The more I think about it, the more I realize there may be many winners in this battle - with Macmillan being fairly low on the list.
- Apple wins in two ways. First, they are garnering lots of publicity by the nature of proposing the agency-style relationship in the first place, and Steve Jobs clearly calculated comments post-special event about the price of books at Amazon coming up to parity with Apple, rather than vice-versa. Secondly, most of the negative reactions towards their pricing deals will have faded by the time orders are being accepted and reviews are being published for the iPad. Apple (allegedly) starts a fire storm over eBook pricing - and Amazon pays the price!
- HarperCollins - and many more publishers. Macmillan shoots first, Amazon blinks, and Harper (and presumably the other big publishers) follow suit to cut similar deals with nary an ill word against them. You can't blame other publishers for following the newly established model.
- Me! Look, I like $9.99 books just as much as you do - if I thought $1.99 could be done without hurting the authors and preventing the release of great new books I'd like that even more. But mostly, I like reading them electronically and I dislike waiting. If the choice is $25 in hardcover, $9.99 in eBook but wait 7 months or $15 in eBook immediately - I'll take the latter every time. People pay $10 to see a movie when they can rent it months later for half the price, why should books be any different.
- Kobo, Sony, Barnes and Noble and half a dozen other smaller eBookstores. Does anybody really think a startup like Kobo wants to pay $12 for a book and sell it for $9.99? Did anybody really think Barnes and Noble wants to sell eBooks for a $2 loss rather than sell a $24 copy in a physical store at a profit?
If you want to establish yourself in this industry, you probably need to realize that people know Amazon likes to sell books for ten bucks - and join with the ranks of seemingly "everybody but Sony" in matching that price. Sony's a special case anyway - until nook's are widely available, Sony is the only player with a large retail presence. You see their Readers in Best Buy, Sony Style, Borders and many other retail powerhouses.
Kobo in particular has a lot to gain. Once the branded offering with Borders is done and the Spring Design Alex ships, they'll have even greater mindshare and volume. They also are a company that wins no matter what - as long as Amazon loses. If Amazon starts ceding marketshare to B&N - well, Kobo works with their products. If Sony picks up some customers - Kobo again can be a viable source of eBooks. Pretty much every product that supports DRM and isn't from Amazon or Apple is going to be Kobo compatible, after all.