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Is J.K. Rowling Undercutting Her Pottermore Shop With Amazon Deal?

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Quoth the raven, "Pottermore."

In June of 2011, J.K. Rowling announced the forthcoming launch of Pottermore, a “unique online reading experience unlike any other.” The experiment will be an online community built around the Harry Potter series, peppered with unique content from Rowling as well as community-generated discussions among Harry Potter fans.

“The digital generation will be able to enjoy a safe, unique online reading experience built around the Harry Potter books,” said Rowling. And then, the rub: “It will also be the exclusive place to purchase digital audio books and, for the first time, eBooks of the Harry Potter series.”

But Pottermore hit some snags. Despite being originally slated to launch to the public in October of lat year, the site remains in private beta. According to a note on the Pottermore site, “Pottermore is currently only available to those who are part of the Beta. Pottermore will open to everyone in early April.”

This morning, Amazon announced more developments for Harry Potter fans – for the first time, the online retailer will be carrying the Harry Potter series in eBook form.

“For years our customers have loved reading Harry Potter books in print, and have made them the best-selling print book series on Amazon.com. We’re excited that Harry Potter fans worldwide are now able to read J.K. Rowling’s fantastic books on their Kindles and free Kindle reading apps,” said Amazon’s Russ Grandinetti, VP of Kindle Content in a statement. A great get for Amazon, to be sure, but one that doesn't exactly jive with Rowling's original statement of exclusivity.

A little poking around shows that Rowling isn't actually undermining her own effort, though -- at least not in a major way. In a rare turn for Amazon, customers attempting to buy Harry Potter books through Amazon.com will find themselves in a new world as they go to complete their payment. That world? You guessed it – Pottermore.

Unlike the still-shuttered main site, Pottermore’s shop is alive and well, selling eBooks and audio books for all digital platforms. The books sell for $7.99 (the first three books) and $9.99 (the last four) -- the same price as Amazon's listings. Of course, Amazon take a cut of sales through its site -- likely somewhere between 10% and 30% of each sale, according to the experts -- but that's a trade Rowling is willing to make for the publicity and information she stands to gain in return.

When you click on a Harry Potter title on Amazon.com, like Harry Potter and the Goblet of Fire, the usual “Buy for $9.99” button is replaced with a Pottermore-branded box inviting you to “Buy at Pottermore.” To do so, you’ll need to create a separate Pottermore account; prospective buyers are met with the following message:

“You are being redirected to the Pottermore Shop, the only place to buy the Harry Potter eBooks for your Amazon Kindle or free Kindle reading apps.

eBooks purchased will be accessible in your Kindle Library like any other Kindle book purchased from the Kindle Store.

Once you have selected your purchase, you will be asked to create or log into your existing Pottermore Shop account. You will then be able to link to your Amazon account and seamlessly send purchased titles to your Kindle Library, and to every Kindle and Kindle app registered to your account.”

Not a bad deal for Rowling. With each purchase, she’s driving fans to her soon-to-launch site, harvesting user information and hooking more readers. Though Rowling recently fell off of the Forbes Billionaires list, she probably won't sweat the percentage cut. And with a new novel on the horizon, an email list of Rowling readers is an invaluable asset.

Is Amazon’s deal for the Harry Potter franchise a good thing for the company, though? In short, yes. Having popular series like Harry Potter, Twilight, and The Hunger Games is essential for Amazon to drive adoption of its Kindle line of reading devices. Barnes and Noble has made similar concessions to bring the Potter eBooks to its digital shelves and Nook devices. As I’ve written before, Amazon must continue to successfully sell digital content in order to capitalize on its low-margin (and potentially no-margin) Kindle devices. The deal strikes me as a win/win, although some might disagree.

As of press time, the first five Harry Potter books are in the top ten on Amazon’s Kindle Store, alongside the insanely hot Hunger Games series and E L James’ racy novel, Fifty Shades of Grey.