes book prices free.

    Whatever politicians say, ebooks are still books and should be subject to the same regulations, including VAT, georestrictions and price fixing.

  2. I find it fascinating that in this day and age and with the technology available, old school distribution models for selling books are still trying to function in the same way as Brick and Mortal businesses. It is also interesting to see how Publishers are squeezing money out of readers, over and above that which was squeezed out of the Authors royalties.
    I believe that the publishers that treat the book industry as a growth business and not as an sustainable business will eventually fail.
    Already now, former Publishing professionals are creating intendant publishing businesses to sell books in all mediums from their own sites. These books are fresh and generally cheaper that mainstream books and the business can literal be run from a laptop with a internet connection.
    There also seems to be a growing trend in smaller independent Publishes that work with authors to get their books published in all mediums globally in a much shorter time and with far greater royalties for both the author and the Publishers, due to fewer overheads that the lager dinosaurs have to take care of.
    This growing model also allow writers to get their books published faster with out having to wait for the large publishing house to eventually publish a authors book. It is not uncommon for an new author to have to wait up to a year before her completed book is published.

    It would not surprise me if Amazon eventually become “better” Publisher that offers writers a better deal than existing publishers. (their current model for e-writers is just not good enough) All they need to do is hire the former employees of the big publishing houses and they will indeed have excellent products that are far cheaper than the large publishers.

    As far as income distribution and earning are concerned, there does seem to be some similarities between the Music Industry and the Publishing industry. If publishers treat their products in the same way the Music industry is treating artist recordings…..well we all can see how that ship is slowly sinking.

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