Dive Brief:
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E-book sales are falling at three big publishers that last year signed new deals with Amazon concerning pricing, but it’s still not clear exactly what’s going on within the industry.
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Some in the industry believe the drop in sales may have to do with a poor selection of titles, while others in publishing are saying the rise of e-book prices have discouraged customers from buying.
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The sales drop comes as new higher pricing at Amazon is kicking in under the new contracts with publishers. And sales of physical books have ticked up, though not enough to offset the drop in revenue from e-book sales.
Dive Insight:
A host of new distribution deals between Amazon and a number of publishers has been hard-won, with publishers sticking to their guns despite Amazon playing hardball last year.
Now it looks like publishers maybe should have been more careful of what they were wishing for; their drops in e-book revenues look very much to be due to the higher prices they fought for.
“Since book buyers expect the price of a Kindle e-book to be well under $9, once you get to over $10 consumers start to say, ‘Let me think about that,’” Peter Hildick-Smith, CEO of publishing research company Codex, told the Wall Street Journal.
In the absence of the tight-fisted control Amazon once had on e-book prices, the market will need time and experimentation to find the sweet spot in pricing that satisfies customers, doesn’t cannibalize physical-book sales at higher prices, and products sales and revenue for publishers and their distribution outlets. And consumers may just need time to adjust to a new normal.