Ebook prices all over the place

[JSWolf]

Why is it that ebook prices are all over the place. I'm not talking a dollar or two. This can be significant. Take a look at the book The Year of Living Biblically: One Man's Humble Quest to Follow the Bible as Literally as Possible by A. J. Jacobs.

At the Sony Connect Store the price is $13.59 for BBeB
At Simon & Schuster the price is $11.04 for Adobe, MS Reader, and eReader
At eReader the price is $15.29 for eReader
At BooksOnBoard the price is $10.99 for Adobe, MS Reader, and eReader while Mobipocket is $20.75
At Mobipocket the price is $25.00 for Mobipocket
At Fictionwise the price (non-club) is $13.59 for MS Reader and eReader.
And for reference at Amazon the price is $14.99 + $3.99 (roughly) shipping for a total of $18.98 for the hardcover

Why is it the price is all over the place? Why is it Mobipocket is the most expensive format? The ebook prices range from $10.99 - $25 for the very same content in an electronic file. I cannot see how it would be that much more expensive to create one format vs. another. Is it that much more time consuming ot make a Mobipocket edition that they have to charge so much more then the others? Heck, Mobipocket themselves are charging the cover price for the book even.

This illustrates one of the major issues we face today with ebooks. There is no such thing as a standard price. And to find the best price, you have to go looking on a number of different sites and possibly be willing to do some DRM removal and format conversion to get the best price. Can something be done to bring the prices more in line with what we expect of them?

[HarryT]

Originally Posted by JSWolf

This illustrates one of the major issues we face today with ebooks. There is no such thing as a standard price. And to find the best price, you have to go looking on a number of different sites and possibly be willing to do some DRM removal and format conversion to get the best price. Can something be done to bring the prices more in line with what we expect of them?

But the same is true with pbooks - why should eBooks be any different.

In the UK at least, book stores charge the "cover price" for the majority of books. Sometimes they have "special offers" such as "three for the price of two". Go online and you'll often find that Blackwells (a large UK online book store) charge a completely different price to Amazon for the same book.

It's a free market - a seller is free to charge whatever they wish for a book.

In the UK at least, price fixing is illegal. I guess from what you're saying, this isn't the case in the US?

[JSWolf]

Yes, price fixing in the USA is illegal. If the price on a book is listed at $25, then $25 before sales-tax is the most that can be charged.

But in this case, given that the ebook market is small and they want your business, they need to set more reasonable pricing overall. Also, if people go to say Mobipocket's site and see such high prices, that may put them off from buying a reader. "Why should I spend $350 on a device to read ebooks that cost as much as the pbook?" That's what can happen. It's not that they'll go and look on the net at PG or other sources of free books. They'll look at the shops and see what's there. I'm not talking tech savvy people. I'm talking regular people that don't know all that much about ebooks, but enough to sorta get them.

[Liviu_5]

Originally Posted by HarryT

But the same is true with pbooks - why should eBooks be any different.


It's a free market - a seller is free to charge whatever they wish for a book.

Completely agreed here. However for p-books there are some standard "cover" prices (hc usually 25-28$, tp 15$, mmpb 7-8$), and then each bookstore chooses if and how to discount it, and I guess that's the core of the issue, where to "cover" price e-books. At hc levels, at tp levels, at mmpb levels, based on how the p-book is released with possible some discount (30% of hc...)??

Baen has a uniform policy, e-books of current print books are by and large 6$ with some 4$ or 5$, e-arcs of books to be released in several months hence 15$ and the serialized Webscriptions 15$ too, with "specials" bundles priced accordingly, and I find it quite fair, so I do not mind paying 15$ once in a while for an e-arc that I really want for the privilege of reading the book in advance.

[jasonkchapman]

You can blame that one on MobiPocket. They're the ones who don't seem to be keeping up. I'm assuming it's DRMed, so anyone else selling the MobiPocket version is going to have a price based on MobiPocket's wholesale price. Either MobiPocket missed a price drop, or their contract with S&S stinks.

The thing I find surprising about that list is that S&S is willing to undercut other e-book dealers with direct sales. If I were an e-bookseller, I would be incredibly ticked that my own supplier was cutting me off at the knees. I suppose it's possible that S&S had a price drop on the Adobe/MSReader/eReader formats and people like Fictionwise just haven't reacted yet, but I don't know. That would certainly make me feel better about S&S.

[HarryT]

Originally Posted by jasonkchapman

You can blame that one on MobiPocket. They're the ones who don't seem to be keeping up.

I'm not certain it's down to them. I have a feeling that the price is set by the publisher.

[JSWolf]

Originally Posted by jasonkchapman

You can blame that one on MobiPocket. They're the ones who don't seem to be keeping up. I'm assuming it's DRMed, so anyone else selling the MobiPocket version is going to have a price based on MobiPocket's wholesale price. Either MobiPocket missed a price drop, or their contract with S&S stinks.

The thing I find surprising about that list is that S&S is willing to undercut other e-book dealers with direct sales. If I were an e-bookseller, I would be incredibly ticked that my own supplier was cutting me off at the knees. I suppose it's possible that S&S had a price drop on the Adobe/MSReader/eReader formats and people like Fictionwise just haven't reacted yet, but I don't know. That would certainly make me feel better about S&S.

If you notice, BooksOnBoard is cheaper then S&S. And S&S does not sell Mobipocket format ebooks. But most of the time, I see S&S books cheaper.

[jasonkchapman]

Originally Posted by HarryT

I'm not certain it's down to them. I have a feeling that the price is set by the publisher.

In a sense, yes, in that everything is based on percentages of the retail price.

In the MobiPocket case: S&S sets the retail price. MobiPocket, as a distributor, gets a discount from that as a distributor. They mark it up to a wholesale price, which is what the booksellers pay per sale. The booksellers add their markup and sell it. As a dealer, they keep their direct prices high enough to avoid undercutting their dealers.

In the case of the Adobe/MSReader/eReader format, it's different. If S&S is acting as its own distributor, then dealers selling those formats are paying a wholesale price set by S&S and dealers are free to price it from there. That's what makes it irksome that S&S would undercut them. It may all just be a matter of timing, that S&S dropped the price and word hasn't yet gotten through the distribution chain, yet, but I don't know.

The Sony case is a little different, in that they're contracted directly with S&S for a unique format. I have no idea where their wholesale price falls relative to what MobiPocket pays, but I'm certain that Sony is free to set its retail price wherever they want based on that wholesale price.

I have no idea how the eReader deal works.

[HarryT]

Thanks, Jason - that's very interesting.

[Robert Marquard]

Here in Germany the price for German books are fixed. The publisher sets the price and all sellers have to charge it.

[HarryT]

I'm surprised that's legal under EU competition laws, Robert. We used to have a similar law in the UK, but it was ruled to be illegal about 10 years ago, and since then the UK's book market has completely opened up to competition.

[jasonkchapman]

So I've done a little more research now.

In the pbook world, the large publishers generally work through distributors, who then sell to the bookstores. Dealing directly with a ton of individual stores just isn't cost-effective for the publishers. So it's no surprise to find that they're using the same approach in the e-book world.

From what I've found, if you want to set up an e-book store that sells DRMed books from the major publishers (assuming you don't have the size, money, device, and unique format of a Sony) you sign up with any or all of the following list of e-book content distributors: MobiPocket, LightningSource, or Overdrive.

MobiPocket we all know. They distribute books in the MobiPocket format and also operate their own retail site. Anyone selling DRMed MobiPocket books is likely buying them wholesale from MobiPocket.

Lightning Source is part of Ingram Digital Group, which is part of Ingram, the largest pbook distributor in the US. Lightning Source also sells POD services, by the way, as well as e-book conversion services. Lightning Source distributes e-books in Adobe, MS Reader, and eReader format. So any e-booksellers selling DRMed books in those formats from major publishers is most likely buying them wholesale through Lightning Source. Here's their FAQ for booksellers: https://www.lightningsource.com/FAQbookseller.htm

Overdrive is the company providing the services for many of the public library e-content lending systems. I couldn't make much sense out of their offerings for resellers, but one of there services is to provide an entire hosted, brandable store.

So, let's say S&S drops the list price of a title. That price change has to go to Lightning Source, MobiPocket, and Sony. MobiPocket and Sony have to update their price lists. Lightning Source and MobiPocket have to pass the new price on to their dealer networks who each have to update their price lists. There's all kinds of room for delays and drags in that process.

Anyone for starting an e-bookseller site?

[AnemicOak]

I'm new to all this & still looking into things, but one problem I'm seeing, for me at least, is books that were priced at HC prices 2 or 3 years ago ($25ish) are still priced that high while others have had their price lowered to MMPB prices ($8ish) once that release hits a year or so after the HC. I can understand why they're charging HC prices for a new release when the PBook version is a HC release, but have a problems paying that price years after release.

[hamh]

wow, I never know there is such big difference on price....

may be the sony ebook reader is the best to get economically

[silvania]

Originally Posted by jasonkchapman

The thing I find surprising about that list is that S&S is willing to undercut other e-book dealers with direct sales. If I were an e-bookseller, I would be incredibly ticked that my own supplier was cutting me off at the knees. I suppose it's possible that S&S had a price drop on the Adobe/MSReader/eReader formats and people like Fictionwise just haven't reacted yet, but I don't know. That would certainly make me feel better about S&S.

Yes, it's called "channel conflict". S&S is making it impossible for any ebook retailer to discount to match S&S's own ebook store prices and still turn a profit. BoB is losing money on every sale at that price after factoring in support costs. If that's a typical BoB discount, then they are making every single S&S title a "loss leader."

Ebook retailers are horrified that S&S does this and privately complain about it all the time. But no single retailer has enough power to force the issue. And if two ebook retailers joined forces to try to force the issue, then they would run afoul of "price fixing" laws in the USA. It is literally illegal in the USA for one ebook retailer to call up another one and even mention the word "price" or discuss discount levels in any way, shape or form. The result is, until there is an ebook retailer large enough that they can independently put the screws to S&S, it isn't going to change.

You might think this is good for S&S, but really it isn't. It means any intelligent ebook retailer will give them little or no front page or newsletter space except perhaps for the super-blockbuster type releases. And because most people who read ebooks don't like buying from 10 different places, that means all their smaller releases (and there are tons of them) get no exposure on all those retail sites. This is really costing S&S a lot of money.