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Originally Posted by Superlucky
Publishers should be worried, but not because of Amazon's pricing. They should be worried because of what happened in the music industry....
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There is a major difference between the book & music industry though, namely that music had been released in a completely unprotected digital format (CD's) for years. This made it a snap to release massive catalogs of copyrighted music onto P2P networks, and it's fairly clear that massive copyright infringement has devastated music sales. Paper books require much more effort to convert, so it's unlikely that you will get anywhere near the depth of books shared out as you saw with sound recordings.
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Originally Posted by Daithi
Is Amazon really losing money on ebooks they sell at $9.99? How much does a hardback actually make after you deduct the cost of printing, distribution, and the discount from unsold books returned to the publisher?
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Yes, Amazon and others lose $3-4 per copy on $9.99 new bestseller ebooks. However some hardcover bestsellers are loss leaders for retailers anyway. As to "how much a hardback makes," that depends on who you're talking about
: the retailer, distributor, or publisher.
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Originally Posted by kostas
the article barely mentions the lower cost of distributing books electronically. I think I'll pass on the crocodile tears for Hachette this time around.
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Oh? Margins in the book business are razor-thin. Most books actually lose money; the big sellers subsidize most of the other titles. I believe the old saw is, "if you want to make a million in publishing, start with two million...."
Digital distribution does cost less -- but nowhere near as much less as most people presume. To publish an e-book you still have to pay: the author's advance and royalties, agents, editors, proofreaders, lawyers, marketers, PR, management, overhead and (last but not least) taxes. The retailers make out much better with e-books, since they don't have to manage, warehouse, or distribute inventory, and can cut out the distributors (e.g. Ingram).
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Originally Posted by nomesque
In all seriousness, I generally roll my eyes at complaints from traditional (paper) publishers. People in businesses which have failed to keep up with the times generally DO whine about how they're losing money.
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The problem isn't that publishers aren't "keeping up with the times." They've adapted reasonably well to many industry changes such as online and discount-chain sales (e.g. Walmart), and POD.
The problem is that it's quite plausible, although not yet certain, that reducing the wholesale price for a high-margin book could destroy their profit margins.
I might add that I have a sneaking suspicion that at least some of the people who deride an industry for failure to adapt to a disruptive technology would not be too thrilled if it was
their industry, livelihood and/or profits that were under threat.
This is quite evident, for example, when you examine how negatively programmers and IT workers react to their own jobs getting outsourced to India.