CBC: E-book prices spark battle between publishers, retailers

[DiapDealer]

Originally Posted by Phogg

Because Dolphin brains are largely insulation mass, and if you look at the number of firing neurons they have instead of just brain volume you find that they are pretty much only equivelent to dogs.

Thus a human equivelent AI would be smarter.

Science giveth fiction plotlines, and then science taketh them away.

Ah... but who ever mentioned "human equivalent" until now?

I propose that dolphins will be voting long before true "human equivalent" AI is developed/evolved.

[FuzzyPuffin]

I'm in favor of dolphin suffrage. I believe their votes would be more informed.

[nogle]

Originally Posted by slex

The publishers are right, of course, to charge for the content. However that's not the point.

For print books you have:
costs for content creation + costs for typesetting and design of the print book + costs for printing (1)

For ebooks you have
costs for content creation + costs for typesetting and design of the ebook (2)

Provided that the third component of the cost is absent for ebooks, the second should be more or less the same as with print books, and the first is completely identical, you should get cheaper ebooks than print books. In fact, for the majority of the books on Amazon the paperback version is sold at a lower price than the ebook (maybe that's the way I see it here in Europe, because Amazon charges VAT).

This all assumes that the price at which the product is offered is a function of its cost to produce. This relationship holds true in the case of commodities; goods that are perfectly substitutable between producers.

If you want to read an eBook, and don't care which eBook, then by all means the price should be a function of the cost to produce the book (per page or per word if you so desire).

But, if you want a particular book, then eBooks are not perfectly substitutable. Now the pricing decision revolves around maximizing profit. And in fact, you are giving the opportunity to price disciminate. Are there consumers that will pay more to be the first to read a book? can you offer it at a high price first then gradually offer discounts, thereby getting consumers to pay the highest price they are willing to pay and maximizing profits? Are there books that are preferred over other books and can you charge a premium for them?

The production costs of a Cadillac are about the same as for a Chevrolet; shouldn't they be priced the same if production cost is the determinant of retail price?

[nogle]

Originally Posted by FuzzyPuffin

I'm in favor of dolphin suffrage. I believe their votes would be more informed.

I too am in favor of dolphin sufferage; I don't want to suffer alone.

[cHex]

I think this is all a red herring. Before the agency price fix, wasn't Amazon buying the books at a wholesale price set by the publisher, and then free to resell for whatever they thought best? That wholesale price should have protected the publisher's interests, not a fixed retail price.

[slex]

Originally Posted by nogle

This all assumes that the price at which the product is offered is a function of its cost to produce. This relationship holds true in the case of commodities; goods that are perfectly substitutable between producers.

If you want to read an eBook, and don't care which eBook, then by all means the price should be a function of the cost to produce the book (per page or per word if you so desire).

But, if you want a particular book, then eBooks are not perfectly substitutable. Now the pricing decision revolves around maximizing profit. And in fact, you are giving the opportunity to price disciminate. Are there consumers that will pay more to be the first to read a book? can you offer it at a high price first then gradually offer discounts, thereby getting consumers to pay the highest price they are willing to pay and maximizing profits? Are there books that are preferred over other books and can you charge a premium for them?

The production costs of a Cadillac are about the same as for a Chevrolet; shouldn't they be priced the same if production cost is the determinant of retail price?

I think that your comparison between Cadillac and Chevrolet is not on point. After all, we are not comparing different books - e.g. one by Nora Roberts and one by Steven King. We are comparing the same book by the same author, but offered in a different format - print or digital. Higher prices of hardbacks are justified by higher production costs than paperbacks, at the same time we don't see such price differentiation bettween paperbacks and ebooks, even though it costs more to get a paper copy to the user than a digital copy.

I agree with you that in principle production costs do not determine retail prices (provided that prices>costs in the long run). Publishers charge a lot for ebooks because they can, not because they have to (or else they will not cover their costs and will be out of business). And my impression is (as far as I follow the issue) that they try to justify ebook prices with the need to cover production costs (for content creation) - but this claim does not stand on its own. Yes, if you sell ebooks, you need to cover for the content, but then, if you sell paperbooks you need to cover for both content + printing, so I don't see how you can justify higher (or even the same) prices for ebooks compared with paperbacks based on the costs needed to produce them.

[cHex]

The publishers in question are members of a free economy, and they don't need to justify their prices to anybody. They will certainly take production costs into account, but presumably they are interested in higher profit margins if such are available. Fair enough.

It could be argued that higher prices, when it comes to electronic formats, lead to more paper purchases, piracy, less sales, etc. True or not, it must be admitted we have an interest in the outcome, so whatever.

What bothers me personally is when it seems publishers aren't paying attention; when it seems they are pricing irrationally, and if someone would just take a look everyone--publishers and readers both--would be happier.