Publishers Embrace iPad As Rival To Kindle



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One of the applications built into Apple's iPad tablet computer is an e-book reader that will come integrated with the company's new iBooks app and store. At the iPad's unveiling Wednesday, Steve Jobs announced that five publishers — Simon & Schuster, Hachette Book Group, HarperCollins Publishers, Penguin, and Macmillan — had signed on to provide books to Apple's venture, with more to come.

Publishers are happy to have their products on the iPad's virtual shelves because partnering with a behemoth like Apple gives them the clout they need to counter Amazon's virtual monopoly on e-book sales. So it wasn't too surprising that most of the big publishing houses had struck a deal with Apple.

The technology itself was part of what attracted publishers to Apple. Unlike others' e-book readers, iBooks and the iPad can handle full color illustrations and photographs. Books may feature videos of author interviews, even lectures and links to other sites.

"Because of the technology being used, we can now show our color books, our illustrated books, cooking and photography titles which really isn't possible through the grayscales of an e-ink device," says David Young, the CEO of Hachette.

Price also figures into the arrangement. Like Amazon, Apple has a store where its e-books can be sold. But Amazon has set the price for e-books in its store at $9.99, which publishers felt was too low. Young says Hachette has worked out a deal with Apple that puts the pricing power back in the hands of the publishers. Under what is called the "agency model," the publisher will set the price for a book and Apple will take a commission.

"What we will get back is a better equilibrium," Young says. "There was no future at $9.99 other than ruin, so I am very glad there is this new device on the market that has enabled us to do something we have been contemplating for a number of months and discussing with our e-book retailers."

Many of the books available in Apple's store will carry a price tag between $12.99 and $14.99.

Random House, the only major publisher that did not make a deal with Apple, issued a statement saying it is continuing conversations with the company about how they might best work together.

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