Joe Wikert, the former general manager of O'Reilly Media, has a new opinion post up this morning. He's spent some time this past week thinking about Amazon's newly announced Kindle Matchbook program, and he is concerned:
MatchBook will only help erode the perceived value of ebooks. When the original Kindle launched in 2007 Amazon convinced us that ebooks should be $9.99 or less. MatchBook will now cause consumers to look at ebooks as a $2.99 (or less) throw-in or afterthought when you buy the print book. Publishers are already struggling to grow their ebook revenue fast enough to make up for their ongoing print revenue decline. What happens when there's even more downward price pressure like this, even as a bundle?
Here's what I think will happen: Amazon initially gave publishers the option to participate in MatchBook. Most didn't. Amazon moves forward with the MatchBook launch next month and they'll closely monitor the numbers. If the results shows Amazon could open this up to all ebooks without adding significantly to the company's overall quarterly financial loss, they'll announce a much broader version of MatchBook down the road, with our without publisher approval.
Based on what Amazon is doing right now I would say that Joe is mostly correct, in his prediction, but I am betting that it won't end up being as terrible as he makes it sound. I am basing that on Amazon and how they are running their other bundling program.
Amazon currently has a bundling program for audiobooks and ebooks. I posted about it in April, but it had been around for several months before I noticed.
I just checked, and at the moment this program offers Kindle ebook buyers the opportunity to add an Audible audiobook for $10 to $13 (normal retail is $26 to $45).
The price points are less varied than when I checked in April, and that suggests that Amazon has stopped experimenting with the program and set a plan for the future.
Update: I've been told told that I should have spent more time looking; the prices vary over a larger range than what I found. But that's okay because the basic point remains the same. Thanks, Brian!
Amazon is offering the bundle just like they sold $9.99 ebooks (not all titles are included). Only about half of the Stephen King titles I checked today offered a bundle, even though most had an audiobook listed.
If Amazon applies the same selection process to the ebooks included in the Kindle Matchbook program, then Joe's concerns are overblown. At best Amazon is going to offer a limited number of bundled ebooks, not "all ebooks" as Joe mentions.
It's much more likely that Amazon is going to use the program to selectively suggest ebook sales based on one's Amazon order history. I wouldn't be surprised if I started getting emails from Amazon telling me I can get a $3 Kindle edition of past paper books purchases. They'll be using it just like they used the $10 ebook - to tempt me into buying more ebooks.
And is that really such a bad thing?
The actual cost of selling that one extra copy is minimal, so why shouldn't it be used to push more ebook sales?