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August 30, 2012 11:04 AM   Subscribe

Some ebook buyers are getting refunds. Pending approval by the court, a group of publishers (Simon & Schuster, the Hachette Book Group, and HarperCollins) have settled and agreed to pay back close to $70 million to consumers. They've also agreed to end Agency Model agreements with publishers. The lawsuit against the others continues and one company finds this settlement unfair.
posted by juiceCake (126 comments total) 12 users marked this as a favorite

 
They can do wheelin'. They can do dealin'. But they can't do no damn stealin'.
posted by Egg Shen at 11:12 AM on August 30, 2012 [2 favorites]


Hey, Apple? You should really spend more time innovating with those mountains of money you've made over the last decade and less time bitching and suing about the money you didn't make.

You're acting like a spoiled rotten fat kid at a birthday party complaining that your giant cake isn't big enough to share while stuffing fistfuls of cake in your face.
posted by loquacious at 11:24 AM on August 30, 2012 [18 favorites]


I'm still not sure who the bad guy is in all this but I do know ebooks are still too expensive.
posted by chairface at 11:26 AM on August 30, 2012 [9 favorites]


how do i find out if i'll be seeing a few cents from this?
posted by sio42 at 11:26 AM on August 30, 2012 [2 favorites]


ebooks are still too expensive.

By what yardstick? You realize that the physical paper and ink of a conventional book is a tiny, tiny fragment of the cost you're paying for a book, right? Here's one reasonably good account of why e-books shouldn't really cost much less than physical books.

If you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?
posted by yoink at 11:35 AM on August 30, 2012 [7 favorites]


I'm still not sure who the bad guy is in all this

For e-book buyers, the bad guys are the publishers for trying to preserve the agency model that lets them charge more for an e-book than a printed one.

For publishers and some writers, the bad guy is Amazon for trying to use its dominant market position to force e-book prices down to levels that, while beneficial for Amazon and sales of its Kindles, will purportedly leave the publishers and those writers not enough money to survive. Which would, in turn, be bad for e-book buyers.
posted by Egg Shen at 11:37 AM on August 30, 2012 [2 favorites]


I'm still not sure who the bad guy is in all this but I do know ebooks are still too expensivefeature-poor.
posted by DU at 11:37 AM on August 30, 2012 [3 favorites]




f you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?

No transportation? No storage? No shop rent? No shop staff salaries?
posted by PenDevil at 11:39 AM on August 30, 2012 [40 favorites]


Maybe finally the Kindle edition of books will be cheaper than the brand new paperback. Ebooks have significantly less value than paper books, and not just because it's not printed on paper. You can't sell an ebook, you can't lend it to a friend, you can't trade it. In many important ways you don't really own an electronic book at all. The loss of consumer rights should come with a significant discount.

I keep hoping someone offers 30 day ebook rentals, wouldn't that be great? I admire the libraries that have figured out how to do eBook lending.
posted by Nelson at 11:43 AM on August 30, 2012 [16 favorites]


If you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?

No transportation? No storage? No shop rent? No shop staff salaries?


…and the biggest of all: no chance of going unsold.
posted by esprit de l'escalier at 11:44 AM on August 30, 2012 [21 favorites]


If you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?

But it's not cheaper. In fact it's often more expensive than the paperback because retailers will discount the paperback price but not the e-book price.
posted by stopgap at 11:44 AM on August 30, 2012 [2 favorites]


If you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?

Because with a paper book, you can sell it, loan it, trade it, or donate it as you see fit, whereas most e-books are locked down with DRM to prevent those things.

It's not at all unreasonable to suggest that in return for customers giving up the right of resale, the price should be lower.
posted by jcreigh at 11:47 AM on August 30, 2012 [13 favorites]


ebooks are still too expensivefeature-poor.

If you would only miscategorize DRM as a feature instead of a bug, then e-books would have LOTS of extra "features".
posted by anonymisc at 11:48 AM on August 30, 2012 [3 favorites]


Here's one reasonably good account of why e-books shouldn't really cost much less than physical books.

It does a good job of cover various things that need to be taken into account in the price of an ebook, but very little in actual numbers. Sure. Indesign* costs nearly $700, but how much does all the editing and formatting actually cost per book?

*Besides, epub creation doesn't require Indesign.
posted by drezdn at 11:48 AM on August 30, 2012 [1 favorite]


No transportation? No storage? No shop rent? No shop staff salaries?

No cost to convert previously published hard copy book to ebook? No infrastructure costs to support the ebook network? No complex legal negotiations over copyrights that were processed solely for the physical-copy edition?

Yeah, sure, there are some incremental costs for physical books that aren't accrued for e-books--and vice versa. But these still work out at pennies per copy. Look how many books there are in a typical bookshop. If warehousing costs were exorbitant per book no one would sell remaindered books (which have to be warehoused and processed) over the internet for pennies a copy--which they do.
posted by yoink at 11:51 AM on August 30, 2012 [2 favorites]


one reasonably good account of why e-books shouldn't really cost much less than physical books

"publishers -- good ones at least -- then have the resulting file professionally proofread for scanning errors"

Visit TeleRead or an e-books discussion forum to find out what quality of proofreading is being provided.
posted by Egg Shen at 11:51 AM on August 30, 2012 [1 favorite]


If a publisher was feeling bold, I think something like Netflix instant could work for ebooks. You pay a flat monthly fee and can read as many available books as you want (with the number of books in your possession at a time being limited as with regular Netflix).
posted by drezdn at 11:51 AM on August 30, 2012 [1 favorite]


Restoring Amazon's monopoly in digital publishing is not in the public interest.

I have a large Kindle library, I have a couple versions of Kindles, and there's nothing about this witch hunt that has noticeably reduced costs of Kindle books or devices for myself and others.
posted by Blazecock Pileon at 11:57 AM on August 30, 2012 [1 favorite]


It does a good job of cover various things that need to be taken into account in the price of an ebook, but very little in actual numbers.

Actually, it gives quite a lot of actual numbers; did you read the whole piece?

But there are myriads of other articles out there breaking down the same numbers which are, in any case, pretty self-explanatory if you only stop to think for a moment. What you pay for when you buy a book is the intellectual labor that went into creating it. Human intellectual labor is very expensive in our economy, mass manufactured items like bound books are very cheap. The change from physical book to e-book removes only the relatively inexpensive parts of the equation from the cost calculation, and leaves pretty much all the expensive parts. There is, again, simply no reason why an e-book should cost substantially less than a physical book.
posted by yoink at 11:59 AM on August 30, 2012 [2 favorites]


But yoink, it shouldn't cost more than the physical book, which is exactly what happened to many, many titles when the agency model happened to ebooks.
posted by FreezBoy at 12:02 PM on August 30, 2012 [3 favorites]


Ebooks have significantly less value than paper books, and not just because it's not printed on paper. You can't sell an ebook, you can't lend it to a friend, you can't trade it. In many important ways you don't really own an electronic book at all. The loss of consumer rights should come with a significant discount.

THINGS I CAN DO WITH E-BOOKS THAT I CANNOT DO WITH PHYSICAL BOOKS
  • look up the meaning of a word by clicking on that word to cross-reference it with the dictionary also on my e-reader
  • highlight passages without damaging the e-book
  • easily find a passage in a text, without having to flip around
  • look up how many times an author uses a word or a phrase without having to manually count the word or phrase
  • look up what other people have highlighted in the text
  • carry around 1000 books in my backpack without destroying my back
Maybe with all of these additional features that I can't get from a physical book, e-books should cost more.
posted by nushustu at 12:03 PM on August 30, 2012 [7 favorites]


I recently took Mike Carey's The Devil You Know out of the library. It was a good book. I looked into getting the sequel. $7.99 for a DRM-ed ebook. $4.20 for a "Like New" copy of the hardcover, shipped.

I went with free from the library in the end, but unless I was really intent on it being one of several books I wanted to read while travelling and not wanting to carry physical books, there's just no way the e-book isn't the less attractive option.

They can price 'em however they want. But they shouldn't be surprised if pricing them stupidly costs them sales.
posted by Zed at 12:05 PM on August 30, 2012


Actually, it gives quite a lot of actual numbers; did you read the whole piece?

I did. And besides breaking down royalties, it's really not that specific.
posted by drezdn at 12:05 PM on August 30, 2012


it's really not that specific.

By which I mean, where's the break down of how much it actually costs to negotiate digital rights? The actual cost per title to proofread? The actual cost per title to check formatting?
posted by drezdn at 12:08 PM on August 30, 2012


There is, again, simply no reason why an e-book should cost substantially less than a physical book.

Perceived value. The convenience of an ebook vs the loss of actual ownership.

Some of the costs in that article were about OCR and editing, or using unnecessary programs (Photoshop?), or somehow assuming that the one-time costs should be associated with each ebook title. I'd like to see a real breakdown of costs.

(I'd really love to know how much less publishers could pay in salaries and rent if they elected to move to smaller cities. However.)
posted by jeather at 12:09 PM on August 30, 2012 [1 favorite]


But it's not cheaper. In fact it's often more expensive than the paperback because retailers will discount the paperback price but not the e-book price.

This is because part of the agreements between the publishers and Apple meant that no ebook seller could do discounts without publisher say-so. Basically, the publishers all re-wrote new contracts with Apple, the new entrant to the ebook market with its ipad, and also agreed to make the same change to their other contracts with other sellers, mainly Amazon.

These changes forced through
1) the agency model: Publishers set the final retail price, rather than setting a wholesale price and letting end-sellers price whatever they wanted. This is what killed non-approved price cuts on books, and resulted in higher prices for end customers - higher prices than for new paperbacks in most cases, and much higher than old paperbacks in many more.

2) 'Most Favoured Nation' - this meant that none of the major publishers would undercut Apple in pricing - thus locking in their 30% profit margin for Apple, with no risk of being undercut.

The overall result was an illegal collusion between publishers, that artificially raised prices, and cut the legs out from anybody wanting to compete with Apple on price. This is why several publishers have now settled with the DOJ, both to pay customers back for their collusion to raise prices, and to end the contracts for two years that prevented competition.

Now, the defending argument for this behaviour is that Amazon had a near-monopoly on ebook sales before Apple, and therefore breaking that monopoly was a good thing. Punishing the collusion will defacto give back monopoly power to Amazon, or so the argument goes.

I believe that to be fallacious, for three reasons.

1) First, a monopoly is only bad when it leads to higher prices, and/or prevents competition in the same market. Neither were the case with Amazon.
2) Amazon gained that near monopoly by aggressive pricing on Kindles, and ebooks for them. This was at a time when the only real competition was e-readers that cost anything up to twice as much. They won out based on low prices, not illegal action (the DOJ initially started investigating Amazon, found nothing illegal, but realised that Apple and the publishers may be doing something illegal as a result of that).
3) The ebook market is quite different now, but not because of Apple, but because the costs of e-ink devices has plummeted because of improvements in technology. Tablets also have massively dropped in price, for the same reason - see the kindle fire, or the nexus 7 for example. So now we have a number of competitors - amazon, Apple, B&N, Borders/WHSMiths/Kobo, Google books, etc etc.

Clearing out the illegal collusion of artificially higher prices will result on multiple vendors competing on quality of service, quality of formats (aka less badly scanned books), and also price. The companies that did collude to stifle competition and raise prices should indeed be punished. I note that the three that have settled have also agreed to provide testimony against Apple and Penguin. As a result of settling, they have avoided an expensive court case against the DOJ, and much higher penalties if/when they did lose the case.

However, I do expect a certain Apple-can-do-no-wrong poster along shortly to slag off Amazon because clearly they're an evil monopolist, and any attack on Apple is totally unjustified.

On preview, too late...
posted by ArkhanJG at 12:10 PM on August 30, 2012 [19 favorites]


$7.99 for a DRM-ed ebook. $4.20 for a "Like New" copy of the hardcover, shipped.

You're complaining, in all earnestness, that the price for the new item was more than the price for a used item?

This is the kind of wackiness that must make poor publishers just tear their hair out.
posted by yoink at 12:13 PM on August 30, 2012 [1 favorite]


If you buy a paperback book, the paper, ink and binding cost is less than a dollar per copy. Why should the e-book be any cheaper than that difference?

Lots of reasons. First of all, shipping costs - to and from the printers. And to the places that sell it. Sometimes back from them as well. Second, storage and warehousing costs for the publisher. Third, many of those books won't sell, and so the expense of making them comes out of titles that are profitable. Fourth, because retailers mark the price of those "$1" books up to cover expenses they don't have (or don't have as much of) with e-books - retail space, different forms of advertising, etc. Fifth, because e-books can stand in print forever at little cost, making them endless moneymakers even at a few sales per year . . . not the case with physical books, which fall quickly out of print (by necessity) if they don't sell "x" number of copies per year. And loads more reasons.
posted by Dee Xtrovert at 12:13 PM on August 30, 2012 [4 favorites]


>There is, again, simply no reason why an e-book should cost substantially less than a physical book.

>But yoink, it shouldn't cost more than the physical book

>THINGS I CAN DO WITH E-BOOKS THAT I CANNOT DO WITH PHYSICAL BOOKS

Given the profound risk of piracy, particularly to works with scarce, non-commodified information, there's a viable argument for making DRM-free e-books much more expensive than physical books.

After all, every sale of a DRM-free e-book courts the possibility of it being offered up to the Winds of Torrent, and thereby radically reducing future sales.
posted by darth_tedious at 12:15 PM on August 30, 2012


In fact it's often more expensive than the paperback because retailers will discount the paperback price but not the e-book price.

Which retailers are these precisely? The best you'll see is a 3-for-2, sometimes. Amazon generally doesn't discount (mass market, anyway) paperbacks, nor can I think of any shops that do outside of the limited selection of 3-for-2s.
posted by hoyland at 12:17 PM on August 30, 2012


$7.99 for a DRM-ed ebook. $4.20 for a "Like New" copy of the hardcover, shipped.

You're complaining, in all earnestness, that the price for the new item was more than the price for a used item?

This is the kind of wackiness that must make poor publishers just tear their hair out.


You have that backwards. That's the kind of wackiness that will kill publishers if they don't buck up in time.
posted by anonymisc at 12:18 PM on August 30, 2012 [1 favorite]


Which retailers are these precisely?

It's been a while since I've checked, but Walmarts, Targets and supermarkets will often have a discount on the list price of a paperback.
posted by drezdn at 12:19 PM on August 30, 2012


Lots of reasons. First of all, shipping costs - to and from the printers. And to the places that sell it. Sometimes back from them as well. Second, storage and warehousing costs for the publisher. Third, many of those books won't sell, and so the expense of making them comes out of titles that are profitable. Fourth, because retailers mark the price of those "$1" books up to cover expenses they don't have (or don't have as much of) with e-books - retail space, different forms of advertising, etc. Fifth, because e-books can stand in print forever at little cost, making them endless moneymakers even at a few sales per year . . . not the case with physical books, which fall quickly out of print (by necessity) if they don't sell "x" number of copies per year. And loads more reasons.

Try finding any plausible per book accounting of those total costs (shipping, storage, etc.) that shows them to be a significant portion of the cover price of the book. I'll be happy to wait.
posted by yoink at 12:19 PM on August 30, 2012



No cost to convert previously published hard copy book to ebook? No infrastructure costs to support the ebook network? No complex legal negotiations over copyrights that were processed solely for the physical-copy edition?



Ah, that onerous cost of conversion? So that means that only new ebook editions of old paper books should be effected, right? Since the cost of any of these for a new ebook is about zero, new ebooks should be cheaper at least, right?

Wrong. Because what's sacrosanct here is that the publishers want to be sure that the per-unit profit amount is no less than for a paper book in their heyday.
posted by tyllwin at 12:19 PM on August 30, 2012 [4 favorites]


That's the kind of wackiness that will kill publishers if they don't buck up in time.

If publishers start offering new books at the cost of used books, then they are signing their own death warrants.
posted by yoink at 12:20 PM on August 30, 2012


You're complaining, in all earnestness, that the price for the new item was more than the price for a used item?

I'm stating, in all earnestness, that paying almost twice as much for a DRM-ed digital copy than for a like-new physical copy that I could then flip on paperbackswap.com, isn't a good deal. Like I said, they're welcome to offer bad deals, and even welcome to tear their hair out over the results.
posted by Zed at 12:20 PM on August 30, 2012 [6 favorites]


If publishers start offering new books at the cost of used books, then they are signing their own death warrants.

Think harder. The example was DRM'ed books vs books that could be lent and resold.
posted by anonymisc at 12:21 PM on August 30, 2012 [1 favorite]


darth_tedious: "After all, every sale of a DRM-free e-book courts the possibility of it being offered up to the Winds of Torrent, and thereby radically reducing future sales."

This makes perfect sense, because lord knows it's impossible to scan in a physical book and offer it up on the winds of torrent.

It's worth noting that every sale of an ebook guarantees that the ebook will never be offered for sale second-hand.
posted by mullingitover at 12:23 PM on August 30, 2012 [2 favorites]


If you want to really look at crazy pricing in ebooks, look into kids picture books. For example, Bad Kitty on the Kindle costs $10 bucks it includes no extra features and is in a series that has sold more than a million copies.

$10 is the average price for kids book on e-readers, an often the publishers haven't even bothered to format them for an e-reader correctly (which, fortunately, is not the case with Bad Kitty).

However, there are app versions of kids books, chock full of features, that cost real money to produce (have to book studio time, programmers, and more) but sell for $1.99 for the Kindle (with the average price range from $2-$5).

Why are the apps (which include the full text and graphics of the print book) cheaper than "lesser" e-book versions of similar picture books?
posted by drezdn at 12:27 PM on August 30, 2012 [8 favorites]


Why is it only intellectual products that people think should be provided to them essentially free of charge? And why, above all, on a place like Metafilter where so many participants earn their living in fields that depend upon their brainpower is this attitude so prevalent? It's bizarre.

Think harder. The example was DRM'ed books vs books that could be lent and resold.

And, as pointed out above rather eloquently by nushustu, the ebook has all kinds of utility that the physical copy doesn't have--which is why you're bitching and moaning about the price of it--you want it because of the utility it has, utility which makes it more valuable to you than the physical copy, but for some reason you resent having to pay for that utility.

Why should the publisher care that you could lend and resell the physical copy? If the book isn't DRMed it won't be "lent and resold" to one or two other people, it will be uploaded and torrented and taken for free by all the assholes out there who refuse to pay for intellectual property. How is the author and the publisher supposed to make any profit on that model? Is the author supposed to go on tour and perform his/her books live, perchance?
posted by yoink at 12:28 PM on August 30, 2012 [1 favorite]


If the book isn't DRMed it won't be "lent and resold" to one or two other people, it will be uploaded and torrented and taken for free by all the assholes out there who refuse to pay for intellectual property.

Oh, good grief. Anyone who bothers to google it knows how to strip the DRM from an e-book. It's not preventing any redistribution, just creating additional bother for legitimate purchasers.

Why should the publisher care that you could lend and resell the physical copy?

Oh, I don't know, maybe because it influences the buying decisions of the people they're trying to sell to?
posted by Zed at 12:30 PM on August 30, 2012 [4 favorites]


If the book isn't DRMed it won't be "lent and resold" to one or two other people, it will be uploaded and torrented and taken for free by all the assholes out there who refuse to pay for intellectual property.

And if it IS DRMed, it will be de-DRMed (takes no time at all to do this; I regularly de-DRM every book I buy) and then uploaded the same way.

Tor has started selling their books without DRM -- the first (I think) was John Scalzi's Redshirts, which he said somewhere was on track to being his highest selling book ever. And yet I am 100% sure it is available on torrent sites.
posted by jeather at 12:32 PM on August 30, 2012


Why should the e-book be any cheaper than that difference?

No transportation? No storage? No shop rent? No shop staff salaries?


not having a physical artifact to put on the shelf, to leaf through when the rolling blackouts hit, which will no doubt be happening quite often in years to come
posted by philip-random at 12:39 PM on August 30, 2012 [1 favorite]


The CEO of Osprey Publishing, who publishes their military history and science fiction books DRM-free:
DRM does not work

DRM is pointless. It doesn’t stop those who are determined to avoid paying for content, and acts as a barrier for those who will happily pay, preventing them using their content on all devices. It protects large corporations from innocent consumers and actively encourages those who would steal to do so in order to spite those same large corporations.

Obscurity vs piracy

We are a small, independent publisher and we know that obscurity is a far greater enemy than piracy for us and our authors. Osprey’s military history books have been pirated as scans of print copies for many years and we have evidence that the transmission of pirate copies has led to purchases. This has not changed since the advent of ebooks.

The world does not owe the publishing industry a living

I worry that the publishing industry is protesting too much. All the resistance to any kind of copyright reform, and insistence on DRM, makes publishers appear like whining children. The world does not owe the publishing industry a living and we need to prove that we add value.
posted by Egg Shen at 12:39 PM on August 30, 2012 [16 favorites]


Most of the benefits nushustu mentions are benefits provided by the ereader and not the ebook itself.
posted by drezdn at 12:41 PM on August 30, 2012 [1 favorite]


If a publisher was feeling bold, I think something like Netflix instant could work for ebooks. You pay a flat monthly fee and can read as many available books as you want (with the number of books in your possession at a time being limited as with regular Netflix).


O'reilly has been doing something very much like this for tech books for years actually.
posted by BigHeartedGuy at 12:42 PM on August 30, 2012 [4 favorites]


Much as I agree that DRM doesn't impede people who torrent, it does, I think, impede casual non-technical people who say "what's a torrent?"
posted by tyllwin at 12:43 PM on August 30, 2012 [1 favorite]


Is it possible to read an e-book without an e-reader of some kind?
posted by nushustu at 12:43 PM on August 30, 2012


(that's a question for drezdn's last comment.)
posted by nushustu at 12:44 PM on August 30, 2012


>This makes perfect sense, because lord knows it's impossible to scan in a physical book and offer it up on the winds of torrent.

Obviously, it's possible to scan a physical book.

Perhaps less obviously-- but actually, probably just as obviously-- it's less much convenient to scan in a physical book, so many fewer people will actually take the time to do it.

>It's worth noting that every sale of an ebook guarantees that the ebook will never be offered for sale second-hand.

From an author's perspective, unremunerated second-hand sales are a trivial problem, next to uncontrolled distribution via the web. Depending on the popularity of the work, the difference in scale is easily 100 or 1000 or 10000 or 100000:1.

>Oh, good grief. Anyone who bothers to google it knows how to strip the DRM from an e-book.

It's a substantively trivial barrier, but trivial barriers can have non-trivial effects, because not everyone is motivated enough in regard to this particular problem to spend the six seconds or sixty seconds or six minutes to surmount the barrier. In theory, anyone can hop a given gate, but in practice, some people would rather spend the time necessary to do this making a sandwich, or painting a portrait, or hopping some other gate.

Runaway distribution isn't binary, in the sense of being either absolutely non-existent or absolutely uncontrollable. It's whack-a-mole: You can't stop the phenomenon as a whole, but you can stop it locally and temporarily, and varying with the prominence of the leakage point, this stoppage will have less or more impact.
posted by darth_tedious at 12:44 PM on August 30, 2012


Is it possible to read an e-book without an e-reader of some kind?

Depends, how's your binary translation these days?
posted by BigHeartedGuy at 12:45 PM on August 30, 2012 [1 favorite]


I've seen an upswing in purchasing of books in my circle of associates, because they can purchase ebooks for their Kindle, Nook, iPad, Kobo, Android tablet, etc. They were buying books they never would have. When the prices got jacked up, they stopped. I expect prices more to the liking of consumers may increase sales.

I like the idea of a Netflix like subscription service as well. Myself and others have ditched cable entirely in favour of digital distribution models whose value we can swallow. With the ever decreasing income of the middle class, lower prices may be the only way to sell.

There is great opportunity here for a number of independent and corporate ebook stores and models.
posted by juiceCake at 12:46 PM on August 30, 2012 [3 favorites]


nushustu, if you have a PC, there's Amazon's Kindle for PC that allows you to read e-books from there.
posted by of strange foe at 12:47 PM on August 30, 2012 [1 favorite]


After all, every sale of a DRM-free e-book courts the possibility of it being offered up to the Winds of Torrent, and thereby radically reducing future sales.

Every sale of a DRM-encumbered e-book does the exact same thing, because the Winds of Torrent will rip the DRM off instantly.

Like it or not, customers can get it free anyway, so you'd better price accordingly. They need to find your offering to be enough better than the free one to be worth giving you money for. The simple fact that you're the original author will give you a substantial advantage, but if you're a jerk, people will flip you the bird and snag the free one instead.

I don't know how widespread this is, but if you treat me like a thief, I'm much more likely to disrespect your wishes. Treat me well, and I'm likely to give you money.
posted by Malor at 12:48 PM on August 30, 2012 [2 favorites]


That was my point. I can't imagine using an e-book for the purpose of reading without a reader, so to me they're one and the same. I don't care if your reader is a kindle, a nook, adobe reader, textedit, whatever. You're going to have to read it on something.
posted by nushustu at 12:48 PM on August 30, 2012


One thing that ebooks have over paper-and-ink ... they can be updated. I've had amazon send me emails that some updates were added and errors corrected in the ebook version of Neal Stephenson's Reamde. Granted, with the update, I had to find the place I last read, but it was not a big issue, because before I allowed the update, I memorized the first couple of words in the paragraph where I stopped reading, updated, and then did a word search.

I also sometimes like to see the passages that other people found significant enough to highlight. Add to that the ability to highlight a word and get an instant definition and the fact that I can carry literally hundreds of books in my pocket.

But I have to admit, they were right when they said that Amazon subsidizing ebook prices to sell more Kindles set up a false expectation. I'm hesitant to buy any ebook that costs more than $9.99.
posted by crunchland at 12:50 PM on August 30, 2012


Much as I agree that DRM doesn't impede people who torrent, it does, I think, impede casual non-technical people who say "what's a torrent?"

Impedes them from what? They can google "Major New Book by Big Name Author download free" and find it in however many tenths of a second it takes to get a search result. The fact that the book once had DRM is irrelevant.

Is it impeding the casual buyer from purchasing? Maybe. (I was a lot more hesitant until I realised I could so easily strip DRM that backups were possible.) But I don't think the casual non-technical person is going to think "Wow! No DRM! Let me figure out how to torrent this!"
posted by jeather at 12:52 PM on August 30, 2012


That was my point. I can't imagine using an e-book for the purpose of reading without a reader, so to me they're one and the same

But should the publisher be able to charge more because by opening it with an e-reader, you can use tools the e-reader provides on it?

To me, maybe, if the information is valuable enough. For example, in the past year, I've bought both the ebook version and print version of a programming book called "CSound Power," but for the vast majority of books though?
posted by drezdn at 12:52 PM on August 30, 2012


But I don't think the casual non-technical person is going to think "Wow! No DRM! Let me figure out how to torrent this!"

My thinking is usually the exact opposite to that. "Wow! No DRM! Where's the buy button?"
posted by Malor at 12:55 PM on August 30, 2012 [5 favorites]


Publishers and authors may not care about (or, in fact, actively hate) the secondary/lending market, but readers do, and it factors into the calculus of whether or not to buy a book.

A physical book that I buy for $X, I could loan to my buddy if I thought it was really good, or sell it to a used book store for something value $Y that is less than $X. If I do decide to sell it, that means that my actual cost of reading the book was really only $X-$Y.

With an ebook, once I buy it I'm stuck with it. Even if I hate it I have no means of mitigating the cost that I spent on it. When the price of the ebook is the same as, or greater than $X (or even $X-$Y), why should I buy it?
posted by sparklemotion at 12:56 PM on August 30, 2012 [3 favorites]


Impedes them from what?

Oh, I think it makes it harder than if Bob and Alice were meeting for coffee and Bob could just share it, or email it later. If that doesn't work Alice, may turn to Amazon and not filestube or something. I personally think they could make more money by charging a dollar extra for the non-DRM version, but that's the publisher's call not mine. My own copy won't have DRM in either case.
posted by tyllwin at 12:57 PM on August 30, 2012


Try finding any plausible per book accounting of those total costs (shipping, storage, etc.) that shows them to be a significant portion of the cover price of the book. I'll be happy to wait.

Use your imagination - that's a naive statement. The failure rate in publishing is incredible. Publishing something solely as an e-book eliminates most of the costs of a book. All of the printing, much of the design work, all of the shipping and storage, the money for retail space and workers, workers in the distribution place, having to print more copies than will sell (which is normal), not to mention that in reali, advertising budgets are lower, editing and proofreading costs are typically lower* and on and on and on.

* They needn't be, but the truth is, generally maintain higher standards when printing a physical book.

People talk about the "$1" per book printing cost as being only 1/15th of the cost of the book. But look at it from a publisher's point of view. They may get $6 to $7.50 per book sold, and only half of those books may get sold (the rest returned and pulped or remaindered). So the true printing cost of a book might be $2 per book sold, or something like 25% to 33% of the money they make. Figure in all that storage and shipping, and double it, too, and it can eat up a lot, and I think you can fairly say that the cost of a physical book could be half of what it is without these costs. Also, without physical retail space, there wouldn't be the need to mark it up as much. Without these costs, a book could cost $8 and still make as much money for the writer and publisher, with reasonable money for the e-tailer as well. AND those books could stay in print forever, generating small but ever-accumulating money for what is (functionally) no cost at all. The only thing e-books have as added cost is diigital storage, which is a minute fraction of the costs it *doesn't* have. AND as it stands now, e-books are not as cannibalized by libraries, trading and resales as physical books, so you're more likely to buy one new than find one to borrow or at a used price. More money for publishers.

That's why e-books should be cheaper.
posted by Dee Xtrovert at 1:05 PM on August 30, 2012 [11 favorites]


One thing's for sure, one need not purchase any of the classics anymore if one has a Kindle. As for newer books, some I buy as ebooks and some not. I'm leaning more toward ebooks lately because my Kindle case has a little light and because I can set the type size to 'old man'.
posted by Mister_A at 1:06 PM on August 30, 2012


Also, indie publishing and self-pub books can sell for very low prices and generate substantial revenue. It's definitely something the big houses are watching with interest; they have already begun snapping up popular self-pub authors and will, I suspect, soon start snapping up small publishers that do well with low price point ebooks.
posted by Mister_A at 1:08 PM on August 30, 2012


Is it possible to read an e-book without an e-reader of some kind?

Sure. calibre is free, open source, available for Windows/Mac/Linux, and will open anything without DRM. [And DRM can be dealt with, as mentioned above.] It will let you read the book on your computer or send it to your cell phone.
posted by Egg Shen at 1:12 PM on August 30, 2012 [2 favorites]


No transportation? No storage? No shop rent? No shop staff salaries?

No going to bargain or remaindered, no strips, no theft...

I write letters. It my hobby. I wrote a shitload of publishers letters asking them to justify the price of eBooks. None wrote back. I don't get it, but then I am of the none texting generation too.

I sold physical books for BGI for 6 years. I was born to be a bookseller. Decades on I still remember my customer's tastes in books. I was a voracious reader and read anything anyone recommended (mostly I liked having someone to hold accountable when a book sucked).

I collect books. Someday I'll actually spend money on some nice cases, even though that means less money for books.

I don't buy eBooks. I would like to. I love the idea of flowable text and searchable text and the ability to make notes in a book without destroying its value.

What keeps me from doing so is the cost. Seriously, I can jump on Amazon and get a used copy of a book sent to me sometimes for as little as a penny plus shipping. When I am done I can then pass that along, donate it to the library, or stick in a box.

I am going to start getting into them now that I am a Prime subscriber on Amazon, but only the loaner books. No way an I going to pay actual money for an eBook.

What I would like to see is free eBooks. Zero dollars. As long as you by the actual physical book. Sure, you can buy the digital only if you like, but why make me buy the same book more than once? I don't when I buy a CD. I rip that puppy to AAC files and listen to them on my iPhone. Why should a book be different?

The irony here is that I taught myself the ePub standard and have created a few eBooks and even have a collection of crappy poems up on the iBookstore. I plan to make more and to sell more. My reasoning for doing this is because the economics of paper doesn't make sense for me (I'll never sell more than a few hundred of anything). Even with print on demand it doesn't make sense, but then I don't support a family through writing.
posted by cjorgensen at 1:15 PM on August 30, 2012 [4 favorites]


Is it possible to read an e-book without an e-reader of some kind?

Sure. I can open it in Calibre and read it on my laptop. Or in Sigil. I can print it out on paper and carry the paper around with me if I want to. (Both Calibre and Sigil are free, cross-platform, and open source.)
posted by rtha at 1:21 PM on August 30, 2012


Why is it only intellectual products that people think should be provided to them essentially free of charge?

You forgot pharmaceuticals.
posted by Kid Charlemagne at 1:25 PM on August 30, 2012


Why is it only intellectual products that people think should be provided to them essentially free of charge? And why, above all, on a place like Metafilter where so many participants earn their living in fields that depend upon their brainpower is this attitude so prevalent? It's bizarre.
Well now, that's an uncharitable reading of the argument. Most folk have been asking that prices be lowered to reflect lower costs of ebooks. Obama's Audacity of Hope from Amazon will cost you $9 on Kindle, yet $8.98 for a paperback. Even if the actual physical book costs less than a dollar to make, shouldn't the Kindle edition then be $8? There's no scanning to be done, and conversions costs from an existing file must be fractions of a penny for each copy sold. Even though there are infrastructure costs in sending the ebook wirelessly, there are infrastructure costs from selling the paperback too. That you can get free shipping on order over $X, suggests that physical infrastructure costs are already partly built in to the paperback price.
posted by Jehan at 1:26 PM on August 30, 2012 [4 favorites]


Hmm, so if the cost is $1 for the physical book, why then the $9 difference just between the paperback and the hardcover? Why, that hardcover should be only a dollar more, right?

And, of course, what people are leaving out of this equation is that a large chunk of the price for a physical copy goes to the retailer. So are we also saying that having a download server costs as much as a chain of brick and mortar stores?

Here's a theory: the prices are set to be the highest that the market will bear, and no reduction in costs will drop the price by a penny so long they're finding buyers at the higher price.
posted by tyllwin at 1:35 PM on August 30, 2012 [2 favorites]


>Why is it only intellectual products that people think should be provided to them essentially free of charge?

>>You forgot pharmaceuticals.


This is an interesting point, although a pharmaceutical-- being massively expensive to develop, strongly desired, yet trivial to duplicate-- can, to a lesser but still significant degree, be treated as an intellectual product: Arriving at the formula costs a lot more than producing the box and the salve it contains.
posted by darth_tedious at 1:40 PM on August 30, 2012


Also missing, very much, on these cost arguments is that the sales cost of ebooks can be much much lower. In fact the publisher could directly sell to the customer if they had a clue. That is not nearly as practical for physical books. Certainly they could make deals with Amazon where Amazon takes a much smaller cut then a major bookstore.

In any case, I buy lots of eBooks, because eBooks have enabled me to read many more books for a variety of mundane life reasons. Because of people like me, and the frictionless sales process, I'd expect ebook sales to increase the absolute number of books sold. I continue to refuse, without exception, to pay more for an eBook then a physical book. It simply isn't acceptable, and it is gouging. My only exception will be if the publisher can prove that extra money is lining the authors pockets, not the companies. Like that will ever happen.
posted by Bovine Love at 1:41 PM on August 30, 2012 [2 favorites]


Kindle Fire sold out forever.
posted by Artw at 1:51 PM on August 30, 2012


I wouldn't mind if publishers moved to something closer to the pricing model of most DVDs. Say $10-$15 when the book first comes out. $5-$7 when it's released in paperback, and then $5 or less when it's established backlist. If you want to charge more for backlist add a bunch of extra features (like with a dvd) and then raise the price.

For a long time, book publishers have consistently kept their prices the same for backlist while every other media drops it eventually (for example "Right Priced" CDs or $5 DVDs).
posted by drezdn at 1:55 PM on August 30, 2012 [2 favorites]


Why is it only intellectual products that people think should be provided to them essentially free of charge? And why, above all, on a place like Metafilter where so many participants earn their living in fields that depend upon their brainpower is this attitude so prevalent? It's bizarre.
That's quite an ad hominem argument there. I don't see anyone in this thread saying that ebooks should all be free or near free.

What we are arguing is is that
a) ebook prices should be lower than paperback prices, not higher, due to the lower costs of production, shipping, not dealing with buybacks, lost product, storage, or having to compete with 2nd hand sellers;
b) that amazon (and every other ebook seller) was forced to hand control of final pricing back to the retailer, which did result in higher prices for ebook customers across the board than previously, which also made them higher than new paperbacks;
c) that the publishers did this in concert, and contracted not to allow anyone to undercut apple on prices.

The dead tree model, along with pretty much every other retail product, works on the principle that the producer picks a wholesale price that will make them a profit, then sells them off to the retailer who will deal with shipping, stock-loss (physical theft), stocking shelves, warehousing, handling customer payments and chargebacks etc. What price the final product varies between retailers; depending upon their margins, cross-selling, target market, location, etc etc. A popular product makes both parties money, and offsets losses in other products.

This was even the model that worked for ebooks initially. But the publishers didn't like giving up that much control to Amazon, they didn't like that Amazon was taking thin margins on ebooks to sell Kindles, and especially didn't like the idea of the Amazon Prime thing where they would pay the wholesale price to the publisher and give it away to a customer who was already paying Amazon for discounted shipping.

So Apple gave them a chance to retake control, at the price that they then couldn't undercut Apple with anyone else, and they all agreed together to do so - and raise prices.

Collusion to hike prices across the board is illegal, as it short circuits one of the many features of the free market, specifically, it prevents competition. How involved Apple was with that collusion (whether it was a passive recipient of the new contracts, or pushed the publishers to work together cut them a good deal) I guess we'll find out when the DOJ and various States get them into court with discovery. Given it propped up the ipad at launch as an ereader that cost no more to supply with books than anything else, and meant that amazon or anyone else couldn't undercut them on price, at the very least they can't have been very upset with the deal.

Raising prices choked off demand. Raising prices across the board to protect their dead tree model, when done as a group, is illegal - it's literally cartel price fixing.

Now that amazon can rip up those contracts they were forced into, and will get new contracts from the setlling publishers, they will once again be allowed to compete on price. And so will everyone else, even Apple. I'll be able to go to multiple epub vendors, such as kobo, google books, waterstones etc etc or even straight to the publishers own store and choose based upon price, convenience and compatibility with my ereader devices (kobo, currently). Instead of them all marching in lockstep, with the same price that the publisher decided wouldn't compete with their dead tree version.

RRP - recommended retail price - used to actually be enforceable by publishers. That was determined to be a restraint of trade, and their monopoly on final pricing was broken. Until they resurrected with the help of Apple and some collusion. Now again retailers can set whatever price they want, depending upon how much profit they want to take/the market will bear in their area; well except for Apple, MacMillan and Penguin published books, anyway.

More competition and prices not kept artificially high by publishers != we want all the books in the world for free. It means we want a fair price, not a rip-off, illegal cartel determined price.
posted by ArkhanJG at 2:12 PM on August 30, 2012 [14 favorites]


My only exception will be if the publisher can prove that extra money is lining the authors pockets, not the companies. Like that will ever happen.
posted by Bovine Love at 3:41 PM on August 30


Hi, I run a small press. My understanding from shoptalk with other writers and publishers is that a lot of the big six contracts still pay royalties for ebooks at the same rate as for physical books (usu 7-10% of the cover price). Savvy writers, and/or writers with agents, aren't putting up with that anymore, or so I hear, but there's no industry-wide consensus on what the new royalty rates should be.

Meanwhile, small presses like mine are paying 30-40% royalties. The Writers' Union of Canada has come out in favour of paying 50% of net to the author, and they define net as whatever is left after the bookseller takes their cut; since Amazon and Apple pay 70% of the cover price to the publisher (including foreign sales makes this a bit hazy but we'll ignore that for convenience), and Barnes & Noble pays 65%, an agreement that pays the writer 50% of net is roughly the same as an agreement which pays 35% of gross (35% of 100% is the same as 50% of 70%), but I favour expressing it as a percentage of gross because I think that's more straightforward, plus I don't think my author should get paid less because their copy sold through B&N when it was my choice to use them as a vendor.

Writers get paid more (per copy) if the price is higher, because pretty much everybody is being paid a percentage of that price. That doesn't mean higher prices are necessarily in the author's favour, if they decrease the number of sales enough, but conversely lower sales meaning higher sales numbers may not translate to more money.

In any case, the extra money is never 100% going to the author.
posted by joannemerriam at 2:15 PM on August 30, 2012 [4 favorites]


Artw - the kindle fire 2 is expected to be announced on september 6th. It's not like it wasn't due a hardware refresh compared to the nexus 7. Guess they just ran out of existing stock a little quicker than expected. That, or it was planned, to both stoke up demand for the new one, and cut down on people feeling ripped off for buying the old model a day or two before the new one comes out...
posted by ArkhanJG at 2:15 PM on August 30, 2012 [1 favorite]


As an author, I would agree to make e-books significantly cheaper if we can figure out some other way to pay for the skills for the agents, editors, publishers, designers, bookbuyers, and authors. I would also agree if we can agree to replicate this model in all other media industries. By this thinking, new video games should only cost $0.99 because they are just software, and the designers and developers don't need to eat. Tickets to new movies should cost $0.99 because theaters should just upgrade to digital download models, and the actors, directors, crew and SFX teams should maybe be paid a flat rate by the government. And maybe all bands should just release their music digitally for free because it doesn't even come with pictures.

A somewhat lower price should be do-able. But not outright. There should be a higher price for new titles, that's how publishers need to make their money. It can't be all quantity and no quality.
posted by asfuller at 2:26 PM on August 30, 2012 [1 favorite]


That certainly seems to be the implication, though they'd have to try hard to beat the Nexus 7. I'm actually slightly more curious about whether they'll be releasing a frontlit eInk kindle like the Nook.
posted by Artw at 2:26 PM on August 30, 2012 [1 favorite]


Also, I note the amazon app store has finally opened to us europeans on android, which hopefully means we'll actually see the fire 2 in the uk this time - the original never came here, probably because the app store/video store didn't either.

I don't want one myself; kindle products in the UK are pretty rediculously marked up from US prices these days, unlike kobo's or the nexus 7, so they're no longer the cheap option they used to be. But that, plus that nooks are also finally coming to the UK means we should much more competition going on, which is also good.

Plus free Angry Birds as app of the day.
posted by ArkhanJG at 2:26 PM on August 30, 2012


The Fire is an okayish tablet for the Price, but really comes into its own as a way of consuming Prime content - without the video store it'd be significantly less interesting.
posted by Artw at 2:32 PM on August 30, 2012


(and App of the Day becomes a habit)
posted by Artw at 2:33 PM on August 30, 2012


Kindle Fire sold out forever.
posted by Artw at 1:51 PM on August 30 [+] [!]
Holy crap, I was just thinking about buying one for a family member, too.
posted by royalsong at 2:41 PM on August 30, 2012


There should be a higher price for new titles, that's how publishers need to make their money.

I agree with this point, but most publishers don't seem to. The bestsellers of yesteryear tend to have about the same e-book price as books that are new in paperback.

Here's A Perfect Spy. $4 shipped, used, paperback or hardcover -- your pick. 50¢ to $1 at any library book sale. $13 for DRM-ed e-book.
posted by Zed at 2:42 PM on August 30, 2012 [4 favorites]


>lower sales meaning higher sales numbers may not translate to more money.

Because it can serve as a proxy for quality, price often doesn't scale linearly with sales volume.

Selling a product at $100 is often much more profitable than selling that same product at $9, or $1-- even factoring in "lifetime value", upsells, and follow-on sales-- because, consistently, people associate higher price with higher quality. For that matter, the biggest challenge, usually, is crossing the Free Line; it's frequently harder to get someone who expects to pay $0 to pay $1, than it is to get someone who expects to pay $67 to pay $100.
posted by darth_tedious at 2:46 PM on August 30, 2012


Holy crap, I was just thinking about buying one for a family member, too. -- Maybe buy a Nexus 7 instead. I got mine and have been really happy with it.
posted by crunchland at 2:53 PM on August 30, 2012 [1 favorite]


ArkhanJG: It means we want a fair price, not a rip-off, illegal cartel determined price.

My internal model for price point is about $5ish for older releases, $10 for brand-new stuff, all DRM-free. If it's DRM-infested, it's worth maybe half that much to me. And as prices go lower, I become more and more likely to try something new, on a lark.

I can get computer games for $20 that will last me twenty hours or more, and it's rare for a book to last more than two or three. Sometimes I luck out and get really amazing stuff for $5, like Arkham Asylum a year or two ago. That was one hell of a deal, lemme tell ya.... and I don't care how good, say, REAMDE is, it's not going to last me the forty hours that Arkham Asylum did.

If they got FLAC-encoded albums down to that $5 price point, I'd buy the dumb things like potato chips, probably. They cost a fair bit more to store and distribute than books, but bandwidth is getting astonishingly cheap, and even though an album is about two orders of magnitude more data than an ebook, a hundred times almost zero is still pretty darn low. I'm confident they could sell FLAC albums very profitably at $5, and I suspect the total volume might increase to the point that they're making almost the same amount of money. But they'll need to expand that market worldwide, no more BS about different prices in different regions.
posted by Malor at 3:13 PM on August 30, 2012


Oh, also, big collections of books lose value -- I'm sure the Discworld books are all very good, but I'm just not willing to shell out $8 each for all those volumes. It'd end up being like, what, $200 to buy all of them? I haven't counted, but there's a LOT. If they had a bundle, for like $50, or maybe $75, for everything that's been done so far in Discworld, I'd probably grab it.

And then, presumably, they'd have a new customer for anything new he was doing, though in Pratchett's specific case, that might not be a good trade, sadly.
posted by Malor at 3:17 PM on August 30, 2012


I'd give it until next week before buying a tablet; Amazon is apparently going to have a press conference to announce the replacement.
posted by Malor at 3:18 PM on August 30, 2012


AND as it stands now, e-books are not as cannibalized by libraries, trading and resales as physical books, so you're more likely to buy one new than find one to borrow or at a used price.

The Pew Internet group did a very interesting study on libraries, patrons, and e-books recently. If you dig into it (and I'm reading their summary without seeing it but the full text has it) you find that patrons who borrow library e-books spend more per year on e-books purchased than non-borrowers (this shouldn't be a surprise: see the Amazon press release on the Kindle Lending Library to view this in the commercial realm); the library acts, as it always has, as a spur to sales and not a hindrance to them.

As Publisher's Weekly puts it, 'Survey says library users are your best customers.' Too bad the publishers won't play ball with libraries in terms of e-books.
posted by librarylis at 3:46 PM on August 30, 2012 [2 favorites]


Somewhere in the "Big Book of Economics" it says that when something is mass produced, its price must eventually become it's marginal cost of manufacture, which is ~$0 for ebooks. Until then I'm going to keep paying basically $0, well indirectly paying for it with my time hunting through piracy sites...but I am poorly paid, so that isn't a high cost.
posted by Chekhovian at 4:23 PM on August 30, 2012


Chekhovian: "Somewhere in the "Big Book of Economics" it says that when something is mass produced, its price must eventually become it's marginal cost of manufacture, which is ~$0 for ebooks. Until then I'm going to keep paying basically $0, well indirectly paying for it with my time hunting through piracy sites...but I am poorly paid, so that isn't a high cost."

That's only for perfect competition, on undifferentiated goods. In the case of books, rights to publish Harry Pottter books are limited.
posted by pwnguin at 4:41 PM on August 30, 2012 [1 favorite]


But in the real world, pwnguin, everyone in the entire world with a computer has the ability to publish perfect copies by the million. The only real limitation is bandwidth.

I would argue that building a business model around selling copies of electronic goods is almost exactly like setting up a gigantic snowball factory in Alaska.
posted by Malor at 4:44 PM on August 30, 2012 [1 favorite]


Dammit, hit post too soon. Continuing...

ie, you can DO it, but your snowballs had better be damn cheap, and damn good, or everyone will just roll their own.
posted by Malor at 4:45 PM on August 30, 2012


That's only for perfect competition, on undifferentiated goods. In the case of books, rights to publish Harry Pottter books are limited.

So you're saying that the simple economic rule doesn't apply when when the government passes laws specifically meant to prevent it from happening...shocking...

It's like saying that the Netherlands natural state is above water, nevermind all those giant dikes everywhere...
posted by Chekhovian at 5:23 PM on August 30, 2012


So you're saying that the simple economic rule doesn't apply when when the government passes laws specifically meant to prevent it from happening

No, he's saying the rule simply doesn't apply in this context, and the reason it doesn't apply here it has nothing to do with anything the government has done.

Also, you're misrembering the rule. It's not the price that goes to zero, it's the profit. In a market with perfect competition (many firms producing functionally identical goods), profit approaches zero.
posted by jon1270 at 6:03 PM on August 30, 2012


By this thinking, new video games should only cost $0.99 because they are just software

And because this thinking carries the force of hard economic reality behind it, and because the video game industry is no stranger to operating within the hard realities of "just software" markets, the majority of new video games are indeed now coming out at around this price point of $0.99 or less.

Many of these $0.99 cent titles have 7-figure production budgets that utterly dwarf the amount of effort and man-hours that go into a similarly-priced book. Games with higher purchase prices typically have 8-figure budgets.

Compared to book publishers, the video game industry seems to put a lot more thought and experiment and R&D into figuring out new business models and new ways to offer value and persuade customers to financially support them.
posted by anonymisc at 6:05 PM on August 30, 2012 [1 favorite]


Oh, also, big collections of books lose value -- I'm sure the Discworld books are all very good, but I'm just not willing to shell out $8 each for all those volumes. It'd end up being like, what, $200 to buy all of them? I haven't counted, but there's a LOT. If they had a bundle, for like $50, or maybe $75, for everything that's been done so far in Discworld, I'd probably grab it.

And then, presumably, they'd have a new customer for anything new he was doing, though in Pratchett's specific case, that might not be a good trade, sadly.
posted by Malor at 3:17 PM on 8/30



This gets exactly at my problem with the price of ebooks: I have over 300 books that I would love to have all saved in digital format so that I can read them anyplace, anytime on my nook, but there's no way in hell I can afford to do that. Most of my book buying comes from browsing in second hand shops also, so there really isn't any motivation for me to totally transition. It seems as if the ebook model works best for casual best seller readers, or people who tend not to re-read things.

If there was a trade in program: give us all those dead trees and we'll give you e-versions for personal use, I think I'd consider it. The cost and logistics of that obviously will never allow anything similar to happen (and I think I'd feel weird about never lending a book to someone ever again, since my friends tend to be approximately as poor as I am. No way I can be like "hey you should read this, it's great PONY UP THE 10$ IT'S THAT GOOD I PROMISE and actually end up sharing the experience)
posted by zinful at 6:09 PM on August 30, 2012


Because it can serve as a proxy for quality, price often doesn't scale linearly with sales volume.

It works both ways. Experiments in selling video games have shown that utterly crashing the price often results in staggering gains, due to a variety of reasons.

(This discovery, only recently made via experiments on online sales platforms, has lead to all sorts of sales innovations, such as the humble-bundle deals, where you pay whatever you feel like, and the average becomes the minimum donation (meaning you tell all your friends BUY NOW because it's great value and the price will only go up!), and you can set slider bars to determine how much of what you pay goes to the artists, the publishers, and to charities, and there is a leaderboard for those who contributed the most, etc)
posted by anonymisc at 6:21 PM on August 30, 2012


Also, you're misrembering the rule. It's not the price that goes to zero, it's the profit. In a market with perfect competition (many firms producing functionally identical goods), profit approaches zero.

No, you're misremembering it, actually. What he said, and what's the correct formulation, is that the price of a commodity good approaches its marginal cost -- the price of making one more unit, once the factories to build the widget have been constructed. So, yes, you're correct that profit approaches zero, but the real observation is that price approaches cost, which in turn means that profit approaches zero.

The marginal cost of digital goods is really difficult to differentiate from zero. The cost to create them can be very high, hundreds of millions of dollars in the case of movies, but the marginal cost to create one more copy is only significant in vast bulk.

A barrier to entry in a market can also keep prices high; this is part of why silicon chips tend to stay expensive, because the fabs to make them cost an insane amount of money. In that case, they're not commodity goods; only a few companies on the entire planet have the necessary expertise to make top-grade chips.

But, the goods those companies are producing happen to be machines that are supremely optimized to do one thing; copy numbers from place to place. And the content companies are trying to sell copies of very large numbers, into a market full of number duplicators. Once the number has been created, it's instantly a commodity item. Any number duplicator out there can make a perfect copy, for free.

So, making a copy of a digital good has almost no value to someone who owns a computer. There's a little bit of value there, but not very much. Coming up with the good in the first place clearly has value, but the actual act of copying is very nearly worthless.

And that is the world in which authors and directors and musicians find themselves. They've been a necessary appendage on a giant industry to make and sell plastic disks and pressed paper booklets. But there's no more need for plastic disks and books; all that's needed is bits, and bits are free to copy. And, at its most fundamental, these people need to be charging for something that has actual value to consumers, not just pretend value.

"Supporting my awesome writing and/or music!" demonstrably has value. Convenience has value. Quality has value. Feeling like a good person for doing the right thing has value.

Pretending to sell disks is fake value, and won't last.
posted by Malor at 6:52 PM on August 30, 2012 [1 favorite]


Also, you're misrembering the rule. It's not the price that goes to zero, it's the profit.

Oh, I got sloppy there. In a case where the marginal cost is zero, saying that the price should approach zero is the same as saying that profit approaches zero. You're still trying to apply the rule out of context, and you're wrong that the marginal cost for ebooks is zero, but I apologize for the misremembering comment.

Many of these $0.99 cent titles have 7-figure production budgets that utterly dwarf the amount of effort and man-hours that go into a similarly-priced book.

I don't think the markets are all that comparable. Even if the marginal cost were zero, the only way it makes sense to drop the price from, say, 10 to $1 is if doing so sells ten times as many of them at $1 as you would at $10. If the marginal cost is fifty cents, then the only way it makes sense to drop the price from $10 to $1 is if you sell 19 times as many.

My guess is that of people are willing to buy lots of games because a gamer doesn't have to invest a lot of time or play a game to some final conclusion in order to get significant utility from it, whereas your average book is accessible to fewer people, takes more than a couple of minutes of reading time to start paying off, and is ultimately disappointing if you don't spend somewhere between several hours and few weeks to finish reading it (and may still be). Games often disappoint too, but the risk is lower because you know sooner and do something else with your time. So, fewer people are willing to buy a given book at *any* price.
posted by jon1270 at 6:55 PM on August 30, 2012


You're still trying to apply the rule out of context, and you're wrong that the marginal cost for ebooks is zero, but I apologize for the misremembering comment.

It's not zero, but it's extremely close. I ran the numbers a month or two ago, and from memory, because I'm on an unusually fast Internet connection, using just the gear that's in my house and the $140/mo network connection I have, I should be able to "manufacture" something on the order of fifty million books a month. Out of my house. With power costs, that'd be like $200/mo overhead. And you can rent servers now, on Tier 1 bandwidth, that have 100 terabyte bandwidth allocations, for $200/mo. If you assume an average book is about 500K compressed (some are more, some are less), that's about 214 million books/mo.

At $200/mo, that's about a thousandth of one cent per book.

Yes, there are other costs involved if you're trying to track per-user purchases, but a simple FTP-ish site, with a ton of book files, could move billions of copies for next to nothing. Even if you assume hosting costs ten times greater than my prices above, you could still deliver a hundred books for one cent.
posted by Malor at 7:18 PM on August 30, 2012


Oh, and:

Games often disappoint too, but the risk is lower because you know sooner and do something else with your time. So, fewer people are willing to buy a given book at *any* price.

So, by that logic, books are outright worse, so therefore we should pay more for them?

Not a very compelling argument.
posted by Malor at 7:20 PM on August 30, 2012


I know that the marginal cost of duplicating an ebook is approaching zero. (I just copied and pasted a .mobi file to prove it!) And I know that there are all these iOS apps that sell for 99¢, so the delivery and whatnot are apparently affordable enough to make a profit at that price point. (And I know I need to have a pretty good reason to spend more than that on an app; I'm going to have to use it a lot, or I'm going to have to have some, say, sentimental reason for wanting it.) So if I'm being charged much more than that, I'm going to feel ripped off.
posted by Casuistry at 7:22 PM on August 30, 2012


So, by that logic, books are outright worse, so therefore we should pay more for them?

Not at all. I was speculating as to why the market for books would be smaller, and why the demand for books may be less price-elastic than demand for games.

I agree with you that 'selling copies' is a dumb and false explanation of what it is that publishers do, and as a rationalization for prices it's probably going to ring more and more hollow and more and more people until nobody takes it seriously. A far larger fraction of publishers' function is to enforce copyright. That's been true since well before the popularity of ebooks, and to some degree you could say the same about all sorts of products.

The fact that publishers don't actually provide value by making copies doesn't make them rent-seeking leeches. Copyright enforcement is not worthless. Marketing is not worthless. Sieving the good stuff out an ocean of crap is not worthless.
posted by jon1270 at 7:54 PM on August 30, 2012


This reminds me of nothing so much as when the RIAA got busted price fixing and the majors had to send every music buyer a check for, what, like $12.

Onto the derail: I do think eBooks should be less expensive than paper books, especially as they get older (relative to eBook release), especially because the marginal costs of eBooks are negligible. A lot of the counterarguments here have been naive special pleading (please, $699 for Illustrator? Yeah, you pay that once. If you pay that for every book you put out, you must have called up Adobe and started the conversation with, "I'm a total moron — how much is your moron license?") and myopically focused on the rights of the creator over the interests of the consumer. You can, of course, charge what you'd like. But then, folks will pirate and you'll lose money, and no one will care about your moaning except other folks with that vested interest.

But, to be fair, I don't actually buy books, really. I buy maybe ten a year, and almost all of those are gifts. I read about three books a week, on average, but that's almost exclusively from the library, both because I couldn't afford that habit (media is really what keeps me from ever seriously contemplating becoming a junkie) and because I don't want to store them. Outside of the library, the most are mostly because these idiots* keep paying me $30 per to read them and report back.

*They're not actually idiots, I just have freelancer guilt.
posted by klangklangston at 8:48 PM on August 30, 2012


Oh, one more thing: I still buy a LOT of music (though, you know, only about 30 percent of what I listen to, if that). Nearly everything I buy is from indie labels. Nearly every indie label gives a free MP3 download (DRM free!) if you buy the vinyl. The vinyl is often cheaper than the CD, even (though you lose that on shipping sometimes).

I would bet that "Buy a hardcover, get the eBook" would be a good look for small presses.
posted by klangklangston at 8:54 PM on August 30, 2012 [1 favorite]


I would bet that "Buy a hardcover, get the eBook" would be a good look for small presses.

This tactic is a commonplace in the role-playing game world, even cross-promoting with local game stores so that you can buy at a local store and download the PDF. (And lack of DRM is also standard, which is why I've spent hundreds on gaming PDFs as compared to nothing on DRM-ed ebooks despite owning a Nook and an iRiver.)
posted by Zed at 10:53 PM on August 30, 2012 [1 favorite]


I agree with you that 'selling copies' is a dumb and false explanation of what it is that publishers do, and as a rationalization for prices it's probably going to ring more and more hollow and more and more people until nobody takes it seriously

LOL. There was this thing once, I think it was called the music industry, ever heard of it?
posted by Chekhovian at 11:00 PM on August 30, 2012


Call me crazy, but I have been known on very rare (one or two times) to buy an ebook version when I could get a 'like new' 2nd hand version cheaper. Always for books I am pretty sure I will want to 'keep' (so not resell because it is crap, or a novel I will only read once) and because for certain types of books I am preferring to have electronic copies. This includes things like cookbooks (I prefer to have them on the iPad) and some non-illustrated non-fiction books. To me, the paying extra for an e-copy is paying for utility: it takes less room to store on my shelves, and is more portable. For some books that is what I want. Just as I will pay extra for a lovely hard cover large format art book when I could have gotten a smaller paperback version cheaper. Or, as some people would pay ridiculous amounts for a hard cover* version of a novel rather than wait for the much cheaper paperback because they prefer hard covers for whatever reason.

* I don't know about now, but I know when I lived in Australia four years ago a new release hard cover could be AU$50, which to me seems crazy for a novel you would be able to get for AU$15 or less a fortnight later.
posted by Megami at 1:19 AM on August 31, 2012


Hardcovers allow publishers to capture more revenue per sale from consumers who are willing to pay more. The buyer wants to possess the book right away, they've got the money (or the credit), so what the hell? But nobody wants to admit to themselves that they've made an impulse purchase and thrown money away. The physical differences between hardback and softcover help early, high-price buyers rationalize their lack of restraint. This books's cover is soooo nice and stiff!"
posted by jon1270 at 4:18 AM on August 31, 2012 [1 favorite]


Again, why not a subscription service, like Spotify/Pandora, that lets the books expire (like the OverDrive service my library uses (but less sucktastic than OverDive))? It would be like joining an 18th Century subscription library.
posted by wenestvedt at 6:10 AM on August 31, 2012


> I wouldn't mind if publishers moved to something closer to the pricing model of most DVDs. Say $10-$15 when the book first comes out. $5-$7 when it's released in paperback, and then $5 or less when it's established backlist.

Well, this analogy would work for me it you followed it through.

When it comes out on DVD it's $20-$25 and more for something fancy like BluRay. Digitally it can be purchased/licensed for $9.99 as a download. Generally same day.

> This books's cover is soooo nice and stiff!

Well, I prefer hardcovers for things I care about an want to keep. If it's a cotton candy read or a something I know I won't reread I'll take a crap paperback.

I often end up buying two copies of many books. A shelf copy and a reading copy. I'll read my shelf copies, but not in the tub or outside or in coffee shops or... You get the point. I hope many of my hard covers will outlive me. You can't even say that about many eBooks. "Anyone know grandpa's password for his Kindle account now that he's dead? No? Crap."
posted by cjorgensen at 6:22 AM on August 31, 2012


Yeah, I'm terribly hard on books - I stuff them into unfriendly luggage, wrap the covers around backwards so I can hold them with one hand, break the spines, carry them outside in inclement weather where they get spattered with precipitation. Often they're in such bad shape when I'm done that I'm embarrassed to donate them to the library. I don't like to retain a large, permanent library at home, but for the occasional book that turns out to be really important to me, I also prefer to acquire a hardback copy -- usually Used - Like New. I don't pay much for that hardback.

If meeting a practical demand for more durable books was hardbacks' reason for existing, softcovers would be released simultaneously.
posted by jon1270 at 6:56 AM on August 31, 2012


I prefer hardcovers for things I care about an want to keep.

Sadly, these days it seems as often as not that the hardcovers, too, get printed on cheap acidic paper that's yellowing in a handful of years.
posted by Zed at 7:07 AM on August 31, 2012 [1 favorite]


I now have hundreds of e-books - 2/3 EPUBs and 1/3 PDFs. The only decent app that handles both those formats is Stanza - so I use that as my digital bookshelf.

Amazon - in its infinite wisdom - will not sell me anything that I can read in Stanza. Or even provide me with an app that will read the industry standard EPUB format in which most of my digital library resides.

So, really, fuck you, Amazon.
posted by Egg Shen at 7:36 AM on August 31, 2012


What's even better is Amazon hired the guy who made Stanza, and Stanza isn't supported in iOS anymore (he made one update last year after much begging and screaming and crying from Stanza users). I thought it was so they could use him to improve the iOS Kindle app, but it still sucks, so I guess not. I'm betting that the next update to iOS breaks Stanza all over again and there will be no fix for it.

p.s. Since you already know about Calibre, why not use it to strip/convert mobi files to whatever you want?
posted by rtha at 8:42 AM on August 31, 2012


I'm betting that the next update to iOS breaks Stanza all over again and there will be no fix for it.

I had already decided that I would never upgrade to iOS 6 for that very reason. Then Apple announced that iOS 6 wouldn't be available for my first-gen iPad anyway.

To the best of my knowledge, calibre can only convert MOBI files that aren't DRM-ed. I did make one Kindle purchase and strip the DRM so that calibre could EPUB it. But I've since gotten a new computer and am too lazy to re-download all the Python scripts for de-DRM-ing.
posted by Egg Shen at 9:31 AM on August 31, 2012


It's a one-click affair to download the Calibre scripts that will download the drm-stripping scripts, and then maybe three more clicks to install them? It will take you five minutes.
posted by rtha at 9:33 AM on August 31, 2012 [2 favorites]


.... treat me like a thief, I'm much more likely to disrespect your wishes. Treat me well, and I'm likely to give you money.

That's a bit thin skinned. After all, pretty much every store of any size tracks and photographs you on the assumption that there is a statistically significant chance that you might be a thief. It's not personal. Just that there are a lot of people out there who missed the kindergarten lesson where they taught the young'uns that you don't take things that don't belong to you without permission.
posted by IndigoJones at 2:55 PM on August 31, 2012 [1 favorite]


What's even better is Amazon hired the guy who made Stanza

Stuff like that is why they should be the target of an antitrust suit. It's all software these days, and buying out competitors more or less gets rid of the competition, by definition.
posted by Blazecock Pileon at 5:45 AM on September 3, 2012


For those who've indicated their affinity for DRM-free e-books, Subterranean Press' e-books are DRM-free and many are on sale for $.99-$2.99 including the omnibus of The Chronicles of Master Li and Number Ten Ox, "best of" collections of Lucius Shephard and Michael Swanwick, stuff by Ted Chiang, our own Scalzi, Connie Willis and a lot more.
posted by Zed at 10:58 AM on September 5, 2012 [3 favorites]


Thanks for the heads up Zed!
posted by drezdn at 1:54 PM on September 5, 2012


kobobooks got my business because I literally couldn't figure out how you buy an ebook at Barnes & Noble. "Buy Now" and "Confirm Order" sends you back to their home page with nothing in your cart. That there's some advanced fail.
posted by Zed at 10:43 AM on September 6, 2012




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