Following the publication of an open letter last Saturday where Macmillan's John Sargent revealed that Amazon had removed all of their books, Amazon has announced the return of Macmillan titles to their stores. The dispute came from a discussion with Amazon over e-book pricing, where Macmillan proposed a new "agency model" that will become effective in early March. Failure to conform to the new model would result in "extensive and deep windowing of titles", causing Amazon to respond to the model by taking off all of Macmillan's titles.
The proposed system works by having the retailers act as "agents" and letting them take a 30% cut, a common percentage in the digital world. E-books would be within the region of $15 to $6, with new releases hitting the virtual shelves the same day as physical counterparts at a price of $13-15. Currently, e-books cost closer to $10, but Macmillan is certain that their agency model solves an issue of long-term viability and stability of the digital marketplace.
Changing their initial position, Amazon has recognised in a response that Macmillan is one of the "big six" publishers and that they have a monopoly over their own titles. Instead, Amazon has left consumers alone to "decide for themselves whether they believe it's reasonable to pay $14.99 for a bestselling e-book."
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