by Dan Moren
Bookshop CEO Andy Hunter talks Apple, Amazon, DRM, and more
Really interesting interview from The Verge’s Nilay Patel with Bookshop CEO Andy Hunter on a wide range of topics, including the company’s recently launched ebook initiative. They touch on DRM, the big players’ influences in digital reading, and more. Well worth a listen or a read if you’re interested in how the company works, and what Hunter sees as the challenges.
Here’s an interesting and somewhat unexpected take, for example, on the situation with Apple’s 30 percent cut:
And are you expressed as a website? Is there an app? I’m asking about the app because selling ebooks and digital goods on mobile phones is pretty tricky.
Yeah, we launched the app yesterday, and we do not support purchasing in the app. And the reason for that is publishers say that resellers can get 30 percent margins when you sell an ebook. So the publisher gets 70 percent, you as a retailer get 30 percent. Now, if you sell it on the App Store, Apple says we get 30 percent. So that leaves 30 percent for Apple, 70 percent for the publisher. Now that’s 100 percent, so that leaves 0 percent for the bookstore. So you cannot sell ebooks in the app and make even a penny, it’s impossible. So there’s no choice but to circumvent the App Store purchasing and force customers to go to the website to buy the books, which is unfortunate because customers don’t understand that. They just think, “You built this dumb app and I can’t buy ebooks in it, why not?” So you’ve got to try to explain it to them.
I’d say what would be rational is if you were a reseller of a digital good that you would pay Apple 30 percent of the profit margin. Thirty percent of the margin would be reasonable, but by saying it’s a flat 30 percent whether or not you’re a reseller, it makes no sense because if your margins on the product are 30 percent and they take 30 percent, then it’s suddenly impossible to have an ebook app, which is why Kindle, you can’t buy the ebooks in the app either, why you can’t buy audiobooks on Spotify’s app, all of that.