eBooks, Apple, Amazon and pricing

Given the recent US judgement against Apple in US courts for eBook price fixing, I figured my views would make a decent topic for another post here.

Firstly, some history.

When eBooks first started becoming mainstream (before iBooks was launched), eBooks were sold using the traditional “wholesale” pricing model. This model is the same as the one used to sell physical books everywhere. The publisher has a wholesale price they sell to retailers at, who are then free to determine their own pricing on their shelves – creating the situation where one retailer may have a book at $12.99, whilst another might have it at $11.99, with the wholesale cost being less than this cost (bookstores have storage, customer service etc overheads). It’s common for retailers to occasionally sell books as “loss leaders” – such things happen mostly with popular new releases – where the retailer chooses to sell the book below wholesale price (i.e. less than they paid) to encourage more people to visit the shop and spend more (due to feeling that they got a “good deal”).

The benefit of this pricing model is obvious – in theory market forces will lower the prices for the consumer by ensuring that there is competition between retailers, and new retailers can enter the ring to try and compete.

When Amazon first launched the Kindle the eBooks were sold with the wholesale model. However, Amazon sold every eBook as a “loss leader” in an attempt to sell more Kindles. They sold for $9.99, whilst being bought by Amazon for $13. Due to a combination of factors including Amazons (at the time) huge eBook market share – over 90% according to the WSJ; Publishers insistence on DRM causing consumer Lock-In; The possibility of Amazons pricing becoming ‘right’ (and thus a ‘loss for publishers); and the general tension between publishers and Amazon, Publishers wanted to raise eBook prices quickly. But with no major competitor their negotiation position was poor – at the time if they didn’t put eBooks on Amazon, their eBook sales would be decimated.

Enter Apple. Apple based its iBooks pricing on the model used in the iTunes Store – so called ‘Agency Pricing’. In this pricing model the publisher decides the retail price, and it has to be sold for that price – the retailer simply gets a percentage cut of that price (in Apples case, 30%). Suddenly the publishers could work with Apple to break Amazons stranglehold on the eBook market. Apple included a clause in the contract for the iBook Store that stated that eBooks must not be sold less elsewhere – i.e. if it was sold cheaper elsewhere then that price had to be used in the iBook Store as well. With these contracts in place the Publishers suddenly had a much stronger position to negotiate with Amazon.

For a short while Amazon held out – causing the infamous situation of an entire publishers catalogues becoming unavailable overnight. Eventually Amazon gave way and allowed publishers to use the Agency Pricing model on Kindle eBooks. Ebooks on Amazon now cost more than the old “wholesale” price due to collaboration between the major publishers and Apple. The seeds for the Price Fixing charge had been sown.

A couple of notes before moving in to my own opinions on the case. Some publishers are now experimenting with DRM-Free eBooks. The proliferation of alternative devices has meant that ePub is now the dominant standard for eBook formats – in all cases except Kindle which still uses the MobiPocket standard. Publishers also claim that physical production and transportation of a book is only a tiny fraction of a books cost.


Right, my own thoughts on this. It’s clear that Apple and the Publishers did break the law. They collaborated as a cartel to raise consumer prices. One of the few kinds of behaviour that is ‘per-se illegal’ (illegal in and of itself) is horizontal price fixing, that is fixing the price across an entire market. There is no defence in law.

That said, morally I’m not sure it’s wrong. The market back when the Agency model was introduced was heavily skewed in Amazons favour (and the publishers position was incredibly weak). They were a monopoly, and charging all ebooks as loss leaders meant it would be very hard for another store to break into the market, unless they could offer something above Amazons offering (which being cloudy is very seamless). If Apple hadn’t managed to break Amazons pricing structure its possible that their own eBook store wouldn’t have been anywhere nearly as successful – especially given there is a Kindle app for iOS. Yes consumers ended up paying more for eBooks – but for the convenience of having them anywhere and having hundreds in my pocket I’d be willing to pay a premium. That premium was, in my opinion, needed as a means of breaking up the market. I’d also argue that Amazon was abusing its dominant position by selling as a blanket loss leader.

It should be said however, that now that Apple has been forbidden from using the Agency model, I have no idea what is going to happen to eBook prices now. The public has become used to the near-retail prices of eBooks, I doubt that a switch to wholesale would see any decrease in price from Apple.

Finally as a disclaimer: I don’t like Amazon as a bookstore. I say this whilst having Amazon Prime, and having ordered books from them recently, and many over the years. Their attempts to become fully integrated vertically by becoming a direct publisher, their questionable practises of remotely wiping books from Kindles, and their sheer advantage of economies of scale disturbs me. When possible I buy from brick and mortar stores, but I must hold my hands up and say that I do still order from Amazon – particularly if I don’t have plans to go to the nearest bookshop within 24 hours. I’m very weak willed when it comes to book purchasing. It’s entirely plausible that this has tainted my own opinions, although I hope they still make logical sense without them.

On Gender and Sexuality

Ok, so here’s the thing. I’ve been trying to write this post for quite a while, but the words just don’t come out in any coherent manner. I intended to write a post explaining the concepts of Gender, chromosomal sex, and Sexuality. As this has not worked out what I shall instead do, I think, is include some useful videos/links etc that explain these concepts better than I ever could, with some comentary afterwards drawing out, what I feel are important quotes/themes

So firstly, a kind of 101 on all things related by the amazing Vlogbrothers

Some of the key ideas here are that sex and gender are two entirely separate things. Also, take note of the pronoun usage throughout – the pronoun is determined by the gender and not the sex.

And now I”ll include a genderbread person, which hopefully underlines that the combinations of the different traits – sexuality, gender, sex are infinite and a continuum, rather than just binary options.


An area that the vlogbrothers skimmed over, to the videos detriemnt is that of intersex people. These are people whose biological characteristics don’t match the two boxes we’ve seen. It may be a case that they have XY (tradiationally male) chromosones, but have female genitalia. Or they may have both genitalia, or even ‘just’ ambiguous genitalia. In all these cases it’s common for doctors to perform surgery on the baby/child (not all conditions are obvious at birth) to ‘fix’ them into one of the two roles they could fit in to.

To illustrate this, here’s a two part interview with a person who is intersex – they have XY chromosomes, and did have testes inside of them, whilst having outwardly female genitalia.

Some important things here- bodily automony and self determination. A person (including children) should be the only people to determine whether any surgery is done to their bodies. And a person is the only person who can determine their own identity, and choose their own labels (if any). Another concept is that the determinations people can make about their gender or sexuality can change over time, and that’s ok.

Another term in those videos was ‘cisgender’. All cisgender means is that basically your gender identity, and your physical sex characteristics all fit within one of the standard boxes of ‘male’ or ‘female’. It’s etymology is pretty much the exact opposite to ‘transgender’. Some cisgender people seem to have a problem with that term, but I simply ask, what other term could describe that particular alignment in a neutral way?

Another video now – one from a TEDx event that outlines some of the problems transgender people can face every single day.

There are a few things in this video that need to be highlighted – the first is the conflation of sexuality and gender. Breaking the gender roles as a child might mean your child is gay, or it might mean they’re transgender, or it might mean that they are a cisgendered heterosexual person. My point is that drawing conclusions about the signs after the facts seems easy, but is really very misleading, and no matter how your child interacts with gender roles, you shouldn’t assume it means anything about their sexuality or gender identity. Your child will tell you when they figure it out, and when they feel comfortable doing so. The important thing is to keep supporting them and loving them.

Another point mentioned is that of pronoun usage. It’s important to note that only the individual can decide which pronouns are acceptable for others to use. Some who fall outside the binary may even prefer something different to he or she – some prefer the use of Xir for example. Personally this next video, on the topic of gendered language sums up my thoughts on the matter of pronouns – although other trans people may disagree about the claim that ‘invented’ pronouns don’t really work.

A couple of things in this video – the use of ‘it’ is never never acceptable (well, there might be one trans person out there who is OK with it, but I have yet to find them). And they is a suitable gender-neutral alternative most of the time. Incidentally, I managed to remove my gender from Facebook via a bit of unfiltered input on their mobile site.

A common theme through this post has been that of ‘gender roles’. They’ve been mentioned in everything I’ve linked to so far. Gender Roles are the idea that ‘blue is for boys’, ‘women belong in the kitchen/at home’, ‘men are the breadwinners’ and ‘women care for the children’ and other such claims. We’ve already blasted through the very notion of ‘boy’ and ‘girl’ binary classifications, so let’s put a final nail in the coffin. ‘Blue is for boys’ is only recently true – in America for example through most of the 1900’s, boys wore pink more often. The entire notion of acceptable colours for boys and girls got turned on its head at some point. If that doesn’t show how the entire notion of objective gender roles is wrong, I don’t know what will.

So, there we have it. An introduction into gender, sex and sexuality and how they really have no relation to each other at all. Except what society tries to force onto people anyway.