The User Experience Blog

September 2, 2009

eBooks: Fair Price or Rip Off Price?

Filed under: 1 — theuserexperience @ 10:17 am
Tags: , , , , ,

In traditional books, there are so many middle men involved that it drives up the cost of the book. There’s the author, the publishers, the distributors, the paper, the binding, etc. etc.

With an eBook, you simply need to convert the file to a .PDF file. Now you eliminate all of the middle men. However, should the price of the eBook be a bargain price because of the removal of the middle men? Or is the content still worth the same when the middle men where in place?

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14 Comments »

  1. OK, we’re talking about the user experience. I think your PollDaddy graphic is 1000 times better than what my web developer put on my WP site. Is that because you’re paying for PD subscription, that you get nicer interface? or is there another plugin you can point me to?

    Comment by Tina Gleisner, Founder Assn of Home Professionals — September 2, 2009 @ 3:47 pm | Reply

  2. Oh, Benjamin, your argument is horribly, dangerously flawed… at least for professionally produced romance novels (which is where my experience lies.)

    A reputable publisher still edits and copy-edits an author’s manuscript. They have to be paid.

    Most e-books still have cover art, many have cover models and talented artists. They have to be paid.

    An e-book still has to have an ISBN. It still has to be copyrighted with the Library of Congress. It has to be formatted. It has to be marketed and promoted and advertised.

    There are still contracts… with the author, with Fictionwise, with Amazon, with any number of distributors. Then, there is the matter of payment. Authors have to be sent their monthly or quarterly statements, and their royalty checks.

    The taxman still has to be paid. Don’t leave taxes out of your analysis. Everyone who earns a living or sells or buys a product –even over the internet– is obliged to pay their share of their state, city, and federal taxes.

    In many cases, the e-book is a companion to a paperback. Maybe there are contractual conditions that an e-book will be published as a Print On Demand if enough e-books sell.

    And finally, sadly, Benjamin, there is the miserable and never ending task for someone in the e-publishing house of dealing with rampant theft and people who do not understand that one cannot legally “share” an e-book. With a paperback, when you lend it to a friend you don’t have it any more. She does. With an e-book, unless you hand your ebook reading device to your friend, you create a copy (of five) and still have it after you’ve given it away.

    Best wishes to you, and thank you for leaving my comments up.

    Rowena Cherry

    Comment by Rowena Cherry — September 2, 2009 @ 6:56 pm | Reply

    • Actually I presented no argument, merely a point for discussion and for all to gain perspectives from each other. πŸ™‚

      Comment by theuserexperience — September 2, 2009 @ 10:56 pm | Reply

  3. You’re kidding, right? No middle men? No one but the author takes a cut?

    So, I guess the distribution channels don’t take their 50% of sale price for e-books sold there or thereabouts. That accounts for what we lose to Fictionwise, ARe, Amazon, Mobi, Sony, eReader, B&N, LI, OmniLit…and so on, depending on which distribution channels we use. If we all sold JUST from the publisher sites, we’d have a lot less sales and a fragmented market, which cannot grow. In order to grow, readers must be able to browse large numbers of publishers at once and then focus on what they like.

    Now, most e-book publishers I know of offer all the same sorts of things print publishers do. They pay cover artists and editors and proofers and marketing staff. And, they aren’t paying them by the hour, except MAYBE for acquisition editors, and they are sometimes paid by the piece, not the hour. They are paying them a percentage of sales on the books, otherwise. So, there’s a percentage gone for each, from the publisher’s 50-65% of net after distribution. The publisher also has overhead of servers, carts, their marketing, updating or purchasing software (because you’ve got to keep up with the new editions of what you use) and so forth. They buy ISBNs. That all costs money. And that’s BEFORE you get into the fact that most established indie/e-publishers also put out print books. All told, the amount of money saved my not printing a book isn’t as large as you might believe it is.

    But, you’re even discounting publishers as unnecessary. Without a publisher, you have to run your own cart, and carts are very expensive, so that’s overhead…plus the server space and such…not so expensive for that. And all of the normal costs a publisher soaks up are now your expenses, including cover art, editing, and their share of marketing. It all costs money…or you run your cart off of Yahoo or PayPal (and hope you write something they like) and pay THEM their cut.

    And the entire publishing business is on your shoulders, when you could be writing the next book instead of hand-selling your book. Remember, you don’t want distribution. Wait…every author sells off of his/her own site, that’s further fragmenting the market and making it impossible for readers to find the books. The less distribution we deal with, the less exposed the book is and the less likely it is to sell. 1000 copies at 25% of cover price (50% going to the distribution channel and 25% going to the publisher to pay themselves, artists, editors, proofers, and staff) is better than 10 books at 100%…which you want to mark down further to a lower cost.

    Not to mention, PDF is not the most user-friendly and universal of formats. I personally like it, but a lot of people don’t, so you lose a lot of sales by just offering PDF. The more formats you add, the more likely you are to have to buy software to make them. Sure, you can make RTF and DOC and HTML and PDF (though Adobe costs money, and many of the free PDF makers are NOT for commercial use). In fact, that’s the problem with a LOT of programs. If you want to convert it to Mobi, you can do it for free, but if you want to sell the converted copy, you need the full edition or you’re breaking the law.

    And finally, don’t judge what e-books are selling at by the NY publishers. They like selling books at or even above mass market prices. In indie press, you’re more likely finding e-books selling below mass market price. If the mass market of the same book would sell for $9, the e-book will sell for $5-7. So, not everyone charges the same.

    Brenna

    Comment by Brenna Lyons — September 2, 2009 @ 7:43 pm | Reply

  4. Personally I think the eBook should be priced lower, but not because of the reduced cost of printing and distribution. It’s because when I buy that eBook I buy it forever. I can’t sell it at a tag sale or on half.com, or even donate it to the local book fair after I’m done. Therefore, the publisher will ultimately sell *more* copies and their overall profit should be higher — assuming everyone who would have read the print version, including the second-hand copies, would purchase the book in order to read it.

    I went to a book fair a couple of years ago on the last day when everything was free. I must have picked up 30 or 40 mass market paperbacks I’d not read. I’m sure I saw thousands of John Grisham / Michael Crichton / Clive Cussler / novels. Would I have bought those 40 books at full eBook price? No, but I would have bought at least some of them.

    Perhaps a sliding scale of some sort would work best. A newly released eBook could command full price and as the saturation point gets reached (or passed) the price would come down, which would create additional demand. I’m not an economist but it seems like a fairly common pricing model.

    Thanks for the interesting discussion topic.

    – Lisa

    Comment by Lisa Pecunia — September 3, 2009 @ 5:22 am | Reply

    • I am glad you liked the topic πŸ™‚

      Comment by theuserexperience — September 3, 2009 @ 8:17 am | Reply

  5. As an indie author/publisher with the ability to do my own pricing to some extent, I do offer my Ebooks for less than print. Definitely. I take out the price of what it costs to print a book. The other costs are still there, as has been said, but if you find the right distributor, there is no actual “publishing” cost. It does depend where you distribute them, as some will charge. I have a very long print book (624 pages) that retails for $26.95 trade paperback. I sell it for $9.95 Ebook. That might seem high but you do have to consider the time and work that went into it. My $14.95 book that came out in 2003 I sell as a $4.95 Ebook. Yes, I believe that’s fair, but then, my middleman percentage is low. I had it priced lower than that until the middleman percentage raised.

    There is a balance between pricing lower for better sales and giving away a book you’ve worked maybe 2 years or more on to get it released. Readers don’t always understand the work that goes into books and authors almost never make even close to a fair hourly wage for their work even with decent sales.

    Comment by LK — September 3, 2009 @ 11:42 am | Reply

  6. Rowena and Brenna gave it to you straight. There’s also such things as the distributor sites like Fictionwise forcing the publisher not to sell the ebook any cheaper on their home site. Publishers have lost all their distribution by failing not to up the price on their sites, and since most books are sold through distributors, the publishers either went out of business or came crawling back to the distributor with a higher price on their books.

    If you want to look for enemies, if there are ones in a capitalistic system, look at Amazon who takes a much higher cut of the profit to the point that no book can be cheap and make a profit. Meanwhile, Amazon appears to be the good guy by forcing ebook prices down, but all they are doing is trying to take the market share in this expanding business. Once that market share is there, and they wipe out most of the competition, they can do what they dang well please, and the publishers and consumers will have little choice in the matter.

    Comment by Marilynn Byerly — September 4, 2009 @ 7:44 am | Reply

    • While I appreciate your perspective Marilynn I am not looking for enemies πŸ™‚ life is too short for that. Just looking for varying perspectives to put the topic into focus. Thanks for writing!

      Comment by theuserexperience — September 4, 2009 @ 11:41 am | Reply

  7. I have been buying e-books since 2000, at least, when they could not be bought on amazon and there was no fictionwise…but I do remember they used to be cheaper. An Ellor’s Cave book was at least a 2 or 3 bucks cheaper then a print book, and I miss those days. I think the author and the publishing house should get the biggest part of the cut…however, I don’t understand even with all the discussion why prices have gone so high. I know with amazon and fictionwise you might grab a wider audience, but why not undersell them? Or just go back to NOT using them… maybe this is a dumb argument, but you have got to remember that it was EBOOKS that changed the market for romantic erotica…and steamy romance. In the late 90’s there were a small handful of print authors who pushed the envelop. , Beatrice Small, Thea Divine, Robin Shone, and Emma Holly. A very small handful. AND there were hardly any sexy vampires, shifters, faeries, fallen angels, gorgeous demons, or alien creatures. Ebooks catered to the readers hunger for all of that and totally changed the market, print companies eventually jumped on the band wagon when they realized where the money was going.

    I think E book pub-houses must have been happy to be included in things like Romantic Times and the big conventions, but they have all been robbed as their place as leaders and innovators buy allowing the big company’s a share in their unique product.

    ahh to go back to the day when i could buy four titles for ten bucks!

    just a note to publishers and authors, when a book is cheep, I am more likely to spend more money than I am if a book is expensive. I will spend more to get more…but if I have to spend 12$ for just one story…I am likely to wait until I can get it at the library or I will just skip it. Now, if I could get four stories would I spend 12 or even 20 bucks? You betcha!

    Comment by Jane Doe Nothing — September 5, 2009 @ 11:06 pm | Reply

  8. Of course, it doesn’t really matter what any of us authors (or others) think, or what we know about what happens behind the scenes; success depends on the perception of the market place. My guess is that most people would think that something physical has a higher value, which is why when I created the ebook version of my second book “The Prediction Trap – and how to avoid it” I priced it slightly lower than the print version.
    Personally, I now prefer ebooks – I can read them on my smart phone anytime, anywhere; I can annotate and search them; and if something comes up in conversation about something I have read in an ebook – I have it with me! So as far as utility, the ebook is worth more to me than a print book.

    Comment by Randy Park — September 9, 2009 @ 9:57 am | Reply

  9. I think the cost of production and distribution should be removed. The author should not lose anything and in fact should gain a little. I also believe that removing those costs will increase the number of copies sold due to the decreased price. If you can buy 2 e-books for nearly the same price as one printed book, in theory more books will be sold. I don’t think we will ever see printed books disappear, but the plugged in generation is more far comfortable with earbuds than a pile of paper in their hand.

    Comment by Stu Wicinski — September 17, 2009 @ 10:55 am | Reply

  10. This is what is in the pipeline for users…. http://www.inteliwise.com Any more or less frustrating? What is your take on this type of technology. Do you believe it adds to the nuisance or helps?

    Comment by Erica Galindo — September 24, 2009 @ 4:25 pm | Reply

    • Interesting but to mechanical at this time. It reminds me of 10 years ago when I was very excited for VoIP…still ahead of its time for 1999.
      The human aspect of this seems to be in need of more engineering but that is just my opinion.

      Comment by theuserexperience — September 24, 2009 @ 8:57 pm | Reply


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