10-26-2009, 10:49 AM | #1 |
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Price Wars/ E-Book Cost
In light of the announcement of the Nook, I started wondering -- how much does Amazon or B & N typically pay for an e-book? If they sell it for $9.99 how much do they pay to the publisher?
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10-26-2009, 11:01 AM | #2 |
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I think it was recently reported that they pay $1.50, which is why they are reportedly making $31 million this year just from ebooks, It is also why I am not buying anything from them, I do not support parasites but prefer to buy direct from authors and publishers who can get a better deal by selling cheaper direct to readers.
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10-26-2009, 11:12 AM | #3 |
The Grand Mouse 高貴的老鼠
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Amazon pays small publishers and self-publishers 35% of the list price of the ebook. Amazon probably pays large publishers 50% of the list price of the ebook.
Smashwords, on the other hand, pays publishers 85% of the list price. Of course, this means that at Smashwords, the list price is the price customers pay, while at Amazon ebooks are often discounted by 20%, 40% or more. |
10-26-2009, 11:19 AM | #4 |
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Wide discrepancy in answer ($1.50 vs. 35%-50% of list). Anyone know which is correct?
The next question becomes -- is the list price for an ebook the same as that for a hardcover? |
10-26-2009, 11:37 AM | #5 |
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Amazon does pay publishers the quoted percentage. The 1.50 is nonsense.
Other distributors generally pay the publishers a little more. Publishers can set the srp and typicall take 50%+ of this figure, irrespective of whether the retailer applies any discounts. |
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10-26-2009, 11:44 AM | #6 | |
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10-26-2009, 11:47 AM | #7 |
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Often times the list price is the same as the latest paper release. So if it's just out in HC then it has a HC list, if it's out as a Mass Market PB then that's the list, if it's re-issued as a trade PB then sometimes the ebooks list goes up to match that. This isn't of course true for all publishers, but it is for most of the biggies. In the UK I've noticed sometimes the list is higher than the HC.
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10-26-2009, 12:55 PM | #8 |
The Grand Mouse 高貴的老鼠
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The list price for an ebook is whatever the publisher says it is.
Some publishers price an ebook at the same price as the cheapest paper edition - so the same as the hardcover until the paperback appears. Some publishers price an ebooks at a higher price than the paperback - sometimes twice as much. Some publishers price ebooks at less than the cheapest paper edition. |
10-26-2009, 03:20 PM | #9 |
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The $1.50 price is wrong, at least for new titles.
I may be wrong but my understanding is it's not based on a percentage. The publisher sets a wholesale price, and the retailer goes from there. For brand-new books (what would normally be a hardcover) the wholesale price is $10 or more; so ebook retailers occasionally lose money on the $9.99 ebook. IIRC someone at Amazon (possibly Bezos) stated that some ebooks are loss leaders, but so are some of the big hardcovers, especially with the current price war. |
10-26-2009, 03:47 PM | #10 | |
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10-26-2009, 03:53 PM | #11 | |
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10-26-2009, 04:51 PM | #12 | ||
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It's possible the publisher does have a formula that is related to the list price, which in turn bears little relation to what the retailer actually charges. They may also lower the wholesale price for back catalog items without changing the list price, I'm not really sure. Pricing is hardly an exact science though. I guess someone in the industry will have to spill the beans. Quote:
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10-26-2009, 08:23 PM | #13 | |
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I think given the sheer practicalities of storing and shipping an ebook and often skipping a middle man wholesaler/retailer they would HAVE to be more profitable than traditional paperbacks (perhaps not as much as hardcovers which have an often ludicrous markup). |
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10-27-2009, 09:21 AM | #14 | |
The Grand Mouse 高貴的老鼠
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By skipping most middle-men, Baen Books sell their ebooks for $6, and make more than from a paperback, but a bit less than from a hardback. (Well, the actual info I had was that the author royalty on an ebook is more than from a paperback and less than from a hardback, but I think it's safe to assume that the same applies to the publisher's cut.)
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