Amazon and the eBook story

Amazon Kindle--- days numbered?Recent kindle releases have shown Amazon's eagerness to battle it out with Apple and Samsung on the tablet market. Amazon has released several tablet options to go along with its e-reader options in direct competition with Apple through its Kindle brand.
     These tablets have been compared endlessly through various media outlets and Apple fans have scoffed at the suggestion they could be even close to comparable on performance. Apple executives have seen otherwise and released the IPad mini to put Amazon on notice, despite Steve Jobs' earlier (negative) position on a smaller Ipad. As these three big companies compete on the tablet scene, Amazon has another industry sweating; namely the publishing industry.
     The publishing industry has traditionally been ruled by six publishing houses supplemented by several, smaller, independent publishers. Authors and literary agents have courted these publishers to get their books published and for everyone to get a slice of the pie. Publishing agents have taken a big slice of the pie but have had the ability to market and the power of product placement. With little to no effort, Amazon has moved into the publishing business and through its online store and its eBook developments has become the biggest player in the eBook industry. They currently sell 1.14 times as many eBooks as hard books through their online stores.    
     EBooks have distinct price advantages over your standard or hard back copy. They cost next to nothing to produce, can be loaded online instantly and the middle man can be avoided. Previously when authors wanted to self publish, then they were forced to employ a printing press and distribute themselves, not to mention cover art, editing, marketing and so on, all at the authors own cost. Now thanks to websites such as bookrix.com and smashwords.com, as well as publishers Barnes and Noble, Apple and Amazon, publishing is free and easy. It involves signing up for an account and loading up your manuscript. Thanks to social media, marketing is easier and once a publisher gets four stars, he can guarantee good sales. 

     Publishers have maintained their good standing through their contracts with their authors which guarantee them a portion of sales, whatever the format. They also have the trust of the market. Books published by publishing houses sell for over 10 dollars where-as self-published books sell for 2 or 3 dollars. The current market is flooded with self-published books and many of these books are under-edited, low quality and shorter than your standard published books. There are gems in there but they are hard to find. Low prices tend to be an indicator to the market of low quality. Consumers avoid books in lower price ranges with a üassion. Studies show that there is no difference in sales between a book priced at 2 dollars compared to 4 dollars. Books priced at over ten dollars (ie those from publishing houses) sell the most. The quality is higher and the trust is higher.

     Amazon is seeking to challenge this. Hidden in Amazon's latest tablet release is their next challenge to the publishing industry. Now with an Amazon prime membership, all kindle owners are also automatically able to use the Kindle Library. In the UK this costs forty-nine pounds but here in Germany it is only 29 euros. The E book library challenges the traditional library at every turn and beats it almost every time. Books come immediately and are returned automatically. You don't need a library card and you don't need to drive anywhere. Because books are returned automatically, there are none of those pesky return fees.
     At the moment it is restricted. You may borrow one book per month for an unlimited amount of time but only one book can be borrowed at a time. As soon as you borrow a new book, the old one is returned. If you choose big enough books then you may never have to pay for books again. For an avid reader like myself, one book a month is about 3 to few but it saves me buying that one book. Amazon is counting on thinking like that to get people like me to invest in a kindle. Amazon knows that kindle owners buy a significant amount more books than those who read hardcopies. More kindles mean more sales.
     Publishing houses are skeptical and slow to get on board. Many denied Amazon's initial attempt to get them on board and refused license only to find Amazon used their books anyway. All Amazon did was buy the books at retail and give them away for free, which legally they were entitled to do. Amazon has offered several publishers a trial and flat fees for their books to show them that this model can work but most have turned down the offer. Amazon will continue their aggressive strategy until publishers have no choice.

     Although the current model is small and one book a month is not quite what a library offers, Amazon no doubt has plans for expansion. I'm tipping the overall goal is a version of Netflix for books. A user pays system where for a monthly fee, books are available for free on a trade and exchange system. As we have seen with TV and movies (Netflix), most networks had no choice but to try and precede the internet's predisposition to piracy. Ebooks have avoided this aspect of the internet and if Amazon has its way, it will never likely be the problem it is for TV. In the process they have managed to not only grab a foothold in the tablet market, but to become a true force in both the publishing and distribution markets.


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