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December 16, 2011

As E-Book Readers Get Cheap, E-Books Get... More Expensive Than Books

I'm really thinking about getting a Kindle.

But lately I've made a couple of comparisons among books I was interested in. Among three books, one ebook was actually more expensive than the real, physical version of the book. (Or as I call it, the Material Download version.)

In the other two cases we're talking about a buck or two cheaper.

Publishers seem hostile to this technology. Hostile enough to try killing it off early.

The digital price increases are the result of a decision by the six biggest publishers to set their own consumer e-book prices, a move that effectively bars retailers from discounting their e-books without permission. No such agreement exists for printed books—where retailers are free to set their own prices. So while a best-selling e-book price is often less than half of the hardcover price, heavy discounting of the print version closes the gap. Industry executives say this new state of affairs may already be hurting e-book sales, which have skyrocketed over the past three years and are today 15% to 20% or more of major publishers' revenue.

"Some people who see $12.99 and $14.99 for e-books may find those prices a little expensive," says Scott Waxman, a literary agent and digital-books publisher.

Slublog writes:

You've got to love the backward thinking here. The cost of producing an e-book has got to be nothing compared to printing millions of hardcovers, so ebooks are the closest thing to pure profit that exists for everyone involved, but these publishers still feel the need to gouge and piss off customers. I loves me some capitalism, but hate what some industries do to it.

It's a dumb manner of pricing.

Let's say I accept that they are going to over-charge for an ebook. I do understand that. Prices are set not just by costs but by comparison to close alternatives. Since the close alternative here is a real book, I understand that the ebook price is going to be close-ish to real book price, even though the ebook costs practically zero to produce on the margins.

But the ebook really is much, much cheaper for publishers. They don't have to print books that they might never sell -- this is completely on-demand publishing. Furthermore, it is cost-free to actually produce a new unit. You don't even have to push a button; it's all automated.

Someone sends in real money, whether $12 or $15, and in return you send back $0. This is profitable.

But to me, this only makes sense if I'm saving, say, $5 on a $15 fat trade paperback, and $10 on a new $25 hardcover. I'll over-pay for content, but I do want a substantial discount to reflect the fact that I'm really saving the publisher printing, warehousing, and shipping costs. That's a lot of costs right there. It should be worth something to a publisher that I'm sparing them that. If they don't see it that way, then it just doesn't seem like a deal to me. I'd rather have the Material Download, then.

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posted by Ace at 12:41 PM

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