Getting Gouged By E-Books?

[ferzerp]

^This guy nailed it. Hi5

The guy didn't nail it at all because he oversimplified it to the level of a survey course understanding.

Traditional publishers, once they have control of pricing (which yes, Apple did give them) aren't going to see it as simple supply and demand. They also have the other arm of their business to consider. Physical books. They have huge amounts of money invested in paper book publishing and distribution. They don't want that business to go away. The overly simplistic model above does not account for that at all. They are incentivized to keep the ebook price artificially inflated in order to maintain the health of their paper book business.

 

[eggrock]

to me, a book that would be JUST a paperback -ie author would not get a hardcover book, the max should be 6 dollars.

the max that a book should cost that is a hard cover release, the max should be....6 dollars.

for those of you that like science fiction, check out baen.com's ebook store. all individual books at 6 dollars- or free, be it a hard cover release or a paper back release. they do charge 15 dollars for an ARC release but you are paying for the ability to read the book 3-6 MONTHS prior to it being on a book store's shelf.

baen also sells e-book bundles every month they take their new releases- hardcover and paperback, combine them into 1 bundle and sell it for 18 dollars, usually that is 2-4 new releases and 3-5 re-releases of olderbooks(or a book that is transitioning from hardcover to paperback)

18 dollars for 2-4 hardcovers and ~4 paperbacks of quality sci-fi...worth it to me. i have WELL over 300 e-books just from baen -i have read authors i NEVER would have read before from getting the first book in a series- the honor harrington series for instance- for FREE, liking that, then the 2nd book.,..WAS FREE,,and i was hooked. John Ringo books, i NEVER would have read, but there he was co-authoring with david weber, read it liked it, now i have almost all of HIS books (even the military porn-paladin of shadows- books) travis taylor, the liaden books, etc i got ALL of them because of baen.com and their -GOOD- ebook site.

baenebooks.com imo is the model the other publishing houses should use.

oh those hard cover ebooks for 6 dollars you CANNOT buy anywhere BUT baen until the paperback comes out...

Baen also has nice free library. Eric Flint proposed the idea originally and his 'Intro' is cogent to e-book format and piracy.

http://www.baen.com/library/

At least with e-books you're essentially getting the same porduct as you would if you physically bought the book. Not the case with music unless they start offering lossless downloads. I am not paying $14.99 for a downloadable album encoded at 256 mp3 when I can pay the same or less for the cd. For $5.00 downoads- that is a different story.

Not necessarily. Amazon's editing of their e-book selection seems cursory at best, and books with pictures or illustraions can be hard or impossible to see. Books like Stephen King's Dark Tower series (color illustrations) are impossible to replicate on an e-ink device.

OTOH there are certain conveniences with e-books that physical copies can't provide, like text-to-speech or the built in dictionary that some readers have, cloud storage and so on.

Bottom line, I hope everyone exterts what influence they can to influence publishers to lower prices. Amazon as a book publisher would really shake up that horrible agency model.

 

[gibber]

Its not gouging, but the prices are outrageous. You dont like it? Dont buy them.

Regardless of your intention, you are in fact, encouraging piracy with that statement.

No matter how much some people might not like it, piracy is the competition. These overly high [greedy] pricing strategies give piracy more validity.

However, I do agree with your statement on some level. For example, I was really a console game nut, I LOVE console video games. But, the disgusting greed of Microsoft, Sony, etc. in raising the price to $60 at the same time as games basically becoming a mass consumer item (huge volume sales) was simply too offensive to me. So, I stopped buying consoles and stopped buying console games.

On some level though, books seem different to me than video games - perhaps I feel that books are simply too important. I'm more inclined to want to "do something" to get the sellers to lower their prices.

 

[eggrock]

No matter how much some people might not like it, piracy is the competition. These overly high [greedy] pricing strategies give piracy more validity.

QFT - I hate piracy but at minimum there is some justification to stripping out DRM from e-books: portability.

 

[raz-0]

The reason e-book pricing is stupid is because publishers think there is such a thing as a large art industry. They are so VERY slowly realizing they are actually in a business. The publishing industry has been on the brink of failure multiple times and has been bailed out by wealthy people who felt that they were effectively being patrons of the arts. The publishers don't want to change their ways. E-books are overpriced simply because publishers NEED them to fail exactly because consumers expect them to cost less, and artists expect them to to share a larger portion of that smaller price. Publishing's inefficiencies are not in the printed book, but in how they run the business. The only hope is that they actually get their act together and learn to stop wasting money, or that the artists realize they don't need them and cut them out.

 

[Topweasel]

so basically these digital copies just float around in the air until someone buys them and they magically appear on their eBook reader? I guess it doesn't cost Steve and Kyle anything for us to use their forum since we're typing directly into digital format.

Who the host? Not the Publishers. It's Amazon or B&N. They get a digital file, they load it on to their servers, they build the content for the page offering the file. They pay for the bandwidth of everyone downloading it.

Distribution doesn't cost Publishers a damn thing. All they need is one golden file and all their work is complete.

Now the way Amazon especially handles their servers. Yeah it pretty much is floating up there waiting for someone to buy it. They want to lower the prices and they are the one most accountable for the cost of distribution. So what does that tell you?

 

[Aielman]

Its not gouging, but the prices are outrageous. You dont like it? Dont buy them.

It is gouging. I had a meeting with Hought-Mifflan last year talking about going electronic for textbooks and in the school system. They spent $85M in 2009 on shipping to resellers alone...just for textbooks. First runs of a book are usually around 50k with an expectation of a 52% sell through. Authors get around 8% advanced royalties on that run unless they're really popular. Then they get a little more. Publishing houses expect 2-3% ROI, so basically 89-90% of the cost of a book is Proof/Copy/Edit, Typesetting, Cover Art, Paper/Printing/Binding, Embossing, Warehousing, Freight, and sometimes Marketing. 80% of those things are eliminated with electronic distribution, leaving the two major costs to the Publisher being paying the Author,and the Cover Art.

More than 4/5 the cost of putting out a 50k book run is completely eliminated by electronic distribution which means that their ROI is going from 2-3% to 75-80% at the prices they're charging.

So yeah...they're gouging. And yeah...you could not buy...if you like to not read.

 

[Stone Cold]

The price of an ebook is based on what the industry thinks makes the most profit, regardless of cost.

 

[Ididar]

Some people have hit the nail on the head already.

Apple and the publishers hopped into bed on agency pricing and so now you pay what the publishers want you to pay, not what Amazon wants to sell it for. Originally, e-books were sold the same way that physical books were sold. The publisher would sell the book to the retailer for a fixed cost. The seller could then set the price they want. They could sell it for a small profit margin or larger one depending. No different than almost any other product on the market. Retailers set their prices and have their sales based on how much profit they want to make and how much product they want to move. Amazon, Wal-Mart, and all the other huge volume sellers can set lower prices because they move massive amounts of stock. Their percentage profit is lower but they're still making massive amounts of cash. The publishers were generally ok with this as it was the model for physical books and e-books were no different in their eyes.

Along came Apple. Apple doesn't like competing on price alone. They set the price and that's that. They don't run sales very often and generally don't watch other people's pricing all that closely. They like the price to be the price ... period. How were they going to go into e-books and compete against the likes of Amazon that already had a huge presence and was moving massive volumes of e-books already? Easy. Change the game. Apple sat down with the publishers and they all agreed on the agency pricing model. The agency model means that Amazon, Apple, etc .. they aren't able to set the price. The publisher sets the price and the retailer has to sell it at that price while taking the percentage that the publishers give them. The retailer is basically just a dumb storefront for the publisher with the agency model. Once Apple and the publishers had signed their deal it was only a matter of time until the publishers could force Amazon to cave to the new pricing model. Amazon fought as long as it could which was evidenced by mass removals of certain publishers from its store at various times shortly after Apple started selling e-books. Amazon tried to play hard-ball with the publishers but eventually it had to cave. It was watching Apple sell lots of e-books and couldn't afford to continue the fight and watch its market share dry up.

Win for Apple. Why? Amazon would sell cheap ... it would run sales, reduce prices, and generally via normal market tactics it would keep Apple's sales of e-books low as could be. The people buying in Apple's e-book store would be paying a higher price. Amazon has no problem competing on price and reducing its profit margin to retain market share. Apple loves its profit margin far more so it was unwilling to fight that fight. Apple doesn't have to compete on price now with the agency model, it only has to compete on the market interface and the products you use to read the books. Win for Apple. All its strong suits.

So, you're paying more because Apple didn't want to compete on price for e-books with Amazon. To fight that battle on its own terms it gave away your cheap e-books to the publishers. Thank Apple, and the publishers, for their little alliance to fuck with Amazon and other e-book sellers.

 

[Jagger100]

Is it just me or does an ebook burning just not have the same image of a traditional hard-cover book?

I think some of the price hike is related to this method of distribution is *kinda* new and they are still paying for the system. Physical books, en mass, have been around for a long time and the distribution channels have been established, paid for and optimized... I dunno. I'm trying to rationalize it but I really can't. It shouldn't be more expensive.

In a not so distant distopian future...

An e-book burning will go off with almost no fanfare as someone trigger the DRM to permalock or delete your copy. Illegal versions that go live will be detected on those responsible, punished.

The problem with the technological future is that information can be made less free than the old brick and mortar past despite propaganda and rose colored views otherwise.

 

[Neb]

I think the gouging is fairly obvious whenever you see "This price is set by the publisher" on an Amazon e-book listing. Almost without fail it is not too far from the price of the physical book.

 

[Ididar]

I think the gouging is fairly obvious whenever you see "This price is set by the publisher" on an Amazon e-book listing. Almost without fail it is not too far from the price of the physical book.

That is, effectively, Amazon's lifting of the middle finger to the publishers.

 

[Zarathustra[H]]

Same reason textbook publishers come out with a new edition of the same text book every couple of years despite the material not having changed. All they do is move the material around a bit and change the questions to make it difficult to use old editions of the book for a new class.

This way they foil sales of used books and force students to keep buying $700 worth of textbooks every semester.

It's sickening and disgusting.

Publishers are greedy bastards. They want all the money and to do none of the work. They pay some faculty member a pittance to write the thing and get their name on it, and then they overcharge for the products, and do the shameful things you see above.

It does not surprise me in the slightest that they charge the same or more for ebooks as they do hard copies. They are after the biggest profit margin possible, wherever they can fool people into thinking that they are getting their money's worth.

IMHO, publishers are up there with Insurance Companies and Banks as some of the worst, most sleazy organizations out there.

 

[NoOther]

so basically these digital copies just float around in the air until someone buys them and they magically appear on their eBook reader? I guess it doesn't cost Steve and Kyle anything for us to use their forum since we're typing directly into digital format.

I am sorry, who is providing the actual infrastructure to store, and distribute the e-books? Oh, that is right...Amazon and Barnes and Nobles for the most part. All the publishers have to do is provide a copy of the e-book to Amazon. Oh and by the way, both Amazon and Barnes and Nobles have ways to make the e-book for the publisher...imagine that.

Also, how do you think publishers keep copies of manuscripts? In filing cabinets? Please...come on man. This is about what prices publishers are setting for their works. If Amazon and B&N could charge less for their e-books, they most likely would. More so Amazon than B&N probably.

 

[Randle2I]

The do it because Apple wanted it that way and made it possible.

This right here. When Amazon was at the forefront of the e-book world they sold the books at a loss, more often than not for less than their paperback counterparts (and when it was not, they were the same price). When the iPad came out and Apple wanted a piece of the pie the publishers saw their out. Apple agreed to their pricing terms for a favorable position in the market and now we have silly high prices for digital content.

 

[Randle2I]

Some people have hit the nail on the head already.

Apple and the publishers hopped into bed on agency pricing and so now you pay what the publishers want you to pay, not what Amazon wants to sell it for. Originally, e-books were sold the same way that physical books were sold. The publisher would sell the book to the retailer for a fixed cost. The seller could then set the price they want. They could sell it for a small profit margin or larger one depending. No different than almost any other product on the market. Retailers set their prices and have their sales based on how much profit they want to make and how much product they want to move. Amazon, Wal-Mart, and all the other huge volume sellers can set lower prices because they move massive amounts of stock. Their percentage profit is lower but they're still making massive amounts of cash. The publishers were generally ok with this as it was the model for physical books and e-books were no different in their eyes.

Along came Apple. Apple doesn't like competing on price alone. They set the price and that's that. They don't run sales very often and generally don't watch other people's pricing all that closely. They like the price to be the price ... period. How were they going to go into e-books and compete against the likes of Amazon that already had a huge presence and was moving massive volumes of e-books already? Easy. Change the game. Apple sat down with the publishers and they all agreed on the agency pricing model. The agency model means that Amazon, Apple, etc .. they aren't able to set the price. The publisher sets the price and the retailer has to sell it at that price while taking the percentage that the publishers give them. The retailer is basically just a dumb storefront for the publisher with the agency model. Once Apple and the publishers had signed their deal it was only a matter of time until the publishers could force Amazon to cave to the new pricing model. Amazon fought as long as it could which was evidenced by mass removals of certain publishers from its store at various times shortly after Apple started selling e-books. Amazon tried to play hard-ball with the publishers but eventually it had to cave. It was watching Apple sell lots of e-books and couldn't afford to continue the fight and watch its market share dry up.

Win for Apple. Why? Amazon would sell cheap ... it would run sales, reduce prices, and generally via normal market tactics it would keep Apple's sales of e-books low as could be. The people buying in Apple's e-book store would be paying a higher price. Amazon has no problem competing on price and reducing its profit margin to retain market share. Apple loves its profit margin far more so it was unwilling to fight that fight. Apple doesn't have to compete on price now with the agency model, it only has to compete on the market interface and the products you use to read the books. Win for Apple. All its strong suits.

So, you're paying more because Apple didn't want to compete on price for e-books with Amazon. To fight that battle on its own terms it gave away your cheap e-books to the publishers. Thank Apple, and the publishers, for their little alliance to fuck with Amazon and other e-book sellers.

Damnit, if I had read to page three I would have seen this post. This man summed it up brilliantly.

 

[jctusmc03]

Not that I encourage it, but these can be had free online too just like movies and games.The people that make these need to just start selling them more cheaply. Guaranteed if they were cheaper tons more people would buy them, they'd make up their profit margin, silly greedy people.

 

[RangerXML]

The message so nice you posted it twice...

Sirhan Sirhan, the man so nice they named him twice.

I still have some issues with digital books, namely how easily they can disappear off your account if there is a dispute with the publisher or change content (only been used to correct errors so far). I wanna read the Dresden books, but I don't wanna buy paperbacks and at the same time the digital copies are still outrageously expensive. So much for saving paper and press costs, the fees for the privilege to publish on Amazon or Apple make up for it. I do have to say I like reading Kindle books on my Asus Transformer, but I have issues with no page numbers.

 

[NoOther]

Sirhan Sirhan, the man so nice they named him twice.

I still have some issues with digital books, namely how easily they can disappear off your account if there is a dispute with the publisher or change content (only been used to correct errors so far). I wanna read the Dresden books, but I don't wanna buy paperbacks and at the same time the digital copies are still outrageously expensive. So much for saving paper and press costs, the fees for the privilege to publish on Amazon or Apple make up for it. I do have to say I like reading Kindle books on my Asus Transformer, but I have issues with no page numbers.

Not only this, but I had a problem where I tried deleting a book off an app version on my phone because it wouldn't open properly. Then what was supposed to be an option to delete it locally somehow deleted it out of my entire library, with no way for me to recover the books even though I had paid for it. It is funny, because I can go into my account and see my receipt for purchasing the e-book, but apparently the e-book account has no record of me owning the actual e-book anymore. So there are still a number of issues with e-book delivery. I would expect the price premium I pay would help go to fix these issues. Only problem is, that money is going to the publisher who doesn't really give a damn about the delivery systems, just their own pockets..

 

[RangerXML]

This is an app to app issue, a lot of the books I get from Amazon tend to auto download even if I only buy them because they are on sale and I have to go threw my device and clean out the books I'm not currently or might read next. The filters for what you own, what is locally available and what I am currently reading work pretty good, but sometimes I need to hit the manual refresh button to get a book up or back.

 

[messerchmidt]

meh, then they complain about piracy...

 

[Aielman]

I am sorry, who is providing the actual infrastructure to store, and distribute the e-books? Oh, that is right...Amazon and Barnes and Nobles for the most part. All the publishers have to do is provide a copy of the e-book to Amazon. Oh and by the way, both Amazon and Barnes and Nobles have ways to make the e-book for the publisher...imagine that.

Also, how do you think publishers keep copies of manuscripts? In filing cabinets? Please...come on man. This is about what prices publishers are setting for their works. If Amazon and B&N could charge less for their e-books, they most likely would. More so Amazon than B&N probably.

They're both charging more...the publisher and the retailer...because they can. We're buying the books at the price. They both gouge and so far, we've let them...and probably will continue to do so.

The infrastructure to store and distribute E-books is pennies on the dollar compared to the cost to do the same for hard copy books. A single cluster of DL380s could store the library of congress, and the server farm to distribute it costs less than a single city's fleet of delivery trucks, but would enable you to reach the entire world, not just one city.

They're making considerably more profit now and because sales have only gone up since they started doing it. People generally accept the price because it's near to what they're used to paying for a hard copy book, but far more convenient to purchase and own, and they just don't think of the cost to produce. So there's no motive for any of the retailers to lower the price by much.

I mean we're all basically in IT, whether we're in the industry directly or not. We all understand the costs involved in electronic storage and distribution. But for the majority of people, you say the word Computer and everything after that word might as well be Swahili, because hey don't get it and tune it out. So they're happy to pay.

 

[Drawmonster]

I think piracy can be minimized by giving the customer the most "bang" for the buck. I don't think twice about clicking the "Buy" button when I know I'm getting a good deal. I have bought a lot of books off Amazon, but only the ones that are priced reasonably. When I see an e-book for $14.99, and the physical version for $12.99, I immediately delete it from my wishlist and move on. On the other hand, a person who is partial to piracy would see the stupidly high price, delete it from their wishlist, and then go download it for free.

So it comes down to a compromise. Publishers of media (book, games, movies, music) have always tried to make massive profits. Pirates hate the prices, and want it all for free. Hence the piracy movement. If publishers are willing to suck it up, make a smaller profit per item, and lower their media's prices to levels where people think it's a damn good deal, then they will take a giant bite out of privacy. To me it would make sense to make 10% profit instead of keeping the prices high and encouraging more piracy, thusly making 0% profit.

If games/music/books/media all went on sale tomorrow for 50%, it would be a feeding frenzy. They would sell more than ever, and people would be HAPPY to give them their money. I know I would. Once publishers come around to that fact, piracy will decline. Customers want a GOOD DEAL. Give it to them and they will throw money at you. Look at Amazon.

I LOVE Amazon for taking a stand, and forgoing massive profits in order to please the customer. I subscribe to Prime and Audible because Amazon treats me great and have great prices. I go there FIRST for everything except food, because they treat me great and have good prices. It seems so simple......

 

[Stxopher]

With over 2000 ebooks in my virtual library, I have no worries that any of the vendors I've bought them from will ever delete or render them unable to be read. That would be because none of them have any DRM on them. (I'm sure you've heard of those horrible, horrible scofflaws who remove the DRM from their books as soon as they get them. A process so simple it's strange that more people don't know of it.) The entire library is backed up to disc every 6 months and also exists on my Dropbox account.

This gives me a comfort that once I've bought the book, it STAYS mine to read...whenever I get around to it. That makes me more likely to spend more on an ebook than I would if I was never sure how long I could read it or on what device.

And now...now there are services that you can actually SEND them the paper book you want in digital format, a couple bucks later they send you an ebook file. True, the book itself is destroyed for the scanner but chances are that's not much of a problem if you were running out of room in your house or apartment anyway and just wanted it in a more compact format. Actually, I've done that several times too. Buy a used book for a couple dollars, send to have it converted for a couple more, receive ebook for under $5 instead of buying the publisher approved one for $15. (Steinbeck for $15 and $20? Really?)

 

[Azhar]

I am sorry, who is providing the actual infrastructure to store, and distribute the e-books? Oh, that is right...Amazon and Barnes and Nobles for the most part. All the publishers have to do is provide a copy of the e-book to Amazon. Oh and by the way, both Amazon and Barnes and Nobles have ways to make the e-book for the publisher...imagine that.

Also, how do you think publishers keep copies of manuscripts? In filing cabinets? Please...come on man. This is about what prices publishers are setting for their works. If Amazon and B&N could charge less for their e-books, they most likely would. More so Amazon than B&N probably.

Who the hell do you think I was talking about? I know B&N and Amazon provide the datacenters for eBooks. That's what I've been referring to. Take papers and printing out of the equation, you should have cheaper books, right? Well no because now you have to pay for bandwidth and datacenter storage for these eBooks. Some would even say you're paying for instant gratifications.

Maybe it wouldn't cost that much more versus printing considering the millions of books adding up rather nicely for publishers and Amazon/B&N, but why would they shoot themselves in the foot offering cheaper eBooks and moving people away from brick and mortar store (B&N) or paper book sales (B&N and Amazon)? They keep them equal so they can sell them without losing money on either side of the divide - digital and analog.

 

[NoOther]

Who the hell do you think I was talking about? I know B&N and Amazon provide the datacenters for eBooks. That's what I've been referring to. Take papers and printing out of the equation, you should have cheaper books, right? Well no because now you have to pay for bandwidth and datacenter storage for these eBooks. Some would even say you're paying for instant gratifications.

Maybe it wouldn't cost that much more versus printing considering the millions of books adding up rather nicely for publishers and Amazon/B&N, but why would they shoot themselves in the foot offering cheaper eBooks and moving people away from brick and mortar store (B&N) or paper book sales (B&N and Amazon)? They keep them equal so they can sell them without losing money on either side of the divide - digital and analog.

Read what other people have said. The price for the storage for e-books is ridiculously low. The bandwidth to take orders and deliver, is neglible for Amazon, they already provide those services. For B&N it is substantially more. But the prices for the e-books themselves are not really set by Amazon or B&N, they are set by the publishers. The publishers don't have to worry about all that overhead. That is my point. Amazon and B&N are not choosing to make them equal to physical copies, the publishers are.

 

[Devistater]

The reason the prices are high is because all of the big publishing agencies (the Agency 6 as they are typically referred to) have engaged themselves in a price fixing scheme with the ebook retailers.

By treating the etailer as an "agent" and setting a selling price for them, the etailer has no choice in setting prices.

It's basically legalized pricefixing since they all do it. It started with Apple last year, you can thank them for it.

Add on the DRM and I buy hardcover books instead.

Thats only part of the story. The other part is that years ago, the writers association/lobby agreed with the publishers that their numbers could be more easily audited in return for giving a much smaller standard royalty on ebooks, since SURELY they would never ever take off compared to paper, so SURELY they were just conceding a small little thing.

Since the standard royalty rate the authors get is so much smaller than paper books, and there's a much bigger chunk of profit involved the publishers are jealously guarding those profits. "Coincidentally," the big publishers have posted record profits since ebooks became popular.

There's WAY WAY less costs in an ebook than paper, and its not just the paper and printing and shipping/distribution. For many decades now, booksellers have been able to return unsold paper books and get their money back from publishers, and this means that a huge chunk of book costs are from the 30% to 50% (or more sometimes) of the books that are returned from the bookstore and then destroyed. So there's a lot of overprinting involved.

There's some good writeups on all this stuff on the web from authors who have actually been in the middle of this.

 

[Loudspeaker]

Ok I keep seeing plenty of people bringing up data center costs. Fellow data center junkies, since were talking about books wouldn't it be logical to say that the cost associated with handing over an ebook to someone are probably about 1/100th of say a movie or music for that matter? Last time I downloaded an ebook it was on my reader before I could even blink. No offense to those who would rather download the Encyclopedia Britannica of course...

All I'm saying is most on this forum could probably host said services from their home. Bandwidth is the only real cost to consider when it comes to the hosting of ebooks.

 

[Marlfox]

Some people have hit the nail on the head already.

Apple and the publishers hopped into bed on agency pricing and so now you pay what the publishers want you to pay, not what Amazon wants to sell it for. Originally, e-books were sold the same way that physical books were sold. The publisher would sell the book to the retailer for a fixed cost. The seller could then set the price they want. They could sell it for a small profit margin or larger one depending. No different than almost any other product on the market. Retailers set their prices and have their sales based on how much profit they want to make and how much product they want to move. Amazon, Wal-Mart, and all the other huge volume sellers can set lower prices because they move massive amounts of stock. Their percentage profit is lower but they're still making massive amounts of cash. The publishers were generally ok with this as it was the model for physical books and e-books were no different in their eyes.

Along came Apple. Apple doesn't like competing on price alone. They set the price and that's that. They don't run sales very often and generally don't watch other people's pricing all that closely. They like the price to be the price ... period. How were they going to go into e-books and compete against the likes of Amazon that already had a huge presence and was moving massive volumes of e-books already? Easy. Change the game. Apple sat down with the publishers and they all agreed on the agency pricing model. The agency model means that Amazon, Apple, etc .. they aren't able to set the price. The publisher sets the price and the retailer has to sell it at that price while taking the percentage that the publishers give them. The retailer is basically just a dumb storefront for the publisher with the agency model. Once Apple and the publishers had signed their deal it was only a matter of time until the publishers could force Amazon to cave to the new pricing model. Amazon fought as long as it could which was evidenced by mass removals of certain publishers from its store at various times shortly after Apple started selling e-books. Amazon tried to play hard-ball with the publishers but eventually it had to cave. It was watching Apple sell lots of e-books and couldn't afford to continue the fight and watch its market share dry up.

Win for Apple. Why? Amazon would sell cheap ... it would run sales, reduce prices, and generally via normal market tactics it would keep Apple's sales of e-books low as could be. The people buying in Apple's e-book store would be paying a higher price. Amazon has no problem competing on price and reducing its profit margin to retain market share. Apple loves its profit margin far more so it was unwilling to fight that fight. Apple doesn't have to compete on price now with the agency model, it only has to compete on the market interface and the products you use to read the books. Win for Apple. All its strong suits.

So, you're paying more because Apple didn't want to compete on price for e-books with Amazon. To fight that battle on its own terms it gave away your cheap e-books to the publishers. Thank Apple, and the publishers, for their little alliance to fuck with Amazon and other e-book sellers.

Quoting for effect. Glad someone took the time to write it out in full.

 

[Stone Cold]

All I'm saying is most on this forum could probably host said services from their home. Bandwidth is the only real cost to consider when it comes to the hosting of ebooks.

The bandwidth for an ebook costs less than a penny.

99% of the cost of an ebook is someone's profit, not someone's cost.

 

[MrGuvernment]

Hosting, storage, bandwidth, IT team to keep the systems up so people can download this shit...

people seem to forget about these costs...

 

[NoOther]

Hosting, storage, bandwidth, IT team to keep the systems up so people can download this shit...

people seem to forget about these costs...

I don't. You can also add in the cost of the author creating the content, and the artists work on the cover if it comes with the e-book version. But even if you add all that up, it is still miniscule compared to the profits they make. Hosting, storage, bandwidth and IT support is not that expensive when you have a vast corporation already behind it and are selling in the quantities that Amazon and B&N does. Every sale of the e-book reduces the cost of that overhead. Think about this, a song takes up more space than an e-book, and it takes more bandwidth to deliver the song. Yet a song will cost you $.99, and companies make huge profits off of that. So how much more profit is there in an e-book then?

 

[lenardo]

Hosting? Bandwidth? rofl. get freaking real/...

lets put this all in perspective....

lets say a book is 2 meg in size including metadata and picture. there are 1000megabytes in a gigabyte...so every gig of storage is ~500books

150gig is 75000+ books 2 million books would need ABOUT 4 terabytes of storage....and bandwidth, and ssl cert & software to run the website..

PURE COSTS just for the hardware/bandwidth and ssl certificate....10 dollars a month. for a shared system via go daddy. (3 books @5 dollars a book)

a dedicated system with 4 terabytes of storage/20TB of bandwidth would run about 300 a month.
at 5 dollars a book you would need at a min to sell 60 books a month to cover the costs of your hardware and bandwidth for a dedicated server

hardware and bandwidth are DIRT CHEAP compartively....

 

[jcollett]

...and this, folks, is why pirating of media (music, video, written word, etc) occurs.

 

[Drawmonster]

...and this, folks, is why pirating of media (music, video, written word, etc) occurs.

Yep. People have gotten greedy, and in response they've inadvertently caused a piracy epidemic. In a quest for massive profits, they've lost sight of what is important - customers. I'd rather have a million loyal customers than 50k uneducated customers who I'm price gouging.

 

[Zoomer]

I've never understood why an electronic book is the same price as a real one that has to be printed and shipped to stores. Does anyone else know why this is?

Price discrimination. The people using e-readers are more likely to be willing to pay more than these who didn't demonstrate their willingness to spend.

 

[ferzerp]

Stop trying to explain the price with IT infrastructure costs.

The price are set by the publisher and the seller gets a percentage. This is thanks to Apple's collusion to allow the publisher's to force set pricing on us. This pricing is totally unrelated to any infrastructure costs, because the infrastructure costs are all on the vendor that we purchase from. The vendor is not free to alter the price of a given e-book anymore.

Again, thank Apple.

 

[kontact]

I have two eBooks chock full of good books and never paid a penny for any of the books. Stick to the classics and you won't get scammed.

 

[Stone Cold]

Hosting, storage, bandwidth, IT team to keep the systems up so people can download this shit...

people seem to forget about these costs...

Good advice to you, if you think someone else is forgetting something, maybe there's something you're missing?

Those items you mention are only pennies per book for a large operation.

 

[kontact]

Oh yea, I've seen Sony selling eBooks for $7.50 that anyone can download from Guggenheim Press for free because they are out of copyright. Sony are just hoping you won't notice they can be had for free.