Amazon has been successful in making a long-term deal with the gigantic name in the publishing industry named Simon & Schuster. The hand-shakes are for printing and selling these e-book collections; confirmed by both companies to Mashable.
This latest news made many of the followers and investors a bit astonished because Amazon was trying by making every possible effort in getting a multi-year deal with the Hachette, another big giant in publishing of e-books. It has been observed that the consensus of both the companies was not resting on mutual grounds when it came to Price settlement of E-books.
The unexpected deal was first revealed by the Business insider.
Amazon’s representative reported mashable that, “we are very happy with this agreement, as it allows us to grow our business with Simon & Schuster and help their authors reach an ever-wider audience.” Above all, this coalition will certainly give an edge to Simon & Schuster to expand their targeted audience network and particularly give financial compensation to Simon & Schuster in distributing low priced books to the readers. The spokesman of Simon & Schuster also endorsed the news.
However, details have not yet come on to the screen but a memo issued by the Simon and Schuster Company to the writers in which it is stated that Amazon has agreed to back off from the provided deadlock wherein it demanded to sell e-books at $9.99.
"We are very happy with this agreement as it is economically advantageous for both Simon & Schuster and its authors, and maintains the author’s share of income generated from e-book sales," Reid wrote. "It addresses our mutual concerns about preserving the value of our intellectual property in the marketplace, as it is a return to a version of agency pricing that, with some limited exceptions, giving control of e-book pricing to Simon & Schuster, while providing us the flexibility to deliver great prices for readers."
They have formed a system called “Agency pricing” in which, the publisher will set the book price and Amazon will get a specific split over each book as being a merchant. This depicts that with the implementation of this system, Amazon will not have the rights to lower the prices of books in any special events according to their wish.
All of this generally means that Amazon does not have the ability to offer deep discounts on titles whenever it wishes (like on summer sales or winter bonanza.
Amazon embraces a great influence on the publishing industry accounts 67% of the E-book market share which is reflecting its strength over other distributors.
This contract will enhance the power of Amazon in entire industry to bargain with the publisher as per its terms and condition of distribution. The Amazon is highly recognized due to low cost E-books availability by giving ever lowest rate up to $9.99 and is claimed as best for every class of consumer in the market.