State of the eBook: Is Apple Going to Own Content?

Only a few days away from the iPad release, and we still have many questions and very few answers. It seems like nothing can happen in the ebook world without everyone wondering if Apple’s cannonball into the bookstore pool is going to be a tidal wave or a tiny ripple.

First of all, even though almost every major publisher agreed to the agency model, Random House is holding out. Remember, Random House also owns the Alfred Knopf imprint. Their authors include Toni Morrison, John Updike, Cormac McCarthy, Alice Munro, Anne Rice, and way too many more to list. The regular Random House brand includes Ballantine Books, which, according to their site, has a backlist of over 3,000 titles. So not having their books in the iBookstore is going to leave a pretty big hole.

Teleread featured some thoughts on how it keeps Random House in the ebook game anyway, since Amazon and the other established players are likely to continue to do well. It really is a brilliant move from Random House, who have made it very clear they want nothing to do with the agency model Apple wants to use. As long as Apple doesn’t cut out every other ebook program from the iPad, RH books are still available. And they are a big enough publisher that if it turns out that iBooks are the only game in town, that big backlist of well known names is an excellent bargaining chip to get a better deal out of Apple.

Speaking of the agency model, it’s causing issues for publishers outside of Apple too. With these new contracts, it changes how everyone is being paid. Ingram is well known in the paper book business as a wholesaler, but they also work with ebook sellers to provide wholesale ebooks. Everyone has jumped with abandon onto this new agency model except Random House, and the chain reaction means they now need to rework how they pay Ingram. Amazing, isn’t it, publishers? You want to be in charge and be a retailer without any of the work, and it causes a whole mess of new negotiations and difficulties. No wonder Random House is holding out! (via Teleread)

Barnes & Noble and Kobo both pad their ebook store numbers with free books from Google Books, allowing them to declare they have over 1 million titles. Apple seems to be going a similar route, but instead of Google Books they are integrating access to Project Gutenberg. It’s nice they are doing this, but this isn’t big news; the Gutenberg library is available to anyone, on any ebook platform. All Apple is doing is making it easier than uploading it through iTunes. Maybe they are hoping the 30,000 Project Gutenberg titles will overshadow the missing Random House ones?

April 1st is more than just fool’s day. At Borders HQ in Ann Arbor, MI, it probably is circled in red with arrows and frowney faces on it. Borders has a huge outstanding loan from Pershing Square, and it has already been renegotiated three times. Unless someone comes rushing in with $42.5 million dollars they found under the couch, it isn’t looking good for B&N’s biggest rivals. Even if they survive this time, there’s a huge uphill battle coming. It’s obvious they are struggling, and as much as ebooks are great for the bottom line, realistically the Kobo/Borders mashup is only going to add a small percentage to their overall sales. It makes me really sad; Borders was my first job ever. Then, after graduating college I spent three years as a sales manager for them. While it isn’t time to eulogize them yet, it’s looking dicey for quite a while. Good thing they teamed with Kobo for their ebooks, since Kobo doesn’t seem to be going anywhere!

And that’s a quick roundup of the ebook news for this week. Obviously we will have more as we learn details of iPad apps from Kobo, Amazon, and Barnes and Noble, not to mention the wide world of ebooks outside the Apple-verse. Do you plan on buying an iPad? If so, will you be purchasing your books through iBooks or an existing store? Share your thoughts below!

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