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A US judge has ruled today that Apple conspired with publishers to fix the price of electronic books.
Manhattan Judge Denise Cote said the iPad maker “conspired to restrain trade”.
But Apple’s spokesman, Tom Neumayr, said Apple would appeal against the ruling and fight “false allegations”.
Five publishers that were originally named as defendants alongside Apple have already reached settlements, including Penguin.
The judge ordered a new hearing to determine damages to be imposed on Apple.
The US Department of Justice said the conspiracy was designed to challenge online retailer Amazon’s dominance of the fast-growing e-books market.
Penguin settled its case for $75 million. Hachette, HarperCollins and Simon & Schuster created a $69m fund for refunds to consumers, while Macmillan settled for $26m.
Judge Cote said: “The plaintiffs have shown that the publisher defendants conspired with each other to eliminate retail price competition in order to raise e-book prices, and that Apple played a central role in facilitating and executing that conspiracy.”
“Without Apple’s orchestration of this conspiracy, it would not have succeeded as it did in the spring of 2010,” she said.
US Assistant Attorney General Bill Baer called the ruling “a victory for millions of consumers who choose to read books electronically”.
A US judge has ruled today that Apple conspired with publishers to fix the price of electronic books
He said the judge agreed with the Justice Department and 33 state attorneys general that executives at the highest levels of Apple orchestrated a conspiracy with five major publishers to raise prices.
“Through today’s court decision and previous settlements with five major publishers, consumers are again benefiting from retail price competition and paying less for their e-books,” Bill Baer said.
Consumer groups in the US cheered the news.
“If we let companies get away with this type of price fixing, consumers will be denied a substantial part of the benefits of the digital revolution,” said Dr. Mark Cooper of the Consumer Federation of America, which had filed a supporting brief in the case.
But after the ruling, Tom Neumayr insisted that Apple had brought innovation and competition to the market, not restricted it.
“Apple did not conspire to fix e-book pricing and we will continue to fight against these false accusations,” he said.
“We’ve done nothing wrong.”
Previously, Apple’s attorney, Orin Snyder, had told the court that Judge Denise Cote would set a “dangerous precedent” if she concluded that Apple manipulated e-book prices.
However, Columbia University law professor Scott Hemphill said today’s ruling was narrow and would be unlikely to set any legal precedent.
“It may send some signals to tech companies about what they can and can’t do,” said Prof. Scott Hemphill.
“But the precedential value is limited because the ruling is by a district court.”
However, he added that the judge in this case took particular pains to anticipate a challenge from Apple – something that chief executive Tim Cook hinted at earlier this year, when he dismissed the idea of a settlement.
Publisher Pearson announces agreement with German media group Bertelsmann to combine their Penguin and Random House businesses.
Under the terms of the deal, the two businesses will be run in a joint venture called Penguin Random House.
Bertelsmann will own 53% of the joint venture while Pearson will own 47%.
The two firms said last week that they were discussing a deal. A report at the weekend also said News Corporation was planning a bid for Penguin.
The Sunday Times reported that News Corp – which owns publisher HarperCollins – was prepared to make a “substantial cash offer” for Penguin, expected to be about $1.5 billion.
The tie-up between Penguin and Random House marks the first deal between the world’s big six publishers.
Publisher Pearson announces agreement with media group Bertelsmann to combine their Penguin and Random House businesses
When news of the talks emerged last week, industry observers said that such deals were inevitable as firms sought to adapt to the changing publishing landscape.
The rapid take-up of e-books means publishers are now attempting to bolster their negotiating strength. most notably with Amazon.
Pearson chief executive Marjorie Scardino, who is leaving the firm at the end of the year, said: “Penguin is a successful, highly-respected and much-loved part of Pearson. This combination with Random House… will greatly enhance its fortunes and its opportunities.
“Together, the two publishers will be able to share a large part of their costs, to invest more for their author and reader constituencies and to be more adventurous in trying new models in this exciting, fast-moving world of digital books and digital readers.”
Based on recent results, combining the two firms will create a business with annual revenues of about $3.8 billion.
In 2011, Random House’s revenues were 1.7 billion euros with an operating profit of 185 million euros. Meanwhile, Penguin recorded revenues of $1.5 billion and a $170 million operating profit.
The joint venture is subject to regulatory approval, but the two firms hope the deal will be completed in the second half of 2013.
Barnes & Noble is set to take on Amazon and Apple with two new versions of its Nook tablet unveiled today, joining an already crowded marketplace.
The new devices are a Nook HD tablet with a 7-inch screen, starting at $199, and a Nook HD+ with a new 9-inch screen, starting at $269.
In addition to new HD screens and a lighter body, Barnes & Noble is also increasing the services the Nook offers, adding a video purchase and rental service, allowing users to maintain different “profiles” and making it easier to browse titles in its book and magazine stores.
New York-based Barnes & Noble, the largest traditional U.S. bookseller, has invested heavily in its Nook e-reader and e-books.
Barnes and Noble CEO William Lynch unveils the new NOOK HD plus, left, and NOOK HD in New York
Barnes & Noble will continue to sell its smaller black-and-white e-reader, called the Nook Simple Touch, for $99, and a backlit Nook Simple Touch for $139.
The Nook HD runs on Google’s Android 4.0 system and includes Barnes & Noble’s own app store and browser. It is an upgrade to the hardware and services offered by its previous tablets, the Nook Tablet and Nook Color, which Barnes & Noble is phasing out.
However, Barnes & Noble faces a tough battle.
Seven out of every 10 tablets sold in the second quarter were iPads, according to IHS iSuppli.
Amazon.com has a 4.2% share of the tablet market, while Barnes & Noble has a 1.9%, according to iSuppli.
However, experts say the bookseller is in with a chance.
“If the decision the consumer is making is whether to buy based on hardware, these new Nooks will beat out Amazon,” said Forrester analyst James McQuivey.
“But that’s not the decision every consumer is going to make – hardware is only as good as the services the hardware enables.”
So far, Amazon offers more services, James McQuivey said, with a bigger app store, and more extensive video library, not to mention Amazon’s vast product offerings and its Amazon Prime free-shipping service.
In an attempt to measure up, Barnes & Noble is launching a video service that lets users buy and watch movies and TV shows on their mobile devices and televisions.
The offerings will come from major studios including HBO, Sony Pictures, Viacom and Warner Brothers. Scrapbook and catalog browsing features have also been added.
One wild card working in Barnes & Noble’s favor this holiday: Wal-Mart and Target, increasingly threatened by Amazon’s online retail operations, won’t carry the Kindle. The retailers will sell Barnes & Noble’s Nooks, as well as other tablets like the iPad.
“This is going to be a lot of fun to watch over the next year,” James McQuivey said.
The new Nooks are available for pre-order online and in stores beginning on Wednesday and will begin shipping in late October and begin arriving in stores in early November.
Novelist Richard Russo refuses to allow his new novel to be sold as an e-book.
Richard Russo, 62, said Interventions, a collection of four volumes, is a “tribute to the printed book” and would not be made available online.
The author, who won the Pulitzer Prize in 2002 with Empire Falls, said he wanted to encourage people to buy from local bookstores.
“Readers can’t survive on e-books alone,” he told the Associated Press.
“The rapid rise of e-books and online sales of printed books pose threats to bookstores, the book publishing industry and the rise of new authors,” he continued.
Interventions is a collaboration between Richard Russo, his artist daughter Kate Russo who provided its illustrations, and her husband Tom Butler who designed the collection.
Each features three short stories and a novella packaged in a slip case, with a postcard-sized print of one of Kate Russo’s paintings.
Novelist Richard Russo refuses to allow his new novel to be sold as an e-book
Richard Russo has enlisted Down East Books – a company located near his home in Camden, Maine – to publish Interventions, saying he wanted to promote “the idea of buying locally”.
“This particular book is part of that groundswell of people who are beginning to understand that buying all of your books through online booksellers is like buying everything from online sellers,” he explained.
Richard Russo, whose other novels include Bridge of Sighs and That Old Cape Magic, has spoken out against e-books and retail giant Amazon in the past.
In December last year he wrote a piece in the New York Times criticizing Amazon’s price-check app, which allows shoppers to scan a bar code in store and see how much they could save buying online.
Richard Russo said he was “fine with online booksellers” in general but added: “I just don’t want them to control the world.”
Earlier this year erotic novel Fifty Shades of Grey by E.L. James topped the New York Times’ prestigious bestseller list on downloads alone.
E.L. James’s book has now sold more than 10 million copies worldwide and was followed by two best-selling sequels.
Despite being an early fan of online publishing, Stephen King’s next horror story Joyland, out in June 2013, will only be released in book form.
Stephen King said he decided against an e-book because he “loved the paperbacks [he] grew up with as a kid”.
Richard Mollet, chief executive of the Publishers Association, said he was not sure Richard Russo’s decision was part of a larger trend.
“Most authors want to reach as many people as possible. Increasingly that does mean the electronic version,” he said.
“We had 366% growth in consumer e-books in 2011,” he added.
“The demand is rising.
“For the majority of authors they want to access that market. But if there are authors that don’t, then that’s fine too.”
US Department of Justice sues giant tech Apple and major publishers over pricing of e-books.
The US accuses Apple and book publishers Hachette, HarperCollins, Macmillan and Penguin of colluding on prices of books on the iPad.
This lawsuit is over the agency model where publishers set the prices of e-books, rather than sellers.
The lawsuit comes a day after Apple surpassed $600 billion in value.
The increase affirmed its position as the world’s most valuable firm.
The US accuses Apple and book publishers Hachette, HarperCollins, Macmillan and Penguin of colluding on prices of books on the iPad
“Apple facilitated the publisher defendants’ collective effort to end retail price competition by coordinating their transition to an agency model across all retailers,” according to papers filed in New York’s Sourthern District court on Wednesday morning.
Electronic books are sold according to a different formula from that governing the sales of physical books.
For most physical books publishers set a wholesale price, often about half the cover price, and then let a retailer decide how much they actually want to charge for the title.
This model was initially adopted for e-books but has since been changed for what is known as an agency model.
Under this scheme, publishers set the price of a book and the agent selling it gets a 30% cut. This model was adopted by publishers largely at the prompting of the late Steve Jobs.
The shift to agency pricing was also seen as a protective measure to head off attempts by Amazon to corner the market in e-books. It had been aggressively cutting prices to win customers over to its Kindle e-book reader.
Amazon once tried to apply the wholesale model on book publishers – but was rebuffed by the publishers.
[googlead tip=”vertical_mare” aliniat=”dreapta”] The books industry has been upended by the expansion of the e-books, and publishers are shifting in opposition to tradition by publishing paperbacks books edition earlier than regular, occasionally less than 6 months after the book came out in hardcover.
It used to be a strict schedule in the books business: first the hardcover edition was printed, and about 12 months after that, the paperback book was published.
E-books have made cost a challenge for publishers and they are considering the right time of a paperback book. There is often a big distance between the price of a fresh hardcover book and its e-book edition. The paperback book and e-book tend to be within a couple of dollars, rendering numerous publishers to speculate if cost-conscious buyers are reading e-books right away instead of waiting for the paperbacks books.
Hardcover book has been the publishing style of the first option for a long time. Authors want to make an impression with their books release, so hardcover is the initial selection when publishing. If a person favors a paperback, he or she will get the book after a long delay.
A hardcover is likely to age far more softly. Paperbacks split, wrinkle and discolor much more quickly. Some people love to have a nice-looking bookshelf. Hardback book is more likely to appear great and even as apposed to a wrinkly paperback book. Although the story contained in a book may be identical, some people will refuse to buy a book if it is not bound in their favored form.
Paperbacks books are generally less expensives than hardcovers. When the editor and author save money in the creation process, the discounts are transferred to the buyer.
Being able to effortlessly take a book with you is a great ease. Paperbacks are free of the extra weight and also free of the thickness of a hardcovers books.
Since the large, synchronised release of hardcover and electronic editions of a book currently gather the bulk of the attention the book is likely to get, letting the paperback book edition considerably in the back, publishers state they have a fresh sense of urgency with the paperback.
[googlead tip=”patrat_mare”] Last week involved the trade paperback release of “Swamplandia!”, a debut novel by Karen Russell, 5 months just after it was first printed in hardcover in February.
Anne Messitte, a publisher of Vintage/Anchor, said that when Vintage editors published the paperback of “Swamplandia!”, they chose July to capitalize on product sales to summertime travellers, who tend to favor fiction.
“It felt to us like a perfect summer paperback,” she stated about the book, that stories the imaginary ventures of a Florida family members threathened by alligators.
“The Tiger’s Wife,” a fictional book by Téa Obreht, that became available in hardcover in March, will be followed by the paperback book in October, 7 months later.
“Those Guys Have All the Fun: Inside the World of ESPN” by James Andrew Miller and Tom Shales, has hardly been in book shops two months, having showed up on May, and the paperback book edition is already planned for December. Therefore, nonfiction release has been sped up as well.
The entire publishing daily life routine has sped up in recent years. Hardcovers books have less time in book shops, due to the fact the merchants tend to shift them off the shelves more quickly than they used to.
“E-book sales are usually strong in the initial period after the publication date but do not spike again after the paperback comes out”, said Terry Adams, the digital and paperback publisher for Little, Brown & Company. [googlead tip=”lista_mare” aliniat=”dreapta”]
Terry Adams released the paperback of “Room,” a book by Emma Donoghue, 8 months after the hardcover book due to the fact hardcover product sales had slowed down but not ceased totally. “The momentum was there, and we wanted to capture the momentum for the paperback,” he said. “For books that rise to a certain level of visibility, you really want to ride the wave.”
However, there are still exceptions to the paperbacks books timetable. A number of publishers said that the 12 months delay was still being the principle for most books. If a book is selling quickly in hardcover, publishers tend to postpone on releasing a paperback book edition. Stieg Larsson’s 3rd book in the Millennium series, “The Girl Who Kicked the Hornet’s Nest,” has not yet been printed in paperback edition in the United States, more than 12 months following the hardcover book was released.