Sunday, July 10, 2011

What's going on with Apple and the ebook apps?

You might remember that back in February, Apple laid down the gauntlet for ebook sellers, insisting that all ebook reader apps needed to give Apple 30 percent commission on the price of any ebook purchased or read via the apps.  Since the ebook sellers themselves only get 30 percent commission, that would eliminate their profits, and thereby make it pointless for them to offer ebook reader apps at all.

Another requirement in Apple's announcement was to limit the selection of ebooks in the app to only a few thousand.  Barnes & Noble has millions of ebooks for sale on your site, so you can imagine how this would limit them.  Then, only those ebooks available for purchase via the app could actually be read in the app.

All of these limitations were blatant efforts to eliminate the competition iBooks was facing, or at least to make sure that Apple was making money off of the competition instead of their competitors.  It's especially disgusting when you consider that a year or so before iBooks came out, Steve Jobs was extremely negative about ebooks, saying that there wasn't a market for them and therefore he wasn't bothering.  When, lo and behold, it turned out there was a market for them, Jobs responded by trying to steal that market from his competitors who had, frankly, been smarter than him in anticipating the market's demands.

Apple set a June 30th deadline for all ebook sellers to change their apps.  (This was partly why I decided to buy a Nook a couple of months later — I love ebooks and wanted to make sure I'd still be able to read them.)  But apparently, they quietly changed their demands in June, probably because it became obvious that ebook sellers were going to call their bluff.  Their new policy eliminates the demand for a 30 percent commission, and instead requires that ebook sellers remove any buy buttons or links to their site from their apps — an attempt to make it harder for their customers to buy from them (still an attempt to redirect ebook buyers to iBooks).

So far, few apps have complied with Apple's new demands.  Articles on the subject question whether this will be the end of Kindle, and anticipate a showdown looming on the horizon.  Meanwhile, Borders has updated their app to comply, but their partner, Kobo, has not.  Neither Kindle nor Nook apps have been updated to comply (I have both).

I wonder what's going to happen with all of this.  Apple made too big a stink of this in February to back out gracefully, but I'm guessing that if Amazon, Barnes & Noble, and Kobo hold rank, Apple will most likely quietly give up, just like they did in June when they revised their demands.

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