Apple's latest gadget, the iPad is being marketed heavily as an eBook reader.  (Source: Apple)
Pricing is predicted to be very variable and in the $10-$15 range

Apple has been widely maligned as "selling out" and heralding the "death of eBooks" for agreeing to higher electronic book prices. traditionally bought eBooks wholesale for half the list price ($26 typically for hardcovers), then sold them to customers for $9.99, stomaching the approximately $3 loss per title.

Apple declined such a deal and since it has helped cause multiple publishers to demand new deals from Apple.  Among them are Rupert Murdoch's HarperCollins Books, Macmillan, and Hachette.  Mr. Murdoch personally cited the Apple deal as justification for demanding higher prices from Amazon.

However, new reports indicate that Apple's eBook prices may not be as consistently high as expected.  Apple CEO Steven P. Jobs had already announced that he had personally worked out deals with five of the six largest publishers -- Hachette Book Group, HarperCollins Publishers, Macmillan, the Penguin Group and Simon & Schuster.  

According to insiders knowledgeable about Apple's arrangement, the Cupertino electronics company will keep 30 percent of the sales revenue, and give publishers 70 percent (of which authors will get a cut).  The arrangement is identical to Apple's app store model.  Most new fiction and nonfiction will sell in the range of $12.99 to $14.99 (unlike Amazon's traditional $9.99).

More significantly, Apple insisted on inserting provisions that gave it flexibility to discount some bestsellers much lower -- possibly at $9.99 or lower.  Could Apple sell some of the most popular eBooks at prices lower than Amazon's traditional ones?  That remains to be seen.

It seems that where Amazon's deal gave its customers the broadest selection, Apple prefers flexible pricing on the handful of hottest titles.  The arrangement should also allow Apple to actually profit on some of its eBook sales (those at $14.99), while potentially selling other titles at the market's cheapest prices..  

Apple's iPad starts at $499, while Amazon's eBook reader, Kindle, starts at $259.  One key advantage Amazon currently holds is it uses E-Ink, which uses less power and reduces eyestrain.  Many have complained about the iPad's 10-hour estimated battery life and the fact that titles may be hard to read on the LCD screen.  However, that advantage may be erased as Amazon is reportedly contemplating replacing the Kindle with an LCD-equipped reader.

"My sex life is pretty good" -- Steve Jobs' random musings during the 2010 D8 conference

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