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iPad Helping Book Publishers Gain More Control Over eBook Pricing
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I don't pretend to know anything about the business model or pricing schemes of the publishing world. But I think it is clear that if publishers go down this road they are going to end up in the same waters as the recording industry. I'm not really into the whole digital book thing anyway, so I'm obviously not the target audience, but I doubt that many people will be willing to pay the same price (or close to it) for a digital version of a book that they would pay for a bound edition that can sit on their bookshelves, that they can loan to a friend, etc. If there are no manufacturing, warehousing, and shipping costs associated with an ebook, why not pass that on to the consumers? At the very least, do it in the early days in order to seed the market.
You'd think that publishers would have learned from the recording and motion picture/television industries.
Also, what's to stop authors from self-publishing ebooks? Or maybe forming small authors' collectives for digital distribution? With all the social media tools at their disposal, word-of-mouth advertising can spread more quickly than ever. The day will soon come when large publishing houses just aren't needed in order for an author to get exposure.
You'd think that publishers would have learned from the recording and motion picture/television industries.
Also, what's to stop authors from self-publishing ebooks? Or maybe forming small authors' collectives for digital distribution? With all the social media tools at their disposal, word-of-mouth advertising can spread more quickly than ever. The day will soon come when large publishing houses just aren't needed in order for an author to get exposure.
Because those bookstores can't compete
I'm sorry, I can't be concerned about individual bookstores. As a consumer (and in the worst economic climate since the Great Depression), I want the lowest prices possible. Have you actually looked at Amazon's New York Bestseller list? Almost every hardcover costs less than $14.99.
What's worse, the only time you get to raise prices in a market is if you're raising them slightly to account for inflation. Nobody gets to come into a two-year old market where customers already have expectations about price and increase the price 50%. Not if they want to stay in business, that is.
This is going to decrease eBook sales, as it should. The greedy publishers should get exactly what's coming to them. Not only will I not buy another eBook until the prices return to $9.99, I'm going to encourage everyone I know to steal all the eBooks they can.
I'm sorry, I can't be concerned about individual bookstores. As a consumer (and in the worst economic climate since the Great Depression), I want the lowest prices possible. Have you actually looked at Amazon's New York Bestseller list? Almost every hardcover costs less than $14.99.
What's worse, the only time you get to raise prices in a market is if you're raising them slightly to account for inflation. Nobody gets to come into a two-year old market where customers already have expectations about price and increase the price 50%. Not if they want to stay in business, that is.
This is going to decrease eBook sales, as it should. The greedy publishers should get exactly what's coming to them. Not only will I not buy another eBook until the prices return to $9.99, I'm going to encourage everyone I know to steal all the eBooks they can.
I'll be buying fewer ebooks
I live in a rural area without a good bookstore so I buy many books from Amazon. Since the Kindle app came out, I've bought and read over 70 books on my IPhone but will think carefully about buying in the future with the higher prices. I can buy a handcover at Walmart for not much more than $14.99. Price and convenience were the two reasons I bought ebooks. If price is removed from the equation, I will probably wait now until the books I want are released in paperback and are cheaper.
The costs of producing an ebook are miniscule compared to the printing and distribution of a printed book so the only explanation for the higher prices is publisher greed. I'll bet the authors won't see any increase in their compensation.
I live in a rural area without a good bookstore so I buy many books from Amazon. Since the Kindle app came out, I've bought and read over 70 books on my IPhone but will think carefully about buying in the future with the higher prices. I can buy a handcover at Walmart for not much more than $14.99. Price and convenience were the two reasons I bought ebooks. If price is removed from the equation, I will probably wait now until the books I want are released in paperback and are cheaper.
The costs of producing an ebook are miniscule compared to the printing and distribution of a printed book so the only explanation for the higher prices is publisher greed. I'll bet the authors won't see any increase in their compensation.
Do you have a source? Two of my favorite authors stated that they won't see any extra money out of this, so it doesn't matter to them. I'm not doubting you (I know nothing about the workings of the publishing world) but I'm wondering if this was just an assumption on your part, or you actually knew that this meant more money for authors. I do know that A) Wont buy an iPad and B) Wont pay $15 bucks for an ebook.
Isn't Apple using the ePub format, and isn't it open? Couldn't you just view any of those downloaded eBooks using Stanza?
Exactly. How much are you willing to pay for a movie? Why can't the industry profit from books? You get much more hour per hour enjoyment from a good novel than a movie. And all the publishers are asking for a model that is sustainable to the industry. Putting more money in will bring more diversity.
It's like going to Walmart. Sure you'll get cheap prices but for what products? It's all very generic. Same as the flat 9.99 pricing. Not everyone wants to just read Dan Brown and James Patterson books. There are much more talented voices out there, which the publishers are not willing to take a risk on because of the current business model. The publishing industry is a dying industry as it. People, this is really good news for our collective culture.
Why in the world would you think Apple would or should "fight for the consumer"?! Apple is a corporation, with a fiduciary responsibility UNDER THE LAW to maximize profit for shareholders. EVERYTHING they do must further that goal. "Fighting for the consumer" is something for your local TV news activist.
Um, NO. If you think the publishers are going to use their new windfall to compensate the workers (writers), you are not familiar with the western capitalist model.
I am a diehard loyalist, I would not be purchasing e-books regularly lol. In fact the tablet needs to be much more IMO for me to look at it seriously. I need serious productivity, as do many who are staying away from this first installment of the ipad. Lol, still can't believe I'm calling this thing an ipad . . sheesh.
I am not talking about "individual" bookstores. I'm talking about Borders being on the verge of going out of business due to Amazon. Now you can argue that as a customer you're looking out to save money in these troubled economic times and we all understand that. But Amazon doesn't have the same costs involved to run retail bookstores. Borders, Barnes and Noble and Books a Million can't compete with their business model. If this trend continues we will all be buying books off Amazon and iBooks. Is this the world you want to live in?
Recently the last bookstore closed down in Laredo, Texas. Population 250,000. The story was on CNN's front page news: http://www.cnn.com/2010/LIVING/01/22/laredo.books/index.html
I wish people would read before commenting.
The publishers will get the same price out of this. What they're banning is Amazon's practice of selling books at a loss in order to promote the Kindle.
Amazon has had a philosophy of running at a loss since they started. The idea is to dominate the market and then take advantage of their monopoly power. I can see publishers not wanting that for the same reason music publishers hated Apple -- they feel that competition benefits them.
It's the same reason why some people hate Wal-Mart; they have too much power, and they CAN tell companies to move their operations to China. Wal-Mart has an effective monopoly because they can (thanks partly to deregulation) choose to drop one company and promote their competitor, which can kill many companies. And under the past CEO, they did that frequently, according to many accounts.
With regard to Amazon, they want to get an iTunes-like dominance over the market. No surprise there. If they have 80% of the ebook market, and the ebook market actually grows to the point of being something that's worth fighting over, then they can jack up their own profits and dictate terms. The publishers probably are looking two years into the future and seeing their profits fall then.
A lot of writers, by the way, dislike Amazon because they get much better royalties through local book stores. That said, others love Amazon because if you write a specialty book, it won't be sold in most book stores, and Amazon can end up being 90% of your sales...
I don't necessarily stand on one side or the other. I dislike seeing monopoly power used without constraint but I also like low prices. I generally use this thing called a "library" so I'm not a writer's best friend anyway. No ebooks for me anyway! Within reason I think it makes sense for resellers to be able to sell at a loss if they want to; supermarkets supposedly do it all the time (I worked in nonfoods, we ALWAYS made a profit, but the grocery people barely made a profit regardless). On the other hand, some companies control their resale price - Apple seems to, at least.
I can see publishers trying to avoid a concentration of power. I can see Amazon trying to make ebooks more popular through selective discounting. Though it reminds me of the pusher's trick - the first hit is free!
The publishers will get the same price out of this. What they're banning is Amazon's practice of selling books at a loss in order to promote the Kindle.
Amazon has had a philosophy of running at a loss since they started. The idea is to dominate the market and then take advantage of their monopoly power. I can see publishers not wanting that for the same reason music publishers hated Apple -- they feel that competition benefits them.
It's the same reason why some people hate Wal-Mart; they have too much power, and they CAN tell companies to move their operations to China. Wal-Mart has an effective monopoly because they can (thanks partly to deregulation) choose to drop one company and promote their competitor, which can kill many companies. And under the past CEO, they did that frequently, according to many accounts.
With regard to Amazon, they want to get an iTunes-like dominance over the market. No surprise there. If they have 80% of the ebook market, and the ebook market actually grows to the point of being something that's worth fighting over, then they can jack up their own profits and dictate terms. The publishers probably are looking two years into the future and seeing their profits fall then.
A lot of writers, by the way, dislike Amazon because they get much better royalties through local book stores. That said, others love Amazon because if you write a specialty book, it won't be sold in most book stores, and Amazon can end up being 90% of your sales...
I don't necessarily stand on one side or the other. I dislike seeing monopoly power used without constraint but I also like low prices. I generally use this thing called a "library" so I'm not a writer's best friend anyway. No ebooks for me anyway! Within reason I think it makes sense for resellers to be able to sell at a loss if they want to; supermarkets supposedly do it all the time (I worked in nonfoods, we ALWAYS made a profit, but the grocery people barely made a profit regardless). On the other hand, some companies control their resale price - Apple seems to, at least.
I can see publishers trying to avoid a concentration of power. I can see Amazon trying to make ebooks more popular through selective discounting. Though it reminds me of the pusher's trick - the first hit is free!
I'm in agreement. I highly doubt that authors are going to see a single penny more. This is really just an attempt by the large publishing houses to maintain control of the market. While I don't think they've learned the proper lessons from the recording industry, I think the one thing they did learn is that you don't want to have a single large digital distributor (Apple, in the case of music) come in and start to dictate pricing. Competition in the digital distribution world doesn't seem to work the same way it normally does. In digital distribution, you have several outlets competing for the same producer's work. In this case, Apple, B&N, and Amazon all competing for the goods coming out of the publishing houses. High demand, with a controlled supply.
Consumers, of course, make the ultimate choice in what they are and aren't willing to pay for a product. I think in the case of ebooks, filesharing won't be as big of an issue as it is for music, mainly because of the demographics involved. This just means that more people will buy bound books, which suits the publishing houses just as well - although I assume the profit margin on bound books is tighter than for digital ones.
I believe what is happening, is another entity, an agency, is going to be taking a cut so that the publishers will make a little profit on each sale. However the idea is that the agency will get the books into more hands in the long run so the publishers will make more money overall.
Why should publishers not be allowed to negotiate what price they can sell their products at? This is good for content creators, and honestly its still not that bad for consumers. You may have to pay a little extra, but people raise their prices all the time. Its called inflation.
And really, the people who will notice are Kindle readers, but the consumers using iPads won't know the difference so this will actually only affect Kindle users and some people using the Kindle app on the iPhone.
Why should publishers not be allowed to negotiate what price they can sell their products at? This is good for content creators, and honestly its still not that bad for consumers. You may have to pay a little extra, but people raise their prices all the time. Its called inflation.
And really, the people who will notice are Kindle readers, but the consumers using iPads won't know the difference so this will actually only affect Kindle users and some people using the Kindle app on the iPhone.
The story isn't reported correctly. Publishers are arguing for variable control over ebook pricing, not simply higher prices. This means that new, high demand just-out-in hardcover books would go for 12.99 - 14.99 as ebooks. These are books that, normally, would be selling for $20 - $25.
For backlist books in paperback, the price would be dropped significantly -- probably to $5-$6. This is the vast majority of books. Publishers want to play the market: high demand material gets premium pricing, low demand gets cheap pricing to spur sales. This is a logical way to price things, in my opinion.
Amazon wants to corner the market in ebooks and sell them at a loss in order to sell millions of Kindles. This is bad for everybody but Amazon. Once they dominate the market, they can charge whatever they like.
There's lots of good information on this situation, and it's worth it to be informed about this. Amazon does not have your best interests in mind.
Here are two:
http://whatever.scalzi.com/2010/01/30/a-quick-note-on-ebook-pricing/
http://whatever.scalzi.com/2010/02/01/all-the-many-ways-amazon-so-very-failed-the-weekend/
Disclaimer: I'm a novelist
Though it costs more now, competition is still good. Now publishers have an incentive to offer more and better material for the consumer, and as the market opens up, they will charge what their materials are worth. Prices for more and better things will go down at that point. It's never good to let one company, who is not producing the material, have total control over the material's value.
That is just an other of those decisions of the the "content" industry that will put another nail into their coffin. How can you be so short-sighted? They are trying to stop the digital tide, as the movie and record industry tried to and -in the most miserable way- failed.
The connection is clear: give people a reasonably priced offer (which would be the retail price of the book minus the costs for printing, distribution, ...) and they will buy it. Scam them off by releasing the digital versions later or too expensive or with DRM and they will laugh at your stupidity and go to The Pirate Bay and download them. It's a battle against your own customers, you just can't win that!
The connection is clear: give people a reasonably priced offer (which would be the retail price of the book minus the costs for printing, distribution, ...) and they will buy it. Scam them off by releasing the digital versions later or too expensive or with DRM and they will laugh at your stupidity and go to The Pirate Bay and download them. It's a battle against your own customers, you just can't win that!
Just read http://www.antipope.org/charlie/blog-static/2010/01/amazon-macmillan-an-outsiders.html which was posted by someone else. You really have to read that, too, before commenting. Apparently Apple is taking HALF the profit that Amazon is... and if you don't think the difference is coming out of writers' pockets... (okay, writers AND publishers.)
Writers get their royalties, normally, as a percentage of the publishers' gross, as I understand it. I might be wrong. Point is if they sell to Amazon for 30% of the normal price, they get 30% of the royalties - again as I understand it.
Apple's deal is kinder... and Amazon's "match" of Apple's deal requires exclusitivity, so that if you sign up for it and the iPad takes off, you can't go there.
Writers get their royalties, normally, as a percentage of the publishers' gross, as I understand it. I might be wrong. Point is if they sell to Amazon for 30% of the normal price, they get 30% of the royalties - again as I understand it.
Apple's deal is kinder... and Amazon's "match" of Apple's deal requires exclusitivity, so that if you sign up for it and the iPad takes off, you can't go there.
I am not surprised to be honest, I think I will just stick to paper books from Amazon
cheap as anything these days.
I can understand why book publishers are doing this though. Selling at a loss is probably not the best business model really ^^
I can understand why book publishers are doing this though. Selling at a loss is probably not the best business model really ^^
The widespread myth is that EVERY Kindle book is $9.99.
It isn't.
For popular titles, and new releases (NYT Bestsellers, etc.), they will price it at the $9.99 mark. But if you want to buy a Kindle edition of a technical book, or something not really that popular, you're going to pay more, but usually less than than the hardcopy version.
So, if you're going to use your iPad (or Kindle) to just read the newest, most popular titles, your cost per e-book just went up.
But, if you were going to use your iPad for textbooks or technical references, the pricing won't change much. You (usually) can't get a $100 chemistry textbook for $10 in a Kindle edition, and that won't change in the iPad.
But for the newer fiction, popular titles - yup, we just got screwed.
$12.99-$14.99 is a fair price
I know a lot of you would rather spend $9.99 on a bestseller. We all love to save money. I just don't think that number could be sustained for long. Not with competition. Amazon had already become essentially the iTunes of Books BEFORE Apple. It's a different world these days. The day Sony or Wal-Mart or Target open up a fantastic Music store that truly is competition for iTunes, it'll give music more leverage and prices will go up. Companies are more savvy about the digital world and cutting deals had to come with more compromise this time.
Up until now, Amazon ran the school yard. Apple moved into town and there's a new BMOC.
I think you guys are forgetting this price is for NEW BESTSELLERS. Most stuff is going to be $5-7. And a whole LOT of stuff will be FREE. Personally, I can't wait to read the Classics on a big beautiful iPad... for NOTHING.
Ever since music and Apple sticking to the 99¢/$9.99 model, big media industries have been sceptical of Apple having control of their content. I never thought Apple's video business would get off the ground. In the Book Space, there was already a consortium of publishers banding together to get content protected at what they considered a fair price. Different Market... we just don't know how or if that played any role in the current situation. Different set of rules.
$12.99-$14.99 is a fair price:
• Let them have Half: Bestseller books normally are around $30. The publishers want HALF (the same the music industry got for a $20 CD that sold for $9.99 on the iTunes store) -- however -- with Music: the difference is that in a PHYSICAL STORE, CDs stay at a much higher price for a longer period of time than a book does. When a book goes off the NYT bestsellers list, prices drop immediately. The publishers have less time to make most of their money AND ESPECIALLY when their digital downloads are priced at such that they're only serving to sell Kindles and cannibalize their own physical book sales.
Also, the song ala carte model is a benefit for the music industry that the book publisher does not enjoy. It's all or nothing with them. Also, Quality pays a big part of the game. The Music industry has got a model here that allows for better tracks to sell at a higher $1.29 price and the other filler music doesn't get bought until someone buys the Album, but eventually is technically valued and sold (even though it may be a lousy song). The author doesn't enjoy a chance to write crappy chapters and still get paid. It has to be quality throughout. Or it won't sell.
Ultimately, HALF is fair. Again, it's all or nothing.
• "Shake your Money-maker, Cormac McCarthy": Sex appeal and Image sell records. Books are sold not through jet-setting with bling & a nice ass, but through honest-to-god labor. Stephen King's unibrow never sold a copy. Writing is simply a harder craft in my opinion. You don't have tight jeans, a nice rack or a cone bra to fall back on to sell your work.
• It takes money to make money: Unlike music, which is just ran through a computer to poop out an AAC file, this whole digital book thing is now a visual experience. Publishers have the ability to add video to their books and make them interactive and really cool. But this is going to cost money.
True, the music industry now has iTunes LPs, but are probably not even on a fraction of a percent of all the albums sold on iTunes. Practically just an experiment at this point. Billions of songs have been downloaded without anything more than just album art attached to the file. We don't even get lyrics attached to every file, which I think is a crime. But because we've never had LPs until now, we're not used to a visual experience with our music. And mostly, we'll never use it. We'll do it a few times and then just listen to the music.
Books are different. Again, more difficult to produce I imagine than just setting up "256kbps AAC" and hitting a button.
Magazines will be even harder to produce and make money with the all the interactivity that people expect due to Times awesome Sports Illustrated video that came out a month or so ago. I doubt we'll see all that at first though. That video shows features you'd expect in a 3.0 or a 4.0 version. While we don't know what magazines will be yet, I imagine it'll be simply the 30-70 split Apple has seen success with; or a completely different model altogether. No one knows. Steve's still hammering it all out.
• You can't judge a book by it's cover: Lastly, it's a fair price because, let's face it, so many songs today (and I'm talking to you RAP) are being bought by the millions and they're just four letter words every few Crystal-fume breaths of the "artist" [termed used very loosely]) -- I just don't think music is judged with the scrutiny that a book is.
Steve Jobs has to tread lightly and be more accommodating this time around. Amazon is the incumbent. I think he hit a happy medium with the $13-15 model.
I know a lot of you would rather spend $9.99 on a bestseller. We all love to save money. I just don't think that number could be sustained for long. Not with competition. Amazon had already become essentially the iTunes of Books BEFORE Apple. It's a different world these days. The day Sony or Wal-Mart or Target open up a fantastic Music store that truly is competition for iTunes, it'll give music more leverage and prices will go up. Companies are more savvy about the digital world and cutting deals had to come with more compromise this time.
Up until now, Amazon ran the school yard. Apple moved into town and there's a new BMOC.
I think you guys are forgetting this price is for NEW BESTSELLERS. Most stuff is going to be $5-7. And a whole LOT of stuff will be FREE. Personally, I can't wait to read the Classics on a big beautiful iPad... for NOTHING.
Ever since music and Apple sticking to the 99¢/$9.99 model, big media industries have been sceptical of Apple having control of their content. I never thought Apple's video business would get off the ground. In the Book Space, there was already a consortium of publishers banding together to get content protected at what they considered a fair price. Different Market... we just don't know how or if that played any role in the current situation. Different set of rules.
$12.99-$14.99 is a fair price:
• Let them have Half: Bestseller books normally are around $30. The publishers want HALF (the same the music industry got for a $20 CD that sold for $9.99 on the iTunes store) -- however -- with Music: the difference is that in a PHYSICAL STORE, CDs stay at a much higher price for a longer period of time than a book does. When a book goes off the NYT bestsellers list, prices drop immediately. The publishers have less time to make most of their money AND ESPECIALLY when their digital downloads are priced at such that they're only serving to sell Kindles and cannibalize their own physical book sales.
Also, the song ala carte model is a benefit for the music industry that the book publisher does not enjoy. It's all or nothing with them. Also, Quality pays a big part of the game. The Music industry has got a model here that allows for better tracks to sell at a higher $1.29 price and the other filler music doesn't get bought until someone buys the Album, but eventually is technically valued and sold (even though it may be a lousy song). The author doesn't enjoy a chance to write crappy chapters and still get paid. It has to be quality throughout. Or it won't sell.
Ultimately, HALF is fair. Again, it's all or nothing.
• "Shake your Money-maker, Cormac McCarthy": Sex appeal and Image sell records. Books are sold not through jet-setting with bling & a nice ass, but through honest-to-god labor. Stephen King's unibrow never sold a copy. Writing is simply a harder craft in my opinion. You don't have tight jeans, a nice rack or a cone bra to fall back on to sell your work.
• It takes money to make money: Unlike music, which is just ran through a computer to poop out an AAC file, this whole digital book thing is now a visual experience. Publishers have the ability to add video to their books and make them interactive and really cool. But this is going to cost money.
True, the music industry now has iTunes LPs, but are probably not even on a fraction of a percent of all the albums sold on iTunes. Practically just an experiment at this point. Billions of songs have been downloaded without anything more than just album art attached to the file. We don't even get lyrics attached to every file, which I think is a crime. But because we've never had LPs until now, we're not used to a visual experience with our music. And mostly, we'll never use it. We'll do it a few times and then just listen to the music.
Books are different. Again, more difficult to produce I imagine than just setting up "256kbps AAC" and hitting a button.
Magazines will be even harder to produce and make money with the all the interactivity that people expect due to Times awesome Sports Illustrated video that came out a month or so ago. I doubt we'll see all that at first though. That video shows features you'd expect in a 3.0 or a 4.0 version. While we don't know what magazines will be yet, I imagine it'll be simply the 30-70 split Apple has seen success with; or a completely different model altogether. No one knows. Steve's still hammering it all out.
• You can't judge a book by it's cover: Lastly, it's a fair price because, let's face it, so many songs today (and I'm talking to you RAP) are being bought by the millions and they're just four letter words every few Crystal-fume breaths of the "artist" [termed used very loosely]) -- I just don't think music is judged with the scrutiny that a book is.
Steve Jobs has to tread lightly and be more accommodating this time around. Amazon is the incumbent. I think he hit a happy medium with the $13-15 model.
Putting more control into the publisher's hands than the retailer's is always going to be more profitable for the authors. Why is this concept so hard to understand for everyone?