Amazon & Penguin Random House Ink New Deal on Book Sales
Things look promising for book lovers as according to Bloomberg, Amazon and Penguin Random House closed a deal on book sales, covering digital and physical book sales in the United States and the United Kingdom.
However, both were mum on specifying the starting date and length of the contract. The statement, released last Thursday by Sarah Gelman, who is spokesperson for Amazon, said that the contract deals and the pacts were "long-term agreements." The company did not mention any other terms.
Meanwhile, Penguin Random House Spokesperson, Stuart Applebaum, was non-committal other than saying that they are still in business with Amazon, and will continue all their retail partnerships.
Before this agreement, Amazon contracted a deal with four big publishers: (1) Simon & Schuster; (2) Macmillan Publishers; (3) Harper Collins Publishers, and (4) Hachette Book Group.
Last year, a harsh and time-consuming dispute happened between SCA's Hachette Book Group and Amazon, over e-books pricing as well as sharing of the revenues. A news agreement was signed by November, but only after Amazon blocked preordering of Hachette titles and initiated the delay in the shipment of some books.
Amazon was asking for discounts, reasoning that lower prices can increase sale volumes, bringing in more total income. But book publishers were not in favor of these discounts. Authors also opposed the tactics of Amazon by removing titles of their books from the web store during the dispute. Amazon was finally able to settle all of its major e-book disagreements with Penguin Random House.
Penguin Random House, with majority ownership by Bertelsmann SE & Co., appears to be the last of other major book publishers signing a new contract with Amazon.
Due to the escalating power of online retailers, negotiations all over the industry have become more controversial. The publishing industry has to adjust to changing business models as fewer readers buy print books, and more preferring digital titles.
Amazon dominates the market when it comes to e-book sales as it helped pioneer the industry with the introduction of the Kindle reading device in 2007. An agreement, reached by the publishers, allowed them to establish consumer prices of their digital books that included incentives for them to lower prices that are more affordable to consumers.
With the coming of summer, more new titles will be released from Amazon and Penguin Random House. Agreement of terms between publishers will go a long way for readers to lay their eyes on more books for lower prices.