Responding to an increasing amount of complaints, the Office of Fair Trading (OTF) launched an investigation into ebook prices. The agency says they are seeing whether certain publishers and retailers have made anticompetitive pricing deals.

The investigation is still in its early stages, so there’s not a lot of details. But it is being reported that the new agency pricing model is under the spotlight:

The OFT will not specify exactly what the investigation entails, but a report in the Wall Street Journal claims that it relates to the “agency pricing model” which sees publishers set the price of e-books, as opposed to retailers. This model is used by Amazon’s Kindle store and Apple’s iBooks store in partnership with publishers including HarperCollins and Penguin.

A similar investigation has been launched in the US by the Connecticut Attorney General last August.

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News Corp Launched their much anticipated e-newspaper ‘The Daily‘ that will be available exclusively on the iPad

Here’s something I haven’t considered: If Borders goes into bankruptcy oblivion, what happens to the ebooks in customer accounts from the Borders’ ebookstore? The question is further complicated by the growing use of the ‘agency model’, where publishers are allowed to set ebook prices rather than retailers.

If Borders goes belly-up, publishers could find themselves in a pickle. I found this post on Mike Cane’s blog that explains the problem:

Until Apple entered the picture and proposed the Agency Model, which allowed publishers to set their prices. The Agency Model changed the entire chain of liability. Publishers are saying, in effect,

Mark Coker, the founder of ebook publisher Smashwords, believes that ebook prices will drop. In an interview with eBookNewser Mark discusses the current ebook market, what publishers are doing wrong and where he sees ebook prices heading. He also heavily criticizes the new ‘agency model’ that publishers are seeking to implement.

The biggest unknown in the ebook world right now is the question of pricing. How much is too much? And how low can ebook prices go before the author and publisher lose money? Publishers continue to give the common line that ebooks still cost a lot of money to produce, therefore justifying a higher price:

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Brad’s Reader is changing! Starting today, this blog will focus exclusively on how digital technology is changing how we read, write and publish. I’ve been moving towards this niche for a while and I think it’s time to make it official.

In order to properly kick off this new direction, I’ve decided to let you, the reader, help me make the transition. I need a new tagline and I want to tap into the creative minds of all my readers out there on the intertubes.

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Amazon.com recently announced the Amazon Singles, ebooks that are between 30 and 90 pages that will be priced much lower than Amazon’s usual $9.99 ebook price point.

The new program allows authors who have not yet written a full-length novel to get their work out on Amazon’s huge publishing platform. In other words, it lets them test the waters. It also lets authors publish their shorter works which might not fit into any other category.

While authors will benefit greatly, Amazon will benefit the most in increased revenue and ebook market share.

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