Penguin Has New eBook Pricing, and Random House Should Follow Shortly

Publishers Lunch

Mainstream media has been scrambling to come up with some kind of impact for consumers related to Judge Denise Cote's verdict against Apple handed down Wednesday morning, but for now there really isn't any. (For a refresher, we had looked in early June at what the government said it would want from Apple if they prevailed.)

Less noticed -- well, not noticed at all until this article, really -- is that retailers recently, finally, started to exercise their right to discount selected Penguin ebooks. Given how "consumers suffered in a variety of ways from [the] scheme to eliminate retail price competition and to raise e-book prices," as Judge Denise Cote told us yesterday, you would think the opportunity to save $1.95 on a new release Penguin ebook would be hailed from the rooftops. (Instead we have an "anecdotal and fragmentary" meme that "Amazon cuts back discounts.") By all indications Penguin is operating under Agency Lite, just like the other 4 settling publishers, listing on their own web site agency ebook prices that are being selectively discounted by retailers. The unanswered mystery -- as was the case with Macmillan -- is why the changeover took so long, since the original Federal settlement required Penguin to notify retailers of their right to terminate existing agency contracts by January 8 (in advance of the court's final approval and entry of judgment).

While we have not determined exactly when Penguin made the switch, it appears to be very recent -- within the last month or so certainly -- and Amazon.com still mistakenly displays their indication that "this price was set by the publisher" on Penguin titles, even though they are clearly selling some Penguin ebooks at discount. (Khaled Hosseini's new novel is $10.99; Meg Gardiner's novel and Jen Lancaster's  THE TAO OF MARTHA are both selling at Amazon for $11.04; THE FAULT IN OUR STARS is priced there at $9.78 -- and Penguin ebooks are discounted by other retailers now as well.)

The next important piece of consumer pricing news is that discounts on Random House's ebooks ought to follow shortly -- again, unless for some reason retailers elect to wait longer. Under the terms of the settlement, Penguin Random House (and thus Random House, too) has 30 days after the close of the merger, or the end of July, to "meet each...obligation" of the Federal settlement that applied to Penguin on its own. Penguin Random House spokesperson Stuart Applebaum confirms to PL that "Penguin Random House is subject to the consent decree" and says "we are taking all the requisite steps to comply with every aspect of the decree by July 31."