Anger at Kindle pricing victimizes ratings of new Turow bestseller
amazon.com
amazon.com
The take-away is that ink to dead trees is a small part of the cost of publishing a book. Personally I dont believe its only 12 cents. It appears to me that Amazon squeezes the cost of a print book and lets the publishers set the Kindle price.
According to "The Insider's Guide to Getting Published" (http://www.amazon.com/Insiders-Guide-Getting-Published-Manus...), a book that sells for $20 costs $2 to produce.
That book is a little dated (1996), but I'd be surprised if the cost structure has changed that much.
The book goes on to explain why it's difficult to make money in traditional publishing, even with those margins.
It appears to me that Amazon squeezes the cost of a print book and lets the publishers set the Kindle price.
Not sure about the former, but the latter is definitely true: http://www.nytimes.com/2010/02/01/technology/companies/01ama...
Of course, Amazon is partially at fault for combining different editions in the reviews.
I have been annoyed at how hard it is to compare different editions of computer books, for example, to decide whether to buy a newer edition or not.
These book reviews are different, though. People are giving 1 star reviews without having read the book, because they don't agree with the price. They are giving 1 star reviews for books that are not available on Kindle. They are not qualified to review the item because they have not used it. Whether or not the complaints are valid, the review section is the wrong venue for voicing them.
See also: http://www.joelonsoftware.com/articles/CamelsandRubberDuckie...
An ebook has less utility compared to a physical book; if I find an ebook entertaining or insightful I can't loan it to a friend or donate it. Because of that, I expect the price to be discounted by a few dollars. Since buying an iPad I've bought several Kindle ebooks and find them to be a fair price at ~$10 for a book that would cost $15 in dead-tree form.
When the price is the same as a physical copy, it's worth it to me to just get the physical book. Getting the book delivered instantly does not, in my mind, outweigh the technical limitations imposed on an ebook.
Looking at the prices, I would also feel Like as an ebook buyer, I'm either subsidizing the price of the physical version, which must cost more than $0.12 to manufacture and ship, or simply being charged a higher margin for the same (and in some cases lower fidelity) content.
The cost of producing an ebook is around 90% of the cost of producing a paper book. This only seems counter-intuitive until you realize that 70% of what you pay for a book is slurped down by the retail distribution channel, 10% goes to the author, 10% goes to the publisher, and 10% goes on production costs.
More here:
http://www.antipope.org/charlie/blog-static/2010/02/cmap-2-h...
If you have an Amazon-scale infrastructure, and you increase your physical book shipments by 10%, you need to cut down 10% more trees, hire close to 10% more guys in the warehouse, pay 10% more to UPS, etc.
For e-books, increasing shipments 10% increases the costs of the salary, infrastructure, etc. probably less than 0.1%.
As ebooks become more important, expect to see a lot of friction between publishers and the current dead-tree retail supply chain, not to mention their attempts to stay relevant (B&N's Nook, Amazon's Kindle). But it's not really going to get serious for another couple of years.
I will concede that there needs to be someone to run a storefront to sell the art, but his costs should be very, very small when the art is non-corporeal.
That's why I co-founded Fifobooks, which is a new DRM-free ebook marketplace, where authors:
- retain all the rights to their work
- maintain full editorial control
- set the price at which their ebooks are sold (and keep majority of the revenue)
- there is no fee to publish
At the same time, publishers can do something others can't: Provide an advance, something a lot of authors need to be able to write their books.
If a book costs 10x as much to produce or has 1/100th the sales as another book that has almost no effect on the overall pricing.
Unfortunately, consumers now expect books (and CDs and movies) to have flat, wholesale-style pricing. As if they were a commodity. Worse yet we have this bizarre hard back / paper back staged release process for books used to extract profit for in demand books. A model which doesn't work at all for ebooks.
I don't know what the answer is and I suspect that consumers may be too inflexible, at least in the near term, to allow for much price variability on ebooks. If that's the case then we may end up in a very bad situation for authors and new literature in general for a very long time.
I don't think a simplistic initial price premium is the answer to this problem but I also don't know what the answer is.
Sure the only people who regularly but hardbacks are early adopters but they don't see themselves as paying extra because they are early adopters they see themselves as paying extra because their buying a better quality hardback book. This is different from a tech early adopter who knows that they are paying extra for the same thing in order to have it first.
Yes it could work if people accepted it but I don't see people accepting it without there being something extra (maybe a forward from the author where the story only version of the book isn't released for a few weeks) that they can justify paying extra for.
For me personally, the ebook advantage value for fiction does not equal the advantage value for a paper book, at least not yet, so for me, the ebook would have to be cheaper.
I can imagine that for a reference book the equation might be different, though, at least using an e-book reader I'm happy with.
It's one of the reasons we don't apply DRM to our books as a matter of policy.
Everybody's heard about that practice where unsold books have their covers ripped off, & are just thrown away. The publishers handily put a notice about that in the front of the book.
If that doesn't make something a commodity, what does?
On top of everything else, everybody with a Kindle who's bought more than a couple books has noticed that over 30% of them have horrible, amateurish formatting & OCR/character replacement errors.
And on top of that, at least in the tech/nonfiction industry, publishers have drastically cut back resources & services offered to authors. O'Reilly, for example, wasn't planning on paying anyone to tech edit my book. They were hoping for volunteers, at a chapter apiece, instead of one person with a consistent viewpoint thru-out.
That screws authors and it screws readers even more.
As a person who did paid tech editing work for Que, Sams, McGraw-Hill & other publishers I can't even remember, I found this ludicrous. (And those publishers regularly told me I did the best work they ever had, which is saying something. Furthermore, I know most of my changes were never incorporated, probably because they "took too much time.")
Basically, publishers are shitting where they eat & are too stupid to realize it, or too terrified to admit it, and instead, they are crowing about how the "consumer" is stupid, horrible, no good, very bad, and just damned stubborn.