Wednesday, April 18, 2012

Price-fixing settlement could mean cheaper e-books

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Big anti-trust lawsuits don't always produce results for the average consumer, but this latest one initiated by the Justice Department -- which alleges that publishers and e-book retailers have been colluding to keep the price of e-books high -- may actually bring real benefits for readers, and soon.

Three of the biggest publishers -- Hachette, Simon & Schuster, and HarperCollins -- have decided to settle without admitting wrongdoing, while Macmillan and Penguin are fighting it. The settlement proposed has to sit for 60 days before it can be accepted, but as soon as ?it takes effect, readers could see dramatic changes almost immediately.

For one thing, popular works will probably be offered for lower prices across the board. The previous de-facto floor price for new and popular books like "The Girl with the Dragon Tattoo" was $9.99, but the new agreement would allow booksellers like Amazon and Barnes & Noble to lower the price, bundle them with other books, or even give them away. There would still be restrictions; for instance, on the ways big companies like Amazon could sell the books at a loss. But booksellers would generally be much more empowered to make their own pricing decisions.

Paid Content describes some other potential changes in detail, and points out that the previous agreements froze out interesting pricing strategies like subscription models. Imagine paying $10 per month and getting all the books you can read, or subscribing to a specific author or genre without "buying" a single book.

Not every bookseller will be changing its pricing and strategies immediately, but chances are that if big movers like Amazon and these three initial publishers start the ball rolling, others will join in soon enough. Some have complained that the new model makes for even slimmer margins, giving big stores like Amazon even more advantage.

This looks increasingly like the start of a publishing revolution akin to what the music industry went through 10 years ago when iTunes took off. While that laid waste to many mainstays of the music biz, it did have a positive impact: consumers can now get more music for cheaper than ever.?The same may soon be said for books.

Devin Coldewey is a contributing writer for msnbc.com. His personal website is coldewey.cc.

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