Amazon sidesteps battle over Dan Brown book

Amazon.com's Kindle may be the most-popular e-reader on the market, but that doesn't mean everyone is happy with it.

Amazon announced earlier this week that it will, in fact, sell a Kindle version of "Da Vinci Code" author Dan Brown's latest novel, "The Lost Symbol." The book is slated for release on September 15.

(Credit: Amazon.com)

The Kindle version of "The Lost Symbol" was in limbo since Amazon first placed the hardcover version on its site for preorder. Its publisher, Random House, was concerned with releasing a Kindle version on the same day as the hardcover version. The company reasoned that with such a low price ($9.99 on the Kindle) compared with the hardcover version, which Amazon is currently offering for $16.17, that Kindle sales would cannibalize hardcover sales.

Random House's issues set the stage for what could have been a major battle between Amazon and publishers. Dan Brown's book promises to be a bestseller the day it's released. Random House might have had some leverage.

But after entering into discussions with Amazon, Random House announced last week that it had approved a Kindle version.

"Now that all of our security and logistical issues surrounding the e-book of 'The Lost Symbol' have been resolved, the e-book will be released simultaneously with the hardcover on September 15," the publisher announced. It didn't elaborate on what those issues were.

Amazon followed up that statement with its own confirmation this week.

It's interesting that Amazon felt the need to write its own press release to announce the book's Kindle availability. It underlies the importance of Brown's book and perhaps of Amazon's desire to show other publishers that Random House is allowing one of the biggest books of the year to hit the Kindle at a reduced price on the same day it's offered as a hardcover in stores.

Stephen King's next book, "Under the Dome," which is slated for a November 10 release, could potentially challenge Kindle policy if its publisher, Simon & Schuster, decides to press the issue.

Publishers are wary of some aspects of the Kindle.

(Credit: Amazon)

Amazon will continue to face those discussions as long as publishers only worry about their hardcover sales. Publishers believe that if people can buy a book on the Kindle store for $10, they will have no reason to buy a hardcover version for $16--or more.

Amazon's troubles are quite similar to Apple's battles with the music industry. Publishers are set in their ways. They don't necessarily welcome e-books, and they're deathly afraid of Amazon building too much power in the space through both hardcover and Kindle sales. The larger the Kindle's following, the less leverage they will have, they believe.

Apple can relate. It has been forced to deal with a wary music industry since its iPod started becoming the dominant force in the industry. The music industry is scared of iTunes and Apple. Book publishers don't want to put themselves in the same position with the Kindle and Amazon.

But it's possible that they are. Random House has already backed down. Simon & Schuster is up next to challenge Amazon and its Kindle. It will be interesting to see whether it goes to battle or follows Random House's example.

In either case, its decision will set a precedent.

Disclosure: Simon & Schuster is owned by CBS. CNET News is published by CBS Interactive, a unit of CBS.

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[Remo_Williams]

Clearly, publishers do not understand new technology. Why would they want to spend money on paper, binding, machines, physical distribution when they can have just the pure profit from releasing an eBook? Rhetorical question, since it's clear they want to stop the future from happening by artificially protecting a dying business model.

[Renegade Knight]

In this case it's not about new technology. It's about maximizing the money. Their issue was concern over selling less hardcover books.

[ralfthedog]

Remember, the cost of publishing a book is very front loaded. Hardbacks cost more, not because it costs more to print a hard back but because they are paying off the cost of editing and promotion. Publishers don't like to sell e-books because people think they cost less to make so they want to pay less.

When a book has paid off all it's initial expenses publishers can crash the price of the e-version.

[ralfthedog]

From my perspective, e-books have more value. The kindle is easier to read. You can read it faster. It takes up less space. I like the ability to back up my books. It is also nice to take a few hundred books with me to the park. Cheep is better, however, I would not mind paying more for an e-book.

Just to be balanced, I have never ran out of charge on one of my paper books.

[gudin]

Right, the point is while they may sell fewer hardcover books, if they sell more ebooks and make more money as a result, who cares? It is very much like the music industry's inability to grasp the fact that electronic media is an opportunity for them, not a threat.

[MasterChefD]

It's simple sales forecasting and looking at margins. If they make more money per unit of hardcover versus per unit of ebook, then of course they want people to buy the hardcovers. But they are also worried about how cannibalization will affect total sales. I'm sure they did some kind of business analysis to consider these thing. Also, they most likely considered a longer time horizon and wider scope that expand beyond the new Dan Brown book. This is what most businesses try to do - maximize profit.

[epross]

Are there really enough Kindles out there to make a dent in national hardcover sales volumes? I don't know. It would have been nice if the estimated number of kindles was included in the story (and even so, not everyone with a Kindle will purchase this title) so the publisher's concerns over less hardcover sales are probably overblown, and perhaps they realized that and that's why they relented in the end. Still, it's time to embrace the future guys!

[MikeDson]

Ha would love to have been a fly on the wall for those negotiations. I reckon "The Lost Symbol" means a LOT more to Random House than it does to Amazon. Perhaps Jeff Bezos offered to alleviate Random's concerns by, say, just not selling the damn book at all.

[dd13reis]

Exactly. I think that's the problem these publishers have: they have zero leverage. Oh, you don't like the Kindle? OK, how about I don't sell your book on the hardcover side? Would you like that better?

It's a simple numbers game.

-Don

[darkebinary]

This just tells me the publishers are asking for an unrealistic margin on hardcover books. There's no printing, binding, and physical distribution required for the digital version. If they are upset about not selling as many hardcovers, they are obviously charging too much in the first place. It?s amazing how media companies act like children when they get their hand slapped out of the cookie jar. Instead of finding a new way of getting the cookie they stand there and cry until hoping someone will give them what they want. Next thing you know we'll have a RIAA type of mafia trying to protect their out of date business model.

[Eludium-Q36]

I'm actually surprised by the simul release. I thought this segment would adopt the theater-then-DVD model: let the hardcover sell for several months, then release the paperback and eBook versions.

[istill316]

Do publishers set Kindle book prices? Maybe they should. If the Kindle version of a new bestseller cost the same as a hardcover book, or very close ($15?), then there wouldn't be an issue.

Actually, they do. But given a 15 dollar ebook or 15 dollar hardcover, which would you buy?

[hawkeyeaz1]

The Ebook costs the publisher less because there is no printing or binding (or distributing for that matter), so they get more profit from the Ebook. Uh, hello, cannibalize the the hardcover sales.

[AnthonyNYC]

I agree that the e-book version costs the publishers less BUT if sales pick up on ebooks then who would need publishers in the future?
Writers would sell their future works directly online thus cutting publishers out of the loop completely.
After all publishers, publish. if there is no need for printing then no need for publishers so they are afraid of long term growth of the publishing businness in general I suspect.

[rpie123]

Correct me if I am wrong...but with Digital Rights the book can't be passed on. After I am done with a hard copy book I leave it in the lunch room for someone else to read. I will not do that with a kindle, so I suspect if they embrace ebooks this will mean more units in the long run.