Death of the agency model?

[TimW]

Originally Posted by HarryT

Yes, that's precisely the point. Although I as an individual would like books to cost £1, £1 books are not economically viable. I have no problem with paying £5 for a nicely-produced ebook. (for comparison, paperbacks in the UK typically cost £7.99)

£5 sounds very good. In the US, agency pricing for the majority of the newer books ranges from £8 - £9.40. That doesn't include sales tax. When I see prices in that range, I don't purchase unless it's a "must have."

[JD Gumby]

Originally Posted by Phogg

Actually, there is a whole lot of good fiction for under $2.50.
And people like me promoting it to new readers at our local independant library.
New books for frugal readers.
It would take draconian legislation and enforcement to stop well written indies from eventually prevailing.

No, what it would take is for the mass market of book readers to change their buying habits. They don't see indie books at the bookstore at the mall or on the shelves at Wal-Mart or their local grocery store or their local library, so they almost never buy them. ie, the indies can not and will not win.

[scrapking]

Originally Posted by J. Strnad

I'm pretty much over the whole debate. Even at $9.99 (ebooks subsidized by Amazon) I thought the price was too high,

I'm curious, why do you think ebooks are too expensive at $9.99? Just because you don't want to pay that price, or because you think an author's work isn't deserving of that price?

[Elfwreck]

Originally Posted by scrapking

I'm curious, why do you think ebooks are too expensive at $9.99? Just because you don't want to pay that price, or because you think an author's work isn't deserving of that price?

I can't speak for him, but I'm almost never willing to pay $10 for a book; when I read mostly paper, I preferred paperbacks to hardcovers (still do) and $10 was more than I was willing to pay for a new paperback. I mostly bought used, which meant no royalties to authors, and read a lot borrowed from friends, which meant the same.

I bought a few new books per year at more than $10, but almost never fiction. I'm willing to pay more than $10 for nonfic--except that I'm not willing to pay anything for DRM'd ebooks, so most of the nonfic I'm interested in has shifted to "I'll buy it used, and decide whether to read paper or chop-and-scan to read as an ebook."

I've never had an income that would keep me in books at $10 each. I don't expect to ever have an income that will allow me to buy every book I read for $10 each, or even $5 each. These days, I usually read 20k-50k words of fiction a day. While I'm very glad that many authors have released their professional works for free, I also read fanfic and public-domain texts.

[stonetools]

Mark Cukor, owner of Smashwords, weighs in on agency pricing:

LINK

Money quote:

As I explained to the DoJ, I think it's fallacy to believe that agency pricing leads to higher prices. That's like blaming cars for drunk driving accidents. The driver behind the wheel is responsible. If the Big 6 publishers are pricing their books too high (and I think they are), blame the publishers.

It's also fallacy to believe that somehow the wholesale pricing model is the savior and enabler of low prices. Under the wholesale model, the publisher has always set the price at which they'll sell the book to the bookstore, typically a 50% discount to the suggested list price. The $30 front list hardcover you purchase earns the publisher $15, or less. If the publisher decides they need to earn $18.00 on each copy sold, they'll set the suggested list price to $36.00. If you agree that under normal circumstances, most retailers will not consistently sell all their books at below cost, then it's reasonable to conclude that even under wholesale, publishers already control the minimum price all customers, on average, will pay.

It's worth noting that when the Big 5 publishers moved to agency, many of them started earning less per book than they had previously earned under the wholesale model. Pricing control was more important to them.

RTWT. Some good analysis by someone not a Big 5 enthusiast

[Daithi]

Originally Posted by Boston

My problem with agency pricing is that the e-book is often more or close to the price of a discounted paper back. (I only rarely bought hardbacks).

I have the mental roadblock where the e-book needs to be at least $1 less than what I can get for new paper (which I can share and pass along).

As a result, my buying of current agency books is way down (from a few a week to maybe one a month). Unless its a "must-read" for me, I just wait to see if it shows up at the library (or there is a price drop).

But clearly I am not the mass market who seem to have accepted the model. (And to be honest, if I hadn't been an early adopter, I may have as well)

I agree. I won't buy an ebook if it costs more than the paperback version, so I've had to pass on several books I wanted to buy. Publishers didn't seem to care, but when Amazon was setting the sales price I never saw ebooks for more than the paperbacks.

[BeccaPrice]

The other day, I purchased 4 ebooks, all at $4.99 (published by Avon). That's just about at the high level of an impulse purchase for me. Had any of the books been more than that, I wouldn't have purchased any.

But for me, the biggest problem with agency pricing is that coupons and discounts are not allowed.

[stonetools]

Many people won't pay more more than $9.99 for an ebook. So what? Clearly, many will pay more than $9.99. It really depends on what you value. Plenty of people who won't pay more than 9.99 for an ebook have $1500 laptops where you can get a decent one for less than 500, or pay $4.99 for a cup of coffee at Starbucks. All kind of depends on what you value.

[JD Gumby]

Originally Posted by scrapking

I'm curious, why do you think ebooks are too expensive at $9.99? Just because you don't want to pay that price, or because you think an author's work isn't deserving of that price?

Because that's the mass market paperback price - and ebooks don't cost nearly as much to produce, meaning we're being charged more for less and the publishers (certainly not the authors!) are pocketing the difference as unearned profit.

[Dulin's Books]

what is an unearned profit? they have a product that they feel can have a higher margin than another product. that increased margin allows them to have higher revenue which leads to them employing people, raising wages for employees or returning money to their investors and paying their bills. you seem to think thats all a BAD THING.

[BeccaPrice]

If they increased wages for employees, increased the amount paid to authors, it wouldn't be so bad. But they're cutting employees and raising the salaries paid to executives while using fancy accounting to not pay authors what they're due.

[speakingtohe]

While I want ebooks to cost less, I don't expect them to. I no longer view holding the paper in my hands or sittting on a shelf as desirable. Perhaps regaining 25% of the price through reselling it would be an advantage although for a book costing less than $20 is it worth the pain in the butt to do this. (I believe some ebook sellers allow this option but have never tried).

I try to look at the ebook purchase in an overall manner.
1. Convenience - easily worth $2

2. Get 30%+ of my books from library - saving 100% on 1/4+ of my books. At least $2,50 average per book read.

3. get 30%+ of my books from public domain - saving 100% on 1/4+ of my books. At least $2,50 average per book read.

4. get the occasional .99 cents or free ebook (maybe 10%) or coupon book (another 5-10%)

So with 70% (approx) of the books I read being less than $1 I can survive spending a bit more on the others.

The convenience factor alone makes up for the a lot of the expense.

Out of 200 books for last year that I have actually tracked in calibre that I read
137 free.
45 less than $1.00
18 at between 1.99 and 12.99 - average 3.92

Slightly less than 20 cents a book spread over 200 books.

How could I achieve this by even buying and selling used paperbacks? Even at the thrift stores thay are not real cheap and one is lucky to get 25% of the retail price in trades.

Maybe I don't have full rights to the books but to read them for 20 cents and not have to physically deal with them via returns/trade-ins etc is a bonus. I used to spend more on gas/bus fare/time annually to borrow or buy books than I do now on ebooks and I used to have to pay for more books. Plus the over due fines

I am feeling a tad guilty now for not actually buying more books, bigger expensive books. Must think on that one.

Helen

[SensualPoet]

Actually, Amazon did a brilliant thing setting the price of best-sellers are $9.99 -- even if it didn't last. With the passage of a couple of years, $10 sounds pretty reasonable and it also helps support $12+ for the "hot off the press" window.

I hope Amazon's attack at $4.99 -- where they released forty odd Ed McBain back catalog -- has a similar impact. I'd like to see a lot more 20 year old back catalogue series stuff turning up in the $5 to $7 range instead of being treated -- as Penguin treats Georges Simenon -- like its brand new stuff at $13.

[Dulin's Books]

Originally Posted by BeccaPrice

while using fancy accounting to not pay authors what they're due.

i dont follow th issue at all so can you link me to sources for this? authors complaining or their lawyers showing the fancy accounting?

[Elfwreck]

Originally Posted by Dulin's Books

i dont follow th issue at all so can you link me to sources for this? authors complaining or their lawyers showing the fancy accounting?

Fancy accounting:

Apparently, some of the Big Six publishers are significantly underreporting the actual number of e-books sold on writers’ royalty statements.

I heard from dozens upon dozens of traditionally published writers last week, and to a person without exception, they had all looked at their royalty statements and found discrepancies like the ones I found. Some—and I find this terrifying—had the exact same numbers reported on their statement as were on my statement.

Things authors never say about their publishers:

"I love the fact that my royalty statements make no sense and I only get paid twice a year!"

"I love that my publisher prices my ebook at $12.99 and then keeps 52.5% of the list price!"

"I love getting my title changed to something I hate, and getting stuck with terrible covers!"

"I love the fact that it takes my publisher three months to give me the proofs, and then I have to return them in four days!

"I love it when I painstakingly go through a copy edit, and then when the book comes out none of my changes were made, and brand new mistakes were added!"

Authors noticing that publishers seem more interested in hurting Amazon than supporting authors: I

n sum, publishers are jacking readers over in regards to digital books but now we are supposed to act against our own financial interest or our own convenience to help publishers fight against Amazon?

We recognize that an Amazon as the exclusive vendor of books would be bad for us but what are publishers doing about it? Why is it the reader, the only party who does not make money in this equation, have to be the one to take the financial hit in the fight against Amazon?

The fancy accounting post details are being investigated through legal means; the details aren't public. But if you really haven't heard of substantial numbers of authors feeling screwed over by publishers, you are oblivious to the publishing industry.