Predictionsthat the move to an agency model would be messy have proven correct with themost serious consequence being the inability of Penguin and Amazon to reach anagreement over terms of sale. As a result, Penguin e-books released beginningtoday will not be available at the Kindle store. E-books released prior toApril 1 are still for sale at the $9.99 price.

In a letter toagents and authors, Penguin CEO David Shanks explained that Penguin has reachednew terms of sale agreements with a number of e-booksellers, but not Amazon.  "Our conversations with Amazon are ongoing and we do hope to continue ourlong-time relationship with them," Shanks said. Shanks notedthat new Penguin e-books "are available through Barnes and, Sony, Kobo,, readerapplications on the iPhone and soon on the iBookstore for the iPad. Additionally, we're working with our digital delivery partners (Ingram,Overdrive, and Baker & Taylor) to make your eBooks even more widelyavailable." He added the sales of print books are not affected by Amazon'sactions regarding new e-books.

Amazon has reached agencydeals with HarperCollins, Simon & Schuster and Hachette. Stil, late Wednesdaynight Hachette CEO David Young sent a letter to authors and agents warningthem of possible problems in moving from the traditional model to the agencyplan, but that he believed any issued could be resolved quickly.  In his letter, Young said Hachette has madearrangements with most of its e-book distributors to operate under the agencymodel. "However," Young said, "as with any transition, we expect there will bea few hiccups along the way, and you may even see some short-term interruptionin the availability of our eBooks, especially in the first few days, as systemsare being adapted to accommodate changes. We fully expect any such issues to beresolved within the first week, as we smooth out the new processes."  

In closing hisletter to agents and authors, Penguin's Shanks observed, "We want you to knowthat when it comes to digital publishing, your interests and ours arealigned.  As your publisher, our first and foremost concern is that weprotect the value of your books.  We appreciate your support. And, wetrust that you are as excited as we are at the opportunity to sell books in allformats and to invent new ones as well."