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Apple's rumored tablet may write next chapter in publishing

The tech giant hasn't announced that it will offer such a device, but the anticipation that it will do so this week has already caused a stir in the newspaper, book and magazine world.

January 25, 2010|By Dawn C. Chmielewski and Alex Pham

With Inc. charging $9.99 for electronic Kindle copies of the same new releases selling for $25 in hardcover, publishers recognize that they won't be able to maintain the pricing they've enjoyed for decades.

Apple's device could also present a new opportunity for publishers to counteract Amazon's mammoth influence over the book market and a new avenue for publishers to explore other ways to make money, such as selling individual chapters of a travel book or charging extra for videos that illustrate step-by-step guides in how-to books.

By going through Apple's iTunes store, publishers can take advantage of the millions of consumers who already use iTunes to buy an assortment of digital media such as music and movies. Publishers also like the ability to set their own retail prices; they have only to give Apple a 30% cut of the sale.

With Amazon, publishers receive 50% of a book's retail cover price, but the Seattle-based online merchant is free to charge whatever it wants -- a fact that has frustrated many publishers who fear the same price erosion that occurred in the music industry when albums began to be sold digitally.

Some analysts say the publishing industry's hopes that Apple will usher in a renaissance are overly optimistic.

Although Apple has proved its deftness at creating trendy devices and a digital store in which publishers could sell their wares, Gartner Inc. analyst Allen Weiner said there will be plenty of trial and error before newspaper, magazine and book publishers figure out the "fine art" of creating digital editions that take advantage of the device's graphics and video.

"Nobody's buying a tablet to read e-books. The lowest-end Sony Reader, which costs $199, does a fantastic job on reading books," Weiner said.

"Where's the opportunity? It's creating book experiences. It's taking a cookbook and adding video and author updates. That's an opportunity, because you can charge extra for that."


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