A year or two ago, some experts were predicting that Amazon would junk the Kindle, and exit the hardware business entirely. Doesn’t look like that’s happening anytime soon.

Amazon’s new tablet can be a huge win for them, and some great competition for Apple’s iPad. If Amazon can deliver a simple, intuitive Android app store, Apple is going to have to rethink its pricing strategy with the iPad. This is starting to really make sense. The result: the sale of more apps, more Kindle books, and more of Amazon’s gazillion other products. No doubt this blows B&N’s Nook out of the water.

Amazon now has a Kindle lineup that starts at $79 and tops out at $199. Mr. Bezos is thanking the teams that made these devices and all of us for coming. Lights are back up. Let the competition begin.

10:53 A.M. Price of Fire

The Fire will cost $199, Mr. Bezos says. (Remember, the iPad starts at $499.) “We’re delivering premium products at non-premium prices,” Mr. Bezos says.

via Live Blogging the Amazon Tablet Announcement – NYTimes.com.

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A Netflix-like rental service for books via Amazon’s Kindle? I’ve always thought a subscription model made a lot of sense for the Kindle (or you get $200 worth of “free” books with the purchase of a Kindle, or make the hardware free if you agree to buy 20 books). It will be very challenging to get publishers to participate, though, so it will be a chicken-or-the-egg problem. Until Amazon can get the vast majority of publishers on board, the subscription won’t have a lot of value in the minds of consumers — they’ll complain “my favorite book isn’t available.” However, the ebook (mainly Kindle) got critical mass in terms of sales long before I predicted. So who knows?

The Kindle maker is trying to get book publishers to buy into a book rental service for digital content, reports the Wall Street Journal. But publishers aren’t excited, believing that such a Netflix-like service could lower the value of books and strain relationships with other book retailers. The service would charge customers a fixed monthly fee.

According to the WSJ, Amazon told publishers that the service would feature older titles. Publishers would also receive a “substantial fee” for participating.

via Tech Today: Amazon Digital Library, Book Prices Pressure Publishers – Digits – WSJ.

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This is worth a chuckle: An author is buying multiple copies of his book each day and reviewing it himself each time — and bragging about it, too. If he spend half of this energy working on a book, he might get somewhere. Apparently Amazon caught wind of this and deleted the phony reviews:

I’ve purchased my own book, Wealth Hazards, close to 200 times now. I wrote 42 customer reviews and voted on them 108 times. Not once was a review or vote rejected by Amazon. It took about 45 days to move the book up to #1, but after it got there I didn’t feel it was appropriate to promote it – so I have not profited from it. I continue to buy 2 or 3 copies a day, write reviews and vote on the reviews and wait for Amazon to notice.

via Author Claims To Manipulate Amazon Rankings By Buying Own Book Every Day.

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As I recall, it’s legal to “share” digital copyrighted material with up to eight people. So this isn’t really news, although I’m sure it will be a revelation to many. Amazon’s competitors have all touted the ability to “lend” e-books, to one degree or another. In an email to publishers this afternoon:

Dear Publisher,

We are excited to announce Kindle book lending (http://www.amazon.com/kindle-lending). The Kindle Book Lending feature allows users to lend digital books they have purchased through the Kindle Store to their friends and family. Each book may be lent once for a duration of 14 days and will not be readable by the lender during the loan period.

All DTP titles are enrolled in lending by default. For titles in the 35% royalty option, you may choose to opt out of lending by deselecting the checkbox under “Kindle Book Lending,” in the “Rights and Pricing” section of the title upload/edit process. You may not choose to opt out a title if it is included in the lending program of another sales or distribution channel. For more details, see section 5.2.2 of the Term and Conditions.

For more info on how Kindle Book Lending works, see our FAQ here: http://forums.digitaltextplatform.com/dtpforums/entry.jspa?externalID=581

Sincerely,
Amazon Digital Text Platform

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With no hard numbers to support his assertion, I don’t know how convincing this is: Russ Grandinetti, Amazon’s VP for Kindle content, claims that e-book publishers who have moved to the agency model and charge more than $9.99 per book are losing market share to publishers with lower prices. Have they? Many of the biggest publishers, who employ armies of bean counters, have decided the sweet spot for e-books is around $12.99. In my own experience with my small line of books, I couldn’t notice any impact on sales, whatever price I charged for Kindle editions. My sales continued at the same rates whether I charged 99 cents, $5, $10 or $15 for a book. Sure, I’ll go along with the idea that higher prices can slow sales. But on the other hand, higher price can enhance the perceived value of ebooks and paper books.

I can sympathize with Kindle owners who believe that Amazon promised to cap ebook prices at $9.99 for most books. The typical Kindle owner probably believes that Amazon has total control over the final price.

Publishers kicked up quite a fuss about digital book prices being too low. Can you actually grow the overall business by shrinking prices?We think digital books should cost somewhat less than their print counterparts. When we controlled the pricing, we built the business around $9.99. A small group of publishers have taken control of their pricing, and they’ve raised the prices. It’s not surprising that publishers who are raising prices are losing market share relative to publishers who decided to keep prices low. Customers aren’t stupid. Ultimately, the market will drive prices.

read more: LA Times: Amazon’s Kindle opens new chapter.

asdf

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Amazon’s Mobipocket subsidiary will stop enabling Mobi publishers to publish directly to the Kindle, according to an email sent to publishers today. The move is a practical one for publishers who want to take advantage of the 70 percent royalty rate on Kindle editions priced lower than $10:

Soon, publishing for distribution in the Kindle Store will no longer be available through Mobipocket.com.

Publishing and selling in the Mobipocket.com store and other Mobipocket partner retailers will not be affected, but the Digital Text Platform (DTP) will become the preferred path to publishing on Kindle. In the coming weeks, we would like to begin consolidating your titles into one location – DTP.

We’re writing to remind you about our earlier message, and to again offer assistance with moving your Mobipocket.com titles to DTP. By making the move, you’ll be able to take advantage of the new royalty options and great features available only on DTP.

You may already have a DTP account, but if not, please sign up today at http://dtp.amazon.com/

For more information about DTP, visit the welcome page for Mobipocket publishers (http://forums.digitaltextplatform.com/dtpforums/entry.jspa?externalID=381).

Once you’ve created an account, we ask that you log in to your Mobipocket account and follow the ‘Migrate to DTP’ link near the top of the page (https://www.mobipocket.com/ebookbase/en/publisher/dtp.asp

).  Here you will be prompted for your DTP email address, DTP publisher code, royalty option and confirmation that you accept DTP Terms and Conditions.

Your DTP publisher code can be found by logging in to DTP (https://dtp.amazon.com/) and clicking the ‘My Account’ link in the upper right. Your DTP publisher code will be located just under the FAQ section of the account page.  Copy and paste this code into the ‘Migrate to DTP’ page on Mobipocket.com

Once you’ve filled out the required fields, click ‘Start migration.’ This will add your account to the queue for migration, which should be complete within the next several weeks. You only need to submit your migration request once.

IMPORTANT: If you have any questions, please reply to this message using the email address to which it was sent. If you must reply from a separate email address, please note in your reply the email address to which this message was sent.

Thank you!

Amazon Mobipocket Publisher Relations

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Google is setting up a reporting and payment system for eBook sales. In an email last night, the company asked eBook publishers to provide bank account details, and promised to send deposits once per month for the previous month’s sales. (According to this publisher’s report, sales are already better than Apple’s iBookstore, but lag far behind Amazon’s Kindle edition sales):

Requirements

In order to receive payments, you must have a U.S. bank account. We will make payments in U.S. dollars to the bank account that you specify. At this time, we don’t offer any other payment methods.

To provide the details of your bank account for Google eBooks payments, follow these steps:

1. Sign in to your Partner Program account at https://books.google.com/partner.
2. Go to the My Account tab, then Payment Information.
3. In the Google Editions Payment Details section, click on add bank account.

Note that we currently use separate payment mechanisms for ads revenue and Google eBooks sales. Although you’re welcome to use the same bank account for both, the setup and payments for each will be separate. We’re working to integrate this process so it’s easier in the future.

Bank account verification

We’ll ask you to verify ownership of this account. The process works as follows:

1. Google will make the deposit within two business days after you add your bank account details. (Your bank may take up to three additional business days to register the transaction.)
2. Review your online bank statement or contact your bank to locate the deposit, which will be labeled GOOGLE DEPOSIT.
3. Sign in to your Partner Program account at https://books.google.com/partner/.
4. Click the My Account tab, then click Payment Information.
5. Click verify bank account.
6. Enter the deposit amount exactly as it appears in your bank account.
7. Click Verify deposit.

If you successfully locate the deposit in your bank account but experience difficulty confirming the amount in your Partner Program account, please contact us.

Should you sell any Google eBooks before your bank account is verified, your account will accrue the amount owed to you and be paid out once you’re eligible for payments.

Payment limits

Payments are limited to US$500 until you complete the credit verification process, which is separate from verifying your bank account. Your balance will reflect any amount we did not pay out to you due to this limit, and will be added to your next payment.

For credit verification, we ask you to provide either your Federal Tax Identification Number (also known as an Employer Identification Number, or EIN), or both your Social Security Number and a credit card number. To enter this information, follow these steps:

1. Sign in to your Program Partner account at https://books.google.com/partner.
2. Go to the My account tab, then Payment Information.
3. Under the Credit Verification section, click on verify credit.

Bank account updates

To update your bank account information for Google eBooks payments, please contact us. Note you’ll have to go through the deposit verification process again.

Payment schedule

Google’s obligations in paying your share of sales revenue can be found in the Google eBooks addendum that you signed. In many cases, Google will initiate a payment once each month, within two business days after the end of the previous calendar month, if we owe you at least US$1 and your bank account has been verified. This payment will be based on any financial transactions, such as sales, refunds, or chargebacks, which occurred during the previous calendar month.

Note that we don’t make payments on weekends or on bank holidays, and that it may take your bank up to three additional business days to register the payment in your account. To learn more about your bank’s turnaround time for electronically deposited funds, please contact your bank representative.

Payments lower than expected and negative balances

Payments are limited to US$500 until you complete the credit verification process, which is separate from verifying your bank account. Your balance will reflect any amount we did not pay out to you due to this limit, and will be added to your next payment.

Refunds and chargebacks may reduce the amount accrued by sales, and can cause a negative balance in your account if you don’t earn an equivalent or greater amount during that calendar month. Google will reconcile this balance by initiating a debit to your bank account.

Additionally, payments will only be made if your balance is at least US$1.00.

Reports

We will provide monthly reports of transactions with your Google eBooks in your Partner Program account. The report for the current month is updated every 24 hours with data on sales and revenue earned.

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QUESTION: I self-publish books through Lightning Source, and Amazon has always sold my books at a 10 percent discount off the suggested retail price. However, last week I noticed that my title is no longer discounted by Amazon. I offer a 20 percent wholesale discount through LSI, and even with this type of a “short” discount, Amazon typically discounted my titles by 10 percent. I contacted Amazon via e-mail and received this rather vague explanation of their pricing strategies:

Hello,

Our decision to discount books is based on a number of strategic considerations, which can vary over time. We cannot confirm when, if ever, a title will be discounted or for how long.

We have a team of people working to consistently improve our pricing model. We continue to do a significant amount of work in the area of pricing and are relentlessly focused on driving down prices.

It is possible that a future change in policy will result in a discount for your title. However, we are not going to discount your title at this time.

I hope this helps. We look forward to seeing you again soon.

Best regards,

[name deleted]

http://authors.amazon.com

I’ve also reached out to Lightning Source to see if they can shed any light on this situation. What is your take on the intent and potential impact?

ANSWER: Like you and most other LSI publishers, I’ve enjoyed the 10-percent discount on my titles for the past couple of years. But I’ve noticed in the past six months or so that pricing has become erratic. At various times, some books would have no discount, or perhaps a 1-percent discount or an 8 percent discount. Until now, I’ve assumed these changes were a glitch in Amazon’s system. Why did I believe this was merely a technical problem? Because I heard from two LSI publishers who claimed that when they notified Amazon of the “problem,” and that their titles were available at lower prices elsewhere, Amazon reinstated the discount. It’s a stated policy at Amazon: when a customer reports that a competing retailer has a lower price, Amazon matches the low price.

So, what’s going on? Has Amazon relaxed its pricing war on books and other merchandise? Is it a coincidence that just when Barnes & Noble seems to be mortally wounded, on the ropes financially and planning to close many stores, prices at Amazon rise?

Is this really a policy change at Amazon, or an elaborate experiment to determine how higher prices might depress sales? If anyone knows the sweet spot, it’s Amazon, and they’re not talking about it. It might be impossible for Amazon to know for sure — even with the higher prices, my December sales have been their strongest in about 18 months. But that’s probably due to increasing consumer confidence and stronger holiday sales this year, more than anything else. So much for the theory that Amazon’s Kindle killed the paperback. Many retailers are reporting strong sales this month, particularly books and music.

The LSI stocking and pricing situation over at Barnes &Noble’s Web site seems to be spotty now. So it would seem logical that BN.com is trying to cut its expenses to the bone, this is one result, and Amazon is taking advantage of the reduced competition. My recollection is that Amazon initiated the 10 percent discount on short-discount LSI books a couple of years ago, right after Barnes & Noble started discounting most LSI books by 10 percent. The price-cutting was matched very quickly over at Amazon.com.

On the other hand, I never really expected the 10 percent discount to last. I figured it was a happy accident in the first place. The really interesting thing to me is that B&N seems to have totally given up on challenging Amazon on price. Even the prices on the B&N Nook e-book editions are full price, at least the ones I’ve checked.

I just checked the prices of my titles at Amazon. Four have no discount, one title has a discount of 1 percent, and one has a discount of 15 percent. There’s no apparent rhyme or reason to the discounts — the bestselling book is one of the titles with no discount.

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QUESTION: Do you believe that sites such as Amazon that publish book reviews written by customers are as credible as print reviews by professional reviewers? Which would give an author more publicity, a good review on a site like Amazon.com, or from The New York Times?

ANSWER: No, most of the “amateur” reviews on Amazon don’t have the same degree of credibility as print reviews by professional reviewers. But, I believe the online reviews can have more impact on book sales than print reviews. And, let’s face it, the number of reviews on Amazon (and the number of reviews being read by book buyers) greatly outnumbers review consumption at the Times.

Not only are newspapers are devoting less space to book reviews, most newspaper book-review sections have been phased out in the past few years. At the same time, the market share of online booksellers like Amazon is increasing and, presumably, readership and impact of their customer book reviews.

The Times’ book review section reviews only a tiny sliver of the most notable books. Because of space restrictions, it must exclude whole categories of books, meaning that most books never have a chance of being reviewed. In addition, The Times has a policy of not reviewing self-published books, no matter what the quality or popularity of the book might be, which excludes an entire universe of books (and a rapidly expanding one).

Yes, a Times review would award more prestige than a typical five-star rave on Amazon. But I’d argue that a pattern of favorable customer reviews on Amazon can better support book sales, and can result in more people reading the book. Also, online reviews are preserved (they’re usually displayed for many years), while newspaper and magazine reviews are usually discarded after a short while.

By scanning several “amateur” book reviews, book buyers can get a quick idea of whether the book is one they’d like to read. This is the kind of information online book buyers are really looking for when making their purchasing decision — something that often isn’t apparent from a “professional” book review. I think there will be more of a fuzzy line between the “gatekeepers” of old (these are the people who publish print book reviews) — and the online reviewers who have a bigger impact. For example, Amazon has “Top Reviewers” whose reviews are displayed more prominently based on voting results from other Amazon customers. Also, there are many literary social networks — such as LibraryThing.com, GoodReads.com, Shelfari.com where amateur book reviewer can build a following nowadays.

LibraryThing and Goodreads have programs where authors can distribute complimentary review copies of their books (hard copies or e-books). The resulting reviews, or summaries of them, can eventually appear not only on these sites, but on blogs and shopping sites, including Amazon.

I don’t mean to discourage authors from seeking “traditional” book reviews. Authors should definitely try for all the big, traditional prepublication review outlets, like Library Journal, Publishers Weekly, and the remaining newspaper reviews. On the other hand, authors should be very cautious about paying for book reviews because they’re usually a waste of time and money. Book buyers rarely consult these types of reviews when making their buying decisions.

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From the Wall Street Journal. Nice article, but I got a chuckle out of the line, “most books sell only a few hundred thousand copies…”

The marketing world is drawing up plans to invade one of the last bastions of media that is largely advertising-free: books.

As e-books proliferate, advertisers are experimenting with ways to pitch to consumers while they read, a trend that could change the publishing business but faces opposition from some traditionalists.

Marketers are exploring a variety of formats, including sponsorships that give readers free books. Videos, graphics or text with an advertiser’s message that appear when a person first starts a book or along the border of the digital pages are also in the works. Ads can be targeted based on the book’s content and the demographic and profile information of the reader.

read more: E-books Entice as New Frontier for Ads – WSJ.com.

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