Today on the Consumerist, there is an article detailing that 30% of books sold for the Kindle are now more than $9.99.
As a Kindle owner, I must say, that chaps my hide. I remember clearly that part of the sales tactics (though not guaranteed as a contract between me as the buyer and the company as the supplier, which is an important point) was the repeated statement that hardbacks were $9.99.
The article is scathing, and I can well understand why people are pissed off. Chris Walters mentions that publishers are the ones setting their own price points on ebooks, and many are attempting to do so between the price of the paperback and the price of the hardback.
Bullshit, I say. Bull. Shit.
As Jane pointed out in her most excellent article about epublishing, many users, myself included, would be in favor of paying more for ebook files that came with exclusive content and additional features. If an ebook is going to priced between paperback and hardback, yes, it should come with special double good bonus features, and a batch of chocolate fudge brownies besides.
But my question is this: what is the actual savings of ebook publication? More specifically, what’s the actual cost vs. paper? The Consumerist article lists the standard set of elements that are eliminated by ebook transmission, and Oprah herself advocated the sale of the Kindle based on lifetime usage savings because ebooks were, at the time, consistently less expensive.
While I certainly see the argument for savings in terms of gas, paper, transit, and storage and indirect costs of the bookseller/publisher industry, I also know that publishing, like every other industry in this economy except for those who manufacture piggy banks, is hurting and hurting bad.
Layoffs are everywhere, and folks fear for their jobs. So when Amazon and publishing houses are criticized because of the creeping cost of Kindle books way, way past the $9.99 range, I have to ask: has anyone quantified the actual savings of creating an ebook vs. creating a paper book?
The same individuals still work on the product: the writer, the editor, the editorial assistant, the copy editor, the production department folks, the art department. Is there a substantial savings over creating an ebook? Or is it similar in end cost before you enter in paper production costs simply because salaries and benefits are expensive, more expensive than gas, paper, and glue combined? Should paperback and ebook be similarly priced for that reason?
Without so much as a spreadsheet before me, I’m of the opinion that the price of books should be recalculated so that the cost of adequately compensating the individuals responsible for literary content production is the base cost, and then the addition costs of three-dimensional production should determine the cost of hardback, paperback or ebook. I’m guessing, with my vast years of experience in the book production industry (snrk), that the ebook copy would remain the lowest in price—but I could be wrong. Feel free to correct me on that one.
So I ask you: How much should an ebook version of a hardcover be in your opinion as a consumer? And if you’re in publishing or in the industry in one form or another, what’s your price point?
[Thanks to BEC for the link.]
I don’t buy very many e-books, because my only “e-reader” is my laptop. I have read quite a few free-e-books (my fave—thanks Baen and Tor!), and that led to me buying a few that were highly recommended (usually here or over at DA) and not available in print. Then the newest release by one of my favorite authors, Naomi Novik, came out in hardback, when the first four books in the series were paperbacks. Aaaargh! The set must match, dangit, but I cannot wait…. In that case, I found the e-book on sale, and I realized that the cost of the e-book plus the eventual paperback for my collection would be the same as the hardback alone. Sold!
In general, though, I’d say e-books don’t tempt me unless they are at or below the print price that’s available—including my Borders card discount and all that. They aren’t really much more convenient, since I don’t have a dedicated reader, and I agree with others here that they lose some value when you can’t pass them along when you’re done with them. (If my aunt hadn’t passed along all those Harlequin Presents during boring summer vacation at my grandparents’, I probably would never have become a romance reader!)
Ya know, I only looked up a a few authors at Amazon, but I don’t see that the Kindle prices are higher than the paper books. But then, I’m looking at romances only. All of them have been less $$ than the paper books. Even the hardcovers.
What’s the deal? Am I crazy?
Are they supposed to give them away?
FYI, from today’s edition of Shelf Awareness:
“Calvin Reid, still at PW, reports that Amazon.com plans to stop offering e-books in Microsoft Reader or Adobe e-formats and will offer e-books only in Kindle or Mobipocket formats. Amazon owns the Kindle and Mobipocket. “
I think they need to go back to the drawing board on the pricing model, for a couple of reasons.
First, there’s fairness to their early-adopter customers, who took a leap of faith partly because they were promised savings on books. It’s stupid to betray your early loyal customers when the idea of your product is so new.
Second, by pricing “hardback” higher, they seem to be going with some sort of theory that “hardback” equals “new release.” But book customers aren’t going to find that model familiar – books that are released originally in pback don’t suddenly get cheaper a year later. The paperback cover price is always the same.
Have any of the e-book companies experimented with a “rental” model, like Netflix? I don’t have an e-book reader, so I’m not sure how that would work, but that is how I would want to use an e-book. I don’t imagine myself keeping storage media full of used e-books.
Sometimes I think a subscription model may be where we are ultimately headed, especially once libraries are commonly “lending” e-books rather than paper books. An e-book can be replicated at no cost, so infinite copies of books could be “loaned.” But then how do the authors and publishers get paid? Perhaps royalties based on how often a book is borrowed?
I’ve also recently become aware of libraries “lending” e-books. If it’s copyable or keepable, there needs to be an arrangement like iTunes selling music. Otherwise it’s just theft from the authors. Heck, will everyone have the ability to download all books free at the library? Can they then keep them forever, trade, or resell them?
Exactly!!!! And ditto on the green issue! Personally, I’m all for using as little paper as possible and would be happy to read ebooks exclusively. I love technology!
But still, once the software is bought and downloaded and the files are converted and that person’s salary is paid, what exactly are ebook buyers paying for? Surely these few humans are not collectively making the same as hundreds of workers who are involved in the actual printing of the book. I swear I’m not being snarky. I could be totally off the mark on this. Help me understand if I am.
A question – why is the word “hardback” used in reference to ebooks? Is that the seller pulling us in with mind-control tricks to make us think we are getting such a great deal that we would be willing to pay just about anything to get that book?
One last thing. I think the Kindle is the ugliest piece of machinery ever and the price is ridiculous. I can stuff 8 megs of crap on my iPod nano and be entertained for hours and hours and nobody knows (ok, maybe a little snarky here).
Jude wrote: ‘Calvin Reid, still at PW, reports that Amazon.com plans to stop offering e-books in Microsoft Reader or Adobe e-formats and will offer e-books only in Kindle or Mobipocket formats. Amazon owns the Kindle and Mobipocket. “
This is old news and PW was sleeping at the wheel. Amazon quit selling these formats about 2 years ago.
Denni wrote: I’ve also recently become aware of libraries “lending” e-books.
Many of them use a technology that allows the file to be read for a certain period of time (say 3 weeks) and then its disabled.
Someone mentioned the formatting of ebooks – once the file file is ready (for the printer or the ebook formatter) it takes approximately 15-20 minutes per format. So for each book you’re looking at maybe 1.5 to 2 hours of work to create the 6 most popular formats. You can download Stanza for free and that program creates about 20 different formats. 🙂
Oops…that would be 8 gigs.
Denni, the library e-books do have copyright protection. The files automatically expire when the lending period is over and you can’t open them anymore.
I know a little about the library side.
The library purchases the e-books.
The borrower does not download it. When they check it out, the program simply moves it to a reading shelf where it stays for three days and then evaporates.
It is not copyable, printable or keepable.
As for e-book pricing, I think $6 is too high for an e-book, really. I download a lot from Project Gutenberg. The publishers I buy from top out around $6
I didn’t want to wait for a Kindle, so I decided to just get an iphone and use that as an ereader (yay, Stanza!). That has worked well for me, and I’m doubly glad now that I didn’t go with the Kindle. Even though, since my own books are epublished, I probably could’ve written the thing off…
After thinking about this whole price issue, I’d vote for the “ebooks have to be cheaper than print to produce” position, if only for the factor of incremental cost.
Think about it. Any publishing house has a web site, so you can’t really say that’s an additional expense the publisher wouldn’t incur anyway, these days. So that overhead is the same, print or e-publishing. Any publisher has editors, cover artists, etc., so that’s the same. But coding? You pay somebody clerical wages to do that stuff these days, it’s not really that highly specialized any more. I’d bet there are a lot more coders out there than people who know how to work printing equipment.
So the author submits the book (which, if you’re an epublisher, you’re probably already requiring in an electronic format following a particular template), the editor and author do their little dance back and forth a bit, and then that book gets coded into html and/or converted to pdf, mobipocket, etc.. That coding process happens ONE TIME. And then the book is stored, digitally, ONE TIME, taking up a fixed amount of space, with a link to the shopping cart that’s already in place. Even if it’s a big, graphic-intensive book of some sort, it’s a one-time cost. No further incremental cost for that book’s production, storage, or sale, whether you sell it once or a hundred thousand times. No remainders to deal with, even.
It’s price-gouging. And yeah, I admit, it ticks me off even though I opted for not-Kindle.
Security word: couldnt97 – it was so hard to type that without the apostrophe…
I’m getting my new Sony E-Reader pretty soon and I’m really excited about it. When I first started buying ebooks mostly to read on my computer when I was aboard, I shunned e-books that were close to same as the paperback, but all things considered it’s a fair price when you think about the fact that the books have to be formatted and stored. By selling ebooks, Amazon has to double if not triple their servers for storing not only the books, but the buyers purchases so they can redownload them. Then there’s also the “free” wi-fi. You need a team of people to constantly watch those servers to keep them from crashing and if they do crash to be able to back up every purchase ever made for the Kindle. With the Kindle becoming not just popular but Uber popular that means more servers and more people to monitor those servers. And then, what’s going to happen in couple of years when Amazon and Sony discover a new format for e-books that better?
But in answer to your question, I wouldn’t want to pay more than 12 dollars for an e-book even with a horrible economy.
Honestly, the cost of e-books is the main reason why I don’t buy an ebook reader. It’s just not worth it to me to spend $300.00+ on a reader and then have to pay the same price or close to it when I can go out buy a paperback version at the same price. I don’t have to worry about people stealing my paperback version or breaking it when I drop it. The convenience of an ebook reader makes me want one, but when I crunch the numbers, it’s just really not worth it to me, not if ebooks are going to be as expensive. I can’t imagine that it’s all that pricey to do. Even I, a relatively uneducated, lower middle class administrative assistant can turn a simple .doc file into a .lit or PDF in a matter of seconds, then anyone can do it. It’s not like they’d need to hire a bunch of specialized labor for it. A college kid will do it for 8 bucks an hour (or free if you want to call it a publishing internship.)
I just use my laptop for PDF and MSReader files. Not ideal, but it works all right for me right now. I like the idea of the Kindle, but device cost and some other issues (like DRM) have made me hold back. I refuse to pay more than the cost of a paperback for an ebook, and I expect it to be at least 10% less than the cost of one—and generally actually pay much less. For example, an ebook I recently bought from the pub cost $4.95, while the print version is $13.95.
My library contracts with NetLibrary for ebook viewing and lending, but they only currently have a collection of 198, all non-fiction self-help-ish books, almost every title in law or related (such as Represent Yourself in Court: How to Prepare & Try a Winning Case or Starting & Building a Nonprofit: A Practical Guide). Audiobooks and ebooks available for actual lending are available for 21 days, after which time they “cease to be playable and viewable.” I have inquired about fiction being made available, but the answer was not yet.
I have had an account with Ereader.com for many years. Previously used a Palm PDA before purchasing my IPhone. Love the convenience of being on the road and having several books with me without the bulk. Hate the limited selection offered. Thought about buying a Kindle, but I have an extensive bookshelf at Ereader that Kindle can’t access. Still buy hardback and some trade paperback. My e-book purchases are for the books I would have only purchased as paperbacks. I haven’t noticed a difference in pricing between e-books and their paper versions. Must be a Kindle/Amazon thing.
I’m a software industry professional, and I used to work in electronic publishing. (I saw some very, very early e-readers!) That was 8 years ago, so my knowledge is significantly out of date. Even so, I am finding it hard to grasp why publishers are claiming it is expensive to publish an e-book. Sure, creating the infrastructure is expensive. But after that’s established, where’s the money going?
When the Kindle first came out, an enterprising friend of mine grabbed some public domain documents (e.g. the U.S. Constitution) and packaged them up into kindle books. He made some sales. He was just a guy messing around at home, seeing what he could do. I know it’s not the same thing as publishing an original work, where you have to worry about editing, copyediting, cover art, and payment to the author. But I’m still having trouble understanding where the huge expense is coming from, when my friend cobbled together some e-books with hardly any difficulty at all, and no expense.
Why should they lower their prices as long as enough people are willing to pay the higher prices? Later, competition will undercut them enough that price wars will begin. When that happens with both readers and ebooks, that’s when I’ll consider buying a reader and ebooks.
Hayley,
I’m in Korea and I have a Sony PRS in shiny red and an Ebookwise Reader. Now I am an American citizen and I do have a US credit card which I believe you need to purchase books off the sony website. However, Fictionwise will take Paypal… and so if you know someone stateside who can buy and ship it to you, you might be able to work it out.
I got the Sony for Christmas and LOVE it. The irony is, I wanted a Kindle, so was initially disappointed with my Sony.
It took a few days for me to get past the whole this-isn’t-a-Kindle-so-I-can’t-possibly-like-it issue, but once common sense set in, I found myself forgetting it wasn’t a paperback, reaching up to turn the page while reading.
Yesterday I saw there was talk of a Kindle V2 and I was doubly glad I hadn’t gotten my Heart’s Desire. I’m annoyed with Amazon’s overly proprietary attitude and what I see as price gouging.
As for price, I don’t want to pay the same for an ebook as for a hardcover. I’d like a reward, even a small one, for being green. I’m Old Skool at heart about books and feel a twinge not to hold the tangible thing in my hands, to give up running my fingers over the silky face of a paperback and being able to flip the pages back and forth in order to skim text already read. I’m willing to adapt, mind, but think a small price reduction isn’t too much to ask.
I read my ebooks on my Palm T/X. What I like about it is that I can read pdf, mobi and ereader formats on my Palm so it depends on which format the book is available in as to which format I purchase. My two negative comments about the Palm T/X are: 1. I wish the screen was slightly bigger and I wish Adobe Digital Editions books were readable on the Palm.
I get extremely irritated about the inconsistent pricing and the inconsistent release dates and am no longer prepared to purchase ebooks that have an overinflated hardcover/trade price.
Do ebooks count in any way towards the NYT Bestsellers list?
Surely you there would be costs associated with print books that would not be associated with ebooks e.g ink and paper, distribution costs, production costs etc. The costs for servers, bandwidth, conversion etc wouldn’t be additional to the production of print books, they would be instead of those costs relating to the production of the physical book.
I would say the time spent and the people used in ebook production must be significantly less. You have maybe a team of two (three if you’re extremely excessive) pull the pdf and other file formats together… which is significantly less than those that would be needed to book layout, printing, and distribution. I think ebooks should be cheaper than paperback and universal DRM free file formats. Buying an ereader is expensive and until they can bring the cost of that down I don’t see how they can justify upping ebook prices. If the reader was cheaper, the ebooks could be higher. As it is I understand that the publishers suffer due to the price points on the readers at the moment, but if the publishers bought stock and funded the companies with the readers they would get some money back.
All I can say is that the more I hear, read and see about “e-book readers”, the less and less inclined I am to ever own one. Period.
non-spam word : costs92 I think that says it all on the subject.
I don’t have a reader. I read y e-books on my pc and it’s a pain in the ass. I want a reader that will work with my .pdfs.
I will not pay more than pb price for an e-book. True, most of the e-books I buy are not available in print, but I’d rather pass than pay more for it than I would for another book I’d like just as well from the bookstore. Start-up and maintenance costs aside, selling e-books has got to be less expensive than print runs.
While I am a day late, I would like to make a point. Web hosting (At least through the people I know) is between $10 and $100 a month depending on the size of the site. Two to four people can usually comfortably run a site once the initial setup is over. Most around here charge about $50 an hour to setup and any maintenance.
Now, let’s take Barnes & Noble for example. You have:
1)Property Costs-buying, building, taxes, upkeep
(1/4 to 1/2 million setup 5k+ yearly taxes
2)Employee Base-Between 2 and 10 people at any given time
3)Electric bill, Telephone bill, DSL/Internet (& Webhosting!!) bill
Seem to me like e-books should be at least the same as paperback, if not a dollar or so cheaper. I don’t think the e-book people should screw themselves over but there is no need for them to screw us either.
One point I haven’t seen anybody make directly is that the price difference between a traditional hardback and a paperback is probably not all in the production cost. I believe that publishers (and authors) do make a higher profit margin on hardbacks. Readers are paying to get the book right away. I am sure, at least in romance and mass market fiction, that the books that come out in hardback mostly have authors who get bigger advances (and more publicity) and these costs must be worked into the books price.
I do think that ebooks should be cheaper than than the paper version, but for new books that have been released in hardback I would bet that the publisher is depending on the extra money from the hardback to make the book profitable. I think it unrealistic to expect that a book released in hardback to sell for a pb price in ebook format.
That said—Amazon probably was deceptive in what it could realistically price hardback ebooks at.
I wonder if the pricing has been set up to cover the whole publishing spectrum.
For example, in restaurants, they have a higher profit margin on cheaper items so that they can afford a smaller profit margin on more expensive items. Like, you spend $10 on a breakfast that cost them $3 to produce, so that they can charge $23 for a steak that cost them $20 to produce. (Not real numbers, in case you’re pulling out your calculator. Just random guesses based on what I’ve been told is a real practice.)
Which is understandable, I guess, but if you’re the guy that only eats breakfast, you’re subsidizing the guy who only eats steak. Similarly, it used to be that long-distance phone calls subsidized cheap local lines, and now it seems to be the other way around.
And whatever the case, they’re certainly not presenting this price discrepancy in any way that’s palatable to the consumer. If an e-book is less than $1 cheaper than a paper book, that’s still enough of a difference to satisfy me psychologically, whereas charging more than a paper book just outrages and offends me.
I can tell you that selling through KINDLE is sort of rough because Amazon takes 65% per download. Of the $3.99 they charge for ‘Gadarene’, they make more off it then we do. I noticed this same trend with Diamond Distro and selling manga through them—they take a large percentage of the retail price, so pubs price high in order to offset their take and still pay whatever royalties are owed the creators.
I wanted tempted to raise the price of Gadarene so that CB Potts and I could get a little more out of it in terms of royalty, per download—but decided against it. We’re making more in print sales.
Wow. Seriously? Amazon takes 65%? If that’s so, then I think we need look no further for where the price gouging is coming from.
I noticed yesterday while checking out the app for the iTouch that Stanza’s (can’t remember who the actual seller is) prices are the same for paperbacks and trade paperbacks. Honestly, even as a writer, this pisses me off.
The 65% is one of the reason my publisher will not put her books up at Amazon Kindle.
Personally I prefer to pay up to $6 per ebook. If it’s more than that I think twice before making the purchase. If its the same price as the print copy I pick up the print one over the ebook.
—my bad. So I’m not accused of lying, I went back and checked my DTP account and noticed some changes.
As per 1/2009: “Provided you are not in breach of your obligations under this Agreement, we will pay you, for each Digital Book we sell, a royalty equal to thirty-five percent (35%) of the applicable Suggested Retail Price for such Digital Book, net of refunds, bad debt, and any taxes charged to a customer (including without limitation sales taxes) (a “Royalty”).
When I first signed on at Amazon’s DTP to sell Gadarene as a Kindle book, they were taking 65% per download and my first quarter sales report reflects this. I first priced it at $7.99 just to cover it. I noticed it wasn’t selling so I decided to lower the price to $4.99 and then we started selling about 2 downloads a month. Amazon reduced the price further to $3.99 – now I see why—since I don’t get a check for my royalties until they accrue $10, I’ve now noticed that the royalty amount has changed. Sadly, Kindle doesn’t make enough in sales for me to keep an eye on it.
Createspace also changed their royalty structure in the middle of last year, which was very beneficial to us when it came to Gadarene. I can’t imagine any eBook publisher not wanting to utilize their service for print editions of profitable books—it’s very rewarding.
Sorry – ‘they were taking’ means—THEY ARE TAKING.
The changes in TOS I pointed out are still lame, but they’re worded to make me feel better: as opposed to saying we get 65%, they felt that saying I get 35% just looks nicer. 🙂