Macmillan CEO Addresses eBook Pricing Dispute with Amazon

After a day of speculation and anonymously attributed claims, Macmillan CEO John Sargent confirmed that Amazon (AMZN) had stopped directly selling books by the publisher. “It is impossible to reach you all in the very limited timeframe we are working under, so I have sent this message in unorthodox form,” he wrote in a paid advertisement in Publishers Marketplace, addressed to “Macmillan authors/illustrators and the literary agent community.”

The story broke on Friday evening, as Amazon and Macmillan had a dispute over raising the standard eBook price from $9.99 to around $15. After negotiations ended in “impasse,” the online bookseller stopped directly selling Macmillan titles, only offering Macmillan books through outside vendors. The $9.99 price point has been a touchy subject all year. As we reported yesterday, a vocal contingent of Amazon customers are still encouraging others to boycott Kindle books that cost more than $9.99.

Here’s an excerpt from the Publishers Lunch ad: “Under the agency model, we will sell the digital editions of our books to consumers through our retailers. Our retailers will act as our agents and will take a 30% commission (the standard split today for many digital media businesses). The price will be set the price for each book individually. Our plan is to price the digital edition of most adult trade books in a price range from $14.99 to $5.99. At first release, concurrent with a hardcover, most titles will be priced between $14.99 and $12.99. E books will almost always appear day on date with the physical edition. Pricing will be dynamic over time.”