NY Times: Amazon pulled books because Macmillan wants iBooks-style deal

More information has emerged about the Amazon/Macmillan spat I mentioned last night, in which Amazon pulled almost all Macmillan titles from its store. An update to the New York Times “Bits” blog article I originally linked adds that, according to the blogger’s colleague who spoke to someone at Macmillan:

Macmillan offered Amazon the opportunity to buy Kindle editions on the same “agency” model as it will sell e-books to Apple for the iPad. Under this model, the publisher sets the consumer book price and takes 70 percent of each sale, leaving 30 percent to the retailer. Macmillan said Amazon could continue to buy e-books under its current wholesale model, paying the publisher 50 percent of the hardcover list price while pricing the e-book at any level Amazon chooses, but that Macmillan would delay those e-book editions by seven months after hardcover release. Amazon’s removal of Macmillan titles on Friday appears to be a direct reaction to that.

The iPad is still months away, but already it seems to be making waves in the publishing industry.

It’s either agency, says Macmillan, or windowing. Given consumers’ anti-publisher reaction to the first windowed Kindle book, not to mention many consumers’ stated aversion to e-book prices higher than $9.99, I wonder if Macmillan is aware of the risk it is taking.

Meanwhile, Cory Doctorow over at BoingBoing calls both Macmillan’s and Amazon’s positions “farcical” for different reasons. He makes some good points: just because Amazon wants to keep e-book prices down to $9.99 does not mean it is the consumer’s friend, given the DRM and obnoxious licenses it slaps on its e-books.

However this squabble turns out, it will probably have big implications for the e-book industry. I don’t doubt that the rest of the big publishers are watching closely to see how it goes before they make their own moves.