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Comment by balloot | Hacker News Reader

This post is ridiculous. Amazon has spent billions upon billions of dollars building and maintaining a ridiculously efficient delivery system for electronic content. THAT is what the markup is paying for.

And from a common sense standpoint, if Amazon were really charging the crazy markup this guy claims, then some other company would mark up a mere 1000% or whatever and massively undercut Amazon's offering. Given that this hasn't happened, it is pretty safe to assume that the true costs are much higher than his math suggests. Either that or other companies have just ceded massive eBook profits to Amazon out of the goodness of their hearts. I'm going to guess it's the former.

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$3 to transmit 15 megabytes is fucking absurd, regardless of the delivery medium. Full stop, end of story.

It's not $3 to transmit a file. It's $3 to:

Design a great UX

Handle Credit Cards safely

Give you access to a robust infrastructure that won't crash

Market the site

Build and research a top quality e-Reader

Build data centers all around the world

etc etc etc

Bottom line is the guy made WAY more selling with Kindle/Amazon than with any other format, even given their large cut. That didn't just happen by magic. He is free to sell only with other vendors and make less money if Amazon's fees upset him so much.

and what is amazon's percentage cut of the price for?

No, it is indeed $3 to transmit a file. They even call it a "delivery fee". Consider that the percentage cut they take should cover all of the above.

I can get a physical pizza delivered for less than Amazon charges to send me an electronic file. That's just messed up.

Hell, I can get physical goods delivered, from Amazon, with 2 day shipping, for less than they charge to send an electronic file! And how much do you want to bet that the infrastructure involved in sending me physical goods is a lot more expensive and finicky than the infrastructure required to blast a file out over 3G?

If it bothers you so much, you are free to not use Amazon. It's not like they have a monopoly in the eReader market. What exactly am I missing here?

>you are free to not use Amazon

Much like I am also free to call bullshit when I see it.

Distribution platforms are not free, and Amazon is thought to sell the kindle at a loss.

No it is just a tiered pricing model. Either get 35% royalties and no delivery fee or get 70% and pay those very high fees. Almost all the things you include in the list apply to both pricing models.

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