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Amazon and Hachette reach deal after months-long e-book pricing dispute: What does that mean for consumers?

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Paul Sakuma/AP

(Read caption) Amazon and Hachette have reached an agreement on e-book pricing, ending a bitter, six-month long battle between the two companies.

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One of the biggest battles in publishing is now over.

Two weeks before the critical holiday shopping season begins, Amazon and Hachette have announced that they have reached an agreement on e-book pricing, bringing an end to one of the most rancorous and long-lasting disputes in publishing in recent history.

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Though neither side gave details of the deal, a joint statement from the companies indicated that Hachette will now set prices on its e-books, a major sticking point in the dispute.

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“This is great news for writers,” said Michael Pietsch, Hachette’s chief executive, in a statement. “The new agreement will benefit Hachette authors for years to come. It gives Hachette enormous marketing capability with one of our most important bookselling partners.”

Amazon also expressed happiness with the settlement.

“We are pleased with this new agreement as it includes specific financial incentives for Hachette to deliver lower prices, which we believe will be a great win for readers and authors alike,” said David Naggar, an Amazon vice president that oversees the company’s Kindle e-reader division.

The agreement caps a bitter, six-month long battle between the two companies. As we explained in an earlier post on the issue, the dispute began in early May of 2014 and centered on e-book terms, including how e-books will be priced and how revenue will be split. Amazon accused Hachette of robbing consumers of lower prices, while Hachette accused Amazon of using authors as pawns in the dispute by threatening sales of Hachette authors' books.

Authors have complained of Amazon’s tactics in the dispute, including removing pre-order buttons, reducing discounts offered, and delaying shipment on Hachette titles.

The dispute wore on through several public campaigns and petitions from both sides. High-profile authors like Stephen King and Robert Caro got involved, criticizing what they saw as Amazon's strong-arm tactics, while independent authors said Amazon made it possible for them to publish work that would otherwise have gone unnoticed. The pricing war illustrated how much clout Amazon has in the publishing world.

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Now that the e-book pricing war is over, what does it mean for consumers ahead of the holiday season?

For starters, Amazon has said it will immediately resume "normal trading" of Hachette titles, as well as feature Hachette books prominently in its promotions, which means consumers should be able to find popular titles on Amazon that were once difficult to find or order, including books by influential authors like Robert Galbraith (a.k.a. JK Rowling), Stephen King, and James Patterson.

As for pricing, new terms will start in early 2015. However, since those terms have not been publicly released, little is known about how they will affect consumers. What we do know: Hachette, which now won control over pricing its own e-books, was seen as wanting to increase e-book prices, which indicates that prices on e-books may rise slightly. However, Amazon has said Hachette would get better terms when it “delivers lower prices for readers," which may encourage Hachette to keep prices low.

For now, it's safe to say the deal saved the 2014 holiday season for a lot of happy readers and writers.


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