By the end of this week, thousands of users will receive their iPad. Once they are able to fully enjoy and test their Apple Tablets to the fullest, the internet will be alive with analysis and reviews. Yet, even before its first delivery, the iPad continues to influence the design and implementation of e-books and magazines. Let’s take a look, shall we?
Random House Rejects Apple’s Agency Model
Apple’s agency model, through which publishers and Apple split sales 70/30 after publishers set the price, is not sitting well with Random House. The well known publisher has not struck a deal with Apple because the company is uncomfortable with Apple's agency model and fears the model will create a sort of price-war over eBooks.
Yet, apparently not many are too surprised by their hold out, admitting that there may be more to gain by going it alone rather than splitting revenue. Mike Shatzkin of the Idea Logical Company is among Random House’s supporters. He explains it like this:
Unlike the Kindle, which is purchased by consumers solely for the purpose of reading books, the iPad will attract customers for all manner of reasons and, actually, reading books would be pretty far down the list for most people.
By holding themselves out of the new channels, continuing the current policies of “wholesale” discounting, and allowing the retailers to set prices, Random House will be maximizing their short-term sales and profits.
Random House and Shatzin alike seem to be underestimating the impact of the iPad. Gartner has dubbed 2010 as the year of the e-reader and the International Digital Publishing Forum reported that wholesale sales of e-books increased 124 percent from the fourth quarter of 2008 to the second quarter of 2009.
Regardless, only time will soon tell if Apple lets Random House to stay wholesale or if Random House will be persuaded to adapt.
There’s no I in WePad
Random House isn’t the only one protesting iPad’s pricing model. In Germany, they have developed the WePad. Considered to be a rival of the iPad and the savior of the German print publishing industry.
Already, the WePad has secured Europe’s biggest publisher, Gruner + Jahr and will feature audio, video and Flash, and is also interwoven with the magazines’ websites.
The WePad comes after German publishers expressed their dissatisfaction with Apple’s pricing policy. Apple’s regulations will make it so that the iPhone version of Germany’s most important news magazine, Der Spiegel, will cost more than the print version. Its price will soon jump to €3.99, after the €2.99 introductory offer is over, while the paper sells for €3.80.
Smashwords Signs Deal with iPad
Big publishers aren’t the only ones signing deals with Apple iPad. Smaller publishing houses, including self-publishing networks are jumping on board.
Smashwords, a site that helps authors digitally publish their books for free, has signed a distribution deal with Apple to put its books into the iPad iBookstore.
The deal allows unpublished authors to sell their work on the Apple iPad at virtually no cost. To get books on the Apple store by launch day, Smashwords authors have to have their works submitted to Smashwords’ premium catalog by March 31. The book has to be in the EPUB format and have a big cover image.
Self-publishers may be in a better position than established publishers to take advantage of the exposure that the iPad is sure to bring.