The economics of the $9.99 ebook(ac-idealog.blogspot.com)
ac-idealog.blogspot.com
The economics of the $9.99 ebook
http://ac-idealog.blogspot.com/2009/05/economics-of-999-ebook.html
10 コメント
Great comment. I have posted it at my blog.
Actually, I do deal with publishers quite a bit, as well as music labels and broadcasters. It is not that they are not dedicated to their work. Unfortunately, the economics of the Web works against these cost structures. It might not happen to books yet but with new reading devices and new marketplaces coming up, I think changes will come.
As to my comment on new genres of books being created, this argument is not unique. Every new medium will create a new form of media that suits its characteristics. Online video created 1 minute clips. Mobile created mobile books (in Japan currently).
Actually, I do deal with publishers quite a bit, as well as music labels and broadcasters. It is not that they are not dedicated to their work. Unfortunately, the economics of the Web works against these cost structures. It might not happen to books yet but with new reading devices and new marketplaces coming up, I think changes will come.
As to my comment on new genres of books being created, this argument is not unique. Every new medium will create a new form of media that suits its characteristics. Online video created 1 minute clips. Mobile created mobile books (in Japan currently).
I agree that the original author's argument was no good. However, you're wrong about the $9.99 price.
The price should be set by supply and demand to maximize revenue. Selling three ebooks for $9.99 is better than selling one ebook for $26.99. Period.
Now, where do supply/demand curves maximize ebook profit? I don't know. But there is every reason to think that in the current market, the intersection point is much lower than the hardcover prices.
The price should be set by supply and demand to maximize revenue. Selling three ebooks for $9.99 is better than selling one ebook for $26.99. Period.
Now, where do supply/demand curves maximize ebook profit? I don't know. But there is every reason to think that in the current market, the intersection point is much lower than the hardcover prices.
That's $9.99 more than I'm willing to pay for any book which I cannot sell, cannot lend to a friend, and could be retroactively censored or deleted from a central location at the publisher's whim. Not to mention one which will vanish when the publisher goes out of business.
Seriously? You wouldn't even pay, say, $0.99 to rent a book? I pay more than that, in time and gasoline, every time I check a book out from the library.
Just driving to the library or the post office, spending 10 minutes, then driving back is a 30-minute commitment for me. If my time is worth $20 per hour, that's $10 right there, not counting the cost of gas or the odds that the book I want isn't available. Unless I'm very diligent about checking out books in large batches (and how many books can I really read before my three weeks is up and they become due at the library?) I might be saving money with a Kindle [1], even if each book self-destructed, Mission-Impossible style, three months after I paid $10 for it. Which they don't.
I am an old-school book collector; it runs in my family. And, yet, when I look at my shelves I dream of actually owning fewer of them. The world has changed. Amazon and Abebooks exist now. By this point, very few of my books are sufficiently precious and sufficiently likely to go out of print that I need to physically hoard them myself -- such books do exist, but they're much fewer in number, perhaps no more than a single bookshelf's worth.
Yeah, I guess the apocalypse could wipe out Amazon and Abebooks, or the copyright Gestapo could create some kind of digital Fahrenheit 451. But, really, what are the odds? To worry too much about that is like hoarding beer because Prohibition might come back. I'm literally more worried about my house burning down.
I'll worry when we reach the point that important books are routinely published in electronic form alone, with no paper copies anywhere. But I don't think that will ever happen. Indeed, the preservation of archival versions might become an even more significant raison d'etre for paper publishers -- we really need more archives, and more librarians and editors, to select, print out, and preserve all the great blog posts and HN comments that will otherwise be lost to linkrot, or buried in spam and rendered unfindable, within my lifetime.
I still love libraries. Shelves of books make me happy. But that thrill is not what it once was. Because it was the exciting feeling of knowing that you were surrounded by the work of centuries of scholars, that the world's knowledge was within reach. And that's true all the time now. I live in a library 24/7. I have to take special measures, like hiking out of cellular range, to escape that feeling of being surrounded by knowledge. I could sit here in this chair for the rest of my life and never run out of interesting things to read, watch, or listen to, so long as someone keeps paying the Comcast bill.
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[1] Ignoring the cost of buying the Kindle in the first place, of course.
Just driving to the library or the post office, spending 10 minutes, then driving back is a 30-minute commitment for me. If my time is worth $20 per hour, that's $10 right there, not counting the cost of gas or the odds that the book I want isn't available. Unless I'm very diligent about checking out books in large batches (and how many books can I really read before my three weeks is up and they become due at the library?) I might be saving money with a Kindle [1], even if each book self-destructed, Mission-Impossible style, three months after I paid $10 for it. Which they don't.
I am an old-school book collector; it runs in my family. And, yet, when I look at my shelves I dream of actually owning fewer of them. The world has changed. Amazon and Abebooks exist now. By this point, very few of my books are sufficiently precious and sufficiently likely to go out of print that I need to physically hoard them myself -- such books do exist, but they're much fewer in number, perhaps no more than a single bookshelf's worth.
Yeah, I guess the apocalypse could wipe out Amazon and Abebooks, or the copyright Gestapo could create some kind of digital Fahrenheit 451. But, really, what are the odds? To worry too much about that is like hoarding beer because Prohibition might come back. I'm literally more worried about my house burning down.
I'll worry when we reach the point that important books are routinely published in electronic form alone, with no paper copies anywhere. But I don't think that will ever happen. Indeed, the preservation of archival versions might become an even more significant raison d'etre for paper publishers -- we really need more archives, and more librarians and editors, to select, print out, and preserve all the great blog posts and HN comments that will otherwise be lost to linkrot, or buried in spam and rendered unfindable, within my lifetime.
I still love libraries. Shelves of books make me happy. But that thrill is not what it once was. Because it was the exciting feeling of knowing that you were surrounded by the work of centuries of scholars, that the world's knowledge was within reach. And that's true all the time now. I live in a library 24/7. I have to take special measures, like hiking out of cellular range, to escape that feeling of being surrounded by knowledge. I could sit here in this chair for the rest of my life and never run out of interesting things to read, watch, or listen to, so long as someone keeps paying the Comcast bill.
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[1] Ignoring the cost of buying the Kindle in the first place, of course.
What a great opportunity it would be for someone to replace the traditional role of the publisher with what the blog-author calls a "lightweight service". Then authors could go directly to these disaggregated services for marketing and editing and then to Amazon for e-publishing. The traditional publishing houses are going the way of the dodo and print newspaper.
Yeah, I fully agreed with your view. That is why I am building a service that allows authors to easily create an iPhone application simply by uploading their book. The idea is to use the iPhone application as a base from which the authors can build their community or fans upon.
"Beyond new structures, we will also see new genres or formats of books that are more light weight and easier to produce. These will enable authors to produce more books."
Really? I read mostly science fiction and CS books. I am not sure what these new genres are, but I dont find the idea compelling. Lightweight books? Half a century ago SF books were 120 to 150 pages long. I like the current 300-400 page books better. Lightweight technical? If I want lightweight, I read blogs. The fiction authors that I read produce 2 or 3 books per year. Writing is hard work, and I dont see format changes changing that. Authors need to make a living. The generally poor quality of OSS documentation attests to that.
There is probably room to squeeze some fat out of $50-100 technical books. Safari rents a selection of books for a reasonable amount per month, so that could be a good model. And there are educators working on low cost/free textbooks.
I would hate to see well written books replaced by crowdsourcing.
ADDENDUM: There is a small but growing trend for authors to put out a free online version at the same time the book is published. It seems to actually increase book sales.
Really? I read mostly science fiction and CS books. I am not sure what these new genres are, but I dont find the idea compelling. Lightweight books? Half a century ago SF books were 120 to 150 pages long. I like the current 300-400 page books better. Lightweight technical? If I want lightweight, I read blogs. The fiction authors that I read produce 2 or 3 books per year. Writing is hard work, and I dont see format changes changing that. Authors need to make a living. The generally poor quality of OSS documentation attests to that.
There is probably room to squeeze some fat out of $50-100 technical books. Safari rents a selection of books for a reasonable amount per month, so that could be a good model. And there are educators working on low cost/free textbooks.
I would hate to see well written books replaced by crowdsourcing.
ADDENDUM: There is a small but growing trend for authors to put out a free online version at the same time the book is published. It seems to actually increase book sales.
It is hard to claim that eBooks are too expensive while audio books are already profitable at 10$.
Hence, I think that the discussion about the need for high prices for eBooks is ridiculous.
Audiobooks are an after-publishing product. Once a novel has become profitable, they can hand the book to a voice actor and say 'read', they then sell the product for $10 because it no longer kills their bottom line.
The reason eBooks don't cost like this, is because people want them here and now like you get with a real book. I'm sorry, but if people want a $10 book, do what everyone else on the fucking planet does and wait for it to come down in price! There's lots of books in book stores that cost less than $10, so why pay for an ebook? You're never going to get a brand new ebook at $9.99 and it cover the cost of the process. Your best bet is a $10 eBook released a year or so after publication like with an audiobook, or discounted mass market paperbacks.
The reason eBooks don't cost like this, is because people want them here and now like you get with a real book. I'm sorry, but if people want a $10 book, do what everyone else on the fucking planet does and wait for it to come down in price! There's lots of books in book stores that cost less than $10, so why pay for an ebook? You're never going to get a brand new ebook at $9.99 and it cover the cost of the process. Your best bet is a $10 eBook released a year or so after publication like with an audiobook, or discounted mass market paperbacks.
If ebooks cost 10% of what books used to cost, but everyone buys 10x as many books because of the lower cost, convenience of buying and storing them, etc., then the costs can be covered the same as today.
I don't really buy into any of that. How is an eBook more convenient to store versus a book, when I'm not allowed to give anyone else my eBook but there's already well established laws that protect my right to resell any book I own. They also invented these things called bookshelves that store a lot of books and often look very nice too.
People are very unlikely to buy more books because they're cheaper. Yes probably one out of ten people will buy more books, however the majority won't. I don't buy a book because it's priced $9.99 I buy it because of the Author, like most readers do. In fact I bought my wife a book last week that cost $9.95, why? Because I'd been recommended the author, price had nothing to do with the purchase.
Why was the book I bought $9.95 brand new? Because the production cost was lower, because I know for a fact this is the authors debut and the publisher prices it lower to help the author get a following. Her next book is already priced at $19.95.
This is a pointless argument. Go ask Microsoft why they don't price their product at 10% of what they currently do. They'll tell you because 90% of people are stealing their product and when Gates tried lower pricing, 90% of people still stole his software. I'd say 90% of people already get their books new at $5, it's only the fans who are willing to pay $30+ for a new book.
People are very unlikely to buy more books because they're cheaper. Yes probably one out of ten people will buy more books, however the majority won't. I don't buy a book because it's priced $9.99 I buy it because of the Author, like most readers do. In fact I bought my wife a book last week that cost $9.95, why? Because I'd been recommended the author, price had nothing to do with the purchase.
Why was the book I bought $9.95 brand new? Because the production cost was lower, because I know for a fact this is the authors debut and the publisher prices it lower to help the author get a following. Her next book is already priced at $19.95.
This is a pointless argument. Go ask Microsoft why they don't price their product at 10% of what they currently do. They'll tell you because 90% of people are stealing their product and when Gates tried lower pricing, 90% of people still stole his software. I'd say 90% of people already get their books new at $5, it's only the fans who are willing to pay $30+ for a new book.
This ignores the fact that there might be a fixed cost per book. If it is 10% of the current book price, then you are making no profit. Books don't just grow on trees. It also assumes that I have time for 10x as many books because they are cheaper. Currently, my time is more of a premium than my convenience or money.
It seems to me that the marginal cost for an ebook is indeed zero. (Or very, very nearly zero: do you count the cost of the electricity or bandwidth to download it?) You disagree?
Can't say I've ever had a problem paying a decent amount for a book. Never been a fan of ebooks either.
It's true. I would've bought 5 or 6 e-books in the past month if they were all $9.99.
The ones I needed were well over $50 and so I spent the extra time finding free alternative. They're lower quality, but unless it's under $10 it's worth the extra research I have to do myself.
The ones I needed were well over $50 and so I spent the extra time finding free alternative. They're lower quality, but unless it's under $10 it's worth the extra research I have to do myself.
From the article: "More and more, ancillary revenue sources will reduce the reliance on book sales."
What -would- the ancillary revenue sources be for writers?
I doubt they can do what the rock stars are doing and sell ten of thousands of tickets for $50 for people to come listen to them reading their books..
Off the top of my head I can't think of anything that would scale enough to be worthwile.
What -would- the ancillary revenue sources be for writers?
I doubt they can do what the rock stars are doing and sell ten of thousands of tickets for $50 for people to come listen to them reading their books..
Off the top of my head I can't think of anything that would scale enough to be worthwile.
Yeah, I've heard this one before. A few authors do have decent speaking gigs (often for keynotes and things like that) but they're the exception. And those who can make money this way are already doing it. The whole idea that there's some huge untapped pot of money in live performances (for reading, music, or whatever) is pretty silly.
I recently self-published (via http://Lulu.com ) a 730-page book of stories in hardback. I disabled Download as PDF. This means someone would have to scan it in and proofread it (the difficult bit) to get it in a digital format. I like that barrier to piracy.
[Additional] Also, Xlibris.com is not as convenient as Lulu, but it's much much cheaper.
[Additional] Also, Xlibris.com is not as convenient as Lulu, but it's much much cheaper.
99cts ebooks.
No need for publishers.
Write your own book and sell it on AppStore alikes.
Everybody can be a writer.
Convenience wins.
Everybody wins.
No need for publishers.
Write your own book and sell it on AppStore alikes.
Everybody can be a writer.
Convenience wins.
Everybody wins.
So are you not going to edit the book? Or just have a friend do a cursory job for free? How are you going to promote the book so people know about it? Of course, you don't have to do any of those things to get an ebook out there but getting a quality ebook out there and marketing it are something else again.
I understand your point, but the thing is lowering the entry barrier so everybody can write AND publish on their own. If you want to spend on a more professional publishing I bet online stores can give you extra exposure for a "fee" at the same time a new crop of side business like editing, proof reading, marketing, etc can grow to make the market healthier and self sustainable.
So, a newbie can write an publish, their work may start at 99cts so if they hit the jackpot a million copies sold can make them millionaires over night.
Professional books, best sellers, academic books etc, can hire professionals to do their job, same as you can do your own web site if you wish, or hire web designers to do a more professional job, which most big companies do. And sure they can sell it for $9 or a thousand, up to them or to the market to decide their price and worthiness.
It all starts at 99cts.
Again, no need for the publisher.
So, a newbie can write an publish, their work may start at 99cts so if they hit the jackpot a million copies sold can make them millionaires over night.
Professional books, best sellers, academic books etc, can hire professionals to do their job, same as you can do your own web site if you wish, or hire web designers to do a more professional job, which most big companies do. And sure they can sell it for $9 or a thousand, up to them or to the market to decide their price and worthiness.
It all starts at 99cts.
Again, no need for the publisher.
Except the publishers...
The entire publishing process is designed to filter out the chaff. First you need an agent (this is undeniable when some publishing houses won't accept a submission without one) whose job it is to first find publishers that are interested and then to make them pay every penny they're willing for it. When a first time author like Stephanie Mayer gets handed $750,000 for a series, that's because their agent just got handed 75,000-112,000. If you go it alone you'd probably get less than what your agent alone would get.
After the books in the publishing house, it is usually reviewed by like up to 5 editors who give their opinion before it's handed over to one editor who they believe is the best for it. You then get an editor, who through multiple revisions helps the author get the book to a better standard and quite often to more closely resemble the authors original idea.
I've worked with editors, and they're very passionate and put a lot of themselves into the work. This isn't something you're going to get at some slapped together organization. The argument that they're being replaced by digg (in the disaggregate link) is completely laughable, I'm sorry but digg and HN link mostly to articles at websites that all have editors. Just because people aren't committed to one information source and choose their own news (hence why some people get several news papers in the morning) doesn't mean the editors job is [gone].
Then he argues that it's help authors by allowing them to produce more books... Some authors release a book every few years and some release one nearly every 3 months (Stephen King). This isn't an efficiency model that can simply be stepped up by a new technology. It's an entirely ignorant argument.
This article is just plain bad. No one should sell their work at $9.99 a copy if it isn't going to cover the costs. In the publishing world especially, you should never release a copy for such a low price when the majority of books make most of their money in the first few months to a year when the book is priced the highest.
I hate these articles, because they're always written by people who are so uninformed on the issues. They're by people who assume the end is nigh for corporate publishing, despite the fact that there's been little to no effect on traditional publishing media, in fact global book sales have been on an increase over the past years.