Agency Pricing; The Great Leveller?

Publishers Lunch raised an interesting aspect of the new Agency Model yesterday. Their report claims that the new agency model will be applied equally to all, irrespective of size, channel whether they sell direct or indirect. The implication is that wholesalers such as Ingram will be treated no different to resellers such as Apple.Apparently, Ingram have sent a letter to some 65 retailers that the company serves alerting them that they will have to discontinue the availability of ebook titles from all publishers wishing to do business under an agency model and enter into new agency agreements.

In one move, major and minor ebook outlets could be effectively marginalised. The move means that wholesalers will have to move to the same agency model and terms as others such as Apple and Amazon and if they supply resellers they have to do so within the same agency share. Ingram expects to continue serving its ebook retail clients under the new agreements with publishers. However, they now expect to have to share the 30% agency commission with no movement.

So when some stand on their pulpits and say that the agency model makes it a level playing field for all, they appear to have forgotten the existing trade channel. So much for publishers supporting the existing channel and in enabling resellers to participate in ebooks and the digital world. This channel can’t afford to build the repositories to be independent and they rely heavily on the wholesaler model to supply them economically. Equally the wholesalers rely on the wholesaler model to justify their huge digital investments. Some would conclude that agency publishers only are focused on supporting the big digital channels and not in supporting the existing channels in a digital world.

We hope that in a few years time they don’t look around the digital lansdscape and wonder who killed to independent and medium chains and prohibited them from participating in the ebook market.

What do you want to call it?

Some of us have always struggled to see textural works as books or journals and remember the shock and horror of many when all works were first referred to as ‘product’ or worse still ‘stuff’. But the reality is that it is hard to keep these fine lines of definition when the works themselves are being digitally exploded. Books have always come in many formats, or renditions and often belong to a series or have associated works. Today there are now many more digital formats and as with training course packs and reference works, they are now also being fragmented within the works themselves. Journals were always broken down into issues and articles but in the online world the referential linking to supplemental information is very real.

Ingram Digital Group, and Swets, a leading worldwide subscription services company, have announced a joint initiative which combines the features of Ingram’s MyiLibrary and Swets offers, to provide organizations a single access interface to manage both their journal subscriptions and eBooks.

It is clearly a step forward in breaking down the demarcation barriers between subscription and purchased product and the article and book worlds. We also see others such as Cengage (previously Thomson Learning EMEA) starting to combine their article and book offers within services such as BizEd Premier. Others, such as in the travel sector, are starting to combine multimedia not as an afterthought, but into the original design and development. We are clearly entering the world of stuff or whatever we want to call it.