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Originally Posted by AnemicOak
That's true in theory, but some publishers (Macmillan for example) are keeping the prices on some of their ebooks at the higher rate even months after the paperback comes out ($12.99 ebook vs $7.99 paperback).
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Pricing is "What the market will bear". Macmillan has maintained higher prices because it thinks it can
get them. I don't know offhand what titles this practice has been applied to, or how well the practice is working for them, but I'm unsurprised it's occurring. If I were them, I might do the same thing. I want to survive. I want to open my doors and do more business with my customers tomorrow. To do so, I must make money, and how much I must make is
not determined by simple greed.
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Also was the publisher not making more on those books ("hardcover" ebooks) the old way? 50% of a $25-$28 list price (regardless of retail price) vs 70% of the Agency retail price? So it's not all about 'losing the difference' on a sale.
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It is about losing the difference. What cut the publisher got on a retail sale depended upon the book and the retailer, and was set by contract. Depending upon who the retailer was, and whether they were big enough to buy directly from the publisher, or had to purchase from a distributor, teh numbers could vary.
One of the issues the publishing industry has been wrestling with is returns. Publishing has historically had a 100% returns model. Unsold titles could be returned for credit. (In practice, unsold hardcovers were actually returned. Paperbacks had the covers stripped of and returned, and the body of the book became trash. Coverless books often got resold at a small fraction of the cover price, which was
another industry headache.) And given the nature of the distribution chain, it could be a year before the reports were in and you even knew if the book sold.
In other industries, the retailer bore part of the risk, because they
couldn't simply return any unsold stock for credit. At the department store I once worked for, for example, clothing had a regular markdown schedule, depending upon how long it remained unsold, with progressive price cuts before it went to Clearance, because it
couldn't be sent back for credit. It was up to the buyer to make good guesses on how much of what to order.
One thing publishers have been experimenting with is a higher discount rate for retailers, in exchange for limits on the amount that can be returned. It's been slow and tentative for the same reason trimming lines to fit demand has been occurring in wrenching spasms: nobody wants to be the first to try it.
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Dennis